Author: admin

• Currencies rally overnight on the dollar selling
• Where have all the senior traders gone? Stowe!

Good Day… And a Wonderful Wednesday to you! Pfennig tradition calls for this: Turkey for me Turkey for you Let’s eat the turkey In my big brown shoe

Love to eat the turkey At the table I once saw a movie With Betty Grable…  Yes, and snippet from the funny man, Adam Sandler’s Turkey Song…. Man was he young when he first sang that on SNL…. Vince Guaraldi greets me this morning with his song: Skating….

Well, after all the shenanigans from the price manipulators on Monday this week, yesterday was a watered-down version of a regular day in the markets without intervention…. The dollar found a bid early in the day, and gained 3 index points in the BBDXY yesterday, while Gold also found a bid, and gained $4 on the day to close at $2,634, and Silver gained 16-cents to close at $30.47… 

Ed Steer had his viewpoint on the “beyond egregious” routing of the metals on Monday…. Here’s Ed: “This bear raid in the precious metals and WTIC had nothing to do with ‘peace’ — and everything to do with final days of rolls/switches out of the December delivery month. The collusive commercial traders wanted to encourage as many long holders as possible to roll out of December instead of standing for delivery.”

Chuck again…  you know the media can’t write or talk about short paper trading, so they come up with “reasons” for Gold’s decline….  But people like Ed (and me!) can see these Engineered Takedowns for what they are and tell you all about them….   I’m just saying…. 

It was reported yesterday by Gold observer/ author, Jan Nieuwenhuijs that China secretly bought 60 Tonnes of Gold last month….  I bet they were happy as a lark that the price manipulators took a pound and a half of flesh from Gold on Monday….. Oh, well, timing is everything….  I used to tell a joke it goes like this: I’m a half-wit comedian, ask me what’s the hardest part of my job, and before you can say, What’s the hardest part of your job, I say, Timing! I’m sure it was no laughing matter to the Chinese on Monday…. 

On a sidebar…. China is working on getting the pricing and trading of Gold away from London and the U.S., to prevent things like Monday from happening….   I hope they succeed and soon! 

The price of Oil slipped another buck yesterday, and ended the day trading with a $68 handle…  I already told you that it is being reported that Israel and Hezbollah are close to a peace agreement, and that has Oil getting sold…. 

The 10-year’s yield inched higher to 4.30% yesterday…. Is the giddiness over new Treasury Sec. Beginning to fade?  

In the overnight markets last night….  Later in the letter today, I tell you about the data explosion that will take place today…. And overnight, traders got leery of all that data not signaling good times for the U.S., and so… The dollar got sold, and sold… The BBDXY has lost 8 index points to start the day today, and the euro is back to pushing the envelope, after last week when it was left for dead….  Again, I ask, is all the giddiness of the FNG, Bessent, passe now?  It certainly appears to be….  The dollar will need some PPT Loving today…..   

The dollar selling didn’t help the ruble, peso, or renminbi last night, as all three are getting the snot knocked out of them as I write…. The peso and renminbi I see getting sold because of the Tariffs that were announced, as being a done deal on Trump’s first day in office…. The ruble has been getting the snot kicked out of it for over a month now, and that’s after the Russian Central Bank hiked rates to 21% in Rocktober!   That’s the highest interest rate in the world right now, and still the ruble gets no buyers…. Hmmm…..   

Gold is up $20 to start our day today…. And Silver is flat as a pancake (Head East)….  Gold is back to pushing higher, and I’m hoping that the short paper traders have all taken off for Vermont to ski this long holiday weekend…. Yes, today will be skeleton crews on the trading desks… Mostly newbies, will little to no experience and strict instructions not to take any positions…. Match all buys and sells, are they walking orders today, and the same will be true on Friday this week….  So, from here I don’t expect to see much movement the rest of the day…

The price of oil bumped higher to trade with a $69 handle overnight…. And the 10-year’s yield was dropped like a hot rock overnight… The 10-year Treasury’s yield is 4.25% this morning…. As far as the giddiness being over in the bonds markets for the FNG, Bessent, that appears to not be he case here…. The Bon boys are showing a deep love for this guy that is cut from the same cloth as they are….  And that’s OK…. As long as the bond boys wake up soon…. 

In other news from last night, The Reserve Bank of New Zealand (RBNZ) cut their Official Cash Rate (OCR) 30 basis points, and pointed to how inflation is almost within their target rate of 1.-3%…..  I would prefer that the RBNZ waited until inflation was well within their target….  As we’ve found out here in the U.S., inflation is sticky and just when you think you have it whipped, it rises up and bites you! 

OK… I found this story on Bloomberg.com this morning: “Coffee futures in New York climbed to the highest since 1997 on worries about crops in top growers, threatening to further raise costs for roasters and consumers.”

Price inflation continues to rise, folks….   Got Gold? 

The good folks at Gata sent me this: “A former official for the Federal Reserve Bank of Richmond pled guilty last week to insider trading after he was caught misappropriating confidential information to execute trades.

The defendant, Robert Brian Thompson, 43, of Mosley, worked as a bank examiner and senior manager with supervisory duties for the Federal Reserve, giving him access to confidential information about financial institutions under the Fed’s supervision, including confidential supervisory information.”

Who can you trust these days?  Certainly not the TV news people, not the print news people, not the Gov’t and their agencies like the CDC, not politicians, and the list goes on, and on, and on…..   But when the people that you entrust to control the economy and its interest rates, use their position to put them in a better position financially…. The line has been crossed….  I’m just saying…. 

So, I read this morning that the price drop in Gold has really spurred interest in physical Gold….  Taking advantage of the cheaper prices, of course, who would have thought that would be an option?  HA!  You certainly know who kept preaching to you that these were excellent buying opportunities!  I guess I could have hired a plane with a banner attached to it to fly around telling everyone that the time o buy was then!  You know when I sit on the deck overlooking the beach at my place in S. Floriday, I see those kinds of planes flaying up and down the coast…. And I don’t believe they work…. So, nix that idea Chuck….  I guess the Pfennig is the only way to get the word out and hope that the readers take note and even spread the word themselves….  One can hope….. 

I don’t know why the schedulers do this but today will be datapalooza…..  They moved the Weekly Initial Jobless Claims to today, so we get to see the color of that, along with: Durable Goods Orders for Rocktober, And Personal Income and Spending for last month… The first revision of 3^rd QTR GDP will print, and bringing up the rear will be last month’s PCE…. (personal cost expenditures), which the Fed Heads use as an inflation indicator… 

And in sidebar data…. There’s this: What’s a good salary?: Axios’s Ben Berkowitz writes that “Boomers say it takes $100k a year to be financially successful, Gen Z says it takes $600k.”  So, why the widespread difference?  Timing, I believe is the key here…. The Boomers have been at their jobs for years and will work them until retirement and beyond for some, therefore they see that $100k a year is sufficed…. While The GenZ’s only see themselves working a minimum of years, and therefore they see that $600k a year will do it….   Who’s right?  Oh, really, I don’t care! 

To recap…. The markets breathed a sigh of relief yesterday, when the shenanigans of Monday didn’t return in the markets… The dollar gained 3 index points, Gold gained $4 and Silver gained 16-cents yesterday… The Reserve Bank of New Zealand cut their OCR 30 Basis points, pointing to inflation nearing their target rate of 1-3%….  And Chuck wants everyone to state what they are thankful for tomorrow….

For What It’s Worth…. This article came to me from the good folks at GATA, and they got it from Andrew Macleod’s substack site…. I’ll give you the link so you can go there and subscribe to his letter if you wish… Otherwise, here is an article about Gold and it can be found here: https://alasdairmacleod.substack.com/

Or, here’s your snippet: “Judy Shelton is a well-known sound-money advocate and former economic adviser to President Trump. This month she set everyone buzzing with a proposal to issue a new 50-year Treasury bond redeemable in gold. If her plan is to be followed through, it would not be gold convertibility for the dollar but merely an alternative to inflation-linked TIPS bonds.

We can argue about how things for the dollar would evolve from there and the likelihood that this would be the first step to a new gold standard for the dollar, but that is a separate debate. Anyway, dollar-centric Fed and Treasury officials would dismiss it as providing too much uncertainty to government financial obligations, because they would argue that gold is unpredictably volatile and they would not want to see a revived debate about its monetary role.

But there is a far greater problem in the background, and that is the integrity of the U.S. Treasury’s gold reserves. Do they actually exist, and, if so, to what extent?

And here we come back to the findings of analyst Frank Veneroso more thqan 20 years ago.

Famously, in a speech in Lima, Peru, in 2002, Veneroso wrote:

“Now we have a conservative set of gold lending numbers and we have a more aggressive set of such numbers. Our range of estimates implies that somewhere between 10,000 and 16,000 tonnes of the official-sector gold position has left those vaults by way of the lending process.”

Chuck again… Well, I haven’t started reading it yet, but I did buy Judy Shelton’s latest Book that Andrew is talking about above, so I’ll be reporting on that in the future

Market Prices 11/27/2024: American Style: A$.6496, kiwi .5904, C$ .7120, euro 1.0572, sterling 1.2663, Swiss $1.1343, European Style: rand 18.1399, krone 11.0682, SEK 10.9039, forint 389.77, zloty 4.0744, koruna 23.9323, RUB 113.12, yen 151.32, sing 1.3482, HKD 7.7814, INR 84.45, China 7.2483, peso 20.73, BRL 5.8234, BBDXY 1,280, Dollar Index 106.12, Oil $69.12, 10-year 4.26%, Silver $30.48, Platinum $930.00, Palladium $980.00, Copper $4.15, and Gold…. $2,654.01

That’s it for today….  I keep track of my vitals (I have to) each day, and they have been quite good lately, ever since my blood levels got back to close to normal…. That was a space in time that I hope never returns… I’ve had quite a few of them in the past 17.5 years…. Ever since I was diagnosed with Stage 4 Cancer….    I stepped on the scale yesterday, and I am now at the lightest weight that I’ve seen in probably 30-35 years!  I’m still attempting to lose more, so stay tuned! From today to the end of the year, I will find it difficult to lose any weight….  So, January 2025 I get back on the diet horse!  Next week, Alex and Grace will be tying the knot, on Saturday Dec. 7…. Pearl Harbor Day! I can’t believe that it’s here already! I’m so proud of my 3 kids, they have all carved out careers, and are happy, and good natured….  Well, what are you thankful for?   Make sure you tell everyone tomorrow! Kenny G takes us to the finish line today with his version of the song: Silver Bells….  I hope you have a Wonderful Wednesday today, and a very Happy Thanksgiving tomorrow… And please…. Be Good To Yourself!

Chuck Butler

• The dollar gets sold on Monday….
• What if there’s no Gold at Fort Knox?

Good Day… And a Tom Terrific Tuesday to you! I couldn’t believe my eye yesterday, when I turned on my laptop during the day, and saw Gold down by a large amount… Silver was right behind Gold’s drop, and this all smelled of short paper trading, along with remnants of the giddiness of the markets for the new Treasury Sec  Boney James greets me this morning with his version of the song: Auld Lange Syne…. My favorite version of that song is sung by Kelly of the Celtic Woman group…. 

Well, what can I say? There’s one more thing that added to the debacle that was Gold trading yesterday, and it was a rumor that Israel and Hezbollah have come to a peace agreement… So, it was a triple whammy on Gold & Silver yesterday, and for those of you keeping score at home, Gold lost $90 to $2,628.50 and Silver lost $1.06 to $30.35… It was the ugliest day for the metals I have ever laid my eye on….  It was like Gold & Silver pulled the lever and saw Joke, Joker, Joker! I don’t mean to make light of it, but I’ve seen these kinds of massacres of the metals before, and they always come back…. So, I’m like Alfred E. Newman, “What, me worry?”… 

The dollar got its rear end handed to it too… The BBDXY lost over 6 index points to 1,285, and at one point in the day it was down over 8 index points!  Why has the dollar’s shine, that shone so brightly late last week, been tarnished this week?  Same reason that Gold’s shine got tarnished this week, the FNG, as my former colleague, Ty Keough used to call the new guys on the desk…. Scott Bessent is thought to be a financial hawk, and therefore the markets all believe he will be the one to get the Budget Deficit to 3%, and the economic growth back to 3%… I’m from Missouri, so I’ll have to be shown, folks….  But until we see the gist of his programs, we’ll have to live with these positive thoughts from the markets regarding the FNG….

