Diamond News Archives

Danielle DiMartino Booth: I was inside the Fed for almost a decade and have never seen such a blanketed propaganda campaign to come out with a new way to explain inflation.

Danielle DiMartino Booth, MoneyStrong President, talks Fed policy, interest rates, and more... VIA CNBC...

Corporations, consumers, the federal government. All have gone on unprecedented debt binges made possible by the Fed’s ZIRP madness.

It should come as no surprise that non-housing consumer debt is at an all-time high. Banks are heavily incentivized to lend out money they can borrow at near-zero interest rates, and consumers are able to carry large revolving balances when interest charges are low.

But rates are rising and most consumer debt is at variable rates. Small banks, who cater to subprime borrowers, are already seeing default rates higher than at the height of the Great Recession. The drumbeat continues: This can’t last, and it’s not difficult to see the tidal wave of bankruptcies, both corporate and household, on the horizon.

This toxic mix – rising interest rates and record high consumer debt in relationship to disposable income – has now started to bite the most vulnerable consumers once again. And for them, debt service is getting very difficult.

In Q1, the delinquency rate on credit card debt at banks other than the largest 100 – so at the 4,788 smaller banks – spiked to 5.9%, higher than at the peak during the Financial Crisis, and the credit-card charge-off rate spiked to 8%.

These smaller banks marketed to the most vulnerable consumers that had been rejected by the biggest banks. And now, once again, subprime is calling.

ORIGINAL SOURCE: Where the Debt Slaves Are the Most Vulnerable^[1] by Wolf Richter at Wolf Street^[2] on 5/22/18...

References

1. ^{^} Where the Debt Slaves Are the Most Vulnerable (wolfstreet.com)
2. ^{^} Wolf Street (wolfstreet.com)

(IDEX Online) – Jewelry group Chow Tai Fook Jewellery Group and the GIA are to use blockchain technology to deliver secure, digital diamond grading reports to consumers for the first time, the GIA said.<?xml:namespace prefix = "o" ns = "urn:schemas-microsoft-com:office:office" /?>

Clients of Chow Tai Fook’s diamond brand, CHOW TAI FOOK T MARK (T MARK), will receive a permanent and immutable blockchain record of their diamond’s GIA grading information.

This innovative service will first be piloted in selected Chow Tai Fook stores in Hong Kong before expanding to other locations at the end of 2018, the GIA said.

Kent Wong, Chow Tai Fook managing director, said “We are very proud of our cooperation with GIA which gives our customers additional assurance and transparency, and the opportunity to have both diamond grading and diamond traceability information at their fingertips. This is an important industry breakthrough and adds a new chapter to the customer experience.”

Tom Moses, GIA executive vice president and chief laboratory and research officer, said: “Securely linking T MARK customers to their diamond’s grading information through the use of blockchain is an important step to enhance consumer trust.

“GIA has been delighted to work closely with Chow Tai Fook to bring this advancement to the entire gem and jewelry community.”

GIA diamond grading information for T MARK diamonds will be written directly to a blockchain ledger shared between Chow Tai Fook and GIA. The unique record of the diamond’s information is transferred via the T MARK app to the final customer.

"This is among the first consumer-facing initiatives to use...

Federal Reserve officials would be content to let inflation briefly run above their 2 percent target as the economy continues to recover, according to minutes from the central bank's most recent meeting.

Following the May 1-2 session, the policymaking Federal Open Market Committee said it wasn't raising rates yet but added the word "symmetric" to describe its inflation goal. Market participants since have puzzled over what the change in language might imply.

The summary released Wednesday indicates a substantial level of debate over how the Fed should approach inflation. The minutes also pointed to an interest rate hike at the June meeting amid debate over how close the Fed might be getting to the end of this rate-hiking cycle.

While the general sentiment was that inflation would continue to rise toward the 2 percent target, there was disagreement over how confident the Fed should be after years of undershooting, and what that would mean to policy. However, there seemed to be agreement that after years of subpar growth and low inflation, allowing the economy to rev up a little would be appropriate.

"A few participants commented that recent news on inflation, against a background of continued prospects for a solid pace of economic growth, supported the view that inflation on a 12-month basis would likely move slightly above the Committee's 2 percent objective for a time," the minutes said.

"It was also noted that a temporary period of inflation modestly above 2 percent would be consistent with the Committee's symmetric inflation objective and could be helpful in anchoring longer-run inflation expectations at a level consistent with that objective."

"Symmetric" was mentioned at least nine times in the minutes.

The Fed's preferred inflation gauge, the core personal consumption expenditures index, currently is...