Author: admin

March 26, 2019 

* Currencies remain stuck in the mud… 

* Gold gains yesterday and gives back its gains today… UGH! 

Good Day.. And a Tom Terrific Tuesday to you! Well, day one back in the saddle was OK, but getting up this morning was another story! I might as well, have rolled over and gone back to sleep, for there isn’t, once again, much movement in the currencies or metals… UGH! It was a quiet day here now that two of my grandkids have gone home… I honestly don’t know where the day went, and I questioned myself when I went around to turn off the lights last night! But… It happens! I did get to speak to my good friend, the Retirementor, Dennis Miller, yesterday. We were putting our heads together for another interview… Should be a good one! Neil Young greets me this morning with his song: Southern Man…

So… How’s your NCAA Basketball Bracket? I’m OK, so far, hanging tough, but sure wish I hadn’t taken our St. Louis University Billikens in the first round! Loyalty will get you nowhere! HA! I’m the only one in our family bracket contest that picked Michigan St. to win it all… So… Go Spartans!

OK, so like I mentioned above, yesterday was a non-trading event day once again… You know how a bull paws at the ground, and stands in one place while it is thinking about its charge? That’s how I view the currencies and metals right now… What will be the cause of the change of sentiment among traders? Well, if the Fed changing horses in the middle of the stream didn’t change their sentiment toward the dollar, I’m not sure I know what will! But there will be a plethora of candidates that will attempt to unseat the dollar’s hold on trader sentiment… And one of them just might be bad data from the U.S….. Sure we’ve seen our share of weaker data around the world, but that doesn’t matter, given the dollar’s use around the world… it’s all about the U.S. folks… And that’s where I think the dollar will find a dark alley soon…   

Gold found a way to add $8 to its price yesterday, but in the early trading this morning nearly all of that $8 gains has been given back! UGH! Up one day, wiped out the next… reminds me of a Frank Sinatra song… Riding high in April, shot down in May…   I think of this prolonged time of sitting here waiting for an upward move, as opportunity…  For those out there that have procrastinated and put off buying Gold… 

Well, can we all just get along now? The Mueller Report has been filed, and it only costs taxpayers $25 Million! Hey that sounds cheap, doesn’t it? What a waste of money, time, effort, etc. now could we just all get along now? And that’s all I have to say about that, for this is not a discussion on politics!

While the U.S. media has been all tied up in knots waiting for the Mueller Report, China has been making moves that are very reminiscent of a time a about a decade ago, when China was going around signing nation after nation to a currency swap agreement… first it was reported that China had gotten Italy to join in the one Belt plan… But then this was also reported to have been done by the Chinese in the past few days… Reuters reports that “France signed 15 business contracts with China worth billions of euros on Monday, including a 300-plane order with Airbus and a 1 billion euro contract for EDF to build an offshore wind farm in China.”

• The Airbus order “was the most lucrative of the deals unveiled in Paris, with a French presidency official saying it was worth about 30 billion euros ($33.94 billion).”

• “France’s Fives and China National Building Materials Group signed a 1 billion euro ($1.13 billion) deal to cooperate on energy savings in developing countries, [and] shipping line CMA CGM and China State Shipbuilding Corporation signed a 1.2 billion euro ($1.36 billion) deal to build 10 container ships.”

• French poultry exports are welcome in China again: An embargo imposed that followed bird flu outbreaks in France was lifted.

Chuck Again… China isn’t wasting any time finding new trade partners to help smooth out the bumps in the road caused by the U.S. and their Trade Wars… Speaking of such, the Trade War Talks have gone nowhere… They have until the end of March to agree to something or the next round of tariffs begin… I doubt that there will be any Midnight agreements here… So, we can expect more Trade problems going forward… In my humble opinion that is…

Ok… the euro is trading in the same clothes as yesterday morning, but still above 1.13… Most of the currencies can’t find a bid with both hands… The Aussie dollar (A$) and kiwi have moved higher and into levels that they’ve reached before, but have been slapped back…  As I explained yesterday, I doubt this continues much longer… But a wise man on a bond trading desk told me years ago… The markets can remain irrational longer than you can stay solvent… Meaning that Mr. Market will decide when to pull the rug from under the dollar, and not me, or anyone else!

So, I mention above that I spoke to Dennis Miller yesterday. He had sent me an article to read, and highlighted a paragraph from the Credit Bulletin that he thought I would take interest in, since they mention my economics hero, Hy Minsky… Let’s listen in to what the writer of the Credit Bulletin had to say…

“March 17 – Financial Times (Rana Foroohar): “Hyman Minsky would have had a field day with last week’s US inflation numbers. One of the key points in the late, great economist’s Financial Instability Hypothesis was that there are two kinds of prices — prices for goods and services, and asset prices. Inflation in the two areas should, as a result, differ. And indeed they have, quite markedly. The latest Consumer Price Index figures show that almost all core inflation, which was weaker than expected, was in rent or the owner’s equivalent of rent (up 0.3%). Core goods inflation, meanwhile, was down 0.2%. Very simply, this means that the housing market is once again completely out of sync with the rest of the economy. A decade on from the subprime bubble, housing… is the only major component of the CPI with a national inflation rate that is consistently above the overall number.” – Credit Bulletin… 

The U.S. Data Cupboard comes back on board today with some housing data, including the Case/Shiller Home Price Index for January… This data has shown home prices sliding in recent prints, so it will be interesting to see if that trend continues… In addition, we’ll also see the stupid Consumer Confidence Index…  Lemmings being led to a cliff, if you ask me… 

Before I head to the Big Finish today, this came to me last night and says a lot, folks… says a lot…   All around the world…. Bonds will be bonds… It’s the same ol’, same old situation… Ah, nothing like changing some lyrics to make the song work with what you’re going to talk about, eh? I thankthe members of Motley Crue… OK… I was minding my own business when I received an email from Twitter telling me there was something I needed to see… And sure shootin’ there was! This was taken from Eric Pomboy’s twitter feed… “Market Value of Global Negative Yielding Bonds rises $421bln today to $10.07 trillion. TEN TRILLION.

To recap…  Another day of little to no movements in currencies. Gold found a way to gain $8 but has given it right back early this morning. Day by day, bond markets all over the world are telling investors the same thing… That things are going to get rough for economies all over the world, but most importantly, here in the U.S.  The A$ and kiwi found a way to move higher, but for how long?  Questions all around… 

For What It’s Worth…  Well, FWIW articles are slow these days too! But today I have something that’s worth reading… It’s an article about how the Germany is defying demands made by the U.S. and it can be found here: https://sputniknews.com/columnists/201903211073433025-nato-us-germany-rift/?

Or, here’s your snippet: “This is going to get very ugly. Germany is openly defying U.S. President Trump’s demands to spend more on its NATO budget. Already the American ambassador to the country, Richard Grenell, is crying foul, prompting German calls for his expulsion.

Of all the countries in the European Union, it is Germany that’s been mostly on the receiving end of Trump’s wrath since he entered the White House. In two years, the bilateral relation between Washington and Berlin has plummeted under the weight of Trump’s withering verbal attacks.

The American president has assailed Germany for unfair trading practices over its lucrative auto exports; and he has virtually accused Berlin of treason in its dealings with Russia for natural gas supply, threatening to slap economic sanctions on German firms over the Nord Stream 2 pipeline project under the Baltic Sea.

Grenell’s condemnations this week regarding Germany’s military budget have again sparked furor among the country’s politicians and media, eliciting further public calls for the envoy to be expelled owing to his alleged gross interference in Berlin’s internal affairs. “An ambassador is not supposed to act like the spokesman of an occupying power,” said Wolfgang Kubicki, the deputy leader of the Free Democrat Party.

The New York Times this week reported “the timing couldn’t be worse” for U.S.-German relations. Next month marks the 70th anniversary of the founding of the NATO alliance. A major celebration is due to take place in Washington D.C. for the occasion. The atmosphere will be severely chilled by Germany’s truculent defiance of Trump to boost its commitment to NATO.”

Chuck Again… when did not obeying what the U.S. demands become vogue? Interesting article I must say… 

Currencies today 3/26/19 American Style: A$.7130, kiwi .6903, C$ .7467, euro 1.1320, sterling 1.3230, Swiss $1.0068, European Style: rand 14.3744, krone 8.5190, SEK 9.2233, forint 278.80, zloty 3.7920, koruna 22.7585, RUB 64.30, yen 110.37, sing 1.3502, HKD 7.8494, INR 68.90, China 6.7096, peso 19.00, BRL 3.8866, Dollar Index 96.49, Oil $59.58, 10-year 2.44%, Silver $15.46, Platinum 852.23, Palladium $1.566.64, and Gold… $1,314.61

That’s it for today… The sunrise was beautiful this morning, and it should be a good warm day here, before the next cold front comes through tonight… I laugh at the weather people down here, they make it sound like the temps are going to go to zero, “as a cold front moves through, and we get chillier temperatures”…  Yeah, instead of 82 it’ll be 76…   funny, eh? Our Blues won their 4th game in a row last night… this past Saturday night they beat the Tampa Bay Lightening (the best team in hockey) There aren’t many games left in the regular season, before the playoffs start… This team has gone from being really bad early in the season to a well oiled machine now… fingers crossed! Go Blues!   A Flock of Seagulls takes us to the finish line today with their song: Space Age Love Song…  I hope you have a Tom Terrific Tuesday, and will Be Good To Yourself!

Chuck Butler

 

March 25, 2019 

* Currencies & Metals continue to be stuck in the mud… 

* Federal Budget hits a record deficit! 