So, the metals got sold…. The dollar got sold…. What got bought?  Ahh grasshopper, come sit and hear what I have to tell you…. Bonds got bought…. The FNG is responsible for all this bond buying and the weakening of the 10-year’s yield to 4.29%….   The price of Oil slipped lower again yesterday and ended the day trading with a $69 handle. 

In the overnight markets last night…. You know, Ed Steer, always calls the engineered takedowns of the metals “egregious”, but today, he called them “beyond egregious”… And he was right!   So, today, in the early trading, Gol is flat and Silver is up 10-cents…. The dollar saw some buying in the overnight markets, and the BBDXY has gained 2 index points to start our day today….  There was more talk about how Israel and Hezbollah are nearing a conclusion of their peace talks…. And that has been a real weight on the metals, oil and the dollar…. So, we’ll have to see if this comes to fruition…  

The price of Oil stayed in the $69 handle overnight, and the 10-year’s yield starts the day today with a 4.29% yield…. 

Well, in a case of anything you can do, I can do better….  Late last week, after getting the wink and nod from the U.S. President (until Jan 20) to use U.S. missiles, Ukraine shot them into Russia…. Russia, doing one better fired back with an ICBM…. Supersonic missile… These ICBMs usually carry a nuclear warhead, but this one didn’t, Thank Goodness…. But what’s next?   I worry about this escalating to a global war….   

That’s just what the U.S financial situation needs right now… War Debt….  I’m just saying…. 

Not that I wanted to talk about war, but it’s out there folks… We might as well grow accustomed to hearing it talked about… 

Ok, back to what I normally talk about… Metals, currencies, economies and dolts!  The euro which had to lick its wounds from late last week when it was announced that Germany had a plan for the Trump Tariffs, and it involved devaluing the euro….    But with the dollar getting sold like funnel cakes at a State Fair yesterday, the euro regained some dignity, which makes sense given it is the offset currency to the dollar… 

The rest of the currencies sat up in their respective sick beds yesterday….  But that’s about all they could muster…. Speaking of tariffs… The new President announced that he would introduce tariffs to: China, Mexico and Canada…. And yesterday, those three currencies were sold and sold and sold….   I get it… They will offset the tariffs to their exports by devaluing their respective currencies…. 

And that means, that goods coming into the U.S. after the tariffs, will be higher priced…. And those higher prices will keep everyone complaining about high inflation….  I’m just saying…. 

Well, I’ve told you all before that I read Tom Woods…. Tom sends out emails daily to his subscribers, and yesterday he sent me something that caught my eye…. Let’s listen in to Tom Woods : “In 1968, Paul Ehrlich released The Population Bomb, warning of global famine and other catastrophes to come, as a result of an unsustainable global population.

As usual with left-wing catastrophizing, these predictions did not come to pass.

In fact, something like the opposite has occurred, with birth rates in fact collapsing all over the world.

“By the end of this century,” writes my friend Kevin Dolan, “nearly every country on earth will have a shrinking population, and economic systems dependent on reliable growth will collapse. Thousands of unique cultures and populations will be snuffed out.”

And in case you’re sure you know how to fix it, Kevin reminds us that governments “have tried everything in the standard technocratic toolset – tax incentives, subsidized childcare, propaganda – and nothing has worked.”

Chuck again… I know, that should be my FWIW today, but I have something else for you there….  

The U.S. Data Cupboard just has the STUPID Consumer Confidence for Nov. Today…. I call this stupid because it has nothing to do with Consumer Confidence in the economy, instead it’s a heat beat check on the stock market! 

To recap… It was a God-awful day for the metals and the dollar…. Bonds were bought, and that’s it…. And then Chuck goes and gets into all kinds of stuff this morning…. Some of it, he shouldn’t be touching with someone else’s ten-foot pole! 

For What It’s Worth….  this article really troubles me….  for if there is no Gold at Fort Knox, then the U.S. is really in trouble…. For you see, the longest time people have reasoned that the U.S. just needed to update the price they carry their Gold, to help offset the debt… Not cover it but help offset it…. Any way, that’s what this article is about and can be found here: Fort Knox Holds “Nothing But Moths and Half-Eaten IOUs” – The Jerusalem Post

Or, here’s your snippet: “Years ago, a floor broker with deep ties to major bullion banks made a startling statement: Fort Knox holds “nothing but moths and half-eaten IOUs.” We all laughed back then. But as time passed, I realized he was right. Recently, something Egon von Greyerz said brought that old memory rushing back:

“In reality, a central bank only holds an IOU issued by a bullion bank. If the central bank attempts to reclaim its gold, it will never get it back, as the gold has likely been sold to buyers in China or India, who have purchased it outright with no obligation to return it.”

Bold claim right? He’s not wrong

Bottom line with regard to Ms. Shelton’s call to monetize our Gold by throwing it out on the yield curve (with which we agree) there is no way you can do it honestly if you wanted to. We’d wager no Gold is there at all. Anyway, there is much less Gold in Fort Knox than people think. Which brings us to Pozsar’s predictive analysis

Recalling Zoltan Pozsar’s Gold Warning

Putting Egon’s statement in context of something Zoltan had said in late 2022 about Gold– trading $1800 then– in our write-up entitled: Zoltan’s Gold-mageddon Deconstructed: “Banks have been using rehypothecation for decades fearlessly with approval of global governments who in turn promised them Gold would never be used as a settlement medium—i.e. have a practical use — again.”

Chuck again…. Yes, for years banks were told that Gold would never be used as a payment mechanism again, not to worry…..  But it looks like the emperor doesn’t have any clothes, eh?  

Market Prices 11/26/2024: American Style: A$ .6478, kiwi .5837, C$ .7083, euro 1.0502, sterling 1.2584, Swiss 1.1275, European Style: rand 18.1664, krone 11.1240, SEK 10.9894, forint 391.53, zloty 4.1094, koruna 24.0789, RUB 107.70, yen 153.40, sing 1.3470, HKD 7.7816, INR 84.33, China 7.2503, peso 20.57, BRL 5.8055, BBDXY 1,287, Dollar Index 106.89, Oil $69.48, 10-year 4.29%, Silver $30.45, Platinum $928.00, Palladium $988.00, Copper $4.15, and Gold… $2,626.90

That’s it for today… Sorry for the lateness of the letter this morning…. I was up with a bleeding jaw a couple of hours in the middle of the night and couldn’t answer the bell this morning…. Our Blues responded favorably to their new Head Coach last night with a win VS the Rangers in NYC…. I actually couldn’t believe it when they won the game that I had watched!  One of my other favorite teams, the Chargers lost last night in MNF… UGH!  Well, are you ready for Thanksgiving?  I’m not responsible for any cooking, so I can relax…. Last year a smoked a Turkey on the Big Green Egg, but I was not asked to repeat that job this year….. I thought the smoked turkey tuned out yummy! Oh well, I carry on despite my shortcomings….  Vince Guaraldi takes us to the finish line today, with his song: Christmas Is Coming…..  I hope you have a Tom Terrific Tuesday today, and please……. Be Good To Yourself!

Chuck Butler

• Currencies get sold down the river on Friday
• Gold kicks tail on Friday but gets sold overnight….

Good Day… And a Marvelous Monday to you… It’s Thanksgiving Week! I used to not enjoy Thanksgiving because every year Kathy and I would argue about which parents’ house we would eat at… It was our only argument all year, and therefore I didn’t enjoy Thanksgiving…. (because she always won!)  My parents were smokers, and so, the argument would go, to how our kids shouldn’t be exposed to the smoke…..  But now, everyone comes to my house on Thanksgiving, and I enjoy that much more! Especially in 2020, when it was just Chuck, Kathy, and our kids, and grandkids…. I made each person say what they were Thankful for… When it was my turn, I simply said, “I’m thankful for the Good Lord who allowed me to be here with you all today.”  The tears were flowing….   Marion Meadows greets me this morning with her version of the song: Jingle Bells….

Well, The dollar took no prisoners on Friday, last week…. It was a siege like I hadn’t seen in a while… And do you want to know what turned the dollar bugs on so much on Friday?  Well, You’ll have to stay tuned until we get to the FWIW article today, which will explain it all….  The Readers’ Digest version of it is simply, Europe had a plan to deal with Trump’s proposed tariffs, and it involves devaluing the euro….    So, with the euro the offset currency to the dollar, and the dollar bugs hearing that news, they took the dollar to a 2-year high… The BBDXY gained over 5 index points, the Dollar Index gained over 50 basis points, and the currencies look torn and tattered once again…. 

Gold didn’t let the dollar’s rally get in the way of its own rally…. Gold gained $47 on Friday to close the day and week at $2,716.90…  Back to $2,700 and looking like it wants to move even higher again…. Silver, too, got into the rally and gained 55-cents on the day to close the week at $31.41… There was no line in the sand at $31 this time, so the buying of Silver must have been very strong, eh? Didn’t I tell you last week that once the short paper trading was completed, that the metals would be back on the rally tracks?   I know, it was difficult to imagine after all that short selling, but…. History shows us that this is the trend……  

The price of Oil bumped higher on Friday and ended the week trading with a $71 handle….  So, much for the rumor that there was a glut of Oil supply, eh?   The goings on in Ukraine, Russia, Middle East got traders all worried that they were going to escalate and that got them marking up the price of Oil….  And the 10-year Treasury saw its yield stay steady Eddie at 4.41% to end the week. 

In the overnight markets last night…. Well, the announcement that the hedge fund guy, Bessent, was going to be nominated to be Treasury Sec really scared up the markets last night….  Right now, the markets are of the belief that Bessent will be the one that can get the U.S. economic growth back to 3%, and a 3% Budget Deficit (Budget? What Budget?) is the question that will be answered as we go along, but for now, the markets are giddy with this nomination, and that has Gold running for safety from the short paper traders this morning, The dollar getting sold, and bonds getting bought…. All opposites of what was going on before his name appeared on the docket…. 

The BBDXY has given back the 5 index points it gained on Friday, and added another index point to the downside move this morning…. Gold has given back $36 of its $47 gain on Friday, in the early trading, and Silver’s line in the sand is evident again, as it falls below $31 again…. Silver is down 36-cents this morning…   This is redonkulous!  Just because this guy (Bessent) is a hedge fund guru, and has made a Billion dollars, doesn’t mean he knows squat about running The Treasury, or bringing the U.S. Budget deficit down to 3%, but… Right now, the markets are all-in on this guy… So, there’s that…. 

The price of Oil slipped back to the $70 handle overnight, and the 10-year Treasury, as I just said, bonds are getting bought, and the 10-year is no exception, as its yield falls to 4.35% this morning, to start our day and week. 

So, what happened on Friday gets thrown out the window, and the markets start over again… I was taught early in my trading careeet that “The markets are never wrong”…. I know that I’ve tried to prove them wrong on several occasions through the years but have never succeeded…. I gave up…. I didn’t want anyone to think I was insane, trying the same thing over and over again….  I have to question the markets here though…. Really…. Throwing all your eggs in the Bessent basket just doesn’t seem to be the correct move….  to me that is…. I guess we’ll have to wait-n-see, but in the meantime, batten down the hatches and hold on to your hat! 

