Author: admin

April 13, 2022

* Dollar, Gold & Silver continue to get bought

* RBNZ hikes rates again!

Good day… And a Wonderful Wednesday to you…  I watched my beloved Cardinals last night win their game against their foes across the state. I  kept switching back and forth to the Blues game that they also won in Boston… So a good night for St. Louis sports teams and fans… I had to chase the squirrels out of my gas barbeque pit again yesterday, they had built another nest in the pit, and there were 3 baby squirrels in there that I had to chase out, don’t worry squirrel lovers, the mama came back and got her babies and were off to build another nest… Little Feat greets me this morning with their rock classic song: Dixie Chicken… 

Well, the dollar got sold for a brief time yesterday, after the consumer inflation data printed, and showed even in the watered down, stupid CPI, prices increased to 8.5%, the highest level for CPI since 1981, and back then the number was on its way down, not on its way up, like now. But,  that selling of the dollar didn’t last too long and by the end of the day the dollar was getting bought again, and the BBDXY dollar index  a  1 1/4 points gain… 

Gold continues its march to higher ground albeit in small amounts, but gains nonetheless. I find this dollar strength to be stranger than fiction, but I also view Gold’s rise while the dollar is so strong to be curious, indeed… Gold gained $12.10 yesterday to close the day at $1,967.20, and Silver turned around its early loss of 10-cents, to show a gain on the day of 25-cents, which put Silver’s closing price @ $25.43…. Bonds rallied yesterday ( was the Fed/Cabal/Cartel buying again?)…. And Oil also rallied to move back above $100…..

In the overnight markets last night… The broken record keeps playing the same song, as the dollar continues to get bought, along with Gold & Silver… Gold is up $13, and Silver is up 41-cents this morning… My spider sense is tingling and I’m going to go out on a limb here and say that Gold & Silver have turned the corner, and are on their respective ways to much higher ground. I also have the thought that Oil is moving higher too…

Yesterday, the gov’t’s watered down, stupid CPI showed that inflation for March rose at the fastest clip since 1981, with the difference between then and now being that inflation is now on its way up! The CPI was 8.5% for March year on year…  And that report got the fires roaring under Gold, and Oil… 

Well, the gov’t’s inflation numbers did not disappoint, were still looking for additional price increases because if you recall, PPI  ( wholesale inflation), to work its way through to consumer inflation…. It’s really gotten out of hand, all this inflation… But have no fear, folks, Mighty Mouse is going to save us with two, back-to-back rate hike beginning this month…. Yeah, that should do the trick….NOT! 

I think the thing about hiking rates 50 Basis Points at a time, that’s being shrugged off is the effect that the rate hike will have on the already, stumbling, bumbling, fumbling economy…. Recall the Jerome  Powell promised us the he could fight inflation and deliver a soft landing for the economy… I’m from Missouri, so he’s going to have to show me, how that’s done, because I’m not buying what he’s selling… The boys and girls at the Eccles Building are so far behind the inflation 8-ball.

The Reserve Bank of New Zealand (RBNZ), being a proactive bank, hiked their Official Cash Rate (OCR), yesterday, another 25 Basis Points to bring their OCR to 1.50%… 

And in the U.K. their consumer inflation report for March was just about as bad as it was here.  U.K. inflation rose to 7%, March year on year, and is the fastest rate of inflation since 1992… And after I tell you this little ditty, I bet you’ll say to yourself or maybe out loud,, “That’s what we should have done in 2008 and now!”

Swiss judges sentenced a banker to three and three-quarters years in prison as it found him guilty of fraud and other counts, in a trial that has gripped the nation. He was a former Swiss ‘banker of the year’ 

Man can you imagine, what the world would be like if the U.S. gov’t, lawmakers, etc. had started down the list of corrupt bankers back in 2008, and started throwing them in jail? And then continuing their jobs through to today, I’m thinking of all the fraud that Wells Fargo has been charged with, and JPMorgan’s list of bad things, among others…  The world would be a better place, the financial system would be better/ stronger, and future bankers would think twice before going down that road…  I’m just saying… 

OK… so remember last spring when I went down the road of talking about defaults and digital currencies, etc?  To jog your memory, I talked about how with all the debt in the world, that eventually we would see a country default, and then another and another, and didn’t leave out the U.S. defaulting… Well, here are a year later, and not one country but two are on the edge of defaulting… Russia has 30 days to come up with the hard assets to pay their bond holders, and Sri Lanka is taking steps to avoid default, but I doubt they’ll get it worked out…   

This is not to be taken as something that can be shrugged off folks…  I can’t put enough emphasis on this, because this is just the beginning… Too much debt in the world is going to come home to roost, this summer, making this summer to be known in the future as the summer of debt default… 

On a sidebar, this June we will celebrate the 55th anniversary of the Summer of Love…  Where were you in 1967?  Maybe you participated in the Summer of Love?  I know I’ve lost quite a few of you, for you were too young, or not even born yet… But this was real, folks… 

OK… Well, I’ve already gone over the stupid CPI report that printed yesterday… Today’s Data Cupboard is basically empty, and in need of restocking! And restocking it will get, as tomorrow’s Data Cupboard will have Retail Sales for March along with other prints.  The BHI (Butler Household Index) indicates that March Retail Sales will be better than February’s that were nearly flat… 

I’m talking about tomorrow’s Data Cupboard, because….  I won’t be writing tomorrow.  You probably don’t want to know why, but I’ll tell you any way. Remember those spots on my bald head that I told you had gone, after I applied the magic lotion the doctor gave me? Well, they’re back and worse than before, so the doctor said, get your self in here and let me look at them. And so that’s where I’ll be tomorrow bright and early in the morning… So now, you know! 

To recap… The broken record keeps playing the same song, that goes like this: the dollar, Gold & Silver continue to get bought…  It’s a catchy tune but I don’t think you could dance to it! New Zealand hike their OCR, and in the U.K. their inflation is soaring too…  Faster than any time since 1992… So the Bank of England is far behind the inflation 8-ball, just like their brothers in the U.S. 

For What It’s Worth… I mentioned the problems that Sri Lanka was having so I thought it would be good to give you more information on their problems and that’s what this article is about and can be found here: Sri Lanka Warns Of Foreign Debt Default To Save Dollars Amid Socio-Economic Crisis  | ZeroHedge

Or, here’s your snippet: “The tiny island nation of Sri Lanka in the Indian Ocean released a statement Tuesday that said it would default on its foreign debt, including bonds and government-to-government borrowings, amid its worst economic crisis in over seven decades.

Sri Lanka’s finance ministry said it “has had an unblemished record of external debt service since independence in 1948.”

A confluence of factors has drained the South Asian island nation’s foreign exchange reserves by more than 70% since the virus pandemic began, including the collapse in tourism and poorly timed tax cuts.

“Recent events, however, including the effects of the Covid-19 pandemic and the fallout from the hostilities in Ukraine, have eroded Sri Lanka’s fiscal position that continued normal servicing of external public debt obligations has become impossible,” the statement said.

Last month, the Washington-based International Monetary Fund (IMF) warned Sri Lanka’s debt is unsustainable:

“Although the government has taken extraordinary steps in an effort to remain current on all of its external indebtedness, it is now clear that this is no longer a tenable policy,” IMF said.

The socio-economic crisis unfolding on the island nation of 22 million people has already sparked mass unrest. It suffers from widespread food shortages, out-of-control inflation, and rolling blackouts.”

Chuck again…  Yes, this is just the beginning folks, buckle yourself in snuggly, and keep your arms and legs inside the car at all times… 

Market Prices 4/13/2022: American Style: A$ .7412, kiwi .6772, C$ .7901, euro 1.0828, sterling 1.3006, Swiss 1.0695, European Style: rand 14.5050, krone 8.8383, SEK 9.5418,  forint 348.73,  zloty 4.2861,  koruna 22.5605, RUB 82.59, yen 125.89, sing 1.3752, HKD 7.8392, INR 75.97, China 6.3680, peso 19.76, BRL 4.6761,  BBDXY 1,210.64,  Dollar Index 100.39,  Oil $102.27, 10-year 2.72%, Silver $25.76, Platinum $980.00, Palladium $2,459.00, Copper $4.66, and Gold… $1,977.30

That’s it for today… I’m late, I’m late for a very important date…  I’m having so many issues with my laptop, that it takes me about 2 hours longer each day to get this letter out than normal…  I know, buck up and buy and new one, right? Ahh, grasshopper it’s not that easy… All the Cardinals’ runs last night came by the home run…  Now I have nothing against home runs, but I prefer old time baseball, with hit and runs, bunts, sacrifices, etc. That brand of baseball produces more action, and less sitting around waiting for a 3-run homer…  I’m just saying…  ELO (Electric Light Orchestra) takes us to the finish line today with a live version of their song: Can’t Get You Out of My Head….  I hope you have a Wonderful Wednesday today, and please remember to Be Good To Yourself!

