Baltic
Dry Index. 2560 +80 Brent
Crude 62.38
Spot
Gold 4256 U S 2
Year Yield 3.47 +0.02
US
Federal Debt. 38.344 trillion
US
GDP 30.606 trillion
"Deficit spending is simply a
scheme for the 'hidden' confiscation of wealth. Gold stands in the way of this
insidious process. It stands as a protector of property rights."
Alan Greenspan
In a thin trading
week it was easy to dress up stocks for month-end. Now comes the all important
December and year-end.
Will it be the Santa
Clause rally or a profit taking year-end ahead of a very iffy AI 2026?
Is
Big Tech back? Meta’s and Microsoft’s stocks score largest weekly gains since
May.
Meta and Microsoft
shares have struggled for momentum over the past three months but rode
improving market sentiment this week
Published: Nov. 28, 2025 at 1:16 p.m. ET
During a big week for Big Tech, Meta Platforms and Microsoft shares notched their largest weekly gains in over six months. . Is sentiment meaningfully flipping for those beaten-down plays?
The rallies in Meta came as the
broad-market mood improved, reflecting investors’ growing expectation that the
Federal Reserve will cut interest rates at its December meeting. A rate cut is
seen as favorable for technology stocks, and especially for the
artificial-intelligence trade. The Nasdaq Composite Index closed the
week 4.9% higher, while the S&P 500 climbed 3.7%.
Meta’s stock advanced 9% on the week to seal its
best weekly performance since May 2. The week’s gain snapped a stretch of four
consecutive weekly declines and outperformed Alphabet’s stock , the new
market darling.
Meanwhile, Microsoft’s 4.2% rise was enough for its
strongest weekly performance since May 2, as well. Within the “Magnificent Seven” grouping of large technology stocks, all
but Nvidia landed in positive territory for the week. Tesla’s
stock was the biggest gainer, up 10%.
The Roundhill Magnificent Seven ETF staged
a 5.2% rise on the week, snapping a streak of three consecutive weekly drops.
But Citi analysts noted Monday that the “Magnificent Seven” have started to
behave less like a monolithic group lately.
Meta and Microsoft shares have generally struggled
for momentum in recent months, with Meta off 13.7% over a three-month span and
Microsoft down 3.5%.
More
Is
Big Tech back? Meta’s and Microsoft’s stocks score largest weekly gains since
May. - MarketWatch
A.I. and the
trillion-dollar question
November 28, 2025
In 2014, I read “The Second Machine Age,” a book by
two M.I.T. economists. The authors offered a sort of utopian vision of A.I.:
The technology would lead to an age of hyper-productivity and plenty, where the
only question was how to distribute its gains fairly.
We could still get there, but it seems fair to say
the road to utopia, if that is our destination, won’t be smooth. Current
anxieties around whether A.I. has become too dominant in the global economy
— what happens if it’s not all it’s cracked up to be? — sit alongside competing ones: What happens if A.I. is all
it’s cracked up to be, and can replace all those humans after all? Would that
really be a good outcome?
I spoke to my colleague Cade Metz, who writes about artificial intelligence. He told me every technological revolution has created anxiety during
the transition from the old to the new, when jobs are destroyed, money is lost
and companies go bust. The question is what emerges on the other side.
Cade,
is this A.I. boom in fact an A.I. bubble?
That’s the million-dollar question. Or rather: the
trillion-dollar question. This one technology is propping up the economy in so
many ways. But we’re at a point where we’re not sure where that technology is
going. It’s hard for even the companies building the technology to articulate
where they’re going.
Some
of these companies are not even turning a profit. What justifies these
valuations?
So some of these companies are enormously
profitable. Google, Meta, Amazon and Microsoft make billions of dollars a
quarter, on core products that are not fundamentally A.I.-related.
But their bottom line is also being driven by the
interest in A.I. To build these A.I. technologies, you need enormous amounts of
computing power. Google has that computing power. So do Amazon, Microsoft and
Meta.
Everyone else who’s jumping on the A.I. bandwagon
pays those firms for that computing power. So there’s all this other money
that’s being pumped into these big companies, and so their stock price goes up,
their valuation goes up, their revenues go up.
All that makes sense. But if those other, smaller
companies don’t start making money soon enough, you might have a problem.
If
this is a bubble, and it bursts, how bad would it be?
The dot-com bubble is one potential analogy. What
happened there was, a lot of people lost a lot of money — people who were
invested in the technology, people who were building the technology. Many
companies just vanished, right? And you had some large companies go bankrupt.
So you know, it wasn’t a small thing.
But the larger economy wasn’t affected in the same
way that it was in the 2008 financial crisis, which is another possible
analogy.
