In 2009, 140 banks failed, and a recent report from financial consulting firm Klaros Group says that hundreds of banks are at risk of going under this year. It’s being billed mostly as a danger for individuals and communities than for the broader economy, but for stressed lenders across America, a string of small bank failures could quite quickly spread into a larger bloodbath — especially in an economy with hot inflation and a feverish addiction to ultra-low interest rates.
Peter’s back to recap the last week in markets and economic news. This episode starts with April’s dismal stock performance and also discusses Jerome Powell’s most recent appearance. Peter wraps up the episode by recounting the Bitcoin debate he participated in on Friday.
On Friday, Peter participated in an exhilarating debate over the merits of gold and Bitcoin. Professor of economics Nouriel Rabini joined Peter to debate Erik Voorhees and Anthony Scaramucci, two proponents of Bitcoin. They cover a lot of ground in their 2+ hour debate, so be sure to watch the full video on Peter’s youtube channel.
With the eventual introduction of central bank digital currency (CBDCs) now seemingly inevitable, there are a lot of directions central banks could take with their digital currency projects that would have dramatic implications for the price of gold.
In April, the U.S. economy added a disappointing 175,000 jobs, falling short of expectations and nudging unemployment up to 3.9% (see current trends here). This signals a slowing economy that might force the Federal Reserve to put the guard rails back on. Our guest commentator gives a deeper look at a worrisome trajectory: while part-time jobs are on the rise, full-time employment has plummeted, hinting at a coming recession.
Joel and JD unravel the shocking economic turmoil of the week, spotlighting the catastrophic collapse of Republic First Bank, alarming jobs data, and Powell’s foreboding speech. With the Fed confessing anxiety about inflation and pulling rate cuts off the path, it’s now clear: we’re in dangerous territory with no guard rails in sight!
The analysis below covers the Employment picture released on the first Friday of every month. While most of the attention goes to the headline number, it can be helpful to look at the details, revisions, and other reports to get a better gauge of what is really going on.
Cocoa prices have dumped since rocketing to a dramatic peak last month as an El Nino cycle winds down and traders rush out of the illiquid market. For now, depreciating fiat currencies are still keeping the cocoa price still far above its 2023 levels. Coffee has had a similar rise and subsequent correction — but now, inflation and other factors are conspiring to brew a pot of strong fuel for more upward price action in markets for the world’s other favorite bean.
Last week Scott Melker interviewed Peter on The Wolf of All Streets podcast. They have a friendly discussion about Bitcoin’s future, the differences between gold and crypto, and the overlap in the crypto and precious metals movements.
California’s government bet that they knew better than the free market. And now millions are paying the price.
The story begins in 1919, when the city of Berkley, California instituted legislation setting aside districts that would only allow the construction of single-family housing. The idea spread, and soon much of California’s urban areas had adopted the zoning policy. Today, approximately 40% of the total land in Los Angeles is set aside for single-family homes, while only 11% is reserved for multi-family residences.