Diamond News Archives

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Insolvency isn't restricted to private enterprise; governments go broke, too.

One reason the economy is so much more precarious than advertised is inflation has pushed households and small businesses to the edge--and one engine of that inflation is local government. This is not to dump on local government, which is facing essentially unlimited demands from the public for more services while mandated cost increases in government union employee wages and benefits ratchet higher.

Since personnel costs are 70+% of city and county budgets, those ever-increasing payroll, pension and benefits costs are the key driver of budgets expanding.

But local governments' ability to increase revenues are also essentially unlimited. There are all sorts of fees that can be created or increased if outright tax increases have been voted down by the public.

What amounts to blackmail is generally effective, however: if you want the giant potholes filled in your streets, you have to pass this municipal bond--or else.

Official inflation, growth in the economy (GDP) and increases in wages are typically pegged at around 2% to 3% annually. But cost increases in local government and agency services are soaring at rates far above the modest rates of economic expansion.

Here's a list of tax and fee increases hitting residents of one of the counties I call home; the list includes taxes/fees raised in 2017 and 2018:

1. Property taxes: between 6.5% and 10%, depending on the property class

2. Gasoline tax (county), from 8.8 cents to 23 cents, phased in over 3 years

3. General excise tax, up 6.3%

4. Garbage fee (commercial): up 27%

5. Sewer fees: up 44%

6. Electricity (base rate): up 7.4%

7. Annual vehicle safety inspection fee (state): up $5.81...

VicenzaOro, the Italian trade show for gold and jewelry, will again present  T.Evolution, its hub for technological innovation at the show that will take place in Vicenza from September 7-11, 2019. Vicenzaoro is organized by IEG - the Italian Exhibition Group. T.Evolution focuses on the technologies and digital methodologies that are play an increasingly central role in jewelry creation process.

T.Evolution aims at those goldsmith workshops and retail jewelers  who intend to offer their clientele a prime service, such as instruments for analysis, 3D printing and so on.

At VicenzaOro September2019, T.Evolution's exhibition purposely-built space will be located inside the Vicenza Exhibition Centre (Hall 2.2), with exhibiting companies from Italy's gold districts - Vicenza, Valenza, Arezzo, Naples -  participating. There will be four goods sectors covering the entire production cycle: 3D printing, workshop tools, workbench equipment and, lastly, services and products for jewelry engineering.

T.Evolution will also feature a full program of workshops and technical seminars with the most qualified experts, i.e. with CPV- Centro Produttivita Veneto as its technical Partner and another two top partners, AFEMO, the Italian Association that groups together leading machinery and technology manufacturers for the jewelry sector, and Federpreziosi, the National Federation of Companies operating within the sector.

With T.Evolution, Vicenzaoro makes room for the most advanced innovations in the industry and meets exhibitors' and traders' extremely high demand for continuity throughout the year in terms of machinery and technologies.  ...

Gold softened last night, sliding in a range of $1402.30 - $1412.15. Stops were hit under $1412 (yesterday’s low, and Friday’s high), which tripped some profit taking from longs and helped accelerate the selling down to support ahead of Monday’s $1402 low.  Gold faded a bounce in the US 10-year bond yield (1.992% - 2.028%) and some strength in the US dollar (DX from 96.15 – 96.32).  The dollar was lifted by a retreat in the safe haven yen (107.10 – 107.75), and a softer pound ($1.2693 - $1.2662, BOE’s Carney said they may cut rates in case of no-deal Brexit, Johnson says 10/31 is “do or die”) and euro ($1.1372 - $1.1351, miss on German GfK Survey).  A rally in equities during European time (European shares up from 0.1% to 0.5%, S&P futures +0.5%) off of upbeat comments on US –China trade from Treasury Secretary Mnuchin (“We were about 90% of the way there [with a deal] and I think there’s a path to complete this”) was also a headwind for gold.  Firmer oil (WTI from $57.80 - $59.13) from a larger than expected draw in US oil and gasoline inventories aided the advance in stocks. 

At 8:30 AM, a weaker than expected reading on US Durable Goods (-1.3% vs. exp. -0.1%) combined with a comment from Trump that Google and Facebook should be sued over bias allegations knocked S&P futures lower (2927), and took the 10-year bond yield down to 2.007%.  The DX edged down to 96.23, and gold advanced to $1412 – where resistance held. 

US stocks opened firmer (S&P +15 to 2932), with Mnuchin’s positive outlook on the US-China trade negotiations still resonating and with the IT and Energy sectors pacing the advance.  The US 10-year yield bounced to 2.021%, and the...