Chuck Butler

 

 

 

April 12, 2022

* Dollar continues to get bought

* Gold continues to ignore dollar strength… 

Good day… And a Tom Terrific Tuesday to you… Rainy days and Mondays always bring me down… with kudos to Karen Carpenter, that was a good description of yesterday, and hoe it affected my mood….My beloved Cardinals had their game canceled due to rain… And I couldn’t go outside! Oh well, it’s days like this thar make the sunny days even better! Frank Sinatra greets me this morning with his song, that I  danced with my daughter, Dawn, at her wedding reception: The Way You Look Tonight…

Well, the dollar bulls are romping all over the field and getting anything they want! The dollar buying continued yesterday and at least I can see where they got their idea to buy dollars, even if the idea is a bit stretched….  The markets now believe that the Fed/Cabal/Cartel is going to hike rates at the next two FOMC meetings by 50 Basis Points or ½%…That’s what people in the market believe to be an aggressive approach to fighting inflation…

Now…. Even if the Fed Funds Rate sits @ 2% at the end of May, it’ll still be way below the rate of inflation… Negative real rates don’t get me ready to put on my dancing shoes… But for the dollar bulls… it apparently is…

And speaking of inflation… The White House Press secretary, made a statement yesterday letting us know that March inflation data is going to be big, and then she added that “they would show Putin’s price increases.”

I don’t know why, but that statement got me all riled up and ready to March to Washington DC and explain money supply’s effect on inflation to her… But what good would that do…They are all in denial that inflation is our own fault , and that they are all as dumb as a box of rocks!

And Jim Rickards didn’t care for the statement either as he tweeted “ Memo to Jen: No one in America believes inflation has anything to do with Putin. It was here before the war, and it will remain after. Stop treating people as if they were stupid. Start treating people with respect and they might actually listen to you.” – Jim Rickards on Twitter yesterday…

Gold had an interesting day, yesterday…. In the early trading , yesterday Gold was up $16, then right after the market opened Gold traded up to $19, but then the trap door was sprung and by midday Gold was in the red for the day… But, just like the old saying that its hard to keep a good man down… Gold ended the day up $7.40 to close at $1,955.10. Silver traded the same way as its early morning gain of 34-cents got pushed down to a 30-cent gain, and closed at $25.17….

You may recall me saying yesterday that the early gains in Gold and Silver were ripe for some short selling, and that sure did play out, only to see the metals rebound late in the day… The price od Oil continued to drop, along with bond prices, as yields continue to rise…

In the overnight markets last night… The dollar continued to get bought… I know, I’m beginning to sound like a broken record… But that’s what’s happening and there’s nothing I can do about it…. The BBDXY gained another 2 index points in the past 24 hours…. The currencies just get weaker by the day…

Gold and Silver continue to ignore the dollar rally, with Gold up $10 and Silver is down just 10-cents to start today. Bonds continue to get sold, and the price of Oil wrapped a tourniquet around itself and stopped the bleeding, overnight, and trades this morning with a $98 handle….

I want to mention here that we’ve seen a very strong move in the Brazilian real in recent months… Their strong position of commodities has helped, along with their internal rate of 9.75%…The real has become the darling go-to currency of the “carry trade*… long time readers may recall the phenomenon of the carry trade when Japanese investors sold yen and bought Aussie dollars back quite a few tears ago, now… Russia’s internal 20% rate would seem to be a candidate for the buy side of a carry trade, but…. They are at war…..

I was looking into the concentrated shorts in Silver on Saturday, and saw from Ed Steer’s Saturday letter that that number of days of production that would equal the amount of short positions on the books has risen again and now sits at 171 days of production needed to fill the amount of solver sold short…

That was followed up by a note from the good folks at GATA who had this from Silver guru, Ted Butler ( no relation that I know of)… “Silver market analyst Ted Butler notes tonight that the concentrated short position in silver futures and derivatives in the United States is many, many times larger than the short position in nickel that blew up and prompted default of the London Metals Exchange’s nickel contract.

Butler writes that U.S. market regulators should be investigating the grotesque short position in silver.”

Chuck again, yes the government should be investigating… but, they won’t, because? Well, in my humble opinion they won’t because they are the architects behind all the sort positions… That’s been my position on the price manipulation for over a decade now and no one has been able to prove to me that I’m wrong!

In the U.S Data Cupboard yesterday we saw the govt forecast for inflation out one year, and they forecast it to be 6%…. Well we all know that the govt’s inflation calculator doesn’t calculate inflation in a real world environment, so if inflation, according to the govt, is still at 6% in a year from now that means we all will be suffering greatly from tis form of taxation…

In a follow up of something I Wrote about last week… thank goodness that there has been no follow talk regarding the “gas stimulus” that was being discussed…Of all the lame brain, idiotic, numbskull, ideas…. this was right up there near the top!  But leave to our lawmakers to findcways to spend money we don’t have!

Well the aforementioned stupid CPI will print this morning for March… The gov’t says that the March inflation rate will rise to 8.4%! Later today ill check to see where shadowstats.com shows the real inflation rate sits… for those of you new to class… shadowstats.com calculates where real inflation is without the hedonic adjustments of substitutions and weighting adjustments that the stupid CPI uses… The gov’t has no intention of showing the citizenry what real inflation is for they have no intention of being thrown out of office!

To recap… the dollar is still on the rampage, kicking tail and taking names later… There’s no stopping this runaway bus right now… There’s talk that the U.S. Central Bank is going to hike rates by 50 Basis Points in April and May… whoopee our negative real rates will be narrowed by 1%!?? Ooohhh I’m all giddy about that…NOT! And the stupid CPI will print this morning…

For What It’s Worth… This is another very long article today, and its about how the writer feels that the Fed/Cabal/Cartel is panicking and it can be found here: The Fed Is Scared $h*tless – DollarCollapse.com

Chuck again… This article hits the Fed/Cabal/Cartel bang on the head, and although it’s a long article it’s well worth the read… 

Market Prices 4/12/2022: American Style: A$.7436, kiwi .6838, C$ .7910, euro 1.0865, sterling 1.3016, Swiss 1.0719, European Style: rand 14.5710, krone 8.7893, SEK 9.4943,  forint 347.44,  zloty 4.8209,  koruna 22.4956, RUB 83.29, yen 125.58, sing 1.3632, HKD 7.8363, INR 75.90, China 6.3705, Peso 19.85, BRL 4.6950,  BBDXY 1,208.68,  Dollar Index 100.70,  Oil $98.28,10-year 2.80%, Silver $25.07, Platinum $983.00, Palladium $2,391.00, Copper $4.64, and Gold… 1,960.00

That’s it for today… A strange day yesterday… I was in one of my lazy moods… did some reading and then slept all afternoon. I’ve told you this before, but here goes… I believe that your body will tell you when it needs to sleep… And if I’ve learned one thing through my travels with cancer, it is to listen to your body! Well I think I’m going to sell my car and buy a new one that guzzles gas just to tick off the gov’t! HA! Nah… I’m going to drive my current car till it dies…But boy do I miss my Navigator!  Jack Johnson takes us to the finish line today with his song: Drink The Water…I hope you have a Tom Terrific Tuesday today, and please remember to Be Good To Yourself.

Chuck Butler

 

 

April 11, 2022

* Gold & Silver ignore the dollar buying

* Commodity prices continue to rise… 

Good Day… And a Marvelous Monday to you! Well, I’m back in the saddle here at home, but not without a lot of whining the other night… Friday night I went to see my grandsons, (Everett & Braden) play indoor soccer. While, yes, the game was in indoors, the walk to the arena wasn’t, and it had many steps, and it was freezing cold with a blustery wind… I kept saying to myself, “why did I come back here?” I mean it is April… And also on Friday morning it was snowing! No accumulation, but snow nonetheless! Golden Earring greets me this morning with their song: Radar Love…

Well, the breather the dollar took on Wednesday last week, didn’t last long, and the dollar continued to get bought hand over fist, through Friday, with the BBDXY ending the week at 1,206.51, after starting the week at 1,195.41… The euro dropped through the 1.09 level and finished the week with a 1.08 handle… Even the Aussie dollar (A$) which was trading early last week with a .76 handle lost ground to the dollar late last week…. Gold ended the week up $15.50 to close the week at $1,947.70. Silver also gained on Friday by 19-cents to close the week at $24.87…

The price of Oil dropped below $100 again, and bonds got sold once again with the 10-year’s yield rising to 2.72%….

In the overnight markets last night…. there was more dollar buying, albeit, watered down, when compared to last week’s buying. Gold & Silver, however are not letting the dollar buying interfere with their respective rallies. Gold ID up $16 and Silver is up .34-cents in the early trading today. Silver’s rise this morning puts the metal back above $25…. The price of oil has fallen $3 more, and trades this morning with a $94 handle… Bonds continue to get sold and the 18-year’s yield is up to 2.75% this morning…

These rallies in Gold and Silver this morning are ripe for some short selling, so let’s just hope for the price manipulators to oversleep this morning…

I really don’t know what to think about 1. Stock prices and 2. Why the dollar is so strong…I’ve said all I have to say about both of those items, so I won’t get into that anymore at least for today…

Speaking of stock prices… there’s a new warning out on the street, and according to the report I read… you have until June 15^th before the stock market crashes…..this is the 4^th warning of a stock market crash that has been issued…

OK… Late last week, the current administration announced that they were going to issue another extension in the Student Loan Payments… Well, last August they issued a “final extension”, but that proved to be false, as there have been two more extensions since then. And when this extension expires in August, I would expect that another extension will follow, for this has all become very political.. And the mid terms are just around the corner, and I just don’t see lawmakers telling students that they now need to start paying on their loans right before an election…  But this goes further, folks… I see this kicking the can down the road leading to a complete student loan forgiveness… Like the country is Uncle Moneybags, and can afford to wipe these loans off their books…  Utter disbelief at the ignorance of our lawmakers, that’s what I say…

Man did you see the explosion of credit card debt in the U.S.? here’s the skinny from MarketWatch: “The numbers: Total consumer credit increased $41.8 billion in February, up sharply from a rise of $8.9 billion in the prior month, the Federal Reserve said Thursday. That translates into an 11.3% annual rate in February, up from a 2.4% gain in the prior month. This is the highest rate since November 2001″

Chuck again, and the so-called experts had forecast an increase of $15 Billion…  This is what happens, folks, when people run our of savings, inflation has eaten away their disposable income, and the have to revert to buying on Credit… mortgage rates will rise, and house prices will drop…

This is really getting ugly folks… inflation is soaring and our protector of the dollar/stock market, is doing little to help you, and me…. The Fed/Cabal/Cartel announced last week that they will allow up to $95 Million of bonds to mature without rolling into new bonds, thus reducing their balance sheet….well I’m from Missouri so… I’ll have to be shown that they are truly reducing their balance sheet….so what does that mean for you? Well it means that bonds no longer have a crutch to lean on in the Fed/Cabal/Cartel…..and bond yields will continue to rise….

