LOS ANGELES, March 10, 2017 /PRNewswire/ -- The Dow is at 21,000 and markets are priced to perfection – yet the most powerful economy in Europe is in financial trouble.
Deutsche Bank, a major lender of the largest economy in Europe, said Sunday that they are attempting to raise €8 billion ($8.5 billion) through a share sale. This is their third attempt to raise capital with a share sale since 2013.
Deutsche Bank has been overwhelmed by multibillion-dollar legal bills, toughening capital regulations and sagging profits in key businesses ranging from German retail banking to deal-advising and trading.
The bank's struggles have become a political concern – as the German government weighs whether it can, or should, bail out the bank.
The FTSE 100 Index, like our own Dow Jones, is at an all-time high, in spite of growing economic concerns, terror threats and the possibility of the Euro crumbling. The markets continue to ignore these brewing storms, and climb optimistically, implying a level of confidence, which is completely unsubstantiated.
"I find it very difficult to foresee the euro holding together in its current form," former Fed Reserve chairman Alan Greenspan told the BBC in response to the Eurozone tumultuousness.
This level of international market volatility is unprecedented, and the risk of a market crash grows more likely every day. The opportunity to get money out of the markets is running short, and the big money has already begun reallocating their assets so that this type of market can work for them.
The Globe and Mail reported this week that hedge fund managers have been responding to growing economic sensitivity by unloading their stocks and picking up record levels of gold and silver.
Gold thrives on chaos, and is set to perform exceptionally during 2017. Gold is coming off of a six-year low, bottoming at the end of 2015. Since then, growing international market volatility has aided the yellow metal in making impressive gains. Additionally, President Trump is pursuing highly inflationary policies, prompting analysts from CNBC to predict the age of $1,300 per ounce gold before the year is over.
Jonathan Rose, CEO of Capital Gold Group said Thursday, "While the metals seem to be at the beginning of a long-term move higher, they are in direct competition with the stock market, which is making record highs almost every day. This has not only kept the generic gold market in the doldrums, but also affected volumes within the bullion market, creating the current buying opportunity in certified gold coins."
Many generics, especially $20 St. Gauden coins, can be purchased at less than bullion premiums. These abnormalities in pricing usually correct themselves over time. Before you know it, demand shifts and premiums rise. Giving the buyer low premiums like these encourages the possibility of an extra rate of return. But one has to be a buy low/sell high player, and unfortunately, most are the opposite.
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SOURCE Capital Gold Group