Gold News Daily
4.26.18 – Why Are Americans Hoarding Cash?
Gold last traded at $1,317 an ounce. Silver at $16.49 an ounce.
NEWS SUMMARY: Precious metal prices eased back Thursday on upbeat data and a firmer dollar. U.S. stocks cheered quarterly earnings results from some of the biggest U.S. companies.
Americans are hoarding money in their checking accounts – and that could be a problem –Marketwatch
“How much money is in your checking account? Here’s why it matters – and what it might say about you. Markets are experiencing another period of volatility this week, and new research suggests checking account customers are doing something that indicates they don’t feel as secure as they would like about the economy. They’re not feeling as safe as some economists would have expected….’The consumer in banks, thrifts and credit unions by region, state, city and asset size keeps warehousing more checking dollars,’ said Michael Moebs, economist and Chief Executive of Moebs Services. ‘The average Joe and Jane still are very leery of the economy.’….Consumers had the least amount of money in their checking accounts in 2007, when times were good just before the Great Recession. In fact, they had on average less than $1,000 in their account. Since 2008, the checking account customer has been hoarding more money. And today? The average checking account customer has more than $3,700 stashed away.”
Cash “Vanishes” From Bank Accounts –Zero Hedge
“Your money in your bank account can vanish. That is the lesson from yesterday’s enormous screw-up by Ulster Bank that saw payments and bank account balances suddenly vanish. Customers were left out of pocket and struggling for funds. Payments including salaries were not made, cards were declined and customers were unable to pay for urgent goods and services. Ulster Bank has blamed the issue on ‘human error’ and claims this morning that the issue has been rectified….Many customers found themselves unable to access their accounts, whilst some even had access to other peoples’ money….Credit scores and ratings could be damaged and relationships with individuals’ creditors may be impacted. This weekend’s ‘magic money moments’ in both Ireland and the UK are the most recent example of something we have long discussed – cash in the bank is not your cash. You are an unsecured creditor and your cash can just disappear and there is very little you can do about it….Disappearing cash is a reality which will likely come to bank accounts everywhere with increasing frequency….The lesson here is that investors, savers and indeed companies should consider taking some of their hard earned savings and capital ‘off line’….Physical gold that is allocated and segregated is about as out-of-the-system as you can get when it comes to investments and savings.”
Americans just made a major about-face on the stock market for the first time since Trump’s election –Business Insider
“Americans have turned on the stock market – for now. People who expect the stock market to fall over the next year now outnumber people who predict the opposite, according to the Conference Board’s April survey of consumers. The index that tracks expectations for a decrease frequently zooms past the index that tracks an increase. But this happened in April for the first time since the US elections in November 2016, when the stock market extended what became known as the Trump rally. Stocks peaked this past January after a 22% surge in the prior year, the second-best annual gain since the Great Recession.”
Bitcoin is the greatest scam in history –Recode
“I’m tired of saying, ‘Be careful, it’s speculative.’ Then, ‘Be careful, it’s gambling.’ Then, ‘Be careful, it’s a bubble.’ Okay, Iâ€™ll say it: Bitcoin is a scam. In my opinion, it’s a colossal pump-and-dump scheme, the likes of which the world has never seen. In a pump-and-dump game, promoters ‘pump’ up the price of a security creating a speculative frenzy, then ‘dump’ some of their holdings at artificially high prices. And some cryptocurrencies are pure frauds. Ernst & Young estimates that 10 percent of the money raised for initial coin offerings has been stolen. The losers are ill-informed buyers caught up in the spiral of greed. The result is a massive transfer of wealth from ordinary families to internet promoters. And ‘massive’ is a massive understatement – 1,500 different cryptocurrencies now register over $300 billion of ‘value.’ It helps to understand that a bitcoin has no value at all. Promoters claim cryptocurrency is valuable as (1) a means of payment, (2) a store of value and/or (3) a thing in itself. None of these claims are true….Cryptocurrency is best-suited for one use: Criminal activity. Because transactions can be anonymous – law enforcement cannot easily trace who buys and sells – its use is dominated by illegal endeavors. Most heavy users of bitcoin are criminals, such as Silk Road and WannaCry ransomware. Too many bitcoin exchanges have experienced spectacular heists, such as NiceHash and Coincheck, or outright fraud, such as Mt. Gox and Bitfunder. Way too many Initial Coin Offerings are scams – 418 of the 902 ICOs in 2017 have already failed….All of this would be a comic sideshow if innocent people weren’t at risk. But ordinary people are investing some of their life savings in cryptocurrency. One stock brokerage is encouraging its customers to purchase bitcoin for their retirement accounts!”
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