In this article, Ronald-Peter Stoeferle addresses the startling contrast between the economy when Ronald Reagan entered office versus today's economy that Donald Trump is inheriting. The economic conditions (Interest Rates, Inflation Rates, S&P P/E ratios, National Debt, National Debt/ GDP ratio, etc.) are almost contrary from the beginning of their taking office, so it only makes sense that at the end of their terms, they will likely have different results. Trump has spoken about increasing spending and lowering taxes, which parallels the Ronald Reagan era. However, since the starting economic conditions are entirely different the outcome will likely also differ. Click on the link below to read more about this insightful analysis.

In his overnight letter, Jim Brown, at Option Investor, discussed the potential influence of a rebalance before the end of 2016. Here’s a bit of what he wrote:

“The pension fund rebalance for the end of December could see between $38 and $58 billion in equities sold according to Credit Suisse. Stocks have rallied so much since the election the pension funds have to sell stocks and buy bonds to bring their mandatory ratios back into balance. That suggests Thr/Fri should have a negative bias. Normal volume will be very low so that means even $38 billion in fund selling could have a significant impact.”

In addition to a pension fund rebalance this week, causing a drop in the stock market, the first several days of 2017 may also result in a stock market sell off that will be delayed until 2017 in anticipation of reduced taxes as promised by President-Elect Trump during his campaign.

Janet Yellen (head of the Fed) has suggested there may be as many as three rate hikes in 2017. This would cause money to flow out of bonds, as interest rate hikes have an inverse effect of reducing the value of bonds. This will cause money to flow back into the stock market until such time that the bond interest rates are worth investing in and stocks are not worth the risk.

We at Eagle European Capital, LLC see the current, manipulated, low prices of gold and silver metals as an excellent opportunity to buy low. Countries such as China, Russia, India are taking advantage of these low prices and are purchasing vast quantities of gold and silver. 

Owning precious metals is one critical part of preparing your house and family for economic trouble and wealth preservation since gold and silver are a real tangible assets not a paper asset. 

Call us today for a free consultation at 817-825-2036.

We wish you and your family a very prosperous and Happy New Year!