Diamond News Archives

Fed’s favorite inflation gauge spikes, consumer spending holds up solidly.

Consumer spending on goods and services – which includes anything from toys to rent and which accounts for over two-thirds of GDP – rose by 4.4% in March from a year ago, according to the Bureau of Economic Analysis this morning. This growth rate is in the upper third of the range of the past few years. Solid but not spectacular comes to mind.

In terms of dollars, the seasonally adjusted annual rate in March (which shows what the total amount of consumer spending would be for the entire year at the rate March was going) reached a record of $13.82 trillion, and remains on the same trajectory of the past few years. The seasonally adjusted annual rate in March is 36% above the mini-peak in July 2008:

But these numbers of consumer-spending growth do not include the impact of inflation, and inflation is stirring.

The BEA also released the PCE price index this morning – the Fed’s favorite inflation measure because it usually tracks lower than the Consumer Price Index and thus further understates the deterioration of the purchasing power of the dollar as consumers experience it. The PCE price index rose by 2.0% from a year ago, which is right smack-dab on the Fed’s target. And it’s up from 1.7% in February. Note that the Fed’s target of 2% inflation isn’t a minimum, but a target.

The Fed is even more focused on the PCE price index without food and energy – not because food and energy are not important to consumers, but because their prices can gyrate wildly. And this core PCE price index jumped by 1.9% from a year ago. Up from an increase of 1.6% in...

Will the Federal Reserve cool off the market?

<span class="fr-marker" data-id="0" data-type="true" style="display: none; line-height: 0;"></span><span class="fr-marker" data-id="0" data-type="false" style="display: none; line-height: 0;"></span>Former Dallas Fed advisor Danielle DiMartino Booth and Stifel Nicolaus chief economist Lindsey Piegza on how the economy is impacting the stock market and whether the Federal Reserve will raise interest rates....

A diamond mine in Botswana, owned by now extinct Australian miner Kimberley Diamonds, is going up for sale at an online auction to be held Monday, as its liquidators failed to secure viable offers.

The Lerala Mine was opened in 2008 and had to be shut twice due to weak sales, until it finally was placed under judicial management in May last year, leaving 130 people out of work and millions in unpaid bills.

Kimberley, which delisted from the ASX in March 2017, had targeted an annual output of about 360,000 carats over seven years, but Lerala yielded only 59,000 carats in the year leading up to its closure.

Some of the assets included in the sale are five kimberlite pipes ranging from 0.16 hectare to 2.35 hectares in area, mining rights, a 200-metric tonnes per hour processing plant, and a 4.2-megawatt diesel power generator, as listed in The Auctioneer.

Interested buyers must submit a refundable deposit of 5 million pula ($509,000).

Botswana is the world's largest diamonds producer and the trade has transformed it into a middle-income nation.

The country is home to prolific diamond mines, including Lucara Diamond’s Karowe operation, where the now famous “Lesedi la Rona,” the largest diamond discovered in more than a century, was dug up in 2016.

The post Halted Botswana diamond mine to be sold at online auction appeared first on MINING.com....

When it comes to what happens during the next major market correction-crash, we can count on that “this time will be different” for the gold and silver prices.  While many precious metals investors believe that gold and silver will crash along with the broader markets, the charts and data suggest the opposite.

In my newest video, Why Gold & Silver Won’t Crash Along With The Stock Markets^[1], I provide charts and updated information on the break-even analysis of the primary gold and silver mining industry.  According to my research, the gold market price has not fallen below the production cost of the top gold miners in the past two decades.

Some analysts, such as Harry Dent, believe the gold price will fall to $700 this year.  Dent reconfirmed his forecast in the following article, Why We Are Heading Toward $700 Gold In 2018^[2]:

Investors are fleeing to gold in a desperate attempt to weather the recent market volatility… but is this long time “safe-haven” actually poised to collapse wiping out trillions of dollars of wealth in the process?

While many economists will argue that gold is not in a bubble… and insist it will soar to $2,000, $5,000 and even $10,000, my research has said otherwise. I’ve never been more certain of anything in over 30 years of economic forecasting.

Market volatility, worries over the Europe Central Bank, negative interest rates, and China are among a laundry list of events that are driving panicked masses to buy the yellow metal. But this is only inflating the gold bubble that is poised to pop at any moment.

Mr. Dent states the due to the current market volatility, worries over Central...