And if you own a bond you will experience buyers remorse…..

I’m just saying…

Oh and quantitative tightening is a stealth rate hike…. The boys and girls in the Eccles Building seem to think they can fight inflation this way…. It’s their way of not making a big deal out of a rising fed funds rate, so not to spook the stock jockeys….

The U.S. data Cupboard will be somewhat busy this week, with some days not participating and the other days bulking up with a plethora of data… For instance, today’s cupboard doesn’t have much… But tomorrow we’ll see the color of the latest stupid CPI…. And more, so you’ll have to be patient today…

To recap…. The dollar went on a rampage last week, and pushed down the euro and the A$… Chuck is at a loss trying to figure out why the dollar is getting bought… The administration announced that they were going to extend the Student loan payments pause… where did the money come for this boondoggle?

For What It’s Worth…..this article was featured in Ed Steer’s Saturday letter, and its about something that I’ve been ringing the bell about, rising commodities and it can be found here: The commodity currency revolution (goldmoney.com)

Or, here’s your snippet: “We will look back at current events and realise that they marked the change from a dollar-based global economy underwritten by financial assets to commodity-backed currencies. We face a change from collateral being purely financial in nature to becoming commodity based. It is collateral that underwrites the whole financial system.

The ending of the financially based system is being hastened by geopolitical developments. The West is desperately trying to sanction Russia into economic submission, but is only succeeding in driving up energy, commodity, and food prices against itself. Central banks will have no option but to inflate their currencies to pay for it all. Russia is linking the rouble to commodity prices through a moving gold peg instead, and China has already demonstrated an understanding of the West’s inflationary game by having stockpiled commodities and essential grains for the last two years and allowed her currency to rise against the dollar.

China and Russia are not going down the path of the West’s inflating currencies. Instead, they are moving towards a sounder money strategy with the prospect of stable interest rates and prices while the West accelerates in the opposite direction.

The Credit Suisse analyst, Zoltan Pozsar, calls it Bretton Woods III. This article looks at how it is likely to play out, concluding that the dollar and Western currencies, not the ruble, will have the greatest difficulty dealing with the end of fifty years of economic financialization”

Chuck again… in the words of the A-Team… I love it when a plan comes together! This is a very thought provoking article from the author… Check it out if you have time…

Market Prices 4/11/2022: American Style: A$.7447, kiwi .6845,  C$ .7944, euro 1.0901, sterling, 1.3038, Swiss 1.0706: European Style : rand 14.5930, krone 8.7328, SEK 9.4406,  forint 348.44,  zloty 4.8571,  koruna 22.3904, RUB 81.04, yen 125.50, sing 1.3643, HKD 7.8384, INR 75.72,  China 6.3692, peso 20.02, BRL 4.6989,  BBDXY 1,206.99, Dollar Index 99.79,  Oil $94.86, 10-year 2.75%,  Silver $25.21,  Platinum $982.00,  Palladium $2,441.00, Copper $4.68, and Gold… $1,951.00

That’s it for today… it finally got into the 70’s yesterday… my beloved Cardinals won 2 of 3 played over the weekend…. They looked good at times… And others? Well not so good… Day game today at Busch…. My hinting last week did not get me a ticket to Opening Day…. Good thing too, for it was a very cold day! Well, it’s Holy Week this week with Easter coming next Sunday… I sure hope the weather is warm that day…. I have a busy week, for me, starting Wednesday this week…I’m back on my weight loss regimen hopefully I can lose the weight I gained in Florida, quickly! Van Morrison takes us to the finish line today with his great 70’s song: Brown Eyed Girl… my former colleague and long time friend, Jen, used today that he was singing to her…. I hope you have a Marvelous Monday today, and please remember to Be Good To Yourself…

Chuck Butler

 

 

 

 

 

April 6, 2022

* currencies & metals get sold on Tuesday

* And continue to get sold in the overnight markets 

 

Good day… and a Wonderful Wednesday to you! My beloved Cardinals finished their Spring Training season with a 7-0 win VS the Marlins…Tomorrow is Opening Day, and no city outdoes St Louis for their celebration of Opening Day…   The Hall of Famers, the Clydesdales, the pomp and dressing up of the stadium.. I can’t wait to see it all again!  Tony Joe White greets me this morning with his song: Polk Salad Annie

Well, the dollar went on the rampage yesterday. So, let me see if I’ve got this right… Inflation is at 40 years high…. The US President has announced the biggest tax hike in, well a very long time, the U.S. Data continues to point to a recession, and the Fed/ Cabal/ Cartel, is hiking rates well behind the inflation 8-ball, and the dollar rallies?

But it did… and once again I question my place in this world of financial writing if markets don’t follow fundamentals any longer…. The BBDXY rose to 1,200 yesterday, and even the hot commodity currencies lost ground to the surging dollar… 

The price of Gold got slashed yesterday, and I no longer have to look to see if the price manipulators were at the scene of the crime…. For there is not one fundamental reason for Gold to get sold… Oh sure, interest rates are going higher, and in a normal fundamentals driven market… that would be a reason to buy dollars… That is….  if inflation wasn’t running at 15%! And the central  bank hadn’t started sooooooo far behind the inflation 8-ball…

Bonds got sold yesterday as they should… and the price of Oil lost some ground on Tuesday…. It’s a crazy mixed up world, folks… and at the end of each day I only have this to say: Got Gold?

In the overnight markets last night…. There was more dollar buying, and the BBDXY trades at 1,202 this morning. Gold is getting sold with Silver in the early trading today.  These are not the markets were looking for, move along. 

Well, I thought I was going to open Pandora’s box of responses that weren’t very nice yesterday, when I included the snippet of the article on wallsreetonparade.com…I’m just not a fan of govt intervention in any market, including stocks…

And here we are… trying to the pieces of this puzzle together, and when I’m at a loss of words that will explain what’s happening, I turn to log time friend, Bill Bonner, he of best selling and publishing fame had this to say in his daily letter yesterday:

“Among serious commentators (of whom, there are no more than a half dozen), the prevailing view is that the Fed will have no choice. After having recklessly goosed up stock prices for the last 14 years, the Fed must now reckon with its mistakes and goose them down.

• It pushed down interest rates far too low (below zero!) for far too long (almost 14 years).
• The phony and unnatural interest rates created a whole phony and unnatural economy that now depends on ultra-cheap credit.
• The ultra-cheap credit created a culture of rampant speculating and borrowing… which led to an Everest of debt, public and private – now about $87 trillion, or roughly $50 trillion more than in 2007. 
• With so much debt, investors, business, households and the government are desperate to keep interest rates low. To that end, the Fed has had to make more and more cash and credit available. It and other central banks added some $25 trillion in new money since the Wall Street bailout of 2008-2009.

All this easy credit and money printing has produced the inevitable inflation…”

Chuck again… but the dollar rallies?….

April 5, 2022

* the dollar starts to drift lower…

* how much did the Fed spend to save the swamp?

Good day and a Tom Terrific Tuesday to you. We’ll the college men’s basketball championship was played last night.. I have a very difficult time saying Congrats to Kansas on their win… Why? I’m from Missouri.. Nothing else needs to be added. I tried to stay awake for the end… but discretion was the better part of valor, and I succumbed to the sand man… The Easybeats greet me this morning with their great 60’s song: I’ve got Friday on my mind 

Well, the dollar started the day getting bought… but as the day went on, the dollar lost its hold on buyers, and ended the day basically flat… Gold saw the opposite trading pattern the dollar saw. Gold began the day getting bought, and by mid-day, Gold was up $14.00. But then ran into some short selling, that brought Gold’s gain on the day to just $7.60, to close the day at $1,934.20. And Silver lost 10-cents to close the day at $24.62…

The price of oil rebounded to gain $5.00 on the day, while bonds got bought once again to my surprise… Spoiler alert…. In a week or two my good friend, Dennis Miller of www.milleronthemoney.com will run an interview done with me on the potential of a Bond liquidity crisis… Having been a bond trader early in my career I have some insight to how that might come about… so, if you don’t  already get Dennis’ free letter, you might want to go to the website above and get signed up!

In the overnight markets last night…. The dollar drifted lower when you look at the BBDXY…. But in looking at the individual currencies, the euro has dropped below the 1.10 figure, but the Aussie dollar, A$, has rallied and trades this morning with a .76-cents tag… And kiwi is up to .70-cents!