Well, we all know by now that the U.S. National Debt is over $36 Trillion… But the public debt is rising too…. Here’s David Stockman talking about just that: “Thereafter, however, soaring interest expense will ignite a veritable fiscal wildfire. On paper the public debt would power upward unabated to $150 trillion by mid-century under CBO’s latest projection. Yet even the latter is based on a Rosy Scenario budget model that assumes Congress never again adopts a single new tax cut or spending program and that the U.S. economy steams along without a recession, inflation recurrence, interest flare-up or other economic crisis during the entirety of the next quarter-century!

Of course, long before the public debt actually hits $150 trillion or 166% of GDP per CBO’s current long-term projection, the whole system would implode. Every remnant of America as we now know it would go down the tubes.”

That can be found on Ed Steer’s Saturday letter here: www.edsteergoldsilver.com

Chuck again….  This is in line with my thoughts that the whole financial system will collapse under the weight of all this debt, the Gov’t and public….  The FWIW article is long today, so this part of the letter will end now…

The U.S. Data Cupboard has nothing, nada, nil, zero, a big goose egg, for us today, and tomorrow it will only have the STUPID Consumer Confidence….  

To recap… The dollar soared on Friday, along with Gold & Silver…  But most of those gains were given back in the overnight markets last night and early this morning….  All because of the giddiness of the markets over the nomination of Scott Bessent,  a huge hedge fund manager for Treasury Sec.  The markets are all-in on this guy, of which Chuck things there should be calmer heads right now, in a wait-n-see if he’s as good as the markets think…

For What It’s Worth…. This article was sent to me by long-time readers, Bob, and it talks about the proposal of tariffs, and what Europe will do about them, and it can be found here: German Industrialists Very Worried About Trump’s Return – German Economists Say ‘Relax, We’ll Just Devalue the Euro’ – The Last Refuge

Or, here’s your snippet: “Germany is the largest economy in the E.U. However, due to a confluence of horrible events, most of them self-created as an outcome of ridiculous energy production decisions, the German industrial economy has been contracting since 2022.

Into this downward spiral of negative economic events within Germany, now comes the problem of President Trump eager to eliminate the Marshal Plan of one-way tariffs and start dealing with the trade inequities.  The German industrial manufacturing companies who make up the majority of the economic output are concerned, very concerned.

Within the discussion suddenly something appears that all Western financial pundits have yet to accept. Leo Barincou, a senior economist at Oxford Economics in Paris says:

[…] limited tariffs on selected products, such as cars, chemicals and agricultural products, may not be too much of a problem, Barincou says. A rising dollar, and hence a falling value of the euro, would offset some of the harm caused by the tariffs. “At a macro level, the impact would be limited,” he says. (read more)

Yep, here we go again.

We saw this play out in 2017 through 2019.  China first responded to tariffs by subsidizing their targeted industries and later devaluing their currency.  We began importing deflation because Chinese products arrived with lower, subsidized, prices, and we paid for them with higher value dollars.

The downside for the rest of the world was China pulling back from purchases of large industrial products from Europe.  This made the EU furious at Trump, and subsequently the EU central banks lowered the euro as an offset.  For Americans we started importing deflation from Asia and Europe.  Everything was arriving at a lower price and being paid using higher value dollars.

I find it a little humorous that Germany openly admits they will offset Trump tariffs, devalue their currency, and ship goods without tax impacts.  Meanwhile the gaslighting U.S. financial pundits will keep pretending this is not happening.

The names have changed, but the cause & effect outcomes remain the same.”

Chuck again… Yes, a little longer than the usual FWIW but, it was important for you to know what’s going through Europe’s mind right now regarding the proposed tariffs…. 

Market Prices 11/25/2024: American Style: A$ .6512, kiwi .5853, C$ .7163, euro 1.0487, sterling 1.2580, Swiss $1.1243, European Style: rand 18.0674, krone 11.0492, SEK 10.9790, forint 392.44, zloty 4.1257, koruna 24.1429, RUB 103.90, yen 154.50, sing 1.3463, HD 7.7808, INR 84.30, China 7.2443, peso 20.37, BRL 5.8068, BBDXY 1,285.71, Dollar Index 107.66, Oil $70.86, 10-year 4.35%, Silver $30.82, Platinum $955.00, Palladium $1,004.00, Copper $4.15, and Gold…. $2,680.30

That’s it for today…. Well, my beloved Mizzou Tigers won in Starkville, Miss Saturday in a convincing way, and now come home to play their rivalry game VS Arkansas this coming Saturday… They used to play this game on Black Friday, but I guess that changed…. A BIG game for Mizzou… The Border Rivalry game and bragging rights for another year…. Sunday was a nice day here, but that warmer weather won’t last long…. College Basketball has started, and the Mizzou Tigers basketball team is doing much better so far this year than last….  Next weekend will be the College Football Conference Champinonship games…. And then the final issuance of the top 12 teams to make the playoffs…. I still can’t believe that my belovoed Tigers aren’t a part of the CFP playoffs…. UGH!  Beegie Adair takes us to the finish line today with he version of the song: Winter Wonderland….  I hope you have a Marvelous Monday today, and please Be Good To Yourself!

Chuck Butler

• currencies drift on Wednesday, as Gold rallies…
• UBS says Gold’s rally is not over!

Good Day… And a Tub Thumpin’ Thursday to one and all! One week away from Thanksgiving… I had a dear reader point out to me that I had started listing Christmas tunes before Thanksgiving….  Wel, that is right, and the reason I do that is because I listen to Pandora’s Smooth Jazz Christmas…. They play a wide variety of Jazz musicians doing their versions of the songs… And I’m like a kid at Christmas, I love that music!  The new episode of Shrinking was on last night, so at least I had something to watch for an hour!   Well, there’ll be no surgery on the tumor until I get back from Houston on December 19th….  The surgeon’s question:; Why would I risk doing surgery if they (MD ANDERSON) have a new chemo that will melt away the tumor?   I couldn’t argue with him…   Jazz Jethro brings his Bossa Nova sound to the song Happy Holidays this morning…. 

Well, the dollar selling ended in the overnight market Tues-to-Wed. Morning, and the buying didn’t continue throughout the day on Wednesday…. So, as I suspected, it was a one and done with intervention…. Once again, I believe it was the PPT intervening in the currency market to buy dollars, and their buying prompted traders to fear selling dollars, and to buy them instead….. You know, back in the day, when I saw that the dollar buying was ending, and wrote the White Paper: The Demise of the Dollar…. (2001) There was no such thing as the Exchange Stabilization Fund, and the PPT at that time was more into keeping stocks from collapsing again….   Every time the dollar looks like it’s heading to the cliff, to do a Thelma and Louise,  and I notice it and point it out, the PPT steps in to keep that from happening…  I think that there is someone on the PPT that reads the Pfennig, and they stop the selling just to spite me!   Now that would be funny, if it didn’t have a chance of being true! 

The BBDXY ended the day yesterday at 1.284…. That’s 6 index points from where it was the day previously…. But Gold didn’t care if the dollar was rallying albeit on false reasons and Gold gained $20 yesterday to close at $2,652… 

Silver couldn’t find a bid with the short paper traders banging on Silver all day, and Silver lost 39-cents to close back below $31… At $30.89

 Here’s MoneyMetals.com with their take on what’s was going on in Gold: “The big decline in gold and silver over the past couple of weeks was fostered by the belief that the incoming Trump administration was going to halt the upward trajectory of federal spending and choose Bitcoin over the metal as the next key component of sovereign reserves.

Or…traders sensed that the market might be gullible enough to believe all of that and started driving the paper gold price lower in search of one sell stop after another.”

Chuck again… Wait, What?  They didn’t come right out and say price manipulation, but they alluded to it there, and that’s the first time I’ve seen that from them! 

And… I found this on Bloomberg.com this morning: “Gold will rally to $2,900 an ounce by the end of next year, according to UBS Group AG, echoing a call from Goldman Sachs Group Inc. for further gains as central banks expand their holdings.”  

The price of Oil slid lower yesterday by $2 and ended the day trading with a $68 handle….  What gives here? Up one day, down the next? Well, the last check on supply showed there was a glut of Oil on hand…. So, I get it, IF that’s what caused the problem….

And the 10-year saw its yield drop a bit to 4.40% yesterday…. 

In the overnight markets last night…. There was no PPT buying of the dollar last night, and so the dollar drifted lower by 1 index point in the BBDXY…. Again, this proves my point that why else would the dollar the night before to the tune of 6 index points, other than with Intervention?   Gold is up $18 to start our day today…. And Silver is up 16-cents… And has climbed back over the $31 handle, which seems to be the line drawn in the sand with he short paper traders, so we’ll have to see if they bring Silver back below $31 today, or if they will let it slide for now?

I have to say that historically, December isn’t a good month for the metals, not that they get sold, but that the buying abates…. Now, there has been a December or two when the metals kicked tail and took names later, so which one will it be this year?   

The price of Oil bumped back to a $70 handle overnight, so much for the fear of an Oil glut, eh?  And the t0-year’s yield remained at 4.40% overnight, to start out day, still getting sold… I’ve told you why the bond boys haven’t come around to marking down the yield in the 10-year Treasury, so I won’t get into that again…. But the Readers’ Digest version is the bond boys just didn’t believe that inflation was over.. 

I found a headline to an article yesterday that asked this question: Can Trump, trump Inflation? And that got me thinking…. Uh-Oh! I hear you groaning, here he goes again…..   Oh, c’mon, this is going to be different…..  In my opinion, the only way that Trump and trump inflation is to cut deficit spending by a HUGE amount and slow the issuance of Money Supply….  I just don’t see that happening…. The trend in Politics since the Carter administration is for more spending, and money supply from each POTUS….   I know there was the beginning of COVID, but the last Trump deficit figure for his 4 years was $7 Trillion, deficit…. Look for more deficit spending, and the need for additional money supply, to fuel inflation in the coming years….. I’m just saying…. 

But… We The People… We’re all Americans, and Americans always find a way, right? Well, that way, per se, is to cut deficit spending and money supply….  Can we The People stand the austere measures that will need to be taken to get inflation back in the bottle?  I doubt it…. Life has been too good for most for too long, and you’re telling them now that their stimmy checks are not coming? That zero interest rates for low borrowing costs are not coming? And their favorite doodad will no longer be cheap?  What’s a consumer to do?  You’ve got to laugh a little, cry a little
Until the clouds roll by a little (jimmy Durante)….   

Well, it was reported yesterday that the Bank of Japan has sold 22% of their Treasury Holdings..  Not as much as Russia or China has sold, but still a large number of Treasuries that they felt they didn’t have the need for…. This is a recurring theme for the future, as countries line up to sell their Treasuries, because of fear of not being paid back for them….. I get it…. These countries are very fearful of the same thing, I’m fearful of, and that is a default by the U.S. Treasury….. At least when I buy Treasuries, I keep them within 3 years, and shorter…. These countries in search of yield have gone out 20-30 and more years….. Their fear of default is much greater than mine…. 

So, you think that there could be no default by the U.S. ?   I can hear you poo-pooing what I just said…. Well, the debt servicing costs (interest payments)  are now eating up a HUGE chunk of our tax receipts…. And Trump wants to cut taxes…..  The saw dust will be left on the floor from all the minds working to find ways to continue to make payments on Treasuries, will mount up in hills….   And finally, the minds will throw in the towel and say “no mas”…. 

The U.S. Data Cupboard today, finally has a piece of real economic data, and it’s forward looking!  leading Indicators for Rocktober will print, and most likely it will print negative as it has for a very long time….   With today by a Tub Thumpin’ Thursday, we will also see the Weekly Initial Jobless Claims… Last week the Jobless Claims increased by a small amount to 220,000….. 

To recap…. The dollar selling ended the previous night, and then didn’t budge the rest of the day yesterday, thus holding its 6 index point gain in the BBDXY…. Gold didn’t care it gained $20 on the day… Chuck talks about what the new POTUS can do to reduce inflation… And Chuck talks default…. 