 

Good Day… And a Marvelous Monday to you! Front and center this morning, I want to say thank you to all who sent along birthday wishes to me last week… I had a grand day, and ate like a king that night, along with some of my family. I paid for it, when I stepped on the scale the next day! HA! Well, all the March guests have gone now, and it’s just the two of us here, where we seem to bump into each other all the time… UGH! We saw some beautiful moon rises last week, as the last Super Moon of 2019, appeared in the sky… When you’re on the ocean like I am, the moon seems to come up out of the ocean, it’s all pretty cool… Chicago greets me this morning with their song: In The Country… Some of my fave guitarist, Terry Kath’s, greatest work…

Well, I left you last week with the euro trading around 1.1350, and this morning it’s trading around 1.1322… So, not much to talk about still (regarding currency movement) … But there have been some things going on in the world that do need to be addressed, so I’m here, reporting for duty!

First and foremost was the Fed’s FOMC meeting that concluded last Wednesday afternoon, with the Fed backing off their outrageous previous comments about the economy being strong and robust, and decided to take the dovish road…  The Fed has basically changed horses in the middle of a stream!  (I was always told that that was a  very bad idea!) They basically jettisoned their plans for more rate hikes this year, and yet the dollar didn’t budge… Wait! What? That’s right, the dollar stood in place like a Buckingham Palace Guard… So, let me get this straight… The dollar began its rally because the Fed was hiking rates, while most of the world was stuck in the mud with rates near zero, and now that the Fed has stopped hiking them, and is basically looking at cutting them should the economy warrant it (and it does, but no one but me seems to think that right now), the dollar doesn’t get sold? I guess it just shows me that the dollar is the king, and no amount of chinks in the armor can hurt it…

Well, we’ll see about that… I’m just saying, because, bad things are coming, folks… The Treasury Yield Curve inverted last week… That means that long term rates fell below the shorter term rates… And this, historically, has been a keen indicator that a recession is on its way… I don’t make this stuff up folks… It’s all there in the history books on recessions… And this recession could very well be the end of the line for the Credit guys… It won’t be pretty… We have never had this much debt, we have never had this much Corporate Debt leveraged, we have never had this many derivatives that no one knows what happens when they collapse, and we have never had a Central Banks that is bumbling, fumbling, stumbling along and making all the wrong moves…

I must warn you that when the curtain falls on the economy, that at first, Gold will get caught up in the selling because, just like in 2007, when the dark clouds began to appear, investors sold whatever they had that had a profit to offset their margin calls, or just keep the debt collectors at the door… But when all the dust settles, you’ll want to back up the truck to the Gold window… I’m just saying.

Did you hear that the Federal Budget Deficit hit a record? The Treasury Department said Friday in its monthly report that the deficit hit an all-time high for February of $234 Billion. That surpasses the old February deficit record of $232 Billion set in 2012, the last year the deficit for the year topped $1 Trillion!

It’s time that everyone gives up and realizes that I was correct when I told you last year that the Tax Cuts wouldn’t do anything but raise the deficit, for Corporations wouldn’t use the tax cuts to invest in their businesses, but use them for stock buybacks instead… And that’s exactly what has happened, and now we don’t have the Corporations with good futures, and a Treasury Dept, that is lacking tax receipts!

And then add to that… The cost to finance that debt… Interest rates being higher as they are, are adding to the Deficit spending in a Big Way folks… I read last week that the amount we spent in 2018 was greater than in any other previous year… I’ve got a great piece on this from the Peterson Foundation in the FWIW section today, so I’ll leave this here…

Before you head to the currency roundup today, let me tell you that the yield on the 10-year Treasury is correct… I say that because I know some of you would be questioning it, as it has tumbled down to 2.47%…  Bond guys get it… The Fed’s dovish stance that is… The get it, and that’s why bonds have rallied like a banshee…   I guess that’s where I get my attitude here, as I was a bond buy, many year ago…  But back then, I was a foreign bond trader, so I had to understand and know the economies of dozens of countries at the same time…  Boy, I guess I used to be smart, eh?  HA!

But seriously here, we need to take this drop in the 10-year’s yield seriously, and begin to prepare for some read rotten eggs coming from the economy, soon…  And that’s all I’ll say about that! 

Around the world last week, we had the BREXIT talks get an extension, but I think this is like a stay of execution… To leave the EU is like Hotel California… You can check out but you can never leave… And UK PM May is going to take a beating from voters who voted to leave, but never was explained to back then what it would take to leave the EU… Maybe if it were explained back then, the vote would have been different? Anyhow, pound sterling continues to be the whipping boy for these talks…

The U.S. / China Trade Talks are still going nowhere… But I did see that President Trump decided to drop some of the sanctions against N. Korea in hopes to get what he wants from them… (Denuclearization)… Negotiations are far better than sanctions, and wars…

In New Zealand last week, the last quarter’s GDP got a bump when consumers went on a spending spree… I don’t want to think that this was like a star that’s getting ready to burn out, but I have to because what’s good for the goose is good for the gander, right? Anyway… the Reserve Bank of New Zealand (RBNZ) meets this week, and I’m still angry with them for their misleading last year, and they won’t do anything to correct it this week either, so look for kiwi’s recent rise to take a bit of hit when the RBNZ sounds all Eeyore when they meet…

Oh! And one more thing about the Fed that needs to be said…  The Fed has adopted  a very dovish tone, the central bank’s new “dot plot” showed no increases in interest rates this year and only one in 2020, down from a total of four rate hikes in the Fed’s last forecast in December.

So, from December to March, 3 months, if you will, the Fed Heads have gone from “strong and robust” to their current stance of dovish tones… That’s how fast the worm can turn on you when you’re not paying attention to the weeds in the garden…  And they haven’t been paying attention to the weeds in the garden… I have.. David Rosenberg has… Bill Bonner has… and others, but none of us have any pull with the Fed Heads…  I’m just saying… 

The U.S. Data Cupboard is emptied out today, but will be back tomorrow with goodies to eat up…  Late last week, we saw the Markit Manufacturing Index (PMI) here in the U.S. fall to the lowest level it’s been in a month of Sundays… (52.5)  The index number is still above 50, which is good, but the direction of the number is falling, and that’s bad…  

Did you hear that President Trump nominated a new person to the Fed’s Board of Governors?  And it’s “one his guys”…   At least he is now… But there’s something in the water at the Eccles Building, because horses change color when they go there to work… Greenspan, for example was a Gold Bug before, and after, but not during his time as Fed Chairman…  And I’m certain that current Fed Chairman Jerome Powell, was what Trump thought was “his guy” when he was given the top job at the Fed…   

Well, all this talk and no mention of Gold… Hmmm…  I wonder what’s up wit that, eh?   HA!  Well, Gold hasn’t had its breakout upward move yet, so what’s there to talk about?  I did have a dear reader ask me last week if I thought Platinum would soon replace Palladium in cars, just as Palladium once replaced Platinum?  Cost of the metal being the main reason for the changes… Well, maybe… and today could be the start of that, as Platinum is up $8, while Palladium is down $13 this morning… Hmmm…  Good question! 

To recap…  Nothing much has changed since last Wednesday, when Chuck threw in the towel on the week for none movements in currencies and metals, Trade Talks and BREXIT Deals…  Well, he’s baaaaaaacccckkk, but still there’s not much movement going on, and it surprises Chuck, given the Fed’s changing their dot chart, and their position on the economy… 

For What It’s Worth… Well this is the piece that I teased you with earlier… it explains in black and white, how the spending on financing the deficit is going to begin to hurt the economy, and it can be found here: https://www.pgpf.org/blog/2018/11/we-will-soon-be-spending-more-on-national-debt-interest-than-on-these-vital-programs

Or, here’s your snippet: “Programs that millions of Americans depend on and care about may be feeling a squeeze from interest costs on our high and rising national debt.

In fiscal year 2018, the federal government already spent more on interest than it did on budget areas such as veterans’ benefits, transportation, and administration of justice.

But over the next few years, spending on interest will exceed spending on a number of additional major categories:
• In fiscal year 2019, interest will be greater than the amount spent on income security — a category that includes programs such as the Supplemental Nutrition Assistance Program, Supplemental Security Income, and unemployment compensation.

• In fiscal year 2020, interest payments will exceed the amount that the federal government spends on children, according to projections from the Urban Institute.

• In fiscal year 2021, interest will surpass the combined amount spent on Medicaid, the Children’s Health Insurance Program, and subsidies for the purchase of health insurance under the Affordable Care Act.”

Chuck again… The article goes further with more explanation, so if you do have time I think it would be prudent to visit the article in its entirety… 

Currencies today 3/25/19 American Style: A$.7096, kiwi .6883, C$ .7458, euro 1.1320, sterling 1.3172, Swiss $1.0064, European Style: rand 14.4097, krone 8.5234, SEK 9.2162,  forint 279.75, zloty 3.7955,  koruna 22.7311, RUB 64.63, yen 110.22, sing 1.3509, HKD 7.8479, INR 68.95, China 6.7163, peso 19.07, BRL 3.9041, Dollar Index 96.51, Oil $59.01, 10-year 2.47%, Silver $15.51, Platinum $853.46, Palladium $1,539.52, and Gold… $1,318.29

That’s it for today… Good to be back in saddle, but I do have to say that when I don’t write, I lose track of the days…  Well, my beloved Cardinals ended Spring Training with a win in the 9th inning yesterday. Opening Day is this Thursday… A day that should be a National Holiday, in my opinion!  I get a bit sad at the end of Spring Training each year, for I know that I’ve seen 15 games in 30 days, and probably won’t see, in person that is, many more this year…  I love Roger Dean Stadium as it’s easy for me to get in, sit down, and easy to get out…  At my age, and my abilities, ease of use is a major deal to me!  OK, so I celebrated another birthday last week… Another notch in the belt since 2007, is all that’s on my mind when my birthday comes around…   Fleetwood Mac takes us to the finish line today with their song: Say You Love Me…   I hope you have a Marvelous Monday, and continue to Be Good To Yourself! 

Chuck Butler

 

March 20, 2019 

* Currencies and metals didn’t move much on Tuesday… 

* What does currencies should we be looking to buy? 

