Weekly Update 30-Sep-2016

Currencies and bonds rose this week, while stocks and commodities were mixed. The strongest asset class was crude oil, which gained 9.8%, while the weakest was silver, which lost 1.2%.

Among the currencies, Bitcoin made the largest gains, rising 2.4%. The USD and EUR rose 1.2% each, and even the weakest currencies, the CNY and CAD, gained 0.8%. Short term treasuries tracked the dollar's 1.2% gain while long term treasury bonds gained 1.7%.

Stock markets reversed course this week, with US markets rising and Euro and Japanese markets falling; the Dow Jones Industrials and the S&P 500 added 1.5% and 1.4% respectively. The Japanese Nikkei lost 0.8%, while the Euro STOXX fell 0.6%.

Both the strongest and weakest asset classes were commodities. Crude oil dominated, rising 9.8%, followed by palladium, which gained 5.8%. Silver fell 1.2% and platinum lost 0.8%.

Many commodities have recently made new all-time lows, including wheat, copper, and uranium. The latest IMO Food Price Index also set a new all-time low. Financial markets may be inflating (especially when priced in government-issued currencies), but real goods are priced at or below depression-era levels. And even stocks, like the Dow Jones Industrials, have now closed for 2 months below their 36 month moving average, which in the past has been a reliable indicator of a long-term bear market. This is the time to get defensive, holding cash in the form of physical gold and lightening up on speculative currency and equity positions.

Priced in Gold Weekly Summary

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