Since 2013, the federal reserve board has conducted a survey to “monitor the financial and economic status of American consumers.” Most of the data in the latest survey, frankly, are less than earth-shattering: 49 percent of part-time workers would prefer to work more hours at their current wage; 29 percent of Americans expect to earn a higher income in the coming year; 43 percent of homeowners who have owned their home for at least a year believe its value has increased. But the answer to one question was astonishing. The Fed asked respondents how they would pay for a $400 emergency. The answer: 47 percent of respondents said that either they would cover the expense by borrowing or selling something, or they would not be able to come up with the $400 at all. Four hundred dollars! Who knew?
Well, I knew. I knew because I am in that 47 percent.
China laid out measures to choke off bank credit to the heavily leveraged steel and coal industries, the latest attempt to tackle inefficiencies weighing on the economy.
A proposal circulated by the central bank and other agencies Thursday called on lenders to stop making loans to new steel or coal projects that don’t already have government approval, and slow or stop lending to unprofitable companies that can’t repay.
There is, of course, repetition, and a lot of it. One of the lines I'm hearing more and more is that this is "the most hated rally ever." I'm fairly sure I heard that line used following strong rallies in equity ETFs like the S&P 500 SPDRs SPY, -0.33% I don't know what evidence people have to make such a claim, but, wow, does it sound like a powerful statement and a reason for equities to keep pushing higher.
It’s hard to backtest such a statement with actual buys and sells, but viewers seem to love how it sounds. It makes us feel more bullish because the contrarian in us gets excited that markets are hated on the upside. After all, that means stocks have more room to run on the upside, right?
I find it curious that a rally is so hated after such a powerful move in broad indices. More likely, the real hatred comes from those parts of the marketplace that investors left for dead. Gold miners and material stocks more generally fit the bill there. Into this quarter, our top-quartile-ranked ATAC Beta Rotation FundBROTX, +0.31% will be overweighted the materials sector using ETFs like the Materials Select Sector SPDR ETF XLB, +0.21% based on our dynamic momentum weights and risk triggers. I'm excited for that on a personal basis, regardless of the fact that everything we do is quantitative. The contrarian in me believes that the commodity move is real and has legs.
You want a hated rally? It's the one going on in the Market Vectors Gold Miners ETFGDX, +1.97% which has had an immense rally thus far in 2016, but in the context of the last few years, looks like a blimp in positive returns (vertical axis shows price).
Does this continue? Your guess is as good as mine, but after so much real hate and bearishness toward commodities for a prolonged period of time, the contrarian in me says the bias remains higher for anything gold and materials related. The quant in me agrees.
That’s according to Terry Wohlers, an industry analyst and consultant who publishes an annual volume regarded by many as the most authoritative source of analysis for the additive-manufacturing industry. Last year, companies purchased 808 machines capable of building metal parts layer by layer, up from 550 in 2014 and 353 in 2013, according to Wohlers. Annual sales growth in the hundreds of units may seem small, but these machines cost hundreds of thousands to a million dollars each.
Makers of orthopedic and dental implants were among the first to begin 3-D-printing metal products; they have been producing implants this way for a few years. But the entry of the aerospace industry has the potential to turn metal additive manufacturing into a much bigger business.
Several 3-D-printed parts developed by GE, Airbus, and others are either ready for the market or close to it. In fact, GE is already using the technology to produce two complicated jet engine components—a fuel nozzle and an apparatus for housing temperature sensors—as well as parts for a turboprop engine. And companies are developing numerous additional parts for airplanes, satellites, and rockets behind the scenes.
Industrial additive manufacturing generally involves an intense heat source, either a laser or an electron beam, that melts metal powders layer by layer according to computerized instructions, building up parts as the metal solidifies. The technology is especially useful for making complicated components in relatively small volume, because developing the tools to manufacture them can be very expensive.