 

Good Day… and a Wonderful Wednesday to you! Well, I told you yesterday that if things didn’t change in the “not much has happened or going on” scenario, that I would pack up and take a mini-vacation, in hopes that this all changes while I’m gone… Well, here I am, and things really didn’t change much yesterday… I’ll run through it, very quickly, and then head out for the week! The Outlaws greet me this morning with their song: There Goes Another Love Song…

Well, the deluge of rain came as advertised yesterday, and last night… It just didn’t stop! I hear it’s supposed to stop this morning, which would be fine with me, for I have tickets to the Cardinals & Marlins game today at 1:05… And tomorrow, is the day that most of the Cardinals fans that attend these spring trainging games have been waiting for… The Yankees come to Roger Dean… I sure hope they bring their A Team…

So, here we go again… There wasn’t much movement in the currencies yesterday… for those of you keeping score at home, the Dollar Index was 96.39 yesterday morning and when I checked it last night it was 96.45… The price of Oil slipped below $59 and Gold couldn’t find a bid all day… My good friend, the Retirementor, Dennis Miller, is sending out his letter tomorrow, to his subscribers, an interview with a man that I know, by the name of Rob Vrijhof, managing partner of Weber Hartmann Vrijhof & Partners Ltd., Swiss international asset managers. And while I don’t want to steal Dennis’ thunder tomorrow when his letter goes out, I will steal something that Rob had to say about currencies that I agree with wholeheartedly…

He talks about currencies that his firm is investing in and tracking… I won’t give away the store here, so you need to go to www.milleronthemoney.com and sign up to see what Rob had to say… I’ll give you one as a tease… He likes the Russian ruble… Man, where have I heard that before? HA! 

Well, Gold couldn’t get out of its own way yesterday but did manage to close up $2 bucks and change, but has given that right back and more in the early trading today…  The Big mover yesterday was Palladium, again, as it hit a new high of $1,571… And in the early trading today it’s up another $7… and at one point overnight it hit $1,600, according to Bloomberg…  Crazy pricing in Palladium folks, and as I’ve told you, they say it’s all due to a shortage of the metal…   

The U.S. Data Cupboard had January Factory Orders on a delayed basis print yesterday, and it was just like 99% of the other pieces of data that we’ve tracked… It fell way short of expectations, coming in at only 0.1%, instead of 0.4%… All in all it’s just another brick in the wall…

Just a friendly neighborhood spiderman reminder, that the Fed’s FOMC meets this afternoon… I don’t think they’ll do anything rash, but they could say things that get the markets moving…

And in place of a FWIW article today I have a quote from famous economist, David Rosenberg, from his Twitter account… Take it away Rosey!

“The bulls like to use Dec. 24 as the starting point on how right they’ve been without realizing that since the first peak above 2,800 in Jan. ’18, the SPX has generated a total return of 1%; the return on the 10-year note is 4%. In the land of low returns, bonds are still king!”

Currencies today 3/20/19… American Style: A$.7091, kiwi .6844, C$ .7560, euro 1.1351, sterling 1.3230, Swiss $1.0008, European Style: rand 14.5168, krone 8.5376, SEL 9.1885, forint 275.45, zloty 3.7760, koruna 22.5898, RUB 64.35, yen 111.55, sing 1.3507, HKD 7.8498, INR 68.80, China 6.7107, peso 19.02, BRL 3.7853, Dollar Index 96.44, Oil $58.83, 10-year 2.60%, Silver $15.30, Platinum $861.83, Palladium $1,600.71, and Gold… $1,303.03

That’s it for today, tomorrow and this week…  And I’m not going to apologize for the stoppage this week, as there’s just not enough going on that 1. I haven’t already covered like a cheap suit, and 2. You don’t want to read the same thing every day…  I’m waiting for the sunrise this morning, in hopes that it’s not too cloudy out to see it… (it’s way too dark now to tell) Well, Friday this week is my birthday… I used to not get all excited as a school girl about my birthday… but since I was diagnosed with Stage 4 metastatic cancer in 2007, I get somewhat happy on my Birthday, for it’s another year I’ve beaten this awful disease…  So, Happy Birthday to me on Friday…  And with that, Triumph takes us to the finish line today with their song: Fight The Good Fight…   Which is exactly what I’ve done for 12 years! I hope you have a Wonderful Wednesday, and rest of the week, and please Be Good To Yourself!

Chuck Butler

March 19, 2019

* currencies fail to add to gains from Friday

* I guess now, All Central Banks are turning dovish?

 

Good Day… And a Tom Terrific Tuesday to you! The Cyrkle sang it best all those years ago, when they sang… It’s a turn down day… For those of you who’ve never heard of the Cyrkle, they were the warm up band for the Beatles! My Beloved Cardinals finally found their bats yesterday VS the Phillies, but it still wasn’t an awesome offensive display! But a 4-1 win is a win… The long awaited deluge of rain has finally arrived in S. Florida, and I’m glad there isn’t a game today for me to go sit in the rain and then have it called off! Delaney Grace surprised everyone yesterday, when we heard the rain in the forecast, Daughter Dawn asked what we did when the day is washed out by rain, and I replied, “well, your mom goes shopping”… And Delaney spoke up and said quizzically: “Shopping?” The Fabulous Temptations greet me this morning with their song: Papa Was A Rolling Stone…

Well, our turn down day, applied to the currencies, on Monday, as they failed to add to their gains from Friday and in the overnight markets, and lost a little ground… Not much to talk about but a little ground nonetheless… These aren’t the days of wild moves in the currencies… Instead these are days when if a currency moves more than a quarter, the confetti begins to fall, and ticker tape parade is had! In fact, I’m really getting tired of saying that there wasn’t much movement in the currencies and metals yesterday… I was thinking that I would go on a mini-vacation to get away from the markets and so I wouldn’t have to say, “The currencies and metals didn’t have much movement yesterday, anymore this week!

I’ll play it by ear, but if I sit down at my computer tomorrow night to check on things and they’re still stuck in the mud, then I’m calling it quits for this week! Nobody wants to hear the same thing over and over and over again from me…

Hey! And we can all rest easily now, Goldman, aka Lola, tells their clients that there’s no risk of a recession this year… Thanks for calling me out on that Lola… As I’ve said that most economists believe the recession will come next year, but I have said over and over again, that I believe it will begin this year, and I have until 12/31/19, for that to come true!

We won’t be putting / adding any bricks in the wall today, as the Data Cupboard here in the U.S. is basically emplty, with only Housing starts to print today… I have seen quite a few articles in the past few days that are talking about how all Central Banks, including the Fed, have turned dovish…  Well, now isn’t that just special, as the church lady used to say, back when SNL was funny…  

Our friends at OPEC, NOT! had a special meeting that concluded yesterday, in which the members made public comments about how they were holding true to the production cuts, and that news pushed the Price of Oil to the $59 handle in the past 24 hours!  Next stop is $60… And then the vicious cycle for the price of Oil kicks in again… Or does it?  One has to wonder how long this cycle for the price of Oil can continue?  Well, as long as it takes for the shale oil to dry up, which I’ve read many an article about it doing so, recently…  Hmmm….

When the recession hits the U.S. that would most likely be a bad time for the Oil drillers… As demand for gas in the U.S. would stumble… So, think about that for a minute…  But for now, the price of Oil is on the rally tracks, and that’s a good thing for currencies like the Russian ruble, the Brazilian real, the Canadian dollar / loonie, and others that qualify under the heading of Petrol Currencies… 

Last week, after I had signed off for the week, the U.S. had a very interesting data print, that most people glossed over.. The  NY Fed manufacturing  index slipped to a two-year low in March. Factory output -0.4% in Feb after a 0.5% slide in January.  All three bricks in the wall, but I bet you didn’t see that data reported on your evening or cable news, did you?  

Gold was able to eke out a $1 gain yesterday… That’s it… $1…  not a fiver or a sawbuck, but a $1 gain…  In the early morning trading today, Gold is up $3… not “Palladium type moves” but gains, nonetheless, of which we are grateful for! 

The move that Palladium has been making for months now is something to be awed about… They say that the soaring price is a result of a shortage VS the demand… Now, I’m not doubting that, but what I will say  is that there’s been a shortage in Silver for a couple of years now, and we haven’t seen price moves like Palladium has pulled off!  I’m just saying… 

To recap… I know this is shorter than usual, but there’s just not much to talk about these days… It’s the same old song and dance every morning, of which I’m growing tired of talking about, as you are reading about! The Fed’s FOMC meeting is tomorrow afternoon, so we might not have much to talk about tomorrow either!  UGH! the price of Oil continues to gain and it’s all about the production cuts. And Gold eked out a $1 gain yesterday… 

For What It’s Worth…  Well, I get so focused on the debt here in the U.S. that, at times, I forget what’s going on elsewhere with debt…  This article is about the debt in Japan and it can be found here: https://www.asiatimes.com/2019/03/article/japans-debt-passes-250-of-gdp/

Or, here’s your snippet:Santa Claus territory.” That is how Charles Gave of Gavekal Research views renewed debate about how a concept known as “Modern Monetary Theory” can save capitalism.

There’s nothing modern, of course, about the idea that a government can borrow with abandon in its own currency, unconstrained by deficits. It’s not just that its origins can be traced back 100 years – some argue 1,000. It’s that Japan has been toying with MMT for two decades now.

In 1999, the Bank of Japan became the first major authority in modern history to drive interest rates down to zero. A couple of years later, it pioneered the quantitative-easing that peers from Washington to Frankfurt would eventually adopt.

What’s truly astounding is the docility of bond yields. Try as they may, punters haven’t been able to set Japanese government bond prices in nearly 20 years. That’s because the central bank dominated the bond market.

Japan proves that so long as a government borrows at home, and does so skillfully, the laws of financial gravity lose relevance. Yet it also stands as a cautionary tale for other developed economies scurrying down the MMT rabbit hole.”

Chuck again… Well, I’ve explained this before, but I’ll do it again… The major difference between the debt in Japan and the debt in the U.S. is that most of the debt in the U.S. is financed with the kindness of strangers, while most of Japan’s debt is self financed by the people of Japan… Not that by doing it that way it doesn’t mean debt of 250% of GDP is a good thing, because it’s not! 