The price of Copper jumped overnight and that plays well in the commodities sand box… The PCE inflation gauge just recorded a huge jump indicating that even this watered down data print show inflation is not letting up.. Bonds got sold overnight, and oil gel its $5 gain yesterday…

OK I’m going to go in a different direction this morning and give you a snippet of Pam & Russ Martens’ www.wallstreetonparade.com  Long time readers my recall me making a BIG deal about the Fed’s repos they began offering in Sept. 2019… here’s your snippet:” The Fed began its emergency repo loan operations on September 17, 2019 – months before there was a reported case of COVID-19 anywhere in the world. It was the first time the Fed had intervened with emergency repo loans since the financial crisis of 2008. The Fed’s repo loans continued throughout the fall of 2019 and into 2020. By Monday morning, March 9, 2020, news of the coronavirus was making headlines around the world and rattling stock markets. The Dow Jones Industrial Average (Dow) plunged 2,013.76 points that day. The Fed responded with one repo loan operation that day of $112.932 billion, which it pumped into 24 trading houses on Wall Street – its so-called “primary dealers.”

The Fed had calmed the market for the time being and on Tuesday, March 10, 2020, the Dow gained 1,167.14 points. (We can assume that the gain was aided by the fact that the Fed on March 10 had conducted two repo loan operations, pumping in a total of $168.625 billion.)

But panic set in again on Wednesday, March 11, 2020, with the Dow losing 1,464.94 points, despite the Fed conducting a one-day repo loan operation of $132.375 billion. The Fed interpreted that to mean that the Wall Street trading houses were thumbing their noses at short-term loans and wanted longer-term loans from the Fed. It would fulfill their wishes the very next day in a big way.

By early Thursday morning, March 12, a new panic had set in. Before the stock market opened at 9:30 a.m. in New York, S&P 500 futures had plunged 5 percent and were locked, limit-down. That led to a plunge of 7 percent in the S&P 500 Index shortly after the stock market opened at 9:30 a.m. in New York. That plunge triggered a circuit breaker which suspended trading for 15 minutes until 9:50 a.m. By the time the dust settled at the closing bell, the Dow had lost 2,352.60 points.

But now that we know the details of what the Fed did on March 12, it’s fair to question if the stock market could have lost 10,000 points that day but for the actions of the Fed.”

Chuck again…Why can’t the deep state allow markets to be markets and interest rates to be what they should?

The data cupboard yesterday saw negative prints for Factory Orders & Capital Equipment orders in Feb…Yet another sign that the U.S, economy is going nowhere… Today’s Data Cupboard doesn’t have much to move markets , but we do get 3 different Fed Heads talking today…. yawn….

To recap…it was a tale of two markets for the dollar and metals yesterday… Chuck wants everyone to know what the Fed did to save the swamp… and now everyone that didn’t benefit from all that cash get to deal with rising inflation..

For What It’s Worth…. This article came to me from the good folks at GATA, and it’s about how Russia will be directing the Gold price in the future, and it can be found here: Lawrence Lepard: We Stand on the Gold Launchpad – Palisades Gold Radio

Or here’s your snippet: “Tom welcomes Lawrence Lepard from Equity Management Associates to discuss the many things that have changed in just the past few months.

The actions of Russia will likely begin driving the price of gold. We’ve reached a tipping point not unlike when Charles de Gaulle began demanding gold in the 70s. Putin is hitting back economically. The seizure (theft) of reserves was a clear warning to many countries. The Ukraine/Russia conflict is equally an economic one.

Lawrence discusses the low valuations in commodities and the lack of capital investment in resources. Inflation appears to now be the norm.

The dollar could go higher because it’s still the best of the worst. The trend in purchasing power will continue to decline. He says, “Their drunk and they can’t stop drinking.”

Europe needs Russia’s oil and Putin is forcing a seat at the table. The West has ignored and treated Russia like a second-class citizen for too long. The arrogance of those in power is stunning, and Putin is not stupid. They are not used to someone standing up to them and winning. We are on the verge of another move higher in gold.

Margins and multiples in equities are going to come down and holding general stocks now makes no sense. “A huge trend change is coming… and you want to be on the right side of this. If you’re not investing in the right areas it’s going to be a very painful experience.”

Front running may be part of the equation for inflation. Wages aren’t likely to keep up, and it’s difficult to assess all the various parts of the inflation picture. It takes time to solve supply chain issues and find good workarounds. He states, “A capital system based on the correct allocation of capital will make more stuff for less. We need productivity.”

Chuck again… this article goes on further so click the link above should you find you need to read more.

Market prices 4/5/2022: American Style: A$ .7629, kiwi .7001, C$.8030, euro 1.0970, sterling 1.3131, Swiss 1.0801, European  Style: rand 14.5342,  krone 8.6980,  SEK 9.3744, forint 337.83, zloty 4.2159, koruna 22.1917, RUB 84.34, yen 122.88, sing 1.3556, HKD 7.8384, INR 75.09, China 6.3629, peso 19.81, BRL 4.5941, BBDXY 1,194.60, Dollar Index 99.01, 10-year 2.47%, Oil $104.53, silver $24.64, Platinum $1,003.00, Palladium $2,330.00, Copper $4.72, and Gold…. $1,939.50

That’s it for today…every year I watch the Final Four and the National Championship Game and imagine how cool it would be for my beloved Mizzou Tigers or St Louis University Billikens to be in those games! I truly believe that the Billikens will be loaded next year so watch out!  We’ll, hopefully my flight home tomorrow won’t be canceled like my two previous attempts to get home… That would put me back in the hood for The Cardinals opening day… hint, hint I’m available for the home Opener!  You know, just in case… Bob Marley takes us to the finish line today with his son: Three Little Birds… “people don’t worry about a thing, cause every little thing is gonna be alright”   I hope you have a Tom terrific Tuesday today, and please Be Good To Yourself!

Chuck Butler

April 4, 2022

* currencies & metals get sold on Friday

* What’s up with the BLS? only from the mind of Chuck! 

Good day… And a Marvelous Monday to you! And welcome to April! Well, I’m still in S. Florida… I was supposed to be heading home on Saturday 4/2, but after delaying our flight for 3 hours, Southwest decided to just cancel the flight, leaving us right back where we started. We were lucky, because we had a place to go to. But people that had their monthly leases end, etc. would have had to find a hotel… I sat on hold for 3 hours and 20 minutes  waiting for someone at Southwest, to pick up the phone and help me get my flight home rebooked. I had to call them because, Their website wasn’t working. I’m not here to complain about everything it’s just that I don’t get all this bad service that we Americans have to put up with and still pay for premium service.  Robert Palmer greets me this morning with his son: Sneaking Sally Through The alley…. 

We’ll, the dollar continued its upward move that it began on Thursday. Last week, and ended the week on a strong note. The euro, which had rallied the first 3 days of last week, gave back 50 today ticks on Friday to end the week at 1.1050… The BBDXY gained two index points and ended the week at 1,193.84….  

Gold never found a bid on Friday and closed the week at $1,926.60, and Silver lost 14-cents to end the week at $24.72…. one of these days the price manipulators are going to get caught in a short Squeeze… and I’ll be the happiest guy on the planet, watching them squirm and try to wiggle out from all the physical buying…. I’m just saying…

Bonds got sold on Friday and the 10-year yield closed the week at 2.39%… And the information I gave you last week about the U.S. releasing oil reserves came to light… and the price of Oil dropped $2 to close the week at $99.27…

In the overnight markets last night…. The dollar buying continued, and the euro is down almost 1-cent from last Wednesday. The BBDXY has added another 1.60 in index points and trades at 1,195 this morning. Gold is up $4 in the early trading, and Silver is up 15-cents this morning.  Not much going on in the overnight markets, just some minor moves… 

Last week we saw the euro rally nicely… From what I’ve seen, this rally was sparked by the European Central Bank (ECB) and their sudden change of heart towards rising inflation in the Eurozone… Now we’ll have to wait n see if the ECB has really gotten away from their dovish stance……

Ok, I read an article, this weekend, that was sent to me by multiple people, so I had no choice but to read about how the Russian deputy of the Russian Security Council, and former President of Russia, Dmitri Medvedev, believes that the sanctions that have been placed on Russia ” have not only failed, but are instead returning to the West like a boomerang.”

He went further to say that ” confidence in reserve currencies is fading like the morning mist. The era of regional currencies is coming.”

Ok. I get what he’s saying here countries all over the world that use dollars are going to ditch holding dollars in reserve and just trade with regional partners and each other’s currencies…  

Long ago, and oh so far away, Frank Trotter and Chuck penned an article for the folks at Agora Publishing about how after Europe combined all this different currencies into just one (euro) we saw Asia being next to combine different currencies into a single currency that we named “the Pan”….

So, you would have a regional currency for Europe, one for Asia, one for the Americas, and then you would have the outliers like: sterling , Swiss, kroner, and krones, etc…

But I’m not talking about that old rumor regarding what people were so convinced was real, and that is the so-called Amero…..we’ve been down that road before and there’s no sense in going over it again…

We’ll last Thursday was the first day that countries who bought Oil from Russia had to pay for it in rubles, not dollars…. 

Oh and Fred Hickey tweeted this past weekend, that Russia now had 12,000 tons of physical Gold!  

In case your math skills could use some work, that puts Russia and China ahead of the 8,133.5 tons of Gold the U.S. supposedly have…..

And what have I always told you about what would happen when the current Financial System collapsed? That the countries with the largest physical Gold holdings would be invited to sit at the table and make the rules of the new Financial System….