For What It’s Worth…. Yesterday, I told you that Japan had sold 22% of their Treasuries…. But that didn’t include individual banks and what they were doing, and this article is about a HUGE Japanese Bank that is selling their Treasuries, to shore of their portfolio, after suffering major losses, and it can be found here: Norinchukin loss to exceed $9.7 billion as bank dumps foreign bonds – The Japan Times

Or, here your snippet: “Norinchukin Bank, the Japanese lender that got stung by rising global interest rates, expects its annual loss to exceed a previous ¥1.5 trillion ($9.7 billion) projection as it steps up the disposal of unprofitable foreign bonds.

The company, one of the country’s largest institutional investors, shocked global markets in June when it disclosed plans to sell about ¥10 trillion of U.S. and European sovereign bonds this fiscal year to stem losses from wrong-way bets on rates. It now aims to offload even more than that amount, having disposed of ¥7.5 trillion in the first half.

The steeper expected losses and accelerated asset disposals come as CEO Kazuto Oku said he’s preparing for growing uncertainty, including the possibility of higher U.S. rates under a Donald Trump presidency. Oku didn’t dismiss the potential for losses to reach about ¥2 trillion, when asked during a briefing.

“In the second half, we will take deeper steps to improve our portfolio,” Oku said. There’s a risk that Trump’s policies will fuel inflation, prompting the U.S. Federal Reserve to stop cutting rates, he said.

Norinchukin posted a net loss of ¥893.9 billion in the six months ended Sept. 30, versus net income of ¥144.4 billion a year earlier.”

Chuck Again….  Notice that even the Japanese see the new POTUS bringing inflation?    This is just one of the banks in Japan with these problems folks…. And soon it come ashore here in the U.S.   mark my words on that!  And then we’ll be turning Japanese…. yes, i really think so! (The Vapors)

Market Prices 11/21. 2024: American Style: A$ .6521, kiwi .5829, C$ .7161, euro 1.0520, sterling 1.2638, Swiss $ 1.1316, European Style: rand 18.0888, krone 11.0423, SEK 11.0329, forint 391.01, zloty 4.1297, koruna 24.0544, RUB 100.83, yen 154.56, sing 1 3437, HKD 7.7829, INR 84.49, China 7.2413, peso 20.52, BRL 5.7732, BBDXY 1,283, Dollar Index 106.68, Oil $70.10, 10-year 4.40%, Silver $31.05, Platinum $950.00, Palladium $ 1,026.00 Copper $4.17, and Gold…. $2,670.73

That’s it for today…. And this week…. Next week, there will only be 3 Pfennigs: Monday – Wednesday..  I have no more Dr appts until December! YAHOO! Well, we’re getting closer to Chuck’s annual Christmas vacation…. Because of the Calendar dates… I’ll begin it on Dec. 18th, and return on Dec30th….   Alex and Grace’s wedding is only 2 weeks away….  I’ve lost more weight, and now I’m afraid my tux is going to be too large on me….  I had better try it on again today, just in case…. And I won’t be writing on December 5th, as I’ll be heading to Little Rock! So, have you got all that?  Then Dec 9th, is the Trotter, Dubinsky, Lissner Holiday Party!   It’s always fun to see my former colleagues at EverBank and Mark Twain Bank!  The Stephen Kummer Trio takes us to the finish line today with their version of the song: I’ve Got My Love To Keep Me Warm…. (I used to have a recording of Dean Martin singing that song, I loved it!)  I hope you have a Tub Thumpin’ Thursday today, and please…. Be Good To Yourself!

Chuck Butler

• Currencies & metals continue their rally on Tuesday.
• Lola calls for clients to diversify…. .

Good Day… And a Wonderful Wednesday!  Well, our string of very nice days for November comes to an end today…. And then it’s back to normal November weather….  When I was a young man, they would call what we had here an “Indian Summer”….  I haven’t heard that term for years, so I guess they don’t call it that any longer…  Probably was demeaning to the Indians!  The PC Police will probably be dialing me up! And if they do, I’ll be sure to tell them where to go to find someone who cares!  The Stephen Kummer Trio greets me this morning with their version of the song: Have Yourself A Merry Christmas

Well, the dollar didn’t get bought yesterday, thus making it two consecutive days of selling. The BBDXY lost 2 index points yesterday and ended the day at 1,278….  The euro, which was left for dead a week ago, has perked up and is within spitting distance of 1.06….  The rest of the currencies are feeling and looking a bit better, but it will require more dollar selling to get them out of their sick beds… 

Gold was up early in the morning yesterday, then saw some short paper trading bring it back about $15, but by the end of the day, Gold proved that you can’t keep a good investment down, and showed a gain of $22 to close the day at $2,632…  Silver was the same kind of treatment that Gold did, but by the end of the day, Silver had gained 15-cents to close at $31.28

The price of Oil remained trading with a $69 handle yesterday, and the 10-year regained some of its lost yield from the day before, and ended the day trading with a 4.39% yield…. 

In the overnight markets last night.. Well, stop the press! The dollar is back on the warpath! Last night saw the dollar reverse its most recent course, and the BBBY gained 6 index points overnight! Wait, What? Yes, it’ very strange to me that this happened in the overnight markets… There had to be some PPT intervention, I’m positive of that, because the overnight markets all together wouldn’t move the dollar that much in one session… So, the BBDXY is 1,284 this morning, and all the currencies have pulled the bed sheets over their eyes once again, as they remain in their respective sick beds…. 

Gold is not being affected by the dollar rally this morning and is up $8 to start our day… Silver has lost 16-cents to start the day…. Nothing amiss here…..  and no effect on the metals from the dollar strength is a good thing.  The price of Oil has bumped higher again overnight by a buck and trades this morning with a $70 handle…. And the 10-year’s yield has risen to 4.42% again….  The 10-year’s yield has been like a buoy in the water lately, bobbing in and out of the water…. It seems that every time the yield gets around where it is now, someone or some entity comes in a buys the heck of out the bond to bring the yield back down….  My thought here is the “some entity” is the Fed/ Cabal/ Cartel, not allowing yields to get away from them…. 

Well, looky here… Lola is telling everyone to diversify!  And you know what I’ve always said about Lola… What Lola wants, Lola gets….  For all of you new to class, I call Goldman Sachs, Lola….  I found this headline very interesting: “Investors should start diversifying their portfolios, Goldman Sachs says”

By diversifying, Lola is talking about buying investments for your portfolio that are different from your stocks and bonds… This is the first time I recall seeing a Big Casino Bank like Lola telling their clients to diversify…. 

I on the other hand have been telling investors to diversify for decades! I read and studied Markowitz’s Modern Portfolio Theory… I used to give talks to large crowds about diversification, and Markowitz’s theory, that talks about how risk-averse investors can build portfolios to maximize expected return based on a given level of risk.

And the further you diversified, the further out on the scale you went, and were protected by your diversification….. So, for once I tip my hat to Lola for telling their clients to diversify their investment portfolios…. 

The normal way to diversify, is to make sure you have some Gold & Silver as a part of your holdings…  Then you can be as varied as you want to be, by buying art, land, etc. 

And then you need to keep your diversification up to date….  Basically, you would hold up to 20% of metals…. Most of the time you’ll only hold 10-15% of metals, but when metals are kicking tail and taking names later, you’ll want to increase the percentage to 20%…. 

Not the discussion you thought you were going to be having today, eh?  It’s always good to pull Henry Markowitz our of the past and bring to today’s markets…. I used to show attendees of conferences who a stocks and bonds only portfolio how having a simple mix of euros, yen, and Swiss, and 20% in Gold and 20% in Silver enhanced their investment portfolio…. When stocks are strong like they are now, your currencies will not be performing well, but when the dollar changes direction, that’s when you’ll be glad you are diversified…. 

OK… Are we seeing the end of the road for MSNBC?   It was reported that MSNBC barely attracts 30,000 viewers on weekends…. Shoot Rudy, Wayne and Garth had more viewers for their imaginary cable show!  

I found this on Reuters.com: “Boeing will lay off more than 2,200 workers in the U.S. states of Washington and Oregon, according to filings posted on Monday, as part of the debt-heavy U.S. plane-maker’s plan to cut 17,000 jobs, or 10% of its global workforce.”  

Chuck again, looks like Boeing is looking forward to some rough time, eh? 

And I’ll finish this up this morning with a rant from Bill Bonner… After seeing USA Today print a headline:  “Trump inherits strongest economy in 50 years.”  

Here’s Bill: “Oh my. They’re tempting the gods. But Trump is not heir to a strong economy at all. He begins with a labor force that is struggling to keep up with inflation and the highest priced assets in history. And unlike Reagan, who came into office with an economy built on solid ground of low debt and low asset prices, Trump’s economy sits on the slopes of a rumbling volcano of debt ($36 trillion of government debt… $8 trillion of his own doing).  And on the slopes of this Vesuvius stands the whole U.S. capital structure — overpriced… over-extended… and overdue for a correction.”

Chuck again… Of course, USA Today could be talking about the stock market being the economy, of which they would be mistaken, and in error in thinking that way! 

The U.S. Data Cupboard today has nothing, zero, zilch, nada, nil, a big fat goose egg for us today… There will be 3 Fed Heads speaking today, so there’s that…. And yesterday, both Building permits and Housing Starts were slightly lower than the previous month… And the markets shrugged them off…

To recap… The dollar buying has stopped for two days so far this week…. Chuck’s thoughts last week, that the dollar was overbought, might be in play here…  The selling of the metals is over for now too, Gold & Silver have rallied two consecutive days… And Lola tells her clients to diversify….  And that lights a fire under Chuck! 

For What It’s Worth….  This article is somewhat related to what I’m always talking about…. Investors not preparing enough for retirement….  This is all averages, so it’s not like it’s this way for everyone in a state….  But gives you an idea of how difficult it will be for many to retire….  And it can be found here: How much Americans have saved for retirement in every U.S. state

Or, here’s your snippet: “When it comes to retirement savings, residents of one state are leading the pack: Massachusetts.

The average household retirement savings balance in Massachusetts is $448,500, according to an October study by DepositAccounts. That’s the largest amount out of all the states reviewed in the study.

The personal finance site analyzed data from the U.S. Census Bureau’s 2022 Survey of Income and Program Participation, the latest available, to determine the average amount households in each state have saved for retirement. The totals include balances of 401(k)s, IRAs, Keogh plans and thrift savings plans.

A couple of reasons may explain why Massachusetts residents have the highest average balances. At $80,330 a year, Massachusetts workers earn the highest average salaries in the U.S., according to a recent analysis by Empower.

On top of that, Massachusetts implemented the first state-level program to help workers outside of the corporate workforce grow their retirement savings. In 2017, the state launched its CORE program, which helps small nonprofit organizations offer 401(k) benefits to employees. As of May, over 200 organizations were enrolled in the program, per the state’s website.

On the other hand, Americans in Louisiana and Mississippi have the lowest average household retirement savings of $128,900 and $131,500, respectively. And Florida, a popular retirement destination, ranks 19th with average savings of $287,200.

But remember, while averages can provide an interesting snapshot of retirement data, they don’t always tell the whole story. The presence of a few high or low account balances can skew the results.”

Chuck again…. The article goes on to show the average amount of retirement savings each state’s residences have, so click the link above and check out your state! 