Currencies today 3/19/19 American Style: A$.7098, kiwi .6860, C$ .7536, euro 1.1352, sterling 1.3270, Swiss $1.0002, European Style: rand 14.3725, krone 8.5436, SEK 9.2270, forint 276.25, zloty 3.7812, koruna 22.5520, RUB 64.50, yen 111.30, sing 1.3567, HKD 7.8497, INR 68.89, China 6.7103, peso 19.04, BRL 3.8073, Dollar Index 96.39, Oil $59.22, 10-year 2.60%, Silver $15.38, Platinum $841.32, Palladium $1,593.27, and Gold… $1,306.40

That’s it for today…  We all were tired last night from the game yesterday, and it was a turn down night to go along with our turn down day…  I heard the rain in the middle of the night, so it’s finally here… Now, let’s get it over with so the sun can come back out! I’m hobbling along these days with plantar fasciitis that will be taken care of starting today…  Jerry and I were walking yesterday from the ballpark, and he asked me if I was OK, and I said, sure, I’m in pain, but I’ve dealt with pain every day of my adult life, so carry one… And on that fine note…  Cat Stevens takes us to the finish line today with his song: If You Want To Sing Out…   I hope you have a Tom Terrific Day, and remember to Be Good To Yourself!

Chuck Butler

 

 

 

March 18, 2019 

* Currencies & Metals begin to climb VS the dollar… 

* BREXIT continues to be in the news… UGH!

Good day… And a Marvelous Monday to you! What a nice weekend here, with rain forecast for us, but it held off for Two baseball games for me. I’ve told you before that my beloved Cardinals can’t hit the ball this year, and yesterday, I witnessed a near no-hitter in spring training! I sure hope they didn’t show that game back home, because they would have lost some fans on the fence for sure! Nary a hit until the top of the ninth! And down here when you lose to the Marlins, well… that’s not a good thing… Of course my wife tells me “it’s only spring training”… But It’s not! You play the way to practice… I’m just saying… 10CC greets me this morning with their song: I’m Not In Love…

Well, Friday wasn’t much to talk about with the currencies, the dollar or Gold… The Data here in the U.S. since we last talked wasn’t not good, but the dollar held its ground… It just doesn’t make sense to me, given that the U.S. data continues to be bad, but the dollar bugs still rule the roost… While I’m talking about data… we had some bad data, first on Thursday with New Home Sales for January coming in lower that what they were in December… Industrial Production wasn’t anywhere close to the expectations for the data, and neither was Capacity Utilization… The only data that was better than expected was the stupid Consumer Confidence report… And as always the people that take the surveys didn’t call me!

Gold lost $13 on Thursday, but was able to gain back $6.80 on Friday…In the overnight markets last night, the dollar did lose a little ground, but remains on terra firma, and Gold has move back above $1,300, but it all lokks shaky to me, I’m just saying… There’s seems to be no conviction to take the dollar lower on traders’ collective minds at this time. 

OK, I’ve told you all before about my background as a bond trader many years ago, and how I was taught even before that time, that I should always pay attention to what the bond guys are telling the markets… So, with that in mind, the yield on the 10-year Treasury has slipped further lower and trades this morning with a 2.59% yield.   What that tells me is that the bond guys are not believers in the U.S. economy, and that they see the Fed cutting rates sooner than later.  I know, I know, now you’re wondering how I got all that out of the slippage in the 10-year’s yield?  It has to do with experience, and brother do I have a ton of that! 

I’ve been around the financial markets since 1973…  that’s more than 45 years folks… Most bond traders these days aren’t even 45 years old!  OK, enough of talking about how old I am…  I have a friend that I’ve met down here, who’s name is Jack, and he was a stock trader at Dean Witter for 35 years, you can just imagine the stories we swap about trading and trade desks and characters we’ve come across through the years!

OK… well Japan isn’t starting 2019 off on a good foot, economics-wise that is… The printed their January Industrial Production data overnight, and it was negative -3.4%.. Yikes! Now that’s going to leave a mark!  That’s what in our future folks… we follow the Japanese, except in one thing… we spend, spend, spend as consumers, while the Japanese save, save, save…  but that’s it, as far as exceptions to the comparisons. 

Tonight the RBA (Reserve Bank of Australia) meets (tomorrow for them). This is going to be a tricky one, in my book, as the RBA last month was very Debbie Downer about things, and this could be their opportunity to do something about their dour mood, like cut rates… I sure hope that it doesn’t come to that, as I’m still concerned with a housing bubble that has existed in Australia for a couple of years now.  This RBA is important and the thoughts of what may come out of it, is what’s been holding the Aussie dollar (A$) from advancing. 

The BREXIT deal is still up in the air, and that fact has knocked the stuffing out of pound sterling, after it had recorded a very strong recovery last week. I read one observers thoughts from Germany, where he said that the BREXIT problems were political not economics…  Now that sure sheds some light on why this divorce can’t get it legs under it!  

So, the week starts out slow for data prints and then gears up as the week goes on. On Wednesday here in the U.S. will be a Fed FOMC day… What comes from that will be very interesting… I’m telling you this now, so you will hear me later… IF the Fed cuts rates or… talks about cutting rates it’s going to be seen as a “We’ve got your back” move for the stock jockeys…  Is that what our Central Bank is supposed to be concerned about? Well, the answer to that is no, but since when haven’t they been? 

Longtime readers know all too well, that I’m no fan of the Fed… And if their existence comes down to the idea that they are there to save stocks, then they’ll be dead to me… so to speak… Useless as a pay toilet in a diarrhea ward!  So, let’s hope it doesn’t come to that, eh?

To recap… The currencies and Gold ended the week, on an uptick, but after suffering through a selloff on Thursday. In the overnight markets last night, there was some positive moves in the currencies and metals, but the moves are quite small at this point.  There may not be a huge amount of data early on in this week, but by Wednesday when the FOMC meets, things will be getting hot and heavy… 

For What It’s Worth… I’ve been telling you about this state and that state that brings up legislature regarding the tax exempt status of Gold and Silver sales, and this article brings it all together and can be found here: https://www.numismaticnews.net/article/update-on-coins-precious-metals-sales-tax-exemptions

Or, here’s your snippet: “As of right now, 37 states have either no state sales taxes at all (Alaska, Delaware, Montana, New Hampshire, and Oregon) or have complete or partial sales tax exemptions on the in-state retail sales of coins and precious metals bullion. That may soon change.

All ten of the most populous states and 17 of the 20 most populous have such exemptions, so that well over 80% of the nation’s residents have such an exemption where they live.
Last Friday, the West Virginia legislature overwhelmingly passed a coins and precious metals sales tax exemption (33-0 in the Senate and 90-9 in the House). It now awaits the governor’s signature to take effect on July 1.

A legislative committee in Tennessee has already passed a similar exemption bill. On March 13, the first legislative committee in Arkansas considered such legislation. There have also been coins and precious metals exemption bills introduced in the legislatures in Kansas, Maine, and Wisconsin.

Because of my past career as a certified public accountant and in leading Michigan’s effort to gain a coin and precious metals sales tax exemption in 1999, I have been heavily involved in such exemption efforts. After Michigan adopted its exemption, I later documented that the Michigan Treasury actually experienced an increase in total sales tax collections and also in other tax collections. This research, in conjunction with the Industry Council for Tangible Assets, has been used to subsequently help gain similar sales tax exemptions in the states of Alabama, Indiana, Iowa, Minnesota, Nebraska, North Carolina, Oklahoma, Ohio, Pennsylvania, South Carolina, and Virginia and to expand an existing exemption in Texas and Louisiana (and to help reinstate Louisiana’s exemption after it was suspended in 2016).”

Chuck again…  it looks as though the momentum is really gaining steam here folks, and now you should write or call your congressman or woman and tell them how you feel about this! 

Currencies today 3/18/19 American Style: A$ .7111, kiwi .6869, C$ .7536, euro 1.1358, sterling 1.3271, Swiss $1.0003, European Style: rand 14.4060, krone 8.5155, SEK 9.2133, forint 276.69, zloty 3.7838,  koruna 22.5745, RUB 64.78, yen 111.48, sing 1.3510, HKD 7.8487, INR 68.53, China 6.7124, peso 19.16, BRL 3.8127, Dollar Index 96.39, Oil $58.37, 10-year 2.59%, Silver $15.37, Platinum $835.67, Palladium $1,560.17, and Gold… $1,305.78

That’s it for today… Did you have a fun St. Patrick’s Day  yesterday? Have any green beer? Back home in St. Louis, there’s always 3 parades on St. Patrick’s day… And in Chicago they dye the river green!  We’re all Irish on St. Patrick’s Day aren’t we?  Tradition calls for us to go to a local restaurant here, and have corned beef and cabbage on StPD…  And so that’s what we did last night! My favorite little girl, Delaney Grace, is here and brightening up my life for a week… I just love here to pieces!  Everett is an early riser like me, and instead of getting up and writing a letter, he gets up and plays his video games until everyone else wakes up! Good Boy!  Today marks two days in a row that it was too cloudy to see the sunrise… UGH! Kansas takes up to the finish line today with their song: The Wall… and with that, it’s time to say I hope you have a Marvelous Monday, and remember to Be Good To Yourself!

Chuck Butler

March 14, 2019 

* Currencies & metals see Wednesday’s gains wiped out

* China slows down, as Trade War bears weight on their economy… 

Good Day… And a Tub Thumpin’ Thursday to you! A very restful day yesterday, as I did a lot of reading, and mixed in some research on the economies… Through the years, I’ve changed my focus quite a bit, in that, when I first began to write the Pfennig, I rarely talked about the U.S. economy, and the Fed, choosing to focus, instead, on foreign Central Banks and economies. But when more than a dozen European Central Banks became a thing of the past, and the debt of the U.S. began to grow by leaps and bounds,  I eventually, over time, that is, changed my focus to the U.S. because the U.S. economy dictates what the rest of the world does… So, if a foreign currency was going to gain VS the dollar, the U.S. economy had to be doing badly… I have no idea why I just went through that, I just began typing, and well… here we are! The 80-‘s band A-ha greets me this morning with their song: Take Me On… (that should get my good friend Rick all lathered up to start his day!)

