- Dollar buying ends, but there was no selling attached….
- Janet Yellen sees no red lights flashing…
Good Day… And a Tom Terrific Tuesday to you! Well, I didn’t tell you this yesterday, but Sunday night was just awful for me, I woke up at 2 am and started hacking, and then my mouth began to bleed, and this continued until around 4:30 am… So, yesterday, I just kept falling asleep all day, and then I fell asleep watching the 49er’s defense control the game last night… But I did stay awake long enough to smoke some very yummy pork tenderloins… Not that I had to stand over a grill… The Big Green Egg did the majority of the work! Procol Haru Tm greets me this morning with their mega hit song: Whiter Shade Than Pale… That’s what I’ve felt like lately…
Well, The dollar buying ended yesterday, but there wasn’t any selling either… The BBDXY lost 1 index point, so no biggie… I just didn’t get why investors, hedge funds, state Treasurers, etc. were buying dollars… it just didn’t make any sense to me, but then not much does these days… I’m just saying… There’s nothing on the economic data prints calendar for this week, so we go drifting out to sea… We’ll just bob along with the tide, and stay away from the coast of Africa… ( It is still hurricane season!) And that will last until it doesn’t… Probably, this Thursday, when the STUPID CPI for August prints… Because you never know when the Gov’t will throw out a rogue STUPID CPI, but after typing that, my mind reminded me that it is an election year… So, that stirs the “we don’t know pot” even more!
Gold found a way to gain $9.70 yesterday… And Silver gained 36-cents, so, not having the dollar dominating traders’ minds, saw Gold & Silver get back on the rally tracks… But this is getting old, isn’t it? Up one day, down the next day, and rinse and repeat… Did you read the Egon Von Greyerz article yesterday, about Gold? I like the illustrations of how much $14,000 invested in Gold in 1971 would be worth today… Oh, what’s that, you didn’t read the article? Well, then I’ll make it easy for you, the $14,000 invested in a Gold 400oz bar in 1971 would be worth $1 Million today… Now then, don’t you wish you were a Gold bug in the early 70’s? Back then, there were no short paper traders, because the Casino Banks didn’t have currency trading desks… Yes, you, me, and the guy down the street, weren’t allowed to own Gold in 1971… It was 1974, when they finally took that off the books, and that started Gold’s first bull run…
The Pirce of Oil slipped more yesterday, and ended the day trading with a $67 handle… There’s not stopping these Oil contract sellers because they see the Gloom and Doom that is hovering over the U.S., Europe, Asia, and well the rest of the world that loaded up on debt during the last free interest party the Fed/ Cabal / Cartel , and other central banks held… They see it coming, I see it coming, but poor Janet Yellen sure doesn’t… I’ve got an article for you in the FWIW section today that talks about Yellen and her rose colored glasses…
In the overnight markets last night… Dollar traders were nowhere to be found, as the BBDXY begins today’s trading at the same level it closed at yesterday: 1.235… our boat is now bobbing along adrift in the sea… I’m just saying… Gold is flat to down a buck to start the day today… And Silver is up 10-cents… So, nothing to see here either… You know that the markets are in a “wait-n-see” mode when the overnight markets are a dud…
I found this on Reuters.com this morning regarding bonds… Let’s listen in: “Bond traders believe the Fed has waited too long to cut interest rates, according to this indicator. The spread between the 2-year yield and Fed funds rate has fallen to its most deeply negative level in at least 50 years, another potential recession signal from the bond market.
The Fed waited too long to cut interest rates, according to this bond-market gauge.
A long-awaited shift in the relationship between the 2-year and 10-year Treasury notes wasn’t the only recession warning to emerge from the bond market on Friday.
A steep drop in the 2-year Treasury yield has also pushed the spread between the short-dated note and the Fed funds rate, the Federal Reserve’s primary tool for guiding monetary policy, to its most negative level in at least 50 years, according to Nicholas Colas, co-founder of DataTrek.
During that time, the spread between the two short-term rates has only fallen below -1 percentage point on three occasions. A recession had started within a year after each.”
Interesting, don’t you think? This is important stuff folks… Shrug it off if you will, but this will come back to haunt us in the near future…. I’m just saying..
Well, I received quite a few Pfennigs Replies yesterday, telling me that yesterday’s Pfennig was very thought provoking, and thanking me for reminding everyone about the coming disaster of digital currencies… I thank all that replied with nice remarks… You know, I try my best to give you something that’s worth reading each day, but there are times when the news cupboard is dry… But I carry on despite this lack of fodder…
Like this morning… There’s nothing but talk about the BIG DEBATE tonight… It’ll be a dud, I’m just telling you now, so maybe you’ll listen to me later… There was a headline on Bloomberg.com this morning that shook me to the bone… Let’s see how it hits you: “Blinken Says Russia Has Received Ballistic Missiles From Iran”… The reason that got to me was it reminded me of the Weapons of Mass Destruction warnings… And how it got us into a war that we couldn’t win, and lost and maimed many a soldier… This whole Middle East saber rattling is really beginning to sound familiar isn’t it? Or, is it just me? I’ll stop here with this here, and ask just one question: Got Gold?