It sure seems to me like we’re getting closer to this whole shootin’ match coming to and end… I’m just saying…

Ok… I made it all this way without talking about the March Job Jamboree….in a month that already saw 4.3 Million job quits, and Jobless Claims jump

Higher…The BLS decided that they needed to add 23,000 jobs to the surveys from employers… and their grand total was 431,000 jobs created in March, which was below expectations and way below the previous month’s trumped up total of 750,000…

I’m going to do a little ditty here from my imagination of what took place with the jobs #… after posting a Job’s created number last month the BLS received a call from the deep state that went like this: ” hello? BLS? This is the boss… and you really outdid yourself this time with 750,000 jobs in a short month nonetheless ! Are you trying to make people/ investors believe that no rate hikes are needed? How will we ever bring the U.S. economy to its knees with reports like this? This is not in our major plan for the country, so you know what to do next month, right?”

Chuck again….I know it may be a bit far fetched but it’s what my mind was thinking!

We start the week of data prints with Feb Factory and Capital equipment Orders….there’s not a lot of data to see this week and what there is will be dominated by the FOMC Meeting Minutes on Wednesday…

To recap… the dollar ended last week on a strong note after spending the first part of the week on the selling blocks… Medvedev talks about how the sanctions on Russia will push countries to regional currencies…

For What It’s Worth…. Dennis Miller and I just put finishing touches on an upcoming article regarding the problems ahead for bonds… so this article carries on about the problems with bonds and it can be found here: David Stockman on the Coming Bond Bear Market… And What Comes Next (internationalman.com)

Or here’s your snippet: “If you didn’t think the $70 trillion global bond market was a train-wreck waiting to happen, surely last week’s yield surge was a wake up call. From the 2.15% close one week earlier, the 10-year yield soared to a peak of 2.50% just after mid-day last Friday; and that 36 basis point gain was, in turn, the culmination of a stunning 200 basis point rise from the cyclical low point (0.51%) recorded during July 2020.

Needless to say, an economy staggering under the weight of $87 trillion in debt, representing a record 365% of GDP, can’t take much interest rate increase in any case. But when the Fed is drastically behind the curve and will be forced to hit the brakes hard (and unexpectedly) in coming months, you are talking about a recipe for financial carnage.

Of course, the knuckleheads in the Eccles Building are just beginning to faintly recognize the trap they have backed themselves into. As Bill King aptly noted,

“….contributing to the bond carnage on Friday morning: NY Fed President Williams said the Fed will hike rates 50bps if needed, and inflation has been much stronger than the Fed expected. What dopes!!“

Chuck again… that was David Stockman doing the talking there… he used to be the head of the OMB under President Reagan…

Market prices 4/4/2022: American Style: A$ .7514, kiwi .6934, C$ .8003, euro 1.1005, sterling 1.3104, Swiss 1.0781, European Style :  Rand 14.6375, krone 8.7015, SEK 9.4423, forint 335.75, zloty 4.2177, koruna 22.7087, RUB 84.63, yen 122.78, sing 1.3571, HKD 7.8349, INR 75.28, China 6.3629, peso 19.82, BRL 4.6591, BBDXY 1,195.44, Dollar Index 98.85, Oil $99.78, 10-year 2.40%, Silver $24.81, Platinum $992.00, Palladium $2,420.00, Copper $4.65, and Gold $1,930.58

That’s it for today… we’ll my plans to go to Ireland this summer had to be cancelled. I’m hoping that next year all this weird stuff going on in the world will settle down… as long as God is willing I’ll be traveling to Ireland next year… Baseball will start on Thursday this week and that makes me happy!  I didn’t write on April 1st, and therefore I missed saying Happy Birthday to one of my fave people in the world… Happy Birthday to April Showers! I hope your day was grand! Radiohead takes us to the finish line today with their song: karma Police… I hope you have a Marvelous Monday and please Be Good To Yourself!

Chuck Butler

 

 

 

March 31, 2022

* dollar selling ends in overnight markets 

Good day….And a Tub Thumpin’ Thursday to one and all… well I couldn’t grt my laptop fixed yesterday, but we nailed down the problem.  My touch pad went bad, and by having a Surface laptop, I can remove the screen and it becomes a tablet…with a pop up keyboard which is easier to use than an iPad. So here I am using m Surface as a tablet… it doesn’t mean that I will be able to write a regular length letter today…. It just means I didn’t bag you today as I said I would do yesterday! Chicago greets me this morning with their great song… Movin’ in….

Well the dollar seems to be on a slippery slope so far this week…. The euro is still climbing higher, and the BBDXY lost another 3index points yesterday to end the day at 1,188.14….too early to be a think about a selling trend for the dollar, just take it as it is.

Gold finally found a bid yesterday and gained $12.90 on the day  to close at $1,933.90, while Silver gained 11-cents to end the day at $24.95…

The price of Oil was up on the day and ended the day with a $107 handle… The 10-year’s yield dropped again indicating that someone of size is buying bonds…

And that’s all I’m going to say about that!

In the overnight markets last night…. The selling of the dollar ended, and the gins in the currencies were lessened….Gold is down $3.20 this morning, and Silver is down 5-cents to start the day today. The price of Oil dropped $6 in the overnight markets after it was announced that President Biden was going to announce that 1 Million barrels of Oil ,per day, will be released from our Oil reserves…. OK…. Aren’t your reserves supposed to be used in a crisis? I guess it all depends on your definition of a  crisis….eh?

I would have to say that I guess that’s better than the idea I heard  talked about last week that included monthly checks of $100 to citizens to help defray the costs of gas… That idea was just plain stupid if you  asked me!

Ok earlier this week we saw the 10-year’s yield @2.50%…. If you calculated the difference in yields the loss to those bond holders would be in the millions…and now there’s no where for them to run….. They have tom sit and watch bond yields continue to move higher with every rate hike the Fed/cabal/ Cartel makes. I’ll let that sink in to bond holders that didn’t listen to my warnings on bonds….

Bill Bonner wrote yester day “this may not sound like a lot, but the rise in yields worldwide, has already caused bond investors to lose about $5 Trillion.”

So…guess which currency is the best performing currency vs the dollar in March? If you guessed the Russian ruble.. You win that kewpie doll!  Ever since  Russian President Putin announced that he would price Russian oil in rubles the daily beatings of rubles has abated…

In the US Data Cupboard the other day, we saw the home price index rise again in January, just like I said it would …. Today’s cupboard has the ADP Employment report and a final revision for GDP (4^th qtr)…  Remember now that the March Jobs Jamboree will be on Friday..

To recap… the dollar continued to get sold yesterday, but in the overnight markets the selling stopped… Gold is down $3 in the early trading today, and the Russian ruvle is the best performing currency this month… Chuck is not a fan of releasing Oil reserves..

For What It’s Worth… I found this article in Ed Steer’s letter this morning and it’s about rising inflation in  Germany and it ca be found on www.zerohedge.com…

Or, here’s  your snippet: “Say what you will about Germans, they have a distinct hate-hate relationship with hyperinflation, having been one of the very few “developed” nations to experience it in the not too distant past courtesy of Rudy von Havenstein’s application of “Modern Money Theory” to the Weimar Republic back in 1921 with less than stellar results. Well, Germany may soon enjoy double (and triple) digit price gains quite soon.

When asked by Frankfurter Allgemeine Zeitung about the possibility of double-digit inflation rates, Volker Wieland, a member of the German government’s council of economic advisers said that “it can’t be ruled out, especially if Russia stops oil and gas deliveries or if there’s a total import embargo, then I think inflation rates in this magnitude would be conceivable.”

Now if only Germany hadn’t allowed its energy policy to be determined by a petulant, publicity obsessed Swedish teenager, and if the country actually had some strategic views on how to maintain at least some energy independence, none of this would have happened (as we warned last summer in “Will ESG Trigger Energy Hyperinflation“). Unfortunately that wasn’t the case.

Surprisingly, Wieland didn’t fully lay the blame for Germany’s upcoming hyperinflation on Putin sand said that the “future path of inflation is very strongly linked to what the ECB does.” adding that “personally, I would be in favor of acting more quickly and of raising interest rates briskly.” Which is a great idea, if only the ECB didn’t have a rather catastrophic track record of hiking rates into an economic debacle and sparking historic sovereign debt crises in the process.

ECB sarcasm aside – which is not easy as one can never be sarcastic enough about the world’s most clueless ‘buy only’ hedge fund central bank – the reason why the topic of double-digit German inflation emerged is because earlier today analysts were shocked (again) when German headline inflation printed 7.6% YoY in March, sharply above consensus expectations of 6.8%, and up from 5.5% in December.”

Chuck again… yes…older Germans will be longing for the days of the old Bundesbank and their fears of inflation….

Market Prices 3/31/2022: American Style: A$ .7492, kiwi .6937, C$ .7985, euro 1.1095, sterling 1.3127, Swiss 1.0810, European Style: Rand 14.5131, krone 8.7419, SEK 9.3148, forint 333.86, zloty 4.1949,

Koruna 22.0303, RUB 85.43, yen 121.75, sing 1.3540, HKD 7.8294

INR 75.43, China 6.3508, peso 119.88, BRL 4.7611, BBDXY 1,191.06,

Dollar Index 98.23, Oil $101.05, 10-year 2.31%, Silver $24.90,

Platinum $990.00, Palladium $2,548.00, Copper $4.74, and Gold $1,930.70

That’s it for today… very strange typing on a tablet….talk about strange, did you see the score of the Cardinals game VS the Nationals yesterday? Cardinals won 29-8… The Cardinals hadn’t scored that many runs all spring combined before yesterday….Our Blues won for a second game in a row last night, maybe they’ve worked out their funk the were in. I have to start getting my ducks lined up for my return home on Saturday… In the famous word of good friend Duane… I don’t want to go home! And keeping Duane in mind, his fave band takes us the finish line today…Steely Dan and their song : FM… I hope you have a Tub Thumpin’ Thursday today, and please Be Good To Yourself !