Poor Boeing, eh? Their 737’s getting grounded all over the world… Better that than to have any more aircraft problems…

The euro continued to climb VS the dollar yesterday, and moved higher into the 1.13 handle once again. The Aussie dollar (A$) is within spittin’ distance of 71-cents, and the price of Oil moved higher to a $58 handle in the past 24 hours. I have to ask the question here… What have the Currency traders been waiting for? The U.S. data prints continue to point to a turn over of the U.S. economic 10-year recovery… Yesterday’s data didn’t come in as weak as I thought it would with small gains in both Durable and Capital Goods Orders… I’m going to question this report, for its accuracy, given that last month was weak, and now this month, it’s strong? Give me a break!

But in the overnight markets, all the good ground the currencies gained on Wednesday was given back, and quite frankly, I can’t see what caused the overnight markets to reverse Wednesday’s gains…  Sure the Trade War talks have been delayed again, and in Britain, there’s another vote on the BREXIT deal that most likely won’t be good for the divorcees… But I just don’t see these things as “new items” that would cause a knee jerk reaction by traders…  So… I’m befuddled… 

Earlier today, in China, we saw a few data prints that have given credence to the global slowdown folks, as Industrial Production and Retail Sales Retail Sales showed no growth from the previous print, and Industrial Production slipped…  So, the evidence in the data is that things are slowing down in China, probably not as badly as they are in the U.S. but slowing down, for sure. 

I don’t mean to slap myself on the back, but back when the Trade War began, I told you, dear Readers, that there would be no winners of the Trade War, unlike shooting wars… I also told you the history of the Smoot-Hawley tariffs may have not be the cause of the Great Depression, but they were at the scene of the crime… And with that, I basically said that the Trade War would accelerate the recession’s arrival to the U.S. And the other day I highlighted the Atlanta Fed’s forecast of just .2% growth for the U.S. economy in 2019… Uh-oh! From there, it’s just a rounding error, that could put us in the negative growth arena…

My good friend, the Retirementor, Dennis Miller of www.milleronthemoney.com sent me a note yesterday giving me a heads up that a future article of his will be feature Corporate bonds, and junk bonds. I can’t wait for this article to hit my email box!  I’ve been harping about Corporate bonds and their leveraged bonds for some time now, so it will be good to get another person’s viewpoint of this mess…  A couple of weeks ago, Dennis interviewed me on the Fed… if you missed that, you should go to the website link above and find it… I don’t hold back any punches… 

Well, Gold found a way to add to its price yesterday without interference from the paper trades…  But, heaven’s to Murgatroid what the heck is happening early this morning? Gold is getting sold and is down nearly $11 in the early trading, so just like the currencies, Gold can’t hold its gains from yesterday either.  Now, a simpleton would just shrug their shoulders and walk away thinking that everything is as it should be, because that’s what the market does…  But then there’s me… And I smell a rat… 

Remember that phrase? I smell a rat? I’m guessing I can still use that one, as the PC police haven’t got around to pointing out how that’s insensitive to rats!  So, what’s the rat I’m smelling?  I’m thinking that’s it’s the work of the Plunge Protection Team (PPT) once again…  In one fell swoop, both currencies and Gold got whacked and lost their respective gains from the day before… It’s not a co-ink-e-dink here, for I have a difficult time believing co-ink-e-dinks…  There’s always something behind moves like this, that appear to be coordinated takedowns… I’m just saying… 

The U.S. Data Cupboard has the latest New Home Sales for us today, and maybe some others that have been delayed, we’ll have to see if Feb Retail Sales makes the cut of data reports getting printed today…   

To recap… The currencies all rallied along with Gold on Wednesday, and then both saw their gains from Wednesday wiped out in the overnight markets. Chuck can’t make sense of the selloff overnight, so he smells a rat… The Trade War talks are being delayed again, and there’s another vote on the BREXIT stuff today… But that’s all old news… 

For What It’s Worth…  Well, for months we waited to hear about China’s Gold additions and received nothing, but then 3 months ago, they began announcing their Gold additions again, and this article talks about their latest announcement, and can be found here: https://news.goldcore.com/us/gold-blog/china-gold-reserves-rise-to-60-26-million-ounces-worth-just-79-5-billion/

Or, here’s your snippet: “China increased its gold reserves for a third straight month in February, data from the People’s Bank of China (PBOC) showed this morning.

The value of China’s gold reserves rose slightly to $79.498 billion in February from $79.319 billion at the end of January, as the central bank increased the total amount of gold reserves to 60.260 million fine troy ounces from 59.940 million troy ounces.

Chinese foreign exchange reserves, the world’s largest, rose by $2.26 billion in February to $3.090 trillion, central bank data showed on Thursday, marking the highest level since August 2018. The U.S. trade deficit hit its highest in a decade in 2018, in a resounding failure for President Donald Trump’s global trade offensive, U.S. government data showed yesterday.

We have long pointed out two other entities, besides the PBOC, have also been buying gold – the State Administration of Foreign Exchange (SAFE) and the China Investment Corporation (CIC).

These potentially sizeable sources of demand are not included in the PBOC figures.
It is important to note this lack of transparency regarding total aggregate Chinese central bank and sovereign fund demand. Therefore, it is likely that we are underestimating Chinese and thus global gold demand.”

Chuck Again…  An important take out from this is that there’s really no way to know exactly how much Gold China has accumulated through the years, but when the financial system implodes due to debt, and all the countries meet to discuss the new financial system, China will come to the table with their true amount of Gold reserves…  And it will be HUGE!

Currencies today 3/14/19 American Style: A$.7050, kiwi .6818, C$ .7505, euro 1.1308, sterling 1.3240, Swiss $.9960, European Style: rand 14.4454, krone 6.6020, SEK 9.3295, forint 277.99, zloty 3.8045, koruna 22.6954, RUB 65.48, yen 111.60, sing 1.3560, HKD 7.8497, INR 69.29, China 6.7060, peso 19.29, BRL 3.8141, Dollar Index 96.71, Oil $58.13, 10-year 2.63%, Silver $15.25, Platinum $831.51, Palladium $1,547.29, and Gold… $1,297.93

That’s it for today… and tomorrow, and this week! The sun is rising right now, it’s so darn beautiful as it rises, seemingly, out of the ocean…  I head back to the ballpark today. Spring Training is half-over already! UGH! Well, spring break will finally come for the kids in St. Louis, which gives Delaney Grace and brother Everett time to come down and spend time with us… YAHOO!  I sure hope the weather remains nice for their visit! I almost bagged writing today, to sleep instead, as I just couldn’t get going this morning, but here I am, and the letter is finished!  The band Yes, takes us to the finish line today with their song: Rythm Of Love…  And with that I hope you will Be Good To Yourself! 

Chuck Butler

 

 

March 13, 2019

* Currencies, for the most part see some small gains on Tuesday

* Gold closes above $1,300, is this the long awaited breakout to the upside?

Good Day… And a Wonderful Wednesday to you! Well, I finally recovered from my battle with the sun on Monday, yesterday, and actually sat on the beach, under an umbrella with my sun hat on for a couple of hours, with no problems… I still think it was a freak thing, and I’m not going to worry about it… And I was wrong yesterday when I said my next game was a night game, when my next game is tomorrow, a day game… We’ll see how everything works then! I drank plenty of water yesterday (there’s water in beer right? HA!) and I was fine by midday… The Allman Brothers greet me this morning with their song: Southbound…

Well, it was another day without a lot going on in the currencies, the euro gained a small amount again, but Pound sterling got sold off its highs that occurred when traders thought that PM May’s BREXIT deal was going to be a layup… But that didn’t happen, as the British Parliament voted no to May’s plan… So, it’s back to the drawing board once again for the BREXIT negotiators… What a sticky divorce proceeding, eh?

The Aussie dollar (A$) saw some profit taking, while the Canadian dollar / loonie saw some love, along with the Russian ruble and Norwegian krone, for the bump up in the price of Oil… And the fact that the news from Saudi Arabia tells us that the Saudis are holding true to the production cuts they imposed last month to Oil production. So far so good for the Oil producers, but like I’ve explained before, it’s a vicious cycle here, because once the price of Oil rises, it brings the shale producers back on board, and then they flood the market with supply and the brings the price of Oil back down… Rinse, Repeat…

Gold was allowed to breach the $1,300 figure yesterday, with an over $8 gain on the day… But as we’ve seen before, the price manipulators won’t let it get too high before they begin to sell it short on paper again… I’m still of the opinion that Gold will break out on the upside in price… The shiny metal had a good run going there at year-end, and it looked as if that was going to be the break out…  As we all learned, it obviously wasn’t… just a tease, if you will…  

Well, have you heard the news? There’s good rockin’ at midnight! No Wait! That’s not what I was going to say! I was going to talk about the news that ECB President, Mario Draghi, might retire without ever hiking interest rates! Just like his hero, Big Ben Bernanke! Germany, the Eurozone’s largest economy, and main go-to for policy here, are probably saying, “That’s the last time we promote someone from the Bank of Italy to be the President of the ECB” I don’t know who’s “in line” but whomever it is, they have to be able to do a better job than Draghi has, with his constant throwing the euro under a bus, and other crimes!  