Some people are concerned about what they call
potential systemic risk in the economy that would make it more like 2008. There
is a lot of debt being taken on by highly leveraged investors and it’s hard to
tell how much debt, who holds it, how widespread it is.
All
these companies that are betting big on A.I. — what does a successful bet for
them look like?
Take a company like OpenAI. They think that within a
few years, they’ll make tens of billions of dollars a year. They’re already
getting billions of dollars in revenue. But they’re losing even more because
it’s so expensive to build this stuff. They think that by 2030 it will flip.
It might. But even if the technology comes through,
not everybody can win here. It’s a crowded field. There will be winners and
losers.
Yet another potentially good analogy is the railroad
boom of the 19th century. The invention of the steam engine led to a boom in
railroad building. You had railroad lines being built right beside each other.
And that’s a lot of what’s happening here: You have all these companies
building exactly the same thing — these massive data centers. Many people think
there is surplus capacity being built right now. Which means you’ll have a lot
of losers in the longer term.
The World: An A.I. boom or bubble?
In other news, another warning from the BIS.
Central
bank body BIS warns of hedge fund leverage in government bond markets
27 November 2025
LONDON (Reuters) -The new head of the Bank for
International Settlements has said reining in hedge funds' ability to make
highly leveraged bets in government bond markets should be a key priority for
policymakers given rapidly increasing public debt levels.
Pablo Hernández de Cos, who took over as General
Manager of the umbrella body for central banks in July, said the combination of
high debt and growing role of non-bank financial institutions (NBFIs) such as
hedge funds in bond markets posed new financial stability risks.
The worry is their use of leveraged "relative
value" trades like cash-futures basis trades, which look to exploit small
price differences between bonds and their futures contracts.
These strategies have boomed in the U.S. and other
major economies but have been in the sights of regulators after margin calls on
U.S. Treasury future trades in 2021 fuelled a bout of turmoil in the world's
biggest government bond market.
"Around 70% of bilateral repos taken out by
hedge funds in U.S. dollars and 50% in bilateral repos in euros are offered at
zero haircut, meaning that creditors are not imposing any constraint on
leverage using government bonds," de Cos said in a speech at the London
School of Economics.
With ageing populations and rising defence spending
projected to push the debt-to-GDP ratio of advanced economies to 170% by 2050
absent fiscal consolidation, de Cos said reining in NBFI leverage was a
"key policy priority".
He called for a "carefully selected combination
of tools" but highlighted two specific measures as likely to be
particularly effective.
One of those was the greater use of central
clearing, so government bond market players are treated more equally. The other
was for "minimum haircuts" - or discounts - to be applied to the
value of the bonds hedge funds use as collateral, to limit their leveraged
plays.
"The growing intermediation of record-high
public debt levels by NBFIs introduces significant new financial stability
challenges," de Cos said, adding that haircuts should be applied in a
targeted manner.
In the context of these new risks, he said central
bank swap lines remained "critical" to stabilise the global financial
system at times of acute distress.
Keeping inflation in check will remain the most
effective way to support debt sustainability by reducing risk premia, while
central bank independence remains vital too.
"Against the backdrop of rapidly deteriorating
sovereign creditworthiness, the need for credible monetary policy and central
bank independence is stronger than ever," de Cos said.
Central bank body BIS warns of hedge fund leverage in government bond
markets
Gold heads for fourth monthly gain; silver hits
fresh record high
Published Fri, Nov 28 2025 12:20 AM EST Updated
Fri, Nov 28 2025 11:43 AM EST
Spot gold rose 1% to a two-week high on
Friday, as expectations that the Federal Reserve will trim interest rates next
month lifted demand for the non-yielding asset, while silver hit a fresh record
high.
Spot gold rose 0.9% to $4,192.78 per
ounce, its highest since November 14, and was set for a 2.9% weekly gain.
Bullion, set to register a 4.6% rise this month, is on track for its fourth
consecutive monthly gain.
Silver climbed to a fresh record high of
$55.33 per ounce, up 3.5% for the session and 13% for the month.
Futures trading resumed around 1330 GMT,
after an hours-long outage at CME Group halted trade on its currency
platform and in futures spanning foreign exchange, commodities, Treasuries and
stocks.
U.S. gold futures for February delivery
rose 0.61% to $4,227.60 per ounce.
Fed rate in focus
“The expectation is that we’re going to
continue to have a slower economy going into 2026, and the Federal Reserve is
very likely to cut rates, which is getting some investors back” into gold, said
Bart Melek, head of commodity strategies at TD Securities.
Gold tends to do well in low-interest-rate
environments.
Recent dovish remarks from Fed Governor
Christopher Waller and New York Fed President John Williams, combined with softer U.S. economic data following the government
shutdown, have strengthened expectations that the central bank will cut
interest rates next month.