Chuck Butler

March 29,2022

* dollar gets old in the overnight markets

* Daily beatings continue for Gold & Silver

Good day… And a Tom Terrific Tuesday to you! OMG! What a real Chamber of Commerce Day  here in S. Florida yesterday! I don’t know if I’ve ever sat in my seat at Roger Dean Stadium on such a perfect day! My beloved Cardinals proved once again that they can’t hit, and lost, but even that outcome wasn’t enough to spoil the day!  Chuck, Kathy, Tim, Anita, Gus and Diane all couldn’t say enough good things about the day.I onlmenty have 1 more game to attend down here and that won’t come until Friday this week. UGH! It wasn’t a picture perfect day for Gold yesterday, so we’ll get to that in moment, but first… My favorite song from SuperTramp greets me this morning, as I sit here and list to their song: Hide In Your Shell…

Well, the daily beatings for Gold didn’t end yesterday, and the shiny metal lost $35.80 on the day, while Silver also mounted up the losses, with a 62-cent loss on the day… So, once again, I’m confused as all hell about how Gold & Silver are getting treated, with all the fundamentals out there in their favor… I got to thinking last night, that I wonder if these daily beatings of Gold are a master plan by the U.S. Gov’t. to get the price of Gold so low that it would hurt Russia to sell their Gold into this market… You can’t begin to tell me that I’m wrong on that… That’s my story, and I’m sticking to it! So, Gold closed yesterday at $1,923.60, and silver closed at $25.01…

I have to wonder at this point, at what level the price manipulators will be satisfied with? 

I will say this though, the rise in Treasury Bond yields, is quite enticing, and could be a reason for the daily beatings of Gold & Silver, but… and you knew that was coming, right?  But… even with the 10-year Treasury yield at 2.50%, it’s still a negative yield, when you factor in inflation.  Now that 2.50% yield doesn’t look so enticing does it? 

In the overnight markets last night, the dollar got sold to the tune of 4 index points in the BBDXY (dollar index).  Gold, however isn’t getting any different treatment with the dollar getting sold, and the shiny metal is down $9 in the early trading, while Silver has lost the $25 handle, as the price has dropped 32-cents to $24.68… I looked high, I looked low, I looked around the corner, and under the hood, but still can’t put my finger on the reason for this selling today. 

I think I’m going to pack up my ball, bat and glove, and head home. and not deal with these stupid, mixed up, manipulated markets any longer!  That’s my attempt to get an April Fool’s Day joke on you before we get to April Fool’s Day. For no matter how stupid, mixed up, and manipulated these markets are, I’ll always have something to say about them, you know me… right? 

Well, the Bank of Japan (BOJ) was in the news overnight. The BOJ announced that they will attempt to control their yield curve for Japanese Gov’t Bonds (JGB’s)… We all know that the Fed/ Cabal/Cartel have controlled the Treasury bond yield curve for a long time, before they finally got out of the bond buying business a month or so ago. 

The Japanese yen fell to a multi-year low VS the dollar yesterday, and the BOJ doesn’t have a problem with that… What they do have a problem with is the rise of JGB yields… Of course, fundamentals say with inflation rising around the world that yields should be rising to combat inflation, but in these stupid, mixed up, manipulated markets the BOJ is going to fight fundamentals… 

Well, bully for them! Can you tell that my words there are dripping with sarcasm? well, they were! 

While I was on vacation, the Fed/ Cabal/ Cartel hiked interest rates 25 Basis Points (1/4%), and basically they played out their meeting just like I told they would… They hiked rates 25 Basis Points and then told the markets they had more rate hikes up their sleeve…  Fighting 15% inflation (according to shadowstats.com) with 25 BP rate hikes is akin to arranging the deck chairs on the Titanic… 

So, the Russin ruble has stemmed the tide of selling and has come back strong… The ruble trades with an 87 handle this morning, which is a far cry from the 107 it traded it before Russian President, Putin, announced that he was only going to accept rubles for payment of his Oil…  So, all the countries around the world that buy Russian Oil, had to go out and buy rubles to hold and then deliver VS receipt of the Oil… 

Just another nail in the dollar’s coffin as a reserve currency, folks… 

The data in the U.S. just continues to point to a very soft 1st QTR GDP, and then with inflation soaring, and GDP diving, this could end up really ugly for you, me and the guy down the street. Last week it was Durable and Capital Goods Orders both printing negative for February.  These things on the basis of just one print going negative don’t seem to be a big deal, but when taken with all the other negative or soft prints, they add up to a very weak economy… 

Oh, and briefly yesterday the U.S. Treasury bond yield curve inverted, which is normally a sign of bad things to come.  You see, usually 30 year bonds have the highest yield, and so on… but when the short term rates soar and inverts the curve, it is an indication that a recession is on the way… At least that’s how things have worked in the past, when the markets weren’t so stupid, mixed up and manipulated! 

I don’t have anything else to talk about today folks, so we’ll head to the Big Finish and call it a day, eh? 

The U.S. Data Cupboard today has the Case/ Shiller Home Price Index for January, which was before the rate hike, so I would expect this data to show home price increases in Jan. 

And that’s it for data today, folks…  Oh, this little ditty came across the screen this morning.. That in Spain, Producer Prices leaped by 41% last month! That’s crazy folks! So, it looks like soaring inflation is coming to the Eurozone… 

To recap… The dollar got sold overnight, and the daily beatings of Gold & Silver continued yesterday and in the early trading this morning. Chuck is about to call it quits because of stupid, mixed up, manipulated markets… Well, not so much, but he’s thinking about it!  The Treasury bond yield curve inverted yesterday, albeit briefly, but still, the indication is that a recession is heading out way. 

For What It’s Worth…  Well, I spent some time with this phenomenon this morning known as the inverted yield curve, and thought that this article probably explains it better than I did, and it can be found here: U.S. bonds: Treasury yields invert flashing recessionary warning sign (cnbc.com)

Or, here’s your snippet: “U.S. 5-year and 30-year Treasury yields on Monday inverted for the first time since 2006, raising fears of a possible recession.

The yield on the 5-year Treasury note rose to 2.56%, while the 30-year yield fell to 2.55%. This is the first time the shorter-dated 5-year Treasury yield has risen above that of the longer-dated 30-year U.S. government bond since 2006 — just a couple of years before the Global Financial Crisis.

To be sure, the main yield spread that traders watch — the spread between the 2-year and the 10-year rate — remained positive for now. And investors for the time being largely ignored the 5-30 negative rate spread, with the S&P 500 gaining for the day.

The 2-year yield jumped 4 basis points to 2.34% and the benchmark 10-year was down 2 basis point to 2.473%. 

Historically, the yield curve has inverted prior to recessions indicating their concern about the health of the economy.

“With the Fed set to hike into restrictive territory, the curve will invert,” said Seth Carpenter, chief global economist at Morgan Stanley. “As has always been the case in the past, markets will debate whether an inversion presages a recession. A policy mistake that causes a recession is clearly possible, but our baseline is that an inversion without a recession is more likely.”

Chuck again… Well, that’s it, it’s all about as clear as I can get this across, that this is in our future… 

Market prices 3/29/2022: American Style: A$ .7502,  kiwi .6901, C$ .8012, euro 1.1053, sterling 1.3103, Swiss $1.0689, European Style: rand 14.6170, krone 8.6272, SEK 9.3755,  forint 335.47,  zloty 4.2304,  koruna 22.1422, RUB 87.52, yen 123.50, sing .13591, HKD 7.8275, INR 75.80, China 6.3689, peso 20.04, BRL 4.7679,  BBDXY 1,196.87, Dollar Index 98.68,  Oil $106.87, 10-year 2.50%, Silver $24.68, Platinum $981.00, Palladium $2,298.00, Copper $4.66, and Gold… $1,914.20

That’s it for today… A watched a beautiful sunrise this morning as the sun rose out of the ocean… No clouds to distort the rise, and it was simply beautiful. Our company leaves today, and then it’ll just be me and Kathy here to get things ready to button up and get ready to leave on Saturday. That was some crazy scene at the Oscars Sunday night, eh?  My beloved Cardinals couldn’t find any hits in their bats yesterday, and lost to the Astros… One more game for me down here, and next week will be the start of the regular season! Tom Petty takes us to the finish line today with his song: Mary Jane’s Last Dance….  I hope you have a Tom Terrific Tuesday today, and please Be Good To Yourself!  Be Positive!

Chuck Butler

March 28, 2022

* Dollar gets bought in the overnight markets

* Commodity Currencies continue to bask in the sun… 

Good day… And a Marvelous Monday to you! I’m back! My vacation was marvelous! We had company for most of it, and I enjoyed every single minute of the time they were here!  The weather was simply marvelous too, sunny, 80, and nice breezes… I spent my birthday at the ballpark, which is like heaven on earth for me. And baseball is back!  Dawn, Jerry, Delaney, and Everett had a whale of a time getting home yesterday, long story, so I won’t bore you with that. I’ll see two more games this week, before we head home… I don’t want to leave here… but as Mr. Wizard used to tell Tudor Turtle, “Now it’s time to go home”… Alice in Chains (live) greets me this morning with their song: Would?

