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Friday File: Brexit Thoughts and a few nibbles

Some big picture blather, plus buys in PLOW and NXPI and an Altius update

By Travis Johnson, Stock Gumshoe, June 24, 2016

There was a whisper of panic in the air this morning. Early in the day I had trouble connecting to both the Kitco website (for gold prices) and to Fidelity, among a few other websites that seem to have been temporarily swamped. People are a little jittery about just what they should do with their money, I reckon. Perfect time to launch a redesign of, when things are pretty quiet… right?

(Many of you haven’t visited the site since we launched our new look yesterday, I expect, if you’ve got things you’re missing or suggestions or bug fixes to alert us to, please comment on the “a new look” article so we can keep all the suggestions in one place for tracking purposes — thanks!)

Last week I mentioned that I thought a “leave” vote on Brexit would, more than anything else, send the US dollar soaring — and that seems to have been the case to this point… but we are also hitting one of those unusual moments (at least in recent memory) when both precious metals (gold, silver and platinum) and the US$ rise at the same time. Both are “flight to safety” trades as people sell other commodities (including oil and base metals) and, more importantly, other currencies (especially the Pound)…

… and if this trend sticks for more than a brief while, there’s every chance that the Fed will not raise interest rates at all this year. With so much money already flooding into the US, and with the UK and Europe and Japan and other major economies likely to continue to look for more stimulus, the Fed should be reluctant to force the US$ still higher by raising rates (and therefore sucking even more money into US bonds, which, though absurdly expensive with the 10-year yield still well below 2%, look cheap compared to all of the negative rate bonds out there). The economy in the US is soft this Spring but not terrible, compared to other major economies… but it seems like the only thing working in the world’s favor for now will be strong US consumption because the dollar continues to make imported everything cheap for US.

That “sell everything to US consumers” trend might not go on forever, particularly since retail sales here seem to have trended away from “buy more stuff” and toward “travel and ...

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