Michael Lee, the founder of Michael Lee Strategy and former VP at Morgan Stanley, warns that if the Fed can’t bring inflation under control, it will tear society apart. “The Fed is likely to go overboard in their restrictive policy, knowing the dangers of inflation,” he told Kitco News. “You become a banana republic once your currency becomes worthless.” He also said that he expects gold to hit $5,000 in the next bull run as inflation rises and the U.S. dollar weakens. Inflation worries are continuing to rise, and recent earnings reports from big banks aren’t helping to ease investors.

Kitco News/Cornelius Christian
$5k gold in next bull run, inflation to ‘tear society apart’ if Fed fails – Michael Lee

Gold will reach $5,000 per ounce in the next bull run as inflation rises and the U.S. dollar weakens, according to Michael Lee, Founder of Michael Lee Strategy and a 20-year Wall Street veteran who previously worked as a VP at Morgan Stanley. Lee said that he would add “15 percent in gold” to his portfolio.

“We’re on the cusp of a breakout where gold can go up to $5,000,” he predicted. “I think the dollar is getting near its peak. Once you see that dollar reversal, once gold gets above $2,000, you could really see it start to take off.” He added that, “considering the amount of money we print, I have no idea why gold is not above $4,000 right now,” suggesting gold’s role as an inflation hedge.

The latest headline Consumer Price Index data imply a year-over-year inflation rate of 6.5 percent in December, down from 7.1 percent in November. The Federal Reserve raised rates by 425 basis points last year in an effort to stem high inflation, which reached a peak of 9.1 percent in June.

You can read the full story, here.

CNBC/Hugh Son
JPMorgan tops estimates for fourth-quarter revenue, but says mild recession is now ‘central case’

JPMorgan Chase on Friday posted fourth-quarter profit and revenue that topped expectations as interest income at the bank surged 48% on higher rates and loan growth.

Here’s what the company reported:

  • Earnings of $3.57 per share which exceeds the $3.07 estimate after excluding one-time items, according to Refinitiv.
  • Revenue of $35.57 billion vs. $34.3 billion estimate

The New York-based bank said profit jumped 6% from the year earlier period to $11.01 billion, or $3.57 per share. Revenue rose 17% to $35.57 billion, fueled by the rise in net interest income to $20.3 billion, topping the StreetAccount estimate by $1 billion, as the bank saw average loans rise 6%.

Continue reading Craig’s full prediction, here.

CNN Business/Paul R. La Monica
Bank earnings fail to impress investors as recession worries rise

JPMorgan Chase, Bank of America, Citigroup and asset management giant BlackRock posted results that topped Wall Street’s forecasts Friday, but investors were nonetheless disappointed.

Shares of JPMorgan Chase (JPM) and BofA (BAC) both fell about 3% in early trading. Wells Fargo (WFC), which reported earnings that missed Wall Street’s targets, was down 4%. Citi (C) was flat and BlackRock (BLK) slid about 1%.

Investors might have been disappointed by the downbeat tone of the big banks. Executives are clearly still worried about inflation and the threat of a recession this year following several big interest rate hikes by the Federal Reserve.

You can read the full article here, here.

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