Larry MacDonald


Author and freelance writer

Jan. 26, 2017

Perspectives on 2017

1. Goldman Sachs in November gave a thumbs-up to raw materials for the first time in four years … sees an upswing in manufacturing around the world that will increase demand for many commodities … but some metals face threats … Gold could weaken if the U.S. Federal Reserve raises interest rates and causes the $ to appreciate.

2.  According to the Conference Board, US consumer confidence is now at the highest level since 2001 (right before 9/11). This could translate into higher spending

3.  “Looking back over eight centuries of data, I find that the 2016 bull market was indeed one of the largest ever recorded,” wrote Harvard Academic Schmelzing … “History suggests this reversal will be driven by inflation fundamentals, and leave investors worse off than the 1994 ‘bond massacre.’ ”

4. A report from Goldman Sachs highlights the sectors that will benefit most, and be hit hardest, if interest rates climb. Winning sectors include finance, technology, and materials. Losers would be telecom, utilities, real estate and consumer staples.

5. Gold Rally Has Legs as Military Risks Rise with Trump in power and on a collision course with China and North Korea.

6. “'We see the optimism surrounding OPEC and non-OPEC production cuts being counterbalanced by fears of higher U.S. crude production … said Hans van Cleef, senior energy economist at ABN Amro … Last week, U.S. energy companies added oil rigs for a 10th week in a row to 529 ….”

7. If Europe has another crisis that threatens the union, capital outflows could bid up U.S. Treasury prices and keep U.S. rates low another year.

8. Raw materials could get a boost from increased military spending caused by escalating global tensions

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