On the data front, The Eurozone printed their January and YoY Industrial Production reports today… the January print was up 1.4%, but it failed to bring the year on year (YOY) data into positive territory, and the YOY figure was down 1.1%…  I would point out that the rot on this vine was due to a mid-year slump, and that the recent trend has been positive… Something for the European Central Bank (ECB) to think about… 

Well, we’ll see some stale data today here in the U.S. as the January Durable Goods and Capital Goods Orders will print… I’m thinking that we’ll be adding a couple of new bricks to the wall after they print, as they could both be in negative territory… All in all, it’s just another brick in the wall… 

I really stirred up a hornet’s nest on Monday when I went crazy on the kids and what they were being taught in school these days…  I guess it’s more the Universities fault, but so be it…   How about all those people that formerly lived in NY, New Jersey, and California, moving out of their home states to more tax friendly states like Texas and Florida?   The problem with that is that most people can’t make a move like that, due to kids, work, schools, family, money, etc.    But imagine, if you will, that everyone was able to move… would the last person leaving the state of New Jersey, please turn out the lights?  HA!  

To recap…  The currencies, led by the euro were able to move a little higher on Tuesday, but pound sterling got sold off its highs, after the British Parliament voted No to the BREXIT deal… Back to the drawing board…  Gold gained $8.50 on the day, and closed above $1,300, once again… And the U.S. Data Cupboard will have the Durables and Capital Goods Orders for us today, of which Chuck thinks they both will be negative… 

For What It’s Worth… Have you ever heard of Jeremy Grantham? He’s supposedly the guy that called the 2008 financial meltdown, I’m not saying he didn’t do that, but I’m pretty darn sure I called it before he did, when in 2003, I began talking about the Housing Bubble, and what it would do the economy and the dollar. But anyway, he’s very well respected, and he was talking about the next 20 years for the U.S. stock market, and it can be found here: https://www.marketwatch.com/story/investor-credited-with-calling-the-2008-crisis-says-the-next-20-years-in-the-stock-market-will-break-a-lot-of-hearts-2019-03-07?mod=MW_section_top_stories

Or, here’s your snippet: “Jeremy Grantham, an investor credited with predicting the 2000 and 2008 downturns, told CNBC on Thursday that investors should get inured to lackluster returns in the stock market for the next two decades, after a century of handsome gains.

“In the last 100 years, we’re used to delivering perhaps 6%,” but the U.S. market will be delivering real returns of about 2% or 3% on average over next 20 years, the value investor and co-founder of Boston-based asset manager GMO told CNBC in a rare interview.

Grantham, who has been predicting a meltdown in stocks since last year, said that not even the recent go-slow reversal by the Federal Reserve on rate increases and the European Central Bank’s decision to roll out a fresh batch of bank stimulus will push stocks significantly higher. “You can’t get blood out of a stone,” he told the network.

The famed investor said that he expects stocks to limp along against that backdrop, with major developed banks unlikely to remove stimulus first introduced during the 2007-09 financial crisis.”

Chuck Again… Well, it sounds like he’s on board with my long standing call that we’re turning Japanese, yes, I really think so! It’s been more than 20 years of funk for the Japanese stock market, folks… I’m just saying…  

Currencies today 3/13/19 American Style: A$.7060, kiwi .6840, C$ .7483, euro 1.1305, sterling 1.3133, Swiss $.9946, European Style: rand 14.3484, krone 8.6115,  SEK 9.3370, forint 278.38, zloty 3.8041,  koruna 22.7183, RUB 65.71, yen 111.30, sing 1.3560, HKD 7.8498, INR 69.38, China 6.7090, peso 19.32, BRL 3.8244, Dollar Index 96.87, Oil $57.42, 10-year 2.62%, Silver $15.53, Platinum 839.05, Palladium $1,547.89, and Gold… $1,308.85

That’s it for today… March seems to be slipping by way too fast for my liking! If the days keep going by so fast, It’ll be April before I know it, and then it will be time to start packing up for my trip back to Missouri!  I have doctor appts. and scans all scheduled the 3rd week of April. At this point, this is the longest I’ve gone without a blood draw, a scan, or a visit to an oncologist in 12 years! I’m thinking that my veins have all healed, my stomach isn’t upset from the barium and I don’t like going and stepping on a scale at a doctor’s office!  So, I’m good with this, as long as the wolf remains outside the door!  And with that King Crimson takes us to the finish line today with their iconic rock song: The Court of the Crimson King…  I hope you have a Wonderful Wednesday, and continue to Be Good To Yourself!

Chuck Butler

 

March 12, 2019

* Dollar bugs still hold a spell over the currencies & metals

* Fed Atlanta spills the beans on an economic slowdown forecast… 

Good day, and a Tom Terrific Tuesday to you! Well, something happened to me yesterday that had never happened before… I because ill sitting in the sun at the ballpark… I had to drink a lot of water and sit under the ballpark stands in the shade before I was able to get my wits back about me… I’ve always been told that the sun and chemo aren’t a good mix, but I’ve never had a situation like that in the nearly 12 years of taking chemo before… My head still hurts, so I think I over did it… Lesson learned, you don’t have to tell me twice… Good thing the next spring training game is a night game! I’m treated this morning with a song from The Doobie Brothers, from the Captain and Me album, which was their best, and the song is titled: Dark Eyed Cajun Woman… Love that song!

Well, there’s not much to talk about today… The currencies continued to be under the spell of the dollar bugs, and even the stronger price of Oil can’t seem to help the Petrol Currencies these days… UGH!… The Data in the U.S. continues to be weak, and awful at times (Jobs jamboree is one!) but still the dollar bugs rule the roost… I don’t get it… I doubt I ever will… but it is what it is… right?

The euro gained a small amount yesterday VS the dollar, as did the Aussie dollar (A$) and kiwi, but everything else was held back… except… It was being reported last night that U.K. PM, May had stuck a new BREXIT deal with the EU… It’s now up to the U.K. Parliament on whether it gets passed or not… And the Pound sterling found a bid and rallied on the news… But there’s still a risk out there that the Parliament says, No Soup For You!

Gold followed Friday’s $12 and change gain with a small gain of $2.50 yesterday… But still below the $1,300 level that has been referred to as the Maginot Line… Gold analyst, Egon Von Greyerz (I’m not sure I spelled his name correctly) recently wrote that he believed that the “Maginot Line would soon be breached by Gold”… the price manipulators have dug in at $1,300, and to get Gold past that figure will take a lot of physical Gold buying… Are investors ready for that?

Well, President Trump introduced his new Budget yesterday… And brother is it a doozy!  One thing that jumped out at me was the $750 Billion allocated to the Defense sector… That’s a larger budget than the next 14 countries, combined!  It’s money we don’t have, so, you know me, dear reader, I don’t like spending money we don’t have, it creates problems down the road… 

If you recall the old Sunday Pfennig titled: Chuck’s Debt Solutions, I talked about the military spending, and had the idea that we needed to close all foreign bases, especially in the countries where they don’t want us there to begin with, bring the soldiers home to protect the border, we could save boat loads of money that we don’t have to spend…  Just one of the many ideas I presented in the old Sunday Pfennig… 

I don’t know how you feel about this, but… it really ticks me off when over time we, as a country, have used our military to bail a country out of a bad regime, or invasion by another country, only to have the people we helped turn around and kick us later… If that’s what happens, and it does, then why help them to begin with?  These and many other questions are answered on the Butler Patio, which will be opening up again in the middle of April… 

Well, can you tell that there’s just not much to talk about in the currencies and metals today? I begin throwing out opinions like I had a fistful of Benjamins!  HA!  

The U.S. Data Cupboard isn’t helping me today either, with really only one print today, and that’s the stupid CPI (consumer inflation) for February. This data set has had so many hedonic adjustments to it over the years that it’s no longer recognizable as a reliable piece of data…  And that’s why I call it stupid…  (good thing my grandkids don’t read the Pfennig, because they always correct me when I say something or someone is stupid!) 

In a time when things weren’t so touchy, feely, the Charlie Brown cartoons came to television… The next time one of them is on TV, check out how many times the kids call Charlie Brown, stupid…  I’m just saying… 

OK…  Did you see where Facebook is banning Zerohedge.com?  What? Did my old reviewers go to work at Facebook?  I say that because I remember being told not to use zerohedge.com in the FWIW section…  So, freedom os speech means that as long you say what I agree with it’s OK, but when I don’t agree with something, then no soup for you!  What the hell is going on in this country? 

Before we head to the Big Finish today… I saw this and knew I had to highlight it… Recall me telling you last month that West Virginia had a bill that would end sales tax on the sale of Gold & Silver (and other precious metals)… Well… Sound money advocates rejoiced today as the West Virginia legislature overwhelmingly passed Senate Bill 502 and sent it to Governor Jim Justice for his signature.

State Senator Craig Blair (R-District 15) introduced SB 502 with the goal of encouraging precious metals purchasers to keep their investment dollars in the state rather making investments elsewhere. The bill impacts purchases of platinum, gold, palladium, or silver bullion valued upon its precious metal content, whether in coin, bar, or ingot form.

Chuck again…  Way to go Senator Blair! You da man!  

For What It’s Worth…  Well, in honor of those long gone reviewers that banned zerohedge.com from my Pfennigs, I have something from zerohedge.com for you today, regarding the Fed Atlanta’s forecast for GDP in 2019… and it can be found here: https://www.zerohedge.com/news/2019-03-11/gdp-crash-atlanta-fed-sees-q1-gdp-tumbling-just-02 

Or, here’s your snippet: “While the market was delighted two weeks ago to see a delayed Q4 GDP print of 2.6%, which came in well above the expected 2.2% consensus number, we warned that “while Q4 was clearly a stronger than expected print, the real question is what happens in Q1, when most banks and nowcasts expect GDP to print below 1%, in some cases concerningly so.”

Moments ago we got another confirmation of this, when following the latest retail sales report which saw a dramatic cut to December retail sales even as January surprised modestly to the upside, the Atlanta Fed slashed its Q1 GDP nowcast, and after rebounding modestly from 0.3% to 0.5% a week ago, it has once again slumped, and is now at the lowest recorded level, and just 0.2% away from economic contraction.”