Market prices 11/20/2024: American Style: A$ .6501, kiwi .5878, C$ .7148, euro 1.0546, sterling 1.2663, Swiss 1.13, European Style: rand 18.1490, krone 11.0429, SEK 11.0062, forint 388.70, zloty 4.1131, koruna 24.0150, RUB 100.46, yen 155.72, sing 1.3429, HKD 7.7838, INR 84.41, China 7.2462, peso 20.24, BRL 5.7732, BBDXY 1,284.22, Dollar Index 106.62, Oil $70.12, 10-year 4.42%, Silver $31.12, Platinum $970.00, Palladium $1,031.00, Copper $4.20, and Gold…. $2,640.36

That’s it for today…. Well…. My beloved Mizzou Tigers were # 23 in the CFP ratings last night, nowhere close to the Top 12 that hey had their sights set on before the season… But, if the Tigers win their last two games, they’ll have a 9-3 season, and that’s not too bad! It’s better than a sharp stick to the eye, as my good friend, Frank Trotter, used to say…. Speaking of Frank, this week is attending the grandaddy of them all conferences, The New Orleans Investment Conf. I used to speak at that conference! I love NOLA, And people that know their way around the quarter, are always fun to be with! So, if you’re going to NOLA, tell Frank, I said hi!   Jack Jezzro and his Bossa Nova sound, take us to the finish line today with his version of the song: O Christmas Tree…. I hope you have a Wonderful Wednesday today, and please Be Good To Yourself! 

Chuck Butler

• currencies & metals rally on Monday
• who’s buying the 10-year?

Good Day…. And a Tom Terrific Tuesday to you! Yes, I know this is tardy today, but…. I told you yesterday that I had scans today, and I forgot to say that there would be no Pfennig… But as it goes, I was the first in, first out of the CT room, and I was back home right away, so here I am….  the CT operator said to me, “So, you’re the one that had the anaphylaxis shock right there on the table?” And I said, “yes it was me, I really thought that I had bought it that day, that this was it, I was dying..”  He said, “boy that must have been scarry’… No doubt!  The Lori Mechhem Quartet greets me this morning with her version of the song: Christmas Time is Here…

Well, the dollar stopped getting bought Sunday night, and that carried over into Monday’s U.S. Session, which saw the BBDXY lose 5 index points, the currencies are so deep down the rabbit hole right now, that the dollar’s selling didn’t wake them up…. And yesterday, I made a BIG DEAL out of the idea that we wouldn’t have to wait long for the metals to take off again to higher ground, if the selling had stopped…. 

Well, the selling stopped, and Gold gained $43 on the day to close at $2,610, and Silver gained 93-cents to close at $31.13…. So, it does appear to me that the waiting for the metals to rally again didn’t require us to wait too long! The price of Oil bumped higher to a $68 handle yesterday, and the 10-year saw some buying, (I wonder from whom? Maybe the Fed?) and the yield fell to 4.36%…. 

In the overnight markets last night, Gold continued to lick its wounds and gain some more lost ground, and it’s up $22 to start the day, while Silver is up 13-cents to start the day today…  I find this rally to be something that I could count on given the harshness of the short paper trading that took place last week.  I sure hope you all got your orders in for Gold or Silver while their respective prices were down…. 

The price of Oil bumped higher again overnight and trades this morning with a $69 handle…..   The Oil boys must have heard some saber rattling going on in the Middle East….   And the 10-year’s yield sits at 4.35% this morning…. 

Well, wanna know a secret? (Beatles) The U.S. national debt just went over $36 Trillion!  What? You didn’t hear about that on the nightly news or your favorite newspaper? Well, I don’t think you will, so take it from me, or go to the Debt Clock.org and see for yourself!  $36 Trillion, when we had just reached $35 Trillion a few months ago…. YIKES!

It’s just one thing after another with the lawmakers, and their abilities to ratchet up the deficit spending…. But one day, Alice…. To The Moon!  (The Honeymooners) The collapse of the financial system in the U.S. will come upon us, but first we’ll have a debt crisis, with Treasuries…. I hate to sound like Mr Gloom and Doom this morning, but somebody has to tell you the truth, that you won’t get from the nightly news! 

This will be quick one because I’m getting such a late start, but it was still chock-full-o-stuff for you to think about. For certain? Are you Imprint Certain? Yes… I am!

The U.S. Data Cupboard has nothing but housing stuff this morning, Building Permits, and Housing Starts…. No thanks, I’ll pass…. 

To recap… Well, we didn’t have to wait long for confirmation that the metals selling had stopped, with Gold & Silver back on the rally tracks yesterday, and today…. The dollar buying has also stopped for now…. We’ll have to wait-n-see if this is the new trend…  And the U.S. National Debt just went past $36 Trillion!

For What It’s Worth…. This article is asking the question, has the U.S. Consumer tapped out?  And then it goes on to explain that it thinks so…. And it can be found here: Are Americans Tapped Out? Consumer Borrowing Tanked in September

Or, here’s your snippet: “We keep hearing that the economy is “robust” and gliding to a soft landing, but there are cracks in the foundation if you care to look closely enough.

American consumers have continued to spend over the last two years despite the stranglehold of price inflation. On the surface, this seems like a bullish indicator. But when you dig into the spending patterns, you discover that Americans blew through their savings and ran up massive credit card bills to sustain their spending spree.

And now it appears consumers might be pushing up against their borrowing limits.

The increase in consumer debt has slowed to a crawl, with both credit card spending and borrowing for big-ticket items tanking. This may indicate that Americans are close to being tapped out.

That’s bad news for an economy relying on borrowing and spending to keep churning.

Total consumer debt rose by a rather modest $6 billion in September, a 1.4 percent annual increase, according to the latest data from the Federal Reserve.

Americans now owe just over $5.1 trillion in consumer debt.

The Federal Reserve consumer debt figures include credit card debt, student loans, and auto loans but do not factor in mortgage debt. When you include mortgages, U.S. households are buried under a record level of debt. As of the end of the third quarter, total household debt stood at $17.94 trillion.”

Chuck again…. Yes, if the U.S. Consumer has come to its senses and stopped deficit spending, that’s a good thing for them, but a bad thing for the economy, which needs consumer spending to stay afloat…. Without Consumer spending, the Gov’t spending had to fill in the gaps, which means more money supply and higher inflation… 

Market Prices 11/19/2024: American Style: A$.6510, kiwi .5898, C$ .7151, euro 1.0584, sterling 1.2651, Swiss 1.1350, European Style: rand 18.0583, krone 10.9941, SEK 10.9347, forint 384.35, zloty 4.0901, koruna 23.4526, RUB 100.45, yen 153.66, sing 1.3383, HKD 7.7839, INR 84.41, China 7.2394, peso 20.29, BRL 5.7872, BBDXY 1,279, Dollar Index 106.26, Oil $69.12, 10-year 4.35%, Silver $31.25, Platinum $972.00, Palladium $1,022.00, Copper $4.15, and Gold $2,633.29

That’s it for today…  Stayed up way too late last night, watching the Cowboys lose again, which always makes me happy! Not a Cowboys fan… Goes back to the Big Red (football Cardinals0 who had a Big rivalry with the Cowboys… These days, I’m a fan of the Chiefs (Mo. Team) and I always like seeing the Chargers win…. My beloved Mizzou Tigers go to Starksville Miss this Saturday to play Miss. St. I sure hope they have licked their wounds from the awful loss that they had to take last Saturday and are ready to win again!  The Stephen Kummer Trio takes us to the finish line today with their version of the song: Blue Christmas… I hope you have a Tom Terrific Tuesday today, and please Be Good To Yourself!

Chuck Butler

• the dollar finally sees some selling on Friday…
• The metals rally strongly in the overnight markets….

Good Day… And a Marvelous Monday to you! Well, I was so excited one minute and then let down the next minute, watching my beloved Mizzou Tigers this past weekend…  This is a memo to all defense Coordinators, college or pro…. “The Prevent Defense Doesn’t Work!” I shook my head in total disgust, watching that happen Saturday…. Oh well, it’s just a game… That the Tigers should have won! You see? I was a real hot head when I was a young man, and I would have been throwing things if I were still a hot head….  The Mason Embry Trio greets me this morning with their version of the song: This Christmas…

Well, Friday, saw the dollar get sold a little bit, with the BBDXY losing 3 index points, and end the week at $1,285… The weaker dollar, for a day, didn’t help the currencies much, nor did it help Gold & Silver… The selling of Gold & Silver abated a bit on Friday, but in the end the two were down for the day… Gold closed the week at $2,563, and Silver closed at $30.30… There was an article on the paid subscriber side of CNBC on Friday that asked the question: Buying opportunity or time to bail? What to do with gold following the postelection selloff…

And then it cut off and wouldn’t let me read any more of the article… Stupid CNBC! I would hope that they would come to the conclusion that investors should use these cheaper levels to back up the truck..  But I guess, I’ll never know…  Oh, well, knowing CNBC they didn’t mention price manipulation or short futures trades, so I didn’t lose any sleep over not being able to read it. 

The price of Oil slipped a buck on Friday and ended the week trading with a $67 handle… And the 10-year Treasury’s yield ended the week at 4.46%…. 

The Big News last week was a statement from the chief Fed Head, Jerome Powell, who said, “The economy is not sending any signals that we need to be in a hurry to lower rates” And brother did that send the markets into a tizzy! They weren’t expecting to hear anything like that coming from Powell….  He didn’t go as far as saying that rates could be raised instead….  But according to the markets he might as well have said that, because that’s what they heard! And that has given the bond boys affirmation that their marking up of yields was the right thing to do! 

Of course, I don’t know what set of data that Powell was looking at for his view that the economy is strong and doesn’t need more rate cuts…. In just the last week, we’ve seen Factory Orders print negative, and Industrial Production print negative…. And Capacity utilization drop for a second consecutive month… These are REAL ECONOMIC DATA Prints, Jerome…. Please make sure you look at them before making any comments about a strong economy…. 

In the overnight markets last night… The dollar drifted higher by 1 index point in the BBDXY, but Gold is knocking it out of the park this morning, as it rallies by $32 in the early trading…. Silver is up 49-cents this morning, so out Monday and week is starting out on a good foot…  Below, Ed Steer says that if the current selling cycle is over, we won’t have to wait long for a rally in the metals…. And so, I’m with him on that, given the rally in the early trading today…. Gold was very near the “oversold position”, and that has helped turn it around too….  The price of Oil remained trading with a $67 handle overnight, and the 10-year’s yield bumped higher to 4.47%…. 

I’m very happy to see Gold & Silver back on the rally tracks…. And am wondering how many investors took advantage of the cheaper metals prices last week?  it’s not too late, as Gold is still below $2,600, and Silver is below $31.00, and when the metals rally really swings into gear, those levels will be far figures in the metal’s rear-view mirror…  And not the one that says, Object my appear larger….  The one over the dash! I know I didn’t have to explain that to you dear reader, but the writing teacher’s words hung on my mind this morning to not leave the reader wondering what the hell I was talking about! 

Well, Retail Sales in the U.S. were up last month, and it showed that consumers are getting ahead of the Christmas Shopping Season… The BHI indicated to me last week that Retail Sales would be stronger, and they were!  I think people are past where we were a few years ago, when Retail Sales in December were negative!  Nowadays, consumer just run up the credit cards and then hope that the Gov’t bails them out…. Because it will take an EON for consumers to pay them off! 

I wanted to get that out there on Retail Sales and not wait for the U.S. Data Cupboard discussion… 

Ed Steer had this to say about Gold & Silver’s direction in his Saturday letter that can be found :www.edsteergoldsilver.com…. here’s Ed: “It would appear that this current ‘wash, rinse & spin cycle’ is now much closer to its end, than its beginning — and where we go from here…and how soon…is anyone’s guess. I don’t pretend to know…but suspect we won’t have to wait long.”

Chuck again… Sure, the game is played by the short paper traders to sell Gold & Silver until they get all the short term holders out of the market, and then come back in and buy the heck out of the metals, and when the metals reach a level that makes the short paper traders smile, they sell the heck out of the metals again…. The thing to keep in mind before you think, why would I want to be involved in that?, that Gold has climbed above the previous high it held in the ensuing rally, so it’s not that bad! HA! 