Traders see an 89% chance of a rate cut in
December, up from 50% last week.
Meanwhile, “the technical charts for
silver have turned more bullish in the past week or so, and that’s inviting the
chart-based speculators to the long side of the silver market,” said Jim
Wyckoff, senior analyst at Kitco Metals.
Gold demand was subdued across major Asian
markets this week, as high prices curbed retail buying even as India entered
its wedding season. In China, the removal of a tax exemption on gold purchases
dented consumer appetite.
Platinum gained 2.9% to $1,655.14, up 9.7%
for the week, while palladium gained 5.6% to $1,519.37 and was set for a 10.7%
weekly gain.
Gold
heads for fourth monthly gain; silver hits fresh record high
Global Inflation/Stagflation/Recession
Watch.
Given
our Magic Money Tree central banksters and our spendthrift politicians,
inflation now needs an entire section of its own.
Bank of Canada in risk management mode with
stagflation on the table, Poloz says
Central bank is more likely to do very little in terms of rate moves,
according to former Bank of Canada governor
Published Nov 27, 2025
In the face of downside
risks to economic growth and upside risks to inflation, the Bank of Canada is more likely to do very little in
terms of rate moves, according to former Bank of Canada governor Stephen Poloz.
“In that context a
central bank should be thinking, ‘I need to cut rates to cushion the blow, but
I need to raise rates to prevent inflation from going up much,'” said Poloz,
now special adviser to the law firm Osler, Hoskin & Harcourt LLP, during a webinar
on Wednesday. “They’re more likely to do very little and that’s what we’re
seeing.”
Poloz said this is
referred to as risk management mode, where incoming data is assessed based on
whether the risks associated with weak growth and a rising jobless rate,
outweigh the potential for higher inflation.
The trade war with the United States has been a source of
uncertainty for businesses and investment in Canada, which Poloz said has
created a “tricky environment” for the Canadian economy.
“(It) is a stagflation shock, we don’t know how deep of a stagflation
it will be, but it could be more stag than inflation,” said Poloz.
The Bank of Canada cut
its policy rate by 25 basis points in October, bringing the rate down to 2.25
per cent, the lower end of the bank’s estimated neutral range. Bank of Canada
governor Tiff Macklem signalled that may be the end of its
easing cycle, if the economy operates in line with its forecasts, and noted
that inflationary pressures had been “contained.” Expectations currently lean
towards a pause at the central bank’s next rate decision in December.
Canada’s unemployment rate declined in October but remains elevated
at 6.9 per cent. After contracting in the second quarter, the Canadian economy
is expected to grow by 0.5 per cent in the third quarter, according to the Bank
of Canada’s forecast.
Poloz said monetary
policy cannot unwind all the impacts of a trade war, including sectors that
that are hard-hit by U.S. tariffs.
When asked about Canada’s
traditional economy and the future of the auto sector, Poloz said there are
risks to the longevity of some of that industry.
“I’m more confident about
the parts sector being present 10 years from now, than about the final stage —
the assembly sector,” he said.
Bank of Canada in risk management mode with
stagflation on the table | Financial Post
Technology
Update.
With events happening
fast in the development of solar power and graphene, I’ve added this section.
Another
weekend another EV fire to report. Approx. 5 minutes.
Charging Overnight: Rivian Dealership Learns the Hard Way
Charging
Overnight: Rivian Dealership Learns the Hard Way
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt Clocks (usdebtclock.org)
Exponent
Calculator
Enter
values into any two of the input fields to solve for the third.
This
weekend’s music diversion. Europe’s Army prepares to rush to Ukraine if Trump’s
USA leaves. The unofficial anthem of the Republic of Venice. Approx. 2 minutes.
"Juditha
Triumphans" de Vivaldi a Casteło co'l XVI° Rezimento Trevizo (08/10/2017)
"Juditha Triumphans" de Vivaldi
a Casteło co'l XVI° Rezimento Trevizo (08/10/2017)
Next,
more forgotten British history, that secret fishy story. Approx. 16 minutes.
Fishy
Codes: Bletchley's Other Secret - Computerphile
Fishy Codes:
Bletchley's Other Secret - Computerphile
Finally,
that terrible Hong Kong fire. Approx. 5 minutes.
Hong
Kong High-Rise Inferno: 44 Dead, 279 Missing
Hong Kong
High-Rise Inferno: 44 Dead, 279 Missing
"As fewer and fewer people have
confidence in paper as a store of value, the price of gold will continue to
rise. The history of fiat money is little more than a register of monetary
follies and inflations. Our present age merely affords another entry in this
dismal register."
Hans F. Sennholz