The conventional version of GE’s 3-D-printed fuel nozzle is composed of 18 individual parts that must be welded together. The new version is just a single part, and it is 25 percent lighter, which will help increase fuel efficiency. There are 19 such nozzles in a new jet engine that GE is developing, for which the company has 10,000 orders, and the company plans to use the technology to make 30,000 of these nozzles annually.
Japan’s Finance Minister Taro Aso on Friday threatened “necessary” action against a rising yen despite U.S. Treasury Secretary Jacob Lew arguing there was no justification for Tokyo to intervene in the country’s currency.
The public clash between the two allies over currency policy underscores growing worries in the U.S. that Japan might resort to exchange-rate depreciation to revive the world’s third-largest economy.
Mr. Aso, speaking after a meeting of finance officials from the Group of 20 largest economies, said countries can intervene in their currencies if there is “excess volatility” or “disorderly” movement in exchange rates. Those are terms agreed to by the G-20 and the smaller Group of Seven industrialized economies that can justify currency intervention.
Japan and other global heavyweights have said they won’t intervene in markets unless strong exchange-rate movements threaten to jeopardize their economies.
“Taking necessary measures against such exchange-rate movements would conform to the G-20 agreement,” Mr. Aso said told reporters. Earlier this week, Japanese central bank Gov. Haruhiko Kuroda said the yen’s recent rise has been “excessive,” his strongest language yet on the currency’s recent moves.
The price of silver has exploded on Tuesday and is trading at its highest level since May 2015
Just after 2:20 p.m. BST (9:20 a.m. ET) the metal synonymous with finishing second is the biggest gainer of all major commodities, up by more than 4.9% on the day. It is trading at roughly $17.02 an ounce. Silver gained 3% in early trading but has continued to jump.
Here's how silver looked a few minutes ago:
The cause of silver's rally looks to be a correction in the trading ratio between gold and silver. Traditionally, silver prices track gold carefully, meaning that when gold rises, so does silver. However, this year, silver prices have lagged a little behind.
At the start of April, gold had gained more than 13% on the year, while silver was up just 8%. However in the past couple of weeks, silver has started to gain momentum, as investors look to close the appreciation gap between the metals.
As UBS analyst Joni Teves puts it, as quoted by the Financial Times: "It's a combination of silver getting a bit of attention over the past week with the big move in the gold/silver ratio and quite a few market participants looking at silver in and its relative performance to gold and thinking it might be time for a bit of catch up."
Gold has been garnering most of the attention in markets in recent months, enjoying its most successful quarter in 30 years in Q1 of 2016.
The safe-haven metal appreciated hugely in the first quarter, driven by high market volatility and a weakening dollar; however, on Tuesday, it is silver that is in focus, with gold pulled higher by silver's surge. It is up by roughly 1.75% on the day. Platinum, one of few metals to cost anywhere near as much as gold, has gained just less than 3.55%. Palladium, another rare metal, closely related to platinum, is up 2.7%.
Eurasian Resources Group S.a.r.l. plans to use a $2.2 billion project in the Democratic Republic of Congo to become the world’s top cobalt producer and tap growing demand for batteries from companies including Tesla Motors Inc.
ERG, which earlier this month agreed on $700 million of Chinese funding for the project, has started construction and aims to complete it within 20 months, according to Chief Executive Officer Benedikt Sobotka. He sees the company becoming the largest cobalt producer when full capacity is reached. Chinese producers currently vie with each other for the top spot.
Cobalt prices should advance “significantly” in the next two years as demand for the metal used in rechargeable batteries increases, Sobotka said. The battery market is expanding as more consumers turn to electric and hybrid cars and look to store renewable energy to power appliances when there’s little wind or sunshine. Daimler AG and Tesla said they plan to sell batteries storing energy to homeowners and businesses.
“Given that companies such as Tesla are expanding and increasing the use of batteries, our project has very good prospects," Sobotka said in an interview last week.
Luxembourg-registered ERG owns Eurasian Natural Resources Corp., which delisted shares in London in 2013 amid a fraud probe. It controls assets in Kazakhstan, Europe, Africa and Brazil and is 40 percent owned by the Kazakh government with the remaining held by private investors.