Well, I came across this little ditty on zerohedge.com  and it talks about how Russian Gas Co, Gazprom has decided, “no gas for you!”  Here’s the skinny: “Starting November 16, Austria is off the guest list for Russian natural gas, following a €230 million ($242 million) arbitration spat between Gazprom and Austria’s OMV AG. OMV, refusing to let that cash slip away, decided to withhold payments to Gazprom.

Chuck again… Seems about right to me, unfortunately, this non-deliver of natural gas comes at a bad time… Winter i just around the corner… It’s sort of like the sgt in the Airplane movie, Steve McCroskey who said, “Looks like I picked the wrong week to quit drinking”.   I don’t know about you, but that movie still cracks me up… That and the movie Night Shift, still cracks me up…. Speaking of cracking me up… I’m currently watching the 2^nd Season of the show: Shrinking….  I have to wait each week for Wednesday when the new episode is released… But it’s worth the wait! 

The Gold Bug, Judy Shelton, she of failed run at a seat on the Fed/ Cabal/ Cartel, just wrote a book, and in the book she talks about the return of a Gold standard, and that it would be easy to do…. She also discusses the idea of making some Treasuries Gold Backed…  Think about the genius of that idea… The deficit spending would be cut dramatically because the U.S. would be on the hook for the bonds, they issued to finance the debt, with Gold….  I went out to Amazon and ordered the book so I can read more…. And when I do, I’ll report on what she had to say, here…. 

And the rally in yields, bond selloff in price, is beginning to weigh on the stock jockeys…   The Fed Rate cuts haven’t had any effect on bond yields, and that brings me to the idea that “be careful what you wish for…. ” So, why hasn’t the rate cuts had any effect on the yields, other than to make them rise? Well, in my humble opinion, the bond boys didn’t believe the Fed heads cut rates while inflation was still above their target rate, and they thought, the Fed Heads will be back to hiking rates soon enough, so no reason for us to make owing Treasuries, like the Tower of Terror ride…. 

I even told you when the Fed Heads cut rates 50 Basis Points to end their rate hike cycle, that they would end up being sorry they did that, because this scenario was so similar to what Paul Volcker experienced back in the day… Inflation was falling and Volcker decided to jump the line early and be a Sooner, and cut rates, only to find that he had to come back and raise them again a few months later…..  History… It may not always repeat itself, but it’s always near the scene of the crime!  I’m just saying…. 

The U.S. Data Cupboard is void of many real economic data prints this week… We’ll have to wait until Thursday to see the Leading Indicators for this month… Until then, we’ll see a lot of housing data that really doesn’t move the markets much these days… And we already talked about Retail Sales last week…. A very strong print, thus indicating to me that consumers are getting ahead of their Christmas Shopping Season…. 

To recap… The dollar finally saw a bit of selling on Friday….Gold & Sliver tried to play off the weaker dollar but couldn’t leave the short paper traders at the door…. Chief Fed Head, Jerome Powell, said that the Fed Heads were not in a hurry to cut rates, of which the markets took as a sign that the next move will be a rate hike?  What a bunch of dolts! His statement doesn’t mean a hill of beans…. Remember “higher & Longer”?  and how did that work out?  I’m just saying

For What It’s Worth… This article is by Matthew Piepenburg of Gold Switzerland, of whom I used here several time through the years… Whatever Matthew writes about, I want to read it, and you should too! I’m just saying…. Anywhat this is about the U.S. dollar and it can be found here: Gold In a Trump Era: Rock Still Beats Paper

Or, here’s your snippet: “A Weaker Dollar?

What we do know is that change is certainly coming, and despite the DXY’s impressive climb of relative strength (which does matter), we should expect to see a USD that trends weaker rather than stronger in the next four years.

Why?

Well, for one thing, both Trump and Harris have been saying so throughout their campaigns.

And despite Powell’s aborted “higher-for-longer” (i.e., pro-DXY) campaign of 2022-2023, even Janet Yellen and Jake Sullivan have been operating openly and covertly toward a weaker USD.

I, too, have argued and foreseen the same, not because it’s fashionable as a gold executive to be anti-fiat, but because a weaker dollar is the only Realpolitik way out of the United States’ sovereign debt trap.

Throughout history and without exception, whenever a debt-corned nation is forced to choose between its currency and bond market, the currency has always been sacrificed.

Always.

In other words, the US needs a weaker dollar.”

Chuck again… Matthew goes on to talk about Gold, which he is prone to do… He’s a “got to reads this guy” 

Market Prices 11/18/2024: American Style: A$ .6563, kiwi .5841, C$ .7097, euro 1.0540, sterling 1.2628, Swiss 1.1261, European Style: rand 18.0987, krone 11.1137, SEK 11.0051, forint 387.77, zloty 4.1046, koruna 23.9625, RUB 100.33, yen 155.14, sing 1.3446, HKD 7.7842, INR 84.29, China 7.2419, peso 20.40, BRL 5.7928, BBDXY 1286, Dollar Index 106.80, Oil $67.40, 10-year 4.47%, Silver $30.86, Platinum $960.00, Palladium $978.00, Copper $4.11, and Gold…. $2,595.30

That’s it for today… Well, I have a busy week ahead of me this week… Today I go for my annual Medicare Wellness checkup, tomorrow I go for scans, Wednesday I go to the surgeon who is going to de-bulk this tumor in my mouth, and on Thursday I have a happy hour with my classmates! I doubt I would pass any health test…  But to see that I’m still alive and functioning should be good! Better living through chemistry is what I always tell the doctors… And they get it…. Sorry for the rant above today in the intro…. I had to yell at someone, so I yelled at the walls!  And my laptop monitor! And if you didn’t get what I was referring to: Mizzou lost with 15 seconds left in the game! J. Daniel Davidson takes us to the finish line today with his version of the song: What Child Is This? I hope you have a Marvelous Monday today, and please Be Good To Yourself!

Chuck Butler

• the dollar is a runaway bus!
• Inflation on the rise?

Good Day… And a Tub Thumpin’ Thursday to one and all! Every time I turn on our Blues so afar this season, I watch the blow a lead, and lose the game… So, maybe I should keep away from their telecasts! My new GI doc was a hoot! She said she had read my entire health record, and I said, No way! And she repeated my whole history with cancer…. I said, OK, you win! She was so kind to me, as if I were porcelain, She kept wanting to help me up and down…. You know, there’s one thing that I’ve learned through my time with cancer and other maladies, is that it’s OK to allow people to help you, if that’s what they think will help…. Lori Meeham greets me this morning with her versions of the song: We Three Kings…

 Well, the STUPID CPI was up on a year-on-=year basis, and that was the first uptick for the data set since March of this year…. YOY The STUPID CPI was 2.6% up from 2.4% in Sept.  And that news sent the dollar bugs running around the kitchen floor, here, there, everywhere, and at the end of the day the BBDXY had gained 4 index points…. There’s just no stopping this runaway Bus, the dollar that is….  You see, traders took this rise in annual inflation to another level, and said, “this means it will make it tricky for the FOMC to keep cutting rates”, and off went the dollar to higher ground…  

Gold, which was up in the early morning, then turned and the short paper traders came out to play again, and when all the dust settled on the day, Gold had lost $27 on the day… Silver, which was up 22-cents in the early trading, then saw the same selling as Gold did and settled at the end of day losing 66-cents… Gold closed at $2,573.30, and Silver closed at $30.39….  

I’m telling you now, so maybe you’ll listen to me later, but everyone just needs to calm down…. Do not panic sell here! If anything use all this selling to buy at cheaper levels….  With inflation on the rise again, this will get Gold going again… Will you look to buy at these cheaper levels, or will you procrastinate and buy once Gold is back to $2,700 and beyond? 

The price of Oil remained in the $68 handle yesterday, and the 10-year’s yield said, “OK Fed Heads try and stop me today from rising”… And it rose to 4.48%  

I think the Fed Heads are realizing that they are losing the bond market…  And the bond vigilantes are back! 

In the overnight markets last night: I know I’m beginning to sound like a broken record, but here it is… The dollar got bought in the overnight markets to the tune of 4 index points in the BBDXY, which sits this morning at 1.288…. Gold is down in the early trading -$16, while Silver is down – .13-cents… There’s nothing I can here, other than to remain calm and do not sell in panic mode… You’re going to need your metals protection from the inflation that’s coming…. I”m just saying… 

The price of Oil bumped higher to a $69 handle overnight, no rhyme or reason, just GOP…. Adn the 10-year remained offered with a yield of 4.48%….  The Bond boys get it… Inflation is going higher, as too will interest rates have to…. That is unless the Fed Heads have given it to the lawmakers who would love to see inflation riise, to help with the debt…. 

I really don’t believe that the increase in annual inflation last month is going to stop there….  It may take a month or two to get going again, but as long as Trump 2.0 does what he said he was going to do, and that is place huge tariffs on exports to the U.S. then I see inflation increasing again…  Money Supply is off the charts, and it won’t be long before we begin to see it in rising prices….   Remember, what I’ve told you over and over again, that this dance is gonna be a drag, no wait! I’ve told you over and over again that Money Supply equals inflation, period! 

Well, hold on to your hat… Here’s what Kitco.com had to say about Gold & Silver pricing right now.:” Gold and silver have struggled in the wake of Donald Trump’s re-election, and with concerns such as the threat of World War III decreasing, one analyst said the bullish case for precious metals is on the back burner until the current market euphoria subsides.”

Chuck again… Remember when I told you that Bloomberg.com and Kitco.com  were two naysayers to price manipulation of the metals…. And here the writer from Kitco.com failed to mention that the short paper trading of the two metals has exasperated the price drop….  They went on to say in the article that Gold could fall to $2,500, before turning around…..    Like I said, “hold onto your hat”

And speaking of Gold…. The other day I briefly mentioned that the Euro Wanna Bes were making plans to go back to a Gold Standard….  But left it there… Here’s the skinny:  Countries outside the eurozone but inside the European Union, i.e., those that one day might join the eurozone—like Poland, Hungary, and the Czech Republic, are positioning for a new gold standard.

To prepare for a monetary system based on gold, they are buying gold to equalize their reserves to the eurozone average. This balancing of gold reserves in Europe is a key topic

And now, additional evidence of these plans has come out, this time from Konrad Raczkowski, former Minister of Finance of Poland.

Raczkowski recently argued official gold reserves in Europe must be evenly distributed relative to GDP, which “in the near future … will be the new gold standard.

Chuck again… You go! Euro Wanna Bes!   Show the rest of the world how it’s done and can be a viable system!   

The U.S. Data Cupboard today has the usual Thursday fare of the Weekly Initial Jobless Claims, which last week showed an increase, and I expect this week’s print to do the same…. We also will see the color of the Rocktober PPI… Wholesale inflation…. You may recall me writing a month or so ago about how the PPI was giving us signs that consumer inflation was also rising….    I think yesterday’s STUPID CPI proved that point!

To recap…. The dollar buying goes on, and on, an on…. Yesterday the STUPID CPI saw an increase in the annual rate, and that gave traders the idea that the Fed Heads might find cutting rates a little tricky going forward, and therefore they bought dollars like funnel cakes at a State Fair!   Gold & Silver saw their early morning games wiped out and then some, and Chuck tells us all to remain calm, and to not panic sell…. 

For What It’s Worth….  Well, dummy me, I sent myself this link last week when I saw it, for the FWIW article, but then forgot to pull it the next day, and then forgot about it altogether util yesterday when I was going through unopened emails… This is the great jim Rogers talking about what he sees coming for the world economies, and it can be found here; ‘Things are going to go bad soon’: Jim Rogers issues dire warning as global markets hit record highs — here’s what he likes for protection

Or, here’s your snippet; “The relentless rally in stocks seems unstoppable, with the S&P 500 soaring 21% this year alone and a staggering 87% over the past five years. While these gains have propelled many portfolios into the green, veteran investor Jim Rogers said he is deeply concerned.

“Nearly every stock market in the world has had an all-time high, or near an all-time high,” he told Wealthion in a recent interview, warning that when everyone is making profits, “somebody better look out the window and get worried.”