Well, the old saying that “When Chuck is away, the currencies and metals play”, didn’t hold true this time… When I left you, Gold was $2,010, and the euro was near 1.11… While I was gone, Gold got sent through the gauntlet of price manipulators almost daily. From where I was, it looked to be very shameful how the price manipulators went about their daily shorting of Gold & Silver. I could spend hours going over this with a fine tooth comb, but what’s the use? The dirty deed was done, and we are presented with cheaper buying opportunities, and that’s all I have to say about that!

The dollar waffled back and forth, gaining huge pieces of ground one day, and giving back a little the next day, and so on… The BBDXY when I left you was 1,196, and on Friday last week it closed at 1,195.84, so in 10 trading days time, it was flat as a pancake (Head East)…

To me, and this is just my thoughts on where the markets are these days…  We’re going through inflation that hasn’t been seen in 40 years, a war in Europe, job openings that are over 11 Million, each month, and job quits that are over 4 Million each month, and prognostications of 1^st QTR GDP being near zero, and now our POTUS has announced that the U.S. will defend Poland if Russia goes there…  Now, I’m not talking about the rights and wrongs of all that, I’m talking about how the markets have reacted to these things…

They should have been scared out of their collective minds, and bought Gold & Silver as if it were the last pieces of the metals on earth. They should have sold the dollar like it was the proverbial “hot potato”,  But NOOOOOOOOO! These markets are just plain weird, these days… So much confusion, so much manipulation, so much Bull dookie, that it makes a fundamentalist like me want to go yell at the walls, and then leave, never to be heard from again, because, what good am I during these weird trading days like these?

In the overnight markets last night… All hell has broken loose once again, and the dollar buying is off the charts! The BBDXY is up near 5 index points to trade at 1,200 this morning… Gold has been sent through the manipulation gauntlet again and is down $27, while Silver has seen 53-cents of its price shaven from it.  It’s crazy what’s going on this morning, folks, so batten down the hatches, and take cover… 

The price of Oil has slid $6 this morning and trades with a $107 handle, while the treating of bonds continues to show that the bond boys aren’t going to believe that the Fed/ Cabal/ Cartel is really serious about fighting inflation. The 10-year Treasury this morning trades with a 2.46% yield. 

I see where currency traders finally got the memo that the Japanese Gov’t was doing everything they could to weaken the yen, and the currency has been dropping daily for the last two weeks. The Russian ruble finally saw some buying last week, after Putin announced that he would demand rubles for payments of Oil

The Commodity currencies are the only currencies enjoying any kind of rally VS the town bully aka the dollar. A$, kiwi, rand, C$, krone, real are all trading at higher levels than they were when I left you two weeks ago. I have a little ditty for you in the FWIW section today regarding commodities, so you won’t want to miss that!

Ok, here’s a case of the old saying that “it is far better to keep one’s mouth shut and let people think you are a fool, than to open it and remove all doubt”… 

I found this on Twitter while I was on vacation, and wrote it down immediately, because, well, Nancy Pelosi, just removed all doubt…  here’s here little ditty about inflation:

@speakerpelosi: “When we’re having this discussion it’s important to dispel some of those who say, well it’s government spending. No it isn’t! the government spending is doing the exact opposite, reducing the national debt. It’s NOT inflationary”

See, I told you that she removed all doubt, eh?  On what planet did she study economics? Because it wasn’t here on earth!  

Speaking of inflation, you know, as a country we’ve gone from “there is no inflation”, to “it’s just transitory”, to “inflation it good for you”, to “it’s Putin’s fault”, in a manner of months…

I also found this quote on Twitter regarding inflation: “As always, the regime wants to divert the blame from itself onto something else, and it’s hoping you’re enough of a dope to blame “greedy rich people” instead of them.”

And finally on inflation, there was a cartoon the other day in Ed Steer’s letter that says it all… A man and wife are leaving the grocery store, and the man says, “ Biden says that inflation is Putin’s fault.” And the wife says, “Yeah, like the $7 bacon, no one’s buying it”…..

So… the sanctions on Russia keep mounting, and now they include not allowing Russia to sell their Gold should they need to… Well, well, well…  And then the POTUS gave China a call and told them not to aid Russia… And China smiled and said, OK, with their fingers crossed behind their backs! Look I’ll explain this to you, so that you can explain it to your congressman/ woman… Should Russia need to sell some Gold, they could simply sell it to China, without the transaction even being reported… Thus not affecting the price of Gold, and China, as their history has shown, will not reveal their Gold holdings… So only Russia and China will know…

The good folks at GATA sent me this quote from Brien Lundin who is in charge of the New Orleans Gold Conference, “The result of sanctions against Russian gold reserves would be to alert the 36 countries that hold significant portions of their gold reserves in the vaults of the Federal Reserve Bank of New York that they should take their gold back as soon as possible.

And that could create significant turmoil in the gold market, since the Fed has demonstrated difficulty in actually finding and transporting the gold it holds for other nations. The bank famously told Germany that it would take seven years to repatriate just a portion of that nation’s holdings. It ended up taking only four years, but the episode raised serious doubts that all the claimed national gold reserves are actually at hand in the New York Fed’s vaults.”

Uh-oh… more unintended consequences… It’ll be interesting to see how this all plays out, even if Russia doesn’t need to sell its Gold…  I’m telling you this now, so maybe you’ll listen to me later, that all this SHOULD be like manna from heaven for Gold… But as I said above, that’s the fundamentalist in me talking… These days… These days I sit on cornerstones, and count the time in quarter tones to ten, my friend, don’t confront me with my failures, I had not forgotten them” (Jackson Browne)

Longtime readers may recall me calling out the Trump Trade tariffs on China and saying that they would come back to bite us… Same thing with these sanctions on Gold sales in Russia… 

The U.S. Data Cupboard last week had both Durable Goods and Capital Goods Orders for Feb, print negative, and the dollar didn’t get sold…  This week, there’s not much until Friday, when the March Jobs Jamboree prints…  I can’t believe that March is coming to an end… Friday will be April Fool’s Day… time flies when you’re having fun!

To recap… Chuck just doesn’t feel like the markets are reacting to the things going on in the world the way they used to, fundamentally, that is… Gold saw daily beatings while Chuck was gone, and Chuck points out that the sanctions against Russia and their potential Gold sales won’t be worth the paper their printed on… In the overnight markets last night.

For What It’s Worth….  I found this in Ed Steer’s Friday letter, and it makes a point for me that I have tried to get across to people, and that is: Commodities are hot, and the countries that produce commodities are even hotter, as is their currencies…  So this article can be found here: Commodity Traders Sound Alarm on Plunging Market Liquidity (yahoo.com)

Or, here’s your snippet: “ Whipsawing commodity prices and eye-watering margin calls are forcing traders to reduce their activity, driving liquidity out of markets and exacerbating price swings, according to some of the world’s biggest trading houses.

“We’re seeing clearly that liquidity in terms of being able to find buyers and sellers in distressed or highly volatile markets is becoming less,” Engelhart Commodities Trading Partners Chairman and Chief Executive Officer Huw Jenkins said at the FT Commodities Global Summit in Lausanne, Switzerland.

Engelhart halved its positions over the past six or seven months, he said. The company is not alone. As commodities swing wildly, traders and industrial players are struggling to keep up with massive cash requirements to back up their positions or put on new ones, which is squeezing participants out of the market.

The drop in liquidity is heightening volatility when prices do move. Benchmark European natural gas, also known as TTF, surged as much as 34% Wednesday as Russian President Vladimir Putin prepared to demand ruble payments for the fuel. That was just the latest example of the wild price swings spurred by Russia’s invasion of Ukraine.

It’s not just fossil fuel markets that have become unusually volatile, but also those for other goods that underpin the global economy. Nickel prices have continued to swing wildly on the LME, even after the exchange paused trading for days after the metal soared 250% over two trading sessions in early March. Wheat futures in Chicago jumped by the exchange limit for consecutive sessions earlier this month.”

Chuck again… And this is where I point out that the Aussie dollar is above 75 cents, and kiwi is heading to 70-cents, and so on… That Commodity CD basket that I mentioned a couple of months ago, sure looks pretty good right now… If you’re late to the commodity rise party, and want information on this CD, call 1-800-926-4922  and anyone answering the phone will walk you through it… And for full disclosure, I don’t get a plug nickel for sending you there!

I do that out of the goodness of my heart, and wanting to see investors take advantage of the commodity boom without having to deal with futures contracts and such… 

And one more thing… I read yesterday that we should be saving our nickels…  Hmmm…. 

Market Prices 3/28/2022: American Style: A$ .7515, kiwi .6926, C$.8003, euro 1.0965, sterling 1.3113, Swiss $1.0683, European Style: rand 14.5850, krone 8.6750, SEK 9.5111,  forint 341.08,  zloty 4.3011,  koruna 22.4727, RUB 102.09, yen 124.11, sing 1.3605, HKD 7.8296, INR 75.97, China 6.3652, peso 20.03, BRL 4.7393,  BBDXY 1,200.75, Dollar Index 99.25,  Oil $107.25, 10-year 2.46%, Silver $25.09, Platinum $1,010.00, Palladium $2,336.00, Copper $4.64, and Gold… $1,932.40

That’s it for today… More company arrived yesterday, Gus and Diane are here with us for a couple of days, should be fun… Well, I did celebrate another birthday last week, and quite frankly every year that I add on, another number, I’m surprised that I’m doing that… I have so many things going against me health wise, and so when the year comes around again, I’m very happy that I’m still here… I think more about my birthdays these days… My beloved Cardinals are questionable right now… Their pitching is in shambles, and their situation hitting is nowhere to be found… But it’s early, so I’ll give them a pass, for now… Our new pitcher couldn’t get out of the first inning on Saturday… UGH!  I’ve put on some weight while I’ve been down here, and so I have my work cut out for me to lose it again when I return home…  Paul Young takes us to the finish line today with his one hit wonder song: Every Time You Go Away…  That was originally an Hall and Oates song, but Paul Young made if famous… I hope you have a Marvelous Monday today, and please Be Good To Yourself!  Be Positive!

