Correlation Economics Backup

The traditional banking system is losing status while fintech startups are growing. This also includes crypto solutions.

 

Dollar shortages can be monitored by looking at FX swaps.

 Keith Neumeyer just jacked up silver prices from $28/ounce to $30/ounce.

 

 China is recovering both in power consumption and GDP growth.

 Oil demand has not picked up. Refinery inputs are not picking up. Oil stock levels are declining but there is still too much oil out there. Oil majors are in a lot of trouble who need an oil price of at least $50/barrel to sustain dividends.

 Shanghai gold deliveries hit a yearly record high in September. 

September 2020 Perth Mint gold and silver sales numbers are rising. 

Once in a while I need to post an update on all discovered correlations, we're getting a huge list already. If I only had some software to get automatic updates of these charts... Positive correlations mean that if one goes up, the other goes up too. Negative correlations mean that if one goes up, the other goes down. Positive correlations: 1)  Silver/Gold premium Vs. Silver/Gold Price   ( link 2 ) 2)  Baltic Dry Vs. Industrial Commodities 3)  Baltic Dry Vs. Copper 4)  Copper Vs. S&P 5)  Oil Vs. Dow Jones 6)  Agriculture Price Vs. Health of Economy 7)  Agriculture Vs. Fertilizer Price  8)  CRB Index Vs. Commodity prices (oil, agriculture, metals) 9)  MZM velocity Vs. Inflation 10)  MZM velocity Vs. 10 year U.S. treasury yield 11)  Case-Shiller Index Vs. Housing Market Index 12)  Capacity Utilization Vs. Inflation 13)  Rhodium Price Vs. Automotive Industry 14)  Housing Price Vs. Rise of Wages 15)...

Very informative video on oil and why you shouldn't invest in it. As you can see on the chart below, bond yields and GDP are correlated to the net energy delivered to the economy. As net energy declines to zero, GDP will also keep declining. The reason is that it costs more and more to produce energy. We will need to have some sort of more efficient energy source like nuclear energy...   Interesting to note is that GDP is correlated to bond yields and they follow the orange line exactly. The figures below give the energy yield for various sources. The good part is that green energy has less CO2 emissions.

 

 During the Great Depression, earnings went down along with stocks. Today, earnings are not going down, but up. This is why I think stocks will only go higher.

The latest Q2 2020 numbers came out for the Net International Investment Position of the U.S.A. It doesn't look good.

 China starts Golden Week holiday. You know what this means for gold.

When people have a lot of savings, they will be able to buy a lot of houses and the housing market goes up.

The latest Q2 2020 COFER numbers show that the U.S. dollar has lost some reserve currency status.