Earlier this year, reports showed that 14 of the world’s 20 largest stock markets hit record highs. According to Rogers, “just about everybody in the world has joined in now.”

Rogers’ caution is rooted in experience, as he said he understands what follows market euphoria. “I’ve been around long enough, or have read enough to know that when everybody is making a lot of money and piling in, it usually means things are going to go bad soon,” he admitted.

I know from history that the world is going to have problems again … and when the world has problems… it’s nice to have some gold in the closet, or under the bed, have some silver in the closet,” he said. “Because no matter what, many people will turn to gold and silver in times of turmoil.”

Chuck again…  I’ve met Jim Rogers on a couple of occasions in the past, and he has always been a straight shooter, no fluff, no B.S., just the facts, and history on the subject…  And what Jim is talking about above is what I learned to be “A Minsky Moment”….  

Market Prices 11/14/2024: A$ .6463, kiwi .5961, C$ .7131, euro 1.0561, sterling 1.2696, Swiss $1.1227, European Style: rand 18.3450, krone 11.1791, SEK 11.0368, forint 387.18, zloty 4.1220, koruna 24.0514, RUB 99.44, yen 156.09, sing 1.3464, HKD 7.7822, INR 84.41, China 7.2441, peso 20.66, BRL 5.7898, BBDXY 1,288.21, Dollar Index 106.80, Oil $69.02, 10-year 4.48%, Silver $30.24, Platinum $934.00, Palladium $927.00, Copper $4.05, and Gold… $2,559.20

That’s it for today…A nice weekend weather-wise is in store for us here in my little river town, and then next week turn much colder…. UGH!  You know me, I absolutely abhor Cold weather….  But then it is November… The month of gray cloudy days, with bitter chill, and everything looking dead…. Just a friendly neighborhood Spider Man reminder that there will be no Pfennig on Tuesday next week…. I don’t even remember writing everyday Mon-Friday with only holidays stopping me from writing…. That would have been sometime around June 10, 2007….  Oh, and my 3 vacations a year, but back then I had Chris, Mike and Frank to write for me when I was away…. All of us had different styles of writing, and the dear readers would let me know that I was missed…. Well, My beloved Mizzou Tigers play the Gamecocks of S. C.  on Saturday afternoon…. And I’ m very concerned about this one… C’mon Tigers, let’s go!   Tuck Andress takes us to the finish line today with his version of the song: It Came Upon A Midnight Clear…..  I hope you have a Tub Thumpin’ Thursday today, and please, oh please with sugar on top, Be Good To Yourself!

Chuck Butler

• The dollar gets bought in the overnight markets last night…
• What is BOA up to? Playing hide-n-seek?

Good Day… And a Wonderful Wednesday to you! Well, my son, Alex’s wedding is fast approaching, and yesterday I had to go and have my new tux’s legs hemmed… Not that the woman doing the sewing was going to hand them back to me done, I’ll have to go back and pick them up next Tuesday… The jacket fit me perfectly….. Things sure have changed since I last wore a tux, at Daughter Dawn’s Wedding… I doubt I’ll ever have an occasion where I’ll need to wear my tux again, but, just in case….  It’ll be hanging in my closet! Much like the new suit I bought last spring!   The Eddie Higgins Trio greets me this morning with their version of: Have Yourself a Merry Little Christmas… 

Well, the manipulation of the markets continued on Monday, even though some areas were closed….  The dollar ended the day unchanged at 1.274, while Gold lost $21, and Silver lost 2-cents…  For more than a month, the short paper traders were taking a pound of flesh from Silver and leaving Gold somewhat alone….  Now, that appears to have changed…  Gold was closed below $2,600, and $2598 yesterday…. Back to where it was around Sept 19th… The last 7 weeks have been glorious to Gold holders who follow the price… But now it’s back to where it was right before the Fed Heads first cut interest rates….  The next move upward should be a doozy, folks… So, before Gold takes off for higher ground again, why not pick some up at these bargain prices? 

The price of Oil remained in the $68 handle yesterday, but fell through it all day long… Starting at $68.74 it finished the day at $68.00….  So, in essence it was down on the day about a buck….   And the 10-year’s yield? Well the bond boys took the yield up to 4.44% once again yesterday… It will be interesting to see if the Fed Heads step in and try to massage the yield back down again or will they just throw in a towel?

In the overnight markets last night….  well, the dollar buying seems to accelerate when the overnight markets take over the con from the U.S. and last night the BBBDXY gained 6 index points to trade at 1,280 this morning….  This America first line from Trump is really beginning to give me a rash… Not that I don’t want our country to be number 1, it’s the way we’re planning of achieving that aim… With tariffs…   Gold is up $10 to start the day today, and Silver is up 22-cents… The U.S. short paper traders haven’t arrived at their desk yet, to received their instructions for the day…. 

The price of Oil remained in the $68 handle overnight, and the 10-year’s saw some buying overnight, with the yield dropping to 4.39% this morning….  I can see the Fed Heads slapping themselves in the forehead, and saying, ” The 10-year’s yield has risen to 4.44%, we ca not allow that to happen!” and they did… 

Well, the Fed Reserve St. Louis reported that: “Today, consumers are pushing their shopping carts in warehouse clubs and superstores in numbers that dwarf other types of retail sales traffic.”   

Chuck again, no wonder the Retail Sales have been streaky, with one month being OK, and the month being disappointing…  I get it, my wife shops a Costco, and when she goes, she buys stuff that will last a long time, and then she doesn’t have to go back for a while….  And she orders her groceries from Walmart… And they deliver them to our front door!  Shopping sure has changed since the days that I first started driving, and to use the car on a Saturday, I had to take my dad to work, and then take my mom to the grocery store, and then after picking up my dad I was free to us the family car…. But those trips to the grocery store were something!  If you can imagine buying food and planning meals for a family of 7…. And me at that age when they thought I had a tapeworm in my stomach because I could eat a horse!  (no horses were eaten or harmed!) 

My first car was a Ford Falcon… And do I have some doozie stories to tell about that car… But I’ll save you from all those, and just say that even though I had a car to drive, I still took my mom to the grocery store on Saturdays! 

OK… Back to the task at hand… Try to find something to talk about that is fresh and new and doesn’t refer to Trump 2.0 or anything related…. Well, here we go…. The euro has been pummeled in the last 3 weeks, and I guess some of it was warranted, as the European Central Bank cut rates…. Apparently proving that what’s good for the goose isn’t good for the gander, as the Fed heads have cut rates twice, with the first one being a hefty 50 Basis Points cut, and the dollar has done nothing but soar since then….  The euro briefly dropped below the 1.06 handle yesterday, and by the looks of the way it’s trading it won’t be long before it has a 1.05 handle next to it….  A lot will be put into the data this week in the Eurozone, as Euro traders will be looking ahead to Thursday’s EU Gross Domestic Product (GDP) update. The EU’s third quarter GDP is expected to confirm the preliminary print of 0.4% QoQ, and the annualized figure is forecast to show that Europe grew by an unremarkable 0.9% YoY.

That’s sickly growth folks, and I guess the selling is warranted, but C’mon…. It’s not like traders didn’t know that these sickly numbers were in store when they pushed the euro to 1.12 in September!   So, most of the rot on the euro’s vine has come from the buying of the dollar, as the euro is the offset currency to the dollar…   And we can thank the PPT for most of that dollar buying… But the thing these guys that manipulate the markets try to do is sway the attention of the potential buyer, or short-term holder, and when they succeed like they have this time with the dollar, it’s chilling to me… Ice cold….  like a shot in the back….  I’m just saying… 

All the problems that existed in the U.S. economy and our debt picture that were there before the election, that caused the BBDXY to be like Thelma and Louise and edge close to the cliff, and Gold to hit new all-time highs, are still there…  It’s just that the market manipulators have decided to not allow the dollar to fall and Gold to soar, for now….  But like I said above, when the selling stops, and it will at some point, then we’ll get back to the task at hand!  Did someone sweep the all the problems for the U.S. economy and debt picture under the rug, so the markets can’t see them? No… They still are out there, for all to see, if you care to see them, if you don’t care to see them, then they can’t hurt you!   Yes, the markets are like babies…. 

And a currency like the Norwegian krone, which in normal times is the double recipient of good stuff when the euro is rallying, and Oil is rallying… But in times when the two are in rally mode, the krone gets the snot knocked out of it x 2!  The Mexican peso is also seeing a lot of its gains made last year go down the drain, due to the weakness in the price of Oil… And that the new POTUS plans on placing tariffs on their exports to the U.S. 

And The Chinese renminbi, talk about getting the snot kicked out of it…. The renminbi was rallying before the election, and had reached 7.08, has fallen back to 7.23….  China will be the first country to have Tariffs placed on their exports to the U.S. and they will also carry the highest tariffs….  

I wonder if anyone in the new Administration has associated themselves with the names Smoot & Hawley? It would behoove them if they did…. These two gentlemen introduced tariffs and a year later the world was in a depression… I’m just saying….

The U.S. Data Cupboard today has the STUPID CPI for Rocktober…. And that’s it… The star of the show! The STUPID CPI!  I do believe that it will show that inflation bumped a bit higher last month, with the only saving grace being the drop in the price of Oil, thus reducing the price of gas at the pump…. But, I don’t believe it will be enough of a saving grace to help the STUPID CPI, unless of course the BLS decides to massage, roll, and cook the books once again… And since they had to do a mea culpa regarding the way they mis-counted jobs created, I would think they would be on the up an up with everything here on out… Or, at least that’s what I’m hoping! 

To recap… The manipulation of the markets didn’t stop on Monday…. Gold lost $21 on the day, and Chuck thinks that all this selling is about to come to an end, for now…. Then Gold can get back to setting all-time highs!   Chuck talks about grocery shopping in his youth, and puts everyone to sleep… 

For What It’s Worth…. Not much in the way of FWIW article out there this morning, but I did find this article that will make my former colleague and friend, Aaron Stevenson, very happy to read this morning… It’s about the growing problems at Bank of America… And it can be found here: https://justdario.com/2024/11/how-bank-of-america-is-hiding-its-mounting-problems-behind-a-mountain-of-repurchase-agreements/

Or, here’s your snippet: “Finally, the 10-Q of Bank of America has been filed, and it is now time to check how things look in reality beyond the cheerful and “everything is awesome” press release and management call of a few weeks ago when the bank, as expected, beat market expectations (TODAY “EVERYTHING WILL BE AWESOME” FOR BANK OF AMERICA).

As you can understand from the title I chose for this article, Bank of America’s problems are growing, not the opposite. However, I have to admit, at first glance, the numbers looked in better shape until an item usually not that relevant stood out: repurchase agreements.

How do repurchase agreements (aka REPOs) work? In a nutshell, these instruments are generally used by financial institutions to lend or borrow money in the very short term. Usually, the net amounts of money lent and borrowed are fairly the same, and a bank tends to make money using its better credit standing to borrow at a lower rate to then lend at a slightly higher rate to weaker counterparties. The rate is “slightly” higher because REPO operations are always collateralized and often with high-quality government or corporate securities. The typical warning sign of something going wrong with a bank, in particular with its liquidity positions, is when the net amounts borrowed through REPO operations are unusually high.

The amount of liquidity Bank of America borrowed from the REPO market has been DOUBLING in the past 3 quarters to reach a staggering 60 billion USD net balance. How many MSM or Wall Street analysts did you hear flagging this “small” detail? ZERO.

Furthermore, Bank of America isn’t just using REPO agreements to transfer assets off its books and fetch liquidity. As you can read in their own disclosure below, they are doing the same through derivatives using assets that are hard to pledge in the REPO market like non-U.S. Agency MBS.”

