저자: Onyedikachi Ngene · 외국인
다듬은 글
and gold had a great day yesterday. In the midst of the Comey testimony on the Hill it dipped and came back up. Here to discuss the reaction in the gold market is Peter Schiff, CEO of Europacific Capital.
Peter, what can account for yesterday's high and the way it fluctuated today?
Well, I think gold has been trending up for some time now, and yesterday it hit a new high for the year. It didn't quite reach the 1,300 milestone, but it came pretty close, maybe 1,295. Gold stocks finally woke up from their slumber. They had been ignoring the strength in gold, and yesterday they finally participated. Or two days ago, rather; I think that was the rally.
Yesterday there was a bit of a dip in the price of gold. Gold stocks pretty much held on to their gains, but this morning, just before Comey testified, there was a big seller that knocked gold down about 15 bucks. It pretty much retraced all of the rally from Tuesday. It did claw its way back, but not back into the black. I think it closed the session down about 7 or 8 today. But the price of gold is rising overall.
On the flip side, the dollar hit a new six-month low again yesterday and rose a bit today. That was partly on the back of some dovish comments from Mario Draghi at this morning's press conference, and also because there was no bombshell from Comey during his testimony. You're right, he held it together pretty well. I think gold closed at 1,281 today, if I'm not mistaken.
What do you think about the elections in the UK? Do you think they had any bearing on this? Many of our viewers are international, and they've been watching this very closely. Comey may or may not be a big issue for them. What do you think about gold trading on that?
Well, I don't think gold is trading much on the outcome of the UK election. Brexit is pretty much happening anyway. It's obviously a bit better for the British if the Conservatives stay in charge of that process and run their country, but I don't know that many people are waiting on the outcome of the election as far as the gold market or even the dollar is concerned.
I think more people are starting to look at the US economy. The weakness we saw in Q1 is not transitory; it's bleeding over into Q2. People are starting to backpedal their expectations for the second rate hike. More people are now looking at December rather than September. Of course, everybody thinks it's a foregone conclusion that they'll raise rates next week, but we'll see. I think more people are coming to grips with the fact that the Fed has been overly optimistic. Maybe even some of the comments now coming from Fed officials or former Fed officials. The other day, Cochrane... sorry, Lacker, I think, said the Fed should not be raising interest rates. In fact, he said they should not be talking about shrinking their balance sheet; they should expand it some more, which means he's talking about QE4. He may be an outlier, but I do think over time you're going to have more people at the Fed singing that same tune.
So you think the possibility of raising interest rates next week is a foregone conclusion, or do you disagree with that?
No, I mean, I think the Fed is likely to do it because everybody expects it, and so far when everybody expects a hike, they've delivered. But I don't think it's 100% locked. It's possible they don't do it. Even if they do raise rates, they may dampen expectations for future hikes. We'll see. So far they continue to talk about how great everything is and how everything is going according to plan, but it's obviously not. They keep saying they're data-dependent, the data is awful, yet they continue to ignore the awful data and act as if everything is going great. At some point they're going to lose what's left of their credibility if they don't at least acknowledge what's going on, but they're afraid to acknowledge it, because the minute they do, a lot of people who have been pretending everything is fine may have to stop pretending.
What do you think about these retail numbers affecting the economy so much? In Q1 we saw a massive drop in consumer spending. I've talked to plenty of guests on this show who talk about consumer spending dropping, especially among millennials who are strapped with student loan debt. What do you think about that playing out over the rest of the year, and about the data they're looking at? Do you think they're actually taking this into consideration? They seem to keep saying it's transitory, and it doesn't appear so.
I know, look, they're overlooking a lot of these problems. Retail is having a problem across the board, and a lot of people are whistling past the graveyard because they're looking at Amazon and its sales, and they're saying it's all just because consumers are shopping online. No, it's not. Sure, that's part of the problem for brick-and-mortar retailers, but it's not the entire problem. You said it yourself: the younger customer is broke. They either don't have a job at all or have a low-paying job, they're still living with their parents, they don't need to spend much money, and they don't have much money to spend because they have student loan debt. Many of them have auto debt. Maybe they borrowed money to buy a car when they were in college and have to deal with those payments. Maybe they have credit card debt because they put what they didn't borrow from the government on their credit cards while in college. So they're loaded up with debt, don't have good-paying jobs, and, maybe just as important for the economy, a lot of retailers pay rent to landlords. I think there's going to be a big problem in commercial real estate, because you're going to start seeing a lot of vacancies. We're already seeing that in shopping centers and malls. And now interest rates are rising, albeit slowly. When you value commercial property, you take the income and discount it with a cap rate, which is a function of interest rates. When your rents are falling because your tenants are going bankrupt and interest rates are rising, that's a recipe for disaster. And of course the banks are on the hook; they have all these commercial loans out there.
You're right, the malls are turning into ghost towns, and retailers are closing. That's one in ten Americans employed there. Thank you so much for weighing in on this, Peter Schiff, CEO of Europacific Capital.
Comments 0