The U.S. Data Cupboard this morning doesn’t have anything for us… a great big dud… a firework that doesn’t light… A Broadway dud… and so on… But yesterday, the Gov’t tried to sneak a report past us… Consumer Credit for August (read debt)… this from Zerohedge.com “One month ago, when multiple discount retailers (here and here) were lamenting the sudden collapse in U.S. consumer purchasing power, we observed the reason this unexpected hit to U.S. consumption: as the U.S. personal savings rate had collapsed, the growth in consumer credit was slowing, and in July, credit card debt growth posted its first decline since the covid crash, just in time for another month of record high credit card rates.
But fast forwarding just one month later, when in a stunning reversal, July consumer credit growth unexpectedly reversed the dramatic June slowdown, and soared more than $25 billion, to a new record high of $5.093 trillion.”
Chuck again.. Uh-oh! I guess to make sure we’ve come to tapped out consumers, we’ll have to wait-n-see next months’ report here to see if there was any follow up, or the balances got paid down…
To recap… The dollar buying ended yesterday, but there was no selling attached… Chuck believes that the markets have gone into a let’s drift on the sea for a couple of days, until the STUPID CPI prints on Thursday… The news stories are all about the GREAT DEBATE tonight, which Chuck thinks will be a dud…. Consumers are racking up the debt on their credit cards again… And Chuck points to a scary reminder of days past…
For What It’s Worth… Ok, I teased you a bit above this morning about the FWIW article today… This is an article that features Peter Boockvar and his thoughts on Janet Yellen, which just so happen to be aligned with my thoughts on Janet Yellen… And this can be found here: Yellen sees ‘no red warning lights” for U.S economy, but Fed’s rate cuts could backfire – Peter Boockvar | Kitco News
Or, here’s your snippet: ” Recent economic data has raised questions about Treasury Secretary Janet Yellen’s optimistic view of the U.S. economy. While Yellen recently stated at the Texas Tribune Festival that she doesn’t see any “red lights flashing,” revisions to the August jobs report showed just 142,000 new jobs, and underemployment has climbed to 7.9%. The retail and manufacturing sectors are also shedding jobs, contributing to a more mixed economic picture than Yellen’s words suggest.
In a conversation with Jeremy Szafron, Anchor at Kitco News, Peter Boockvar, Chief Investment Officer at Bleakley Financial Group, offered a more cautious perspective. “You can be in a full-blown hurricane, and the Treasury secretary will say, ‘The weather looks great,’” Boockvar said, underscoring his concern that the government may not be acknowledging all the risks. He also questioned the upcoming Federal Reserve rate cuts, saying, “The market assumes the Fed can just cut rates and everything will be fine, but I don’t think it’s going to be that easy.”
As the Federal Reserve’s September meeting approaches, markets are anticipating a significant decision on interest rates. While the consensus leans toward a 25 basis point cut, some speculate the Fed may opt for 50 basis points, depending on incoming data. Inflation figures, including the CPI and PPI due this week, could influence the final decision. Boockvar suggested that while inflation may be moderating, aggressive rate cuts could have unintended consequences for the broader economy.”
Chuck again… Nothing more to add here… except on the link above you can watch an interview with Peter, that I think would behoove the astute reader to watch… He gets into the rate cuts, and so on…
Market Prices 9/10/2024: American Style: A$ .6664, kiwi .6155, C$ .7367, euro 1.1027, sterling 1.3087, Swiss $1.1795, European Style: rand 17.9021, krone 10.7939, SEK 10.3705, forint 360.38, zloty 3.8843, koruna 22.7253, RUB 91.16, yen 143.20, sing 1.3063, HKD 7.7968, INR 83.97, China 7.1188, peso 19.90, BRL 5.5845, BBDXY 1,235.70, Dollar Index 101.65, Oil $67.74, 10-year 3.70%, Silver $28.45, Platinum $948.00, Palladium $967.00, Copper $4.12, and Gold… $2,504.70
That’s it for today… A much better night of sleep last night for yours truly… Thank you for putting up with my whining, and complaining about my health… I don’t mean to be a drag on your day… But I feel like I’m aging quickly, and when I get with people the conversation immediately goes to how I’m feeling these days… I guess that’s better than talking about what I wrote about that day! My beloved Cardinals attempt to play out the year, and get back to that job tonight… And my other beloved team, my Mizzou Tigers are the number 6 team in the country this week… That’s a lofty rating, and the highest they’ve been since the year Chase Daniel led them to # 1 in the country! That only lasted a week, but we could still shout: “We’re number 1, We’re number 1”! Jr. Walker and the All Stars take us to the finish line today with their song: Shotgun…. I was always a big Jr. Walker and his band, fan, back in the 60’s… Seems like a very long time ago now… UGH! I hope you have a Tom Terrific Tuesday today, and please Be Good To Yourself!
Chuck Butler