U.S. stocks sold off late in the day to close at session lows on Wednesday as talks to avert a year-end fiscal crisis turned sour, even as investors still expect a deal.
The S&P 500 ended after a two-day rally that took the benchmark index to its highest close in two months. Defensive-oriented shares led the decliners, including health care and consumer staples.
Obama threatens veto
Boehner and Obama have each offered substantial concessions that have made a deal look within reach. Obama has agreed to cuts in benefits for seniors, while Boehner has conceded to Obama’s demand that taxes rise for the richest Americans.
However, the climate of goodwill has evaporated since Republicans announced plans on Tuesday to put an alternative tax plan to a vote in the House this week that would largely disregard the progress made so far in negotiations.
On Wednesday, Obama threatened to veto the Republican measure, known as “Plan B,” if Congress approved it.
Jobs, the Fed… and Silver
…some picks from this mornings 5 Minute Forecast
We interrupt the Santa Claus rally in the stock market with this foreboding announcement: The businesses responsible for nearly all “job creation” in the U.S. economy are pulling in the reins.
As the unemployment rate is key to several factors, not least of which are Fed policy and the long-term price of gold, today we take a closer look…
Four years ago, the day before Election Day in 2008, we noted “the data point to watch [for whomever occupies the White House] will be unemployment. The real danger economically, socially or politically speaking in the ’30s was loads of young men without jobs.”
Unemployment leapt up to 25% in a very short amount of time between the stock market bust in 1929 and 1934… the end of the official recession:
Now, five years after the start of the “official” 2007-09 recession, the real unemployment rate as charted by John Williams at Shadow Government Statistics remains stuck at 22.9%:
We might have been treated to a statistical reprieve during the campaign this year. We watched U-3 unemployment miraculously drop to 7.8%. But our forecast remains: As long as the quants can keep their grubby mitts off the figures, we expect unemployment to lurch its way back toward 10% before this time next year.
Silver dropped to $31.18 yesterday, too. If you’re tracking the Midas metal’s less famous cousin, you can be forgiven for thinking it’s 2008 again — the price has been beaten down, but the actual metal is hard to come by.
The U.S. Mint has informed its network of dealers that inventory of 2012-dated Silver Eagles has been cleaned out… and the 2013 model won’t be available for order until Jan. 7. “This leaves a three-week void for the Mint’s most popular bullion offering,” Coin Update points out.
Silver Eagle sales to date this year total 33,742,500 — considerably less than last year’s record of nearly 40 million. Gold Eagle sales total 715,000 ounces so far in 2012 — the weakest pace since 2007.
[Ed. Note: Our friends at First Federal have already secured access to the coveted “first releases” portion of the Mint’s 2013 Silver Eagle issue. These beauties will be ready for shipment to your door as soon as they’re minted and certified MS70 by independent grading firm NGC. Get yours here.]
……..read more 5 Minute Forecast HERE