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[Doctor Gollum]

Interestingly I saw on the news that as the stock market has dropped that Gold prices hit an all time high on Monday and then increased again on Tuesday.

Another fools errand. It's like investing in barrels of whiskey...

[Sir Tigger KC]

Interestingly I saw on the news that as the stock market has dropped that Gold prices hit an all time high on Monday and then increased again on Tuesday.

Another fools errand. It's like investing in barrels of whiskey...

Gold has gone from about $2000 an ounce at the beginning of 2024, to about $3100 today. 

Interesting fact about gold that I heard a while ago.

A hundred years ago, a nights B&B in a decent hotel in London, Paris or New York would have cost about one gold sovereign, and this remains much the case today. 

[STEMO]

Bonds are a fools errand. The fact they're falling points to growth elsewhere.

As the price of bonds goes down, the yield goes up. Government bonds are not really for retail investors, more for large companies or even other governments. I CBA to look it up, but China holds a massive amount of US government debt.

[STEMO]

Figures vary slightly, but it appears to be around $850 billion, less than I thought. Japan owns over $1 trillion, while the UK is not far behind China.

[LC0112G]

Interesting that  US 10 year Treasury Bond yields have tumbled from 4.8% in January to 3.95% currently, which saves the US taxpayer hundreds of millions in interest payments on America's massive debt pile of around $36.5 trillion.

The biggest drop has happened in the last week from 4.4%, probably as investors have dumped stocks and moved into 'safe haven' bonds instead.

That's not how bonds work. A 10y bond is sold by the govt with the promise it will pay a fixed amount of interest for 10 years. The amount of interest it pays on a bond is fixed - it does not go up or down with the markets, so it won't "save the US taxpayer hundreds of millions in interest payments on America's massive debt pile of around $36.5 trillion". Bonds already issued have to be paid at the issue rate.

As the owner of such a bond, you can sell it on for whatever they want. Say you paid $1 for the bond, and the govt promise to pay 10cents per year interest - effectively a 10% interest rate. If you sell it to a new owner, then the 10cents interest will be paid to the new owner. At the end of the 10 years the govt will pay the current owner their $1 back. It will therefore have cost the US treasury $2 to borrow $1 for 10 years.

If during the bond period you sell it to someone else for less than you paid (say 90 cents), the new owner will still receive the promised 10 cents interest, so the new owner effectively sees 11.1% interest, but the govt is still only paying out 10 cents. Similarly if you sell it for more than you paid (say $1.1) the new owner still receives the 10 cents interest, so the new owner effectively sees 9.09% interest, but the govt is still only paying out 10 cents.

The only time the govt is really bothered about the bond rate is if/when they are trying to sell NEW bonds. If you crash your economy then buyers of new bonds are going to want more interest before agreeing to give the govt any more money. The bond rate can therefore be seen as a measure of investor confidence in the countries economy.

The fact China holds huge amounts of US bonds is a problem for China, not the US, providing the US can continue to pay the initially agreed interest (which it always can by just printing money if required).

[Sir Tigger KC]

Indeed. However Governments are selling and redeeming bonds all the time, so bonds sold today are costing less in interest than bonds sold a few weeks ago.

Incidentally, UK 10 year Gilt yields are down slightly as well, but that will be for the 'safe haven' reason rather than any renewed confidence in Rach from Complaints! 

[Mister Rog]

I dislike Trump, however without getting into specific rights or wrongs, he is doing pretty much what he said he would do before his election. Unlike some country leaders I could mention. Ahem . . .

[Rangie]

I dislike Trump, however without getting into specific rights or wrongs, he is doing pretty much what he said he would do before his election. Unlike some country leaders I could mention. Ahem . . .

.
He's a business man through & through unlike our bunch of educated idiots who simply offer  positions to chums they went to university with & are completely incapable of doing what is required we really  are the laughing stock of the world now. It was embarrassing to watch Starmer virtually licking Donald's arsehole to secure " a deal "

[JasonH]

He's a business man through & through unlike our bunch of educated idiots who simply offer  positions to chums they went to university with & are completely incapable of doing what is required

He is a businessman but one that has bankrupted 6 businesses, is a convicted criminal, and during COVID told the world to drink bleach.

[Varche]

USA GDP is about 25% of world total and is clearly going to take a hit short term.

The EU is about 22%. The next twelve months will be defining. Buy Europe campaign? Spaniards a very loyal customers. We have friends who will never set foot in the Chinese “ pound shops” ( every town has at least one). There will be some tough defence spending decisions. Home produced rather than buy from US. There will be a lot of poring over paperwork going on behind the scenes.

Presumably China and other countries will look to sell their stuff to Europe if the Americans buy less.

[Sir Tigger KC]

USA GDP is about 25% of world total and is clearly going to take a hit short term.

The EU is about 22%. The next twelve months will be defining. Buy Europe campaign? Spaniards a very loyal customers. We have friends who will never set foot in the Chinese “ pound shops” ( every town has at least one). There will be some tough defence spending decisions. Home produced rather than buy from US. There will be a lot of poring over paperwork going on behind the scenes.

Presumably China and other countries will look to sell their stuff to Europe if the Americans buy less.

It's a lot less than that. According to the EU themselves, EU GDP is 14.7% of global GDP.

https://ec.europa.eu/eurostat/web/products-eurostat-news/w/wdn-20250326-1#:~:text=Did%20you%20know%20that%20with,2022%20world's%20greenhouse%20gas%20emissions%3F

[Doctor Gollum]

He's a business man through & through unlike our bunch of educated idiots who simply offer  positions to chums they went to university with & are completely incapable of doing what is required

He is a businessman but one that has bankrupted 6 businesses, is a convicted criminal, and during COVID told the world to drink bleach.

Very few businesses get to be successful without the experience of failure along the way. The same is true of individuals.

His criminal convictions are akin to being offered a speed awareness course.

His default starting position is extreme and the only reason the current situation exists is because rather than negotiating, the establishment have decided to act like toddlers and try to spit their dummies further just because it's Trump.

This situation is collectively one of our leaders own making. It's easy to blame Trump because he's the odd one out, but I had hoped that having been democratically elected a second time with some considerable margin, that he might have been more respected for it.

[STEMO]

Trump is the same person he always was, a gobshite and a fool. Hopefully, this will be the end of him.

[Varche]

USA GDP is about 25% of world total and is clearly going to take a hit short term.

The EU is about 22%. The next twelve months will be defining. Buy Europe campaign? Spaniards a very loyal customers. We have friends who will never set foot in the Chinese “ pound shops” ( every town has at least one). There will be some tough defence spending decisions. Home produced rather than buy from US. There will be a lot of poring over paperwork going on behind the scenes.

Presumably China and other countries will look to sell their stuff to Europe if the Americans buy less.

It's a lot less than that. According to the EU themselves, EU GDP is 14.7% of global GDP.

https://ec.europa.eu/eurostat/web/products-eurostat-news/w/wdn-20250326-1#:~:text=Did%20you%20know%20that%20with,2022%20world's%20greenhouse%20gas%20emissions%3F

I got the 22% from a Sky News article, gulp. 340 million population of USA , 449 million for EU.

[TheBoy]

You might need to clarify if that figure was EU or Europe. As they are both very different things that the stupid and uneducated* can't seem to grasp


*like our lazy media.