Chuck again… And the only risks to the economy that Fed Chairman Powell sees, is the slowdowns in Europe and China… Yeah, right, and I’ve got some swamp land I’d like to sell Mr. Powell… 

Currencies today 3/12/19 American Style: A$.7075, kiwi .6848, C$ .7461, euro 1.1271, sterling 1.3150, Swiss $.9915, European Style: rand 14.2801, krone 8.6389, SEK 9.3805, forint 279.93, zloty 3.8744, koruna 22.7725, RUB 66.06, yen 111.32, sing 1.3566, HKD 7.8497, INR 69.69, China 6.7208, peso 19.38, BRL 3.8534, Dollar Index 97.06, Oil $57.35, 10-year 2.66%, Silver $15.42, Platinum $831.29, Palladium $1,543.38, and Gold… $1,296.40

That’s it for today…  the sun should be rising in a couple of minutes on another day in S. Florida… I’ve seen my beloved Cardinals win 4 games this spring and in 3 of them they scored all their runs (3) in one inning… That’s not a good thing folks… Your lineup should be a relentless attack, throughout the game, I’m just saying…  Had a good time last night with friends and their families visiting from St. Louis and Oklahoma…   I think I’ll head back to bed after I watch the sunrise on the ocean… My head still hurts a bit…   Steely Dan takes us to the finish line today with their song: My Old School…  I hope you have a Tom Terrific Tuesday and remember to Be Good To Yourself!

Chuck Butler

March 11, 2019

* The dollar rallies despite an awful jobs report!

* Gold is topped at the $1,300 border… 

Good Day… And a Marvelous Monday to you! Well… here we go again… The U.S. Jobs report on Friday was horribly weak, but the dollar rallied… Go figure! I watched my beloved Cardinals win and lose a game since we last talked, and they still can’t, in my opinion, that is, hit the ball… UGH! My wife tells me not to worry, that’s it’s “spring training”… But I know better… this is where hitters get to hit against top pitchers for just a couple of innings, that then the 3rd team comes in, the guys that are destined for the minor leagues… And yet, no hitting… UGH! Oh well, it is what it is… It’s still warm and full of sun here, so I’ll sit there and watch the noodle sticks come up, while basking in the sun! Scott McKenzie greets me this morning with his hit song: San Francisco… If you’re going to San Francisco, be sure to wear some flowers in your hair…

Well, I already told you that on Friday, the dollar rallied in the face of a very weak jobs report… For the month of February, the U.S. only added 20,000 jobs in February… That’s right I said 20,000 jobs… And to make that even more weak… The BLS added 137,000 jobs after the surveys to get to 20,000, jobs… So, in my book, the U.S. lost 157,000 jobs in February… But that didn’t stop dollar bugs from buying dollars… The stock market here in the U.S. has been bleeding badly, and yet, the dollar bugs are dancing on the tables…

So… I would be telling customers of my old place of business that they should be using this drop in the euro, as a buying opportunity… Of course, the legal beagles would make he say, “of course that’s my opinion and I could be wrong”…. Now that I’m no longer associated with anyone with a trading desk… I will just say, that this is just really strange to me… The Gold traders pushed the price of Gold to $1,300, but it just couldn’t get past that figure, and was only able to gain $12 and change on Friday… But still, given the rot on the currencies vine, Gold’s gains were quite impressive, but the price manipulators made sure it didn’t breach $1,300…

When I was a younger man, and my temper needed to be corralled at times, I would have liked to meet a price manipulator in the alley, if you will… But now, I’m an old partially handicapped, chemo filled, fat man that wouldn’t know what to do if that situation presented itself to me!

Can you believe the interview that Fed Chairman Jerome Powell gave on Friday? He said that the only risks to the U.S. economy are the slowdowns in Europe and Asia… Really? Are you blind, Mr. Chairman? Are do the economists that you employ to keep you up to date, feed you nothing but Captain Crunch? (by the way that’s my favorite cereal!, but boy is that sweetened!) If I were in his employ… I would be showing him all the economic reports that I show you, dear readers, on a daily basis that show we are heading to a recession… I can’t believe he said that! My, oh, my, what a tangled web we weave….

I just can’t get past that this morning… I’ll try, but I doubt it will happen… to have a Fed Chairman make a blatantly incorrect statement like that ranks up there with the Bernanke quotes about the housing market not being in any danger of imploding back in 2007…

In fact that was the most imbecile thing I’ve herd since the Bernanke quote that I’m going to just stop writing today, because I’m just all out of sorts, since I heard his words…

OK… I’m trying, but I just don’t have my heart into it… Powell… come, on! Well, the BREXIT talks have come to a standstill (see, Last week I told you the talks weren’t going well! ) Currency traders have finally gotten the message, and pound sterling is getting sold…  

You wouldn’t believe, OK, maybe you would, sorry…  But the number of articles from analysts and economists piling on Australia these days…. It just doesn’t make sense that everyone is piling on the Aussies, but the Aussie dollar (A$) remains well bid… Maybe it’s going to be a case of delayed reaction?  But for now the A$ and kiwi have held their ground while all this green/peachback buying is going on. 

 I would be remis to not mention that the Chinese leader, Xi, announced that China would not devalue their currency to offset tariffs… And a sentence later, he mentioned that the China was going to cut interest rates… Really? And that won’t weaken the currency? I told you all years ago, to always listen to what the Chinese said, because they didn’t say things that they didn’t mean… So, in this case, we have to believe an all -out devaluation of the renminbi is out of the question, but a systematic take down by market forces will be OK… eh?  

Oh, and the renminbi is much weaker at the start of this week, than is was at the start of last week, for those of you keeping score at home… 

So, have you followed the articles talking about the U.S. seizing tons of Gold in Syria, and now Syria claims that the U.S. stole their Gold?  These are quite interesting folks… I’m just saying…  did we take the Gold as payment for all that we’ve done for them? I have no idea, but… Isn’t that they way things should have been all along?  If the U.S. has to be the world police, then when conflicts arise, and the U.S. is called in, they should be paid, or reimbursed for their expenses…  

Boy would we make long last friends that way…. NOT!  OK, this has gone on too long, I need to stop this conversation before I really say what I’m thinking at tick 1/2 the people off! 

Before we head to the Big Finish today, I wanted to mention something that scares the bejeebers out of me… I read last night that a large majority of young voters, are all for a socialist government… How in the world did that happen? What are we teaching these kids these days in school? The parents are to blame too, for not showing their kids that they have things because they worked hard for them in a capitalist economy!  That makes two things that have been said this past weekend that I’m flabbergasted about! I had better quit, and start anew tomorrow… 

To recap… The Jobs report for February was awful at best, but the dollar bugs were dancing on the tables, go figure…  Chuck is flabbergasted by what Jerome Powell said in a speech on Friday… come on Jerome, really? Gold was kept, by the price manipulators, from breaching $1,300 on Friday, and had to settle for a gain of $12 and change on the day.  The BREXIT talks have come to a standstill, and what the hell are they teaching kid in school these days? 

For What It’s Worth… Since the Fed in on my you know what list, as usual, they really got my goat with this announcement about weakening the stress tests for banks… I can be found here: https://www.reuters.com/article/us-usa-fed-stresstests/federal-reserve-scraps-qualitative-test-for-u-s-banks-in-2019-stress-tests-idUSKCN1QN2PX

Or, here’s your snippet: “The U.S. Federal Reserve said on Wednesday it would no longer flunk banks based on operational or risk management lapses during its annual health check of the country’s domestic banks.

The “qualitative” portion of the 2019 test, however, will still apply to the U.S. subsidiaries of five foreign banks subject to the annual exam.

The move, which is a big win for major banks, such as Goldman Sachs Group Inc, Morgan Stanley and JP Morgan, Bank of America and Citigroup, forms part of a broader effort by the Fed to overhaul its annual “stress-testing” process, which the industry has long criticized as too onerous and opaque.

Since the 2007-09 global financial crisis, the Fed has put the country’s lenders through strict annual tests to see whether they would have enough capital to withstand a major economic downturn.

For the largest lenders, that test also included a so-called “qualitative objection,” that gives the Fed the discretion to fail banks due to risk management or operational failures, even if they have sufficient capital.”

Chuck Again…  So, do you see what I see here? A return to pre-2007 for banks… Will this mean that in the next financial crisis, that taxpayers will have to bail them out again?  I think so, folks…  shameful, simply shameful

Currencies today 3/11/19 American Style: A$.7045, kiwi .6811, C$ .7454, euro 1.1248, sterling 1.2981, Swiss $.9914, European Style: rand 14.3737, krone 8.6887, SEK 9.4180, forint 280.56, zloty 3.8211,  koruna 22.8157, RUB 66.32, yen 111.23, sing 1.3586, HKD 7.8498, INR 69.85, China 6.7198, peso 19.48, BRL 3.8651, Dollar Index 96.30, Oil $56.51, 10-year 2.64%, Silver $15.32, Platinum $814.02, Palladium $1,575.37, and Gold… $1,296.57

That’s it for today…  Well, we “sprang forward” an hour this past weekend, which means the sunrise here is later in the morning, which means that I either need to write longer, or later to see the sunrise while I write!  Darling daughter, Dawn and her family will be here on Saturday to spend their spring break with us, which means I get hugs from my little d… (Delaney Grace!)  Two birthdays this past weekend, (Gus and Rick) and this week we have Kathy’s mom’s birthday… And then finally, mine!  more on that when we get there…   Shooting Star takes us to the finish line today with their song: Last Chance…  I hope you have a Marvelous Monday and remember to Be Good To Yourself!

Chuck Butler

 

 

March 7, 2019

* Despite tariffs, The Trade Deficit explodes higher!

