U.S. Futures Falter and Precious Metals Soar Further on Rising Geopolitical Tensions

Trump's latest attack on the Fed and myriad of populist polices receive a “thumbs down” for equities and a “thumbs up” for gold and silver.

Key Takeaways

Risk-Off Returns as Chaotic Policy Fuels Gold: It has been quite a while since we posted back-to-back “risk-off” sessions in equities. Part of this is the attack on the Fed, and part is due to the array of populist policy measures being introduced (policies borrowed from the left-leaning Democrats). Gold and silver are soaring on the back of heightened economic risks at home and geopolitical risks abroad.

Affordability Moves to Center Stage: There are two worrying articles on the page A14 editorial section of today’s Wall Street Journal that are worth a look: The Affordability Problem in One Chart and How to Shrink Credit for the Poor. Well worth a read.

New-Home Sales Beat Estimates but Discounts Deepen: October new home sales beat consensus views, but it took the builders a median of 2.7 months to make a sale upon completion, the longest since last March. Desperation set in to unload the near-8 months’ supply of inventory, forcing builders to discount heavily, with median prices sliding -3.3% MoM after a similar decline in September and down -8% year-over-year (at $392.3k, the lowest since July 2021).