Chuck again…  those pesky repo agreements again… Remember in Sept. 2019, when the repo agreements were the vehicle that was used the most by the major banks (TBTF)? And then Covid hit and everyone forgot about the repo agreements…   Hmmm….  You don’t think that Covid was planned as a diversion, do you? Nah… That can’t be, as there were too many lives lost….  

Market Prices 11/13/2024: American Style: A$ .6540, kiwi .5943, C$ .7175, euro 1.0633, Sterling 1.2747, Swiss $1,1345, European Style: rand 17.9781, krone 11.0479, SEK 10.8897, forint 383.39, zloty 4.0785, koruna 23.7882, RUB 98.49, yen 154.62, sing 1.3363, HKD 7.7783, INR 84.38, China 7.2096, peso 20.44, BRL 5.7379, BBDXY 1,280.77, Dollar Index 105.83, Oil $68.48, 10-year 4.39%, Silver $30.95, Platinum $945.00, Palladium $946.00, Copper $4.14, and Gold… $2,609.62

That’s it for today…. Well, remember when I was in S. Florida and was in the hospital for a bleeding ulcer?  They told me to make sure I found a GI Doc back home… So, I found one, and today I will see her… Just a howdy and get to know you appt. I just found out that I will be at the hospital next Tuesday morning for scans…. This will be on my jaw for the surgeon to look at to see if he can debulk this tumor… I know, I get to have all the fun times, eh?   I just never know when to get off the merry-go-round…. HA! I want to thank all of you who sent me a note telling me how long you’ve been reading and you’re not going to leave….  Eddie Higgins Trio takes us to the finish line today with their version of the song: Hark! The Herald Angels Sing…  I hope you have a Wonderful Wednesday today, and please Be Good To Yourself!

Chuck Butler

• The dollar soars, and the currencies & metals get taken to the woodshed!
• A return to the Gold Standard?

Good Day… And a Tom Terrific Tuesday to you! And… I hope you had a 3-day weekend, with it being Veterans Day yesterday… I don’t mean to bore you with the same story I tell each year on Veterans Day, but here it is…. My dad was a veteran of WWII…  He rarely said anything about his time in Germany, but he did tell me that it was hell on earth, and that’s about it…  He also told me about moving beer from town to town in the gasoline tanks of the trucks… YUCK! But, as he said, it was all they could get… My beloved Mizzou Tigers pulled a rabbit out of the hat on Saturday night, and beat Oklahoma…  Lucky, lucky, lucky… Or as my son said, “Cheater’s proof”….  The Stephen Kummer Trio greets me this morning with their version of the song: The Christmas Song

Well, the manipulation of the markets continued last week, and through yesterday…. Yes, the FOMC did debase the dollar another 25 Basis Points last week, but that didn’t stop the PPT from buying dollars, and getting everyone else to buy dollars… Last Tuesday, the BBDXY was 1,254… Friday last week the BBDXY was 1,267, and after yesterday, the BBDXY closed at 1,274… Up 7 index points on Monday, when the markets were not fully staffed…  And the short paper traders saw to it that Gold took on to the Mid-section… The engineered takedown took Gold down $64 on the day, and that was after a late afternoon rally, that brought Gold to 1.219… Gold was down $74 at one point yesterday… 

Silver saw the same treatment as Gold… Silver finished last week at $31.28, and then after yesterday’s takedown, Silver saw a loss of 30-cents to close the day at $30.74…   I just shake my head in disgust at what these guys do the values on the asset classes…  But, as I always point out, these are much cheaper buying opportunities…  

The 10-year’s yield got manipulated downward late last week, after going as high as 4.40% last week, it saw nothing but buying, most likely from the Fed Heads to keep yields in check, the 10-year closed yesterday at 4.32%… 

And all the reporters out there will talk about is how the Trump election has scared the market participants as they’re not sure what to expect….  They don’t have the intestinal fortitude to tell it like it is (Aaron Neville) and do some investigative journalism and find out that it was mainly short paper trading in the metals, PPT buying in the dollar, and Fed manipulating yields in bons… 

Last Thursday,  Gold was up $47 and Silver was up 84-cents, and I thought to myself… Well, they are back! But then on Friday, all hell broke loose, and those gains were wiped out yesterday… 

And the price of Oil fell out of bed yesterday, losing $3 to trade at the end of the day with a $67 handle…  

In the overnight markets last night…. The dollar buying continued throughout the night, with the BBDXY gaining 2 more index points to start our day today at 1,276…  Gold is trying to recover from the engineered takedown yesterday, but is failing and is down $9 to start the day today, while Silver is down one penny to start the day today… The price of Oil bumped higher to trade with a $68 this morning, and the 10-year’s yield is back to rising this morning as it trades with a 4.39% yield… 

I don’t know when this assault on the metals will end, but the short Gold paper Traders do, I’m sure they have a point where they will call of the dogs, and sit back and watch as short time traders all panic and sell which is their number 2 goal… The first goal of course is to make Bou coup bucks, which they have certainly done this time… 

Well, did you hear about the massive new monetary metals depository in Eagle, Idaho, said to be the largest such vault in the United States west of New York, a vault even larger than the U.S. gold repository at Fort Knox, Kentucky.?  Well, now you have!   So, going forward, you’ll be able to have the depository hold your Metals in safety, and able to have them delivered to you when you are ready for them…   This is competition for the Perth Mint, and other vaults around the world… 

That public service announcement has been brought to by Battle Bank…  to get on their list, simply go to their website at: www.battlebank.com

So, the dollar has been debased 75 Basis Points since this summer… And the dollar continues to gain?  What on earth is happening here? Well, There’s stranger things in life that have happened, but I can’t think of them right now…  Maybe it’ll be delayed reaction?  Any way… This has got to be recorded for history folks… 

You know, my readership has gone down tremendously since I TIAA Bank showed me the door in 2016… And I don’t know why… I wish when readers left, they sent me a note telling me why….   If I continue to lose readers like I have these past 8 years, in 5 years, I’ll only be writing to friends (maybe), family (maybe), and myself…  I’m not whining here, just make a point about letting me know, when you decide to leave me… Please… 

Remember Judy Shelton? Ms. Shelton was the Gold Bug that was nominated to be a Fed Head, but because she advocated for a return to the Gold Standard, she was not approved, and went back to being a strong advocate for the Gold Standard, on her own… Over at www.shiffgold.com they ran an article that saw July Shelton returning to the forefront… She recently said, ” that a return to sound money requires going back to gold.”  

And then there was this in the Financial Times: “Gold, it seems, just can’t be ignored any more. The prospect of falling US interest rates, a decline in the dollar and worries about America’s debt sustainability should lead to more institutional and retail money flocking into gold… There is even talk that the long-mooted new currency set up by the expanded Brics countries will be backed by a number of assets, including gold. A century on from the demise of the [Classical] Gold Standard, which collapsed in the interwar years amid a breakdown in central bank cooperation over how to manage the metal, gold is quietly becoming a more important feature of our financial system rather than an outmoded 20th-century relic.”

Chuck again… Seems to me that this rhetoric about a return to the Gold Standard is getting more airtime this time around than the previous times…  We heard that the BRICS would introduce a common currency that will be backed by something, most likely Gold… And there are more stories about a return to the Gold Standard than you can shake a stick at…  In fact, there was one this past weekend about how the Euro Wanna Bes… Have become the Gold Standard Wanna Bes….  I’m just saying 

OK… Well, I’m lost without news articles about the countries that I follow, the economies, and their dolt Central Banks… So, with that in mind, I’ll head to the Big Finish and call it a day… But one thing I do see without any words written about is the Petrol Currencies getting whacked even more… Currencies like the pound sterling, real, peso, krone, etc. are all seeing extra selling…  And the one currency that continues to get whacked because of the Trump victory is the Chinese renminbi…. 

The U.S. Data Cupboard doesn’t have anything for us today that’s real economic data… And tomorrow we will be subjected to the STUPID CPI for last month…. You already know how I hold the STUPID CPI in such high regard (NOT!) and i’ll  bet a shiny quarter that even the STUPID CPI will show an increase in inflation last moth… 

To recap… After an impressive recovery for Gold & Silver last Thursday, it’s been all downhill from there… And yesterday, the short paper traders did one of their engineered takedowns, Chuck is so disgusted with these guys… 

The PPT has stepped in to buy dollars alongside with the dollar bugs, to send the dollar soaring, in the face of a 75 Basis Points debasing that has taken place since summer….   And there’s a new metals depository in Idaho… Sounds cool… 

For What It’s Worth….  Well, this should sound very familiar to you dear reader, as this is Brian Lundien writing for Money Metals, saying the same things I kept saying last week, but just like when you talk to your kids, they always listen more to someone else, I thought this would be good…. And it can be found here: The Metals Get Mauled (moneymetals.com)

Or, here’s your snippet: “A clear-cut win by Trump negates the risk of political turmoil and sends gold and silver plunging.

But this bull market was never built on geopolitical risk — it’s a decades-long trend of ever-easier money and ever-greater debt that has sent gold to record heights.

The markets will soon realize that the current situation is irreversible and unsolvable by any administration… and the metals bull market will resume in force.

Over the past six months, in interviews and conversations with friends and media in Canada and elsewhere in the world, I was consistently asked how the U.S. presidential election would affect gold.

My answer was always the same: Not a whit.

I would explain that because the debt situation in the U.S. had gotten so completely out of hand…and because neither party was inclined or even able to solve it at this point…far higher gold prices would result no matter who was elected.

Obviously, I should have cautioned that a clear-cut win by Trump would evaporate any perceived geopolitical risk being factored into the gold price by some speculators and, therefore, result in a short-term sell-off.

That’s exactly what’s happened. As I wrote this on Wednesday, gold was off $77 (2.8%), and silver was leveraging the move to the downside with a drop of $1.48 (4.5%).

A move of this magnitude is obviously being driven by traders shorting the metals with wild abandon. I sincerely doubt that much of the big money that’s moved into gold over the past year was motivated by concerns over this election.

Thus, this short-term trade seems destined to reverse soon.

And, if you’ve read anything I’ve been writing for the last few years, you will not be surprised to learn that I view this as a long-term opportunity.

It’s a mixed bag in the post-election markets. With the Dow jumping over 3% and the Dollar Index soaring, investors are obviously considering that lower taxes and looser regulation will unleash the U.S. economy.

But with Treasury yields also rising strongly, they also seem to recognize that higher tariffs will be inflationary.”

Chuck again… See? I told you he was saying the same things I said last week about the plunge in metals prices, and the soaring of the dollar….  So… It’s back to the task at hand… 

Market Prices 11/12/2024: American Style: A$ .6580, kiwi .5948, C$ 7231, euro 1.0622, sterling 1.2810, Swiss $1.1347, European Style: rand 18.0809, krone 11.0519, SEK 10.8662, forint 388.42, zloty 4.0979, koruna 23.6633, RUB 98.08, yen 154.24, sing 1.3380, HKD 7.7785, INR 84.39, China 7.2301, peso 20.41, BRL 5.7831, BBDXY 1,276, Dollar Index 105.83, Oil $68.79, 10-year 4.39%, Silver $30.73, Platinum $955.00, Palladium $964.00 Copper $4.17, and Gold… $2,610.43

That’s it for Today…  My visit to my oncologist was fine, my blood level is still a little low, but has recovered nicely, albeit slowly, quite a bit from my blood loss in July…  That seems like ages ago to me now….  I’m set to revisit MDAnderson next month on 12/19… That’s as soon as they could get me in… I told them what happens if I die before then?   They didn’t respond… I’m very concerned about my beloved Mizzou Tigers’ game this coming Saturday in S. Carolina…  Go Tigers! My Tigers have an outside chance of reaching 10-wins this year… But it will take a victory on the road this week to give them a good chance….   The Stephen Kummer Trio takes us to the finish line today with their version of (my favorite Christmas song): The Christmas Waltz…   I hope you have a Tom Terrific Tuesday today, and please Be Good To Yourself!

Chuck Butler