Chuck Butler

 

 

March 10, 2022

* Currencies rally on Wednesday

* Gold, Silver & Oil all see major losses on Wednesday

Good Day… And a Tub Thumpin’ Thursday to one and all!  And a great BIG Happy Birthday to good friend, Rick B. today… What a great day at the beach yesterday! Then we came in and they put me at the helm of the grill, and I was given the task of grilling one steak  well done, one steak med. Well done, one steak medium, and my steak med rare… And I hit on all cylinders! I admit, it’s not an easy thing to do on an outside grill, with the wind blowing 20 knots… But I did it, and everyone was very surprised that their steaks were just how they liked them! Of course, I’m one of those people that think that eating a steak without any red in the center is a sin… But that’s just me! Overall, it was a fabulous day, spent with good friends, and a warm sun! Weezer greets me this morning with their song: Island In The Sun…

My oh my, it’s difficult to explain things that happened yesterday, other than to tell you that the price manipulators have not gone into the back room. They came out with both guns blazin’ and took down Gold & Silver, to hopefully, their predetermined level… Gold ended the day down $61.30, and Silver ended the day down 59-cents… Both closed below their previous levels of above $2,000 and $25 respectively…  Good friend, Dennis Miller, called me and asked me, “Is the war over? ” And then went on to say that when he saw the drop in the price of Gold, he had to believe that the war was over… and it wasn’t just the metals that got taken down yesterday, so the did the price of Oil which fell by $8… 

So, anyone not aware of the price manipulation in the markets, would look at yesterday’s price action, and say, ‘the War must be over”…  What else could have had the effect on the metals and Oil like that?  Oh, and the dollar also got sold yesterday… 

So, Gold close yesterday at $1,992.80, and Silver closed at $25.87, and from what I saw in the overnight markets last night, the selling of these two wasn’t over… UGH!

So, are all the reasons Gold climbed more then $85 in the last week, prior to yesterday’s engineered takedown, gone? I mean has the war been called off? Has inflation been defeated? Has the U.S. corrected their deficit spending habits? Did the $30 Trillion plus, deficit been wiped clean?  You and I both know the answers to those questions, and therefore the only thing left to explain what happened yesterday was an engineered takedown…

The dollar didn’t exactly have a good day either, and the BBDXY lost over 6 index points on the day. The euro climbed back above 1.10, and the other currencies followed the Big Dog euro higher VS the dollar.  I’m actually appalled that the price manipulators were so brazen to take down Gold & Silver when these two metals had everything going for them…

In the overnight markets last night… Well, the initial selling of Gold & Silver last night, was turned around, and Gold is up $17 in the early trading today, and Silver is up 14-cents, with both metals gaining those levels they lost yesterday, of $2,000 and $26… 

The price of Oil did not recover in the overnight markets last night… Oil trades this morning with a $112 handle… Things got pretty ugly yesterday, and I’m glad that’s over and done with, for now that is…  Bonds also continued to get sold, (Where’s the Fed/ Cabal/ Cartel?, have they really gone cold turkey on buying bonds?) The 10-year’s yield trades this morning at 1.93%… 

The White House finally got around to issuing an executive order on crypto currencies yesterday…  Here are the three key points of the executive order, from CNBC.com:

• U.S. President Joe Biden signed an executive order on Wednesday: calling on the government to examine the risks and benefits of cryptocurrencies.
• The measures focus on six key areas: consumer protection, financial stability, illicit activity, U.S. competitiveness, financial inclusion and responsible innovation.
• The Biden administration also wants to explore a digital version of the dollar.

I’m sure the Crypto heads were sweating bullets on this one, but I think this executive order is a feeble attempt to reel in the wild west trading in Cryptos… I guess we’ll have to see if it has any teeth, but from my view in the cheap seats, I would say, it’s toothless… 

The U.S. Data Cupboard yesterday had the Feb. Job Openings and Job Quits data, and both remained quite high, with the Openings at 11.3 Million and the Quits at 4.3 Million.  The could have been A reason for the dollar selloff, but in reality it probably wasn’t even a pimple on the dollar’s rear…  

Today’s Data Cupboard has the stupid CPI prints for Feb… I read where the White House is leery that this report could show really strong inflation gains last month… I would think that by now they would have figured out that this inflation isn’t going anywhere but up… I would also have thought that the White House could be putting pressure on the Fed/ Cabal/ Cartel to do something about it, now! 

As I see it this morning… Soaring U.S. inflation is expected to continue its surge with no sign of relief in sight, as the costs of consumer goods like gasoline and household items climb to new heights. But then we might not see it that way when the stupid CPI prints today, because of the way it gets calculated… I’ve explained all that before, so I won’t go into it again today, just be aware that real inflation is only calculated by www.shadowstats.com 

The Fed/ Cabal/ Cartel has twittered and shuffled their feet over their decision to hike rates, especially with the War in Europe, and the tenderness of the U.S. economy… In my opinion, they’ll still go ahead with a 25 basis point rate hike when they finally put away the board games that were played on the first day of their meeting… I hear that Battleship is a popular game, and of course the all time winner of fave games with the FOMC is Monopoly!  Can you blame them for liking that game, with the Monopoly money?  HA! 

This is where I would look to the Great Mogambo Guru for some witty remark about the FOMC. I miss you Richard… 

To recap… The price manipulators crawled out from the wall boards, and performed an engineered takedown of Gold & Silver yesterday. the dollar got sold, along with Oil and bonds… It was a very ugly day in the markets, compliments of the price manipulators. Gold lost $61 yesterday, and Silver lost 59-cents, which brought out the question, Was the War Over? Of course it wasn’t… but one would have thought that, eh? In the overnight markets last night, Gold & Silver are attempting to recover those losses yesterday, and the dollar is getting bought again… 

For What It’s Worth…   Doug Casey chimes in with his thoughts on a monetary reset… (spoiler alert, it’s imminent!), and it can be found here: Why US Threats Against Russian Gold Reserves Mean a Monetary Reset Is Imminent (internationalman.com)

Or, here’s your snippet: “These are the recent words of Jerome Powell, the Chairman of the Federal Reserve.

It’s a stunning admission from the one person who has the most control over the US dollar, the current world reserve currency.

It would be as ridiculous as Mike Tyson saying that it’s possible to have more than one heavyweight champion.

In other words, the jig is up.

Not even the Chairman of the Federal Reserve can go along with the farce of maintaining the dollar’s supremacy anymore… and neither should you. (This has profound consequences for you and your savings, more on that in a moment.)

Powell’s comments occur in the context of what could prove to be one of the most short-sighted and self-destructive acts in history… the US government’s economic war against Russia.

In the wake of Russia’s invasion of Ukraine, the US government has launched its most aggressive sanctions campaign ever.

Exceeding even Iran and North Korea, Russia is now the most sanctioned nation in the world.

“This is financial nuclear war and the largest sanctions event in history,” said Peter Piatetsky, a former Treasury Department official.

He went on to say, “Russia went from being part of the global economy to the single largest target of global sanctions and a financial pariah in less than two weeks.”

Chuck again… Yes, you’ll have to click the link to get the whole gist of the article… sorry, but time and space is limited here…

Market Prices 3/10/2022: Americn Style: A$ .7329,  kiwi .6846, C$ .7796, euro 1.1045, sterling 1.3183, Swiss $1.0803, European Style: rand 15.1345, krone 8.9608, SEK 9.7206,  forint 345.50,  zloty 4.4965,  koruna 22.9111, RUB 127.73, yen 115.96, sing 1.3594, HKD 7.8206, INR 76.30, China 6.3233, peso 21.01, BRL 5.0119,  BBDXY 1,196.14,  Dollar Index 98.17,  Oil $112.65, 10-year 1.93%, Silver $26.01, Platinum $1,105.00, Palladium $3,034.00, Copper $4.57, and Gold… $2,010.60

That’s it for today…  And another Happy Birthday to good friend, Rick! Ok, I’ve been remiss in not talking about my annual spring vacation… I know, I know, I should have let you know before this, but… I’ve been so focused on all that’s going on, and trying to make sense of it all that I plumb forgot! So… as of today, I’m on my annual spring vacation, and will not return until 3/28…  I know, what will you do without my daily tirades about price manipulation?  Well, I suggest you go to the Pfennig website: www.dailypfennig.com and read some past issues of the Pfennig, you never know if you might have missed something previously! HA!  Other than that news… My beloved Mizzou Tigers won their basketball game last night in the SEC Tournament… Our Billikens play in the ACC tournament tonight. And our Blues try to correct their recent swoon tonight on home ice. Justin Haywood , and John Lodge of the Blue Jays ( an spinoff of the Moody Blues) take us to the finish line today with their song: Who Are You Now?   Don’t know that one? Look it up, and it will become one of your faves! I hope you have a Tub Thumpin’ Thursday today, and a Fantastico Friday tomorrow, and I’ll talk to you again in 2 weeks! Please Be Good To Yourself! Be Positive, Test Negative! 

Chuck Butler