* Currencies and metals trade in very tight ranges on Wednesday…

Good Day… And a Tub Thumpin’ Thursday to you! Well, it looks as though we will get to have spring-like weather another day here today, before the heat returns for the weekend, and the coming week. My beloved Cardinals beat the evil empire, the Yankees yesterday in Spring Training in Tampa. I kid about the Yankees being the evil empire, because, well, that’s what I was taught as a kid… That the “coast teams” were never to be trusted and always rooted against! My dad was a Midwestern farm boy, who never trusted anyone that wasn’t from Missouri! So, he was no fan of the Yankees, and therefore I wasn’t either! HA! Jack Johnson greets me this morning with his song: Drink The Water…

Well, after Tuesday’s whacking, the currencies traded in tight ranges yesterday, with the euro remaining above 1.13 as the day went along. I told you yesterday that Australia had received some softer than expected growth numbers, and the Aussie dollar (A$) was getting whacked, but the A$ staged a comeback of sorts yesterday, when the U.S. data didn’t look so hot… In fact there were a couple of bricks added to the wall yesterday, so let’s stray from our normal pattern and get right to the data yesterday, because well, it sure doesn’t print a pretty picture…

Front and center, we had the ADP Employment report for February, and it showed that 183,000 jobs were added during the month… Now, in my book, this is the employment data that we should use and NOT the data that the BLS serves us each month… So, is 183,000 jobs created in February good or bad? Well, it’s certainly not the 300,000 jobs ADP said it created in January, now is it? So, it’s not bad, but it’s not good… Moving on we find the Trade Deficit…

Here’s where the going gets sticky, folks… Remember that we started a trade war with China because the Trade Deficit had been out of control for decades now… Well, even with the tariffs added to Chinese goods, the December Trade Deficit was more than $59 Billion dollars! And for the year 2018, the Trade Deficit soared to a $891.2 billion merchandise trade deficit, the largest in the nation’s 243-year history. The trade gap with China also hit a record $419 billion….

As you can imagine, and not very long either, the media is not allowing this data to slip under the covers of darkness, because it makes the President, who uses the Trade Deficit as a guage to tell how American exports are being treated in other countries, look bad… I’m just saying… That’s what I’ve viewed and that’s how I see it… no excuses from me!

The President tried to head this news, about the Trade Deficit, off at the pass this last weekend by talking about how the strong dollar is hurting exports… While he’s correct in that statement, it’s not all that plays into the Trade Deficit… The playing field is not even, folks… Here in the U.S. workers demand higher wages, with benefits and pensions, etc. So, it should come as no surprise that American Goods cost more… And that plays more into what causes the Trade Deficit than most people even stop to think about…

But look at Germany… Here we have a country that has to deal with high wages, benefits, etc. like U.S. workers, and they have to deal with a currency that’s even stronger than the dollar, but… They lead the Eurozone and most of the world in exports… Why? Value of their goods… If you make something of value, that other people want and demand, you can get away with charging higher prices… I would say, that’s a lesson we could learn, but… I would need to schedule a flight on a pig over town if we did!

And finally, Factory Orders for January gave us a head fake, and refused to print yesterday, so we wait for the January report to be massaged by the bean counters, before being presented to the public…

I read on Bloomberg last night that the recent data from the Oil reserves showed a glut of reserves, and the headline title on Bloomberg.com said, “Oil weakens on supplies worries” So, I went to check the price of Oil to see just how badly the price of Oil had weakened… And when I got to the screen that showed the price, I found that the price of Oil had not weakened at all, and in fact it was up about 40-cents in the past 24 hours! Those wild and crazy guys at Bloomberg, throwing me a curve!

All in all it’s just another brick in the wall… Family Tree, which owns Family Dollar stores announced yesterday that they were closing 390 Family Dollar stores here in the U.S. OK, this is significant folks, think about this for a minute before you shrug this off… When the economy slows, consumers usually switch to the Walmarts, and dollar stores… But what is the economy telling us when the dollar stores are closing? Uh-oh! Better call Maaco!

So, speaking of the slower than expected Aussie GDP, for those of you keeping score at home, the figure was 1% growth… But it’s not just Australia having problems, folks… Yesterday the OECD joined the IMF in slashing its 2019 global GDP forecasts from 1.8% to just 1% and warning the “outcome could be weaker still if downside risks materialize or interact.”.

I’ll just point something out here… 1% global growth means that there will be countries with negative growth… (did I just say the U.S. out loud?) Oh, and one more thing… 1.2% is the growth rate of the population of the world, which means that economic global growth will be less than the population growth… Can you say, that’s unsustainable? I knew you could!

OK, this next paragraph is going to get my dander up Big time! Fed Head Kaplan, was out on the road again, speaking to whomever would listen to him, and this is what has me up in arms… Kaplan said that the reason the Fed Heads are pausing the rate hike cycle is because of the concerns with Corporate Debt…   Well, Mr. Kaplan,  would you like to take any of the blame for Corporate Debt being so large and uncontrollable? Why not? For it was the Fed that cut rates to zero, held them there for nearly a decade, and implemented 3 rounds of bond buying, and 1 round of something called Operation Twist and Shout!  THIS is why Corporate Debt is so large and uncontrollable! You set the table and invited the Corporations to dinner, Mr. Kaplan, and the Corporations came to eat dinner, now you can’t complain about the mess they made at the table! 

I’m so mad, right now… To think that this guy takes no blame for this mess just gets my goat!  UGH!  

Today’s U.S. Data Cupboard, has the stupid 4th QTR Productivity report, which will show us that Productivity dropped in the quarter to 1.8% from 2.2%…  We’ll also Unit Labor Costs for the 4th QTR, which given all the reports that wages have grown recently, should show an increase in Labor Costs, which is a good and bad thing… Good for the worker, bad for the inflation numbers. 

Tomorrow, we’ll see the February Jobs report at the Jobs Jamboree thrown by the BLS… (Bureau of Labor Statistics) I prefer to leave out the “L”, when I refer to them! HA!  And for once in a blue moon, I think the ADP report will be in line with the BLS report, which will mean a large reduction in jobs created from month to month… 

I know, at this point, you’re wondering if I’m ever going to talk about Gold today… Well, wonder no more! Gold lost $1.90 yesterday, in a ho-hum day of trading that saw less than 200,000 contracts traded…  The $1.90 loss brought Gold to a low price for this round, which could be significant…  

What I’m saying is the price manipulators take Gold & Silver down to a level, the cash in their shorts, and then allow the metals to move higher until they reach a point that the manipulators enter the market with their arms full of short paper trades, and then systematically take the price back down so they can collect their profits…  But, yesterday, I told you that the GATA folks had a memo that explained how the COMEX and the LBMA were out of physical metals, and therefore they wouldn’t accept anymore paper trades…  Hmmm…  So, if yesterday was the low… wink, wink… 

A dear reader asked me to talk about the old ratio of 16:1 for Gold to Silver… this figure was blasted out a few years ago, and I just don’t see it as relevant going forward…  However, I do believe that once the metals get on their rally horses for a long ride, that Silver will outperform Gold on a percentage basis… And that ratio might come back into play, but by no means will it be the anchor it once was…

To recap…  Still no Trade Agreement, Still no traction with tariffs, as witnessed by the December Trade Deficit that was a “blown out of the water” number! The yearly Deficit in Trade was a record!  Global Growth is faltering as we watch… Chuck takes the paddle to a Fed Head, and the currencies and metals trade in very tight ranges on Wednesday.

For What It’s Worth…  In perusing Bloomberg last night, I came across an article that was FWIW worthy, that plays well with the debt reports in the sandbox, and can be found on Bloomberg.com

Or, here’s your snippet: ” U.S. credit card debt hit $870 billion — the largest amount ever — as of December 2018, according to the data from the Federal Reserve. Credit card balances rose by $26 billion from the prior quarter.

“The increase in credit card balances is consistent with seasonal patterns but marks the first time credit card balances re-touched the 2008 nominal peak,” according to the report.

Nearly 480 million credit cards are now in circulation — up by more than 100 million since hitting bottom after the recession a decade ago.

At the end of last year, credit cards were the fourth-largest portion of consumer debt in the U.S. after mortgage, student loan and auto debt. But the quarterly increase in credit card debt was faster than the other categories. Overall debt reached a record $13.5 trillion.

About 37 million credit card accounts had a 90+ days delinquent mark added to their credit report last quarter, an increase of about two million from the fourth quarter of 2017. These 37 million accounts hold roughly $68 billion in debt that is 90-plus days delinquent.

In aggregate, credit card limits rose for the 24th consecutive quarter, with a 1.5% increase in the fourth quarter of 2018.”

Chuck Again… Debt is everywhere folks… The problem with credit card debt is that it is so darn difficult to pay off, and eventually the holder just cuts up the card, or one day the cashier doesn’t give it back and that debt gets written off, causing the next person to apply for a card to pay even higher interest rates to pay for the debt that was written off…  It’s a vicious circle folks… 

Currencies today 3/7/19 American Style: A$.7048, kiwi .6790, C$ .7478, euro 1.1315, sterling 1.3150, Swiss $.9960, European Style: rand 14.3340, krone 8.6648, SEK 9.3315, forint 278.74, zloty 3.8005, koruna 22.6233, RUB 65.85, yen 111.70, sing 1.3571, HKD 7.8495, INR 69.91, China 6.7078, peso 19.30, BRL 3.7918, Dollar Index 96.82, Oil $56.66, 10-year 2.66%, Silver $15.11, Platinum $826.11, Palladium $1,545.59, and Gold… $1,286.62

That’s it for today, tomorrow, and this week…  The Sunrise this morning has sun’s rays coming through the clouds, and looks very cool…  OK, visitors begin to arrive and the weekend will be filled with baseball games and conversations!  Not much going on today though… no baseball, but the weather will be warmer…  In 9 days, Delaney Grace and Everett will be here, along with their parents of course! I miss their hugs!  Saturday, I do believe is my good friend, Martini Gus’s, birthday! Happy Birthday Gus! Drink a martini for me! The Beatles takes us to the finish line today with a song from their acclaimed album, Sgt. Peppers Lonely Hearts Club Band, titled: With A Little Help From My Friends, which Joe Cocker redid at Woodstock, and people fell in love with the song all over again!   I hope you have a Tub Thumpin’ Thursday, and continue to Be Good To Yourself!

Chuck Butler