Author: admin

December 30, 2021

* Dollar continues to get sold in small amounts… 

* JPMorgan back in the news for spoofing again… 

Good Day… And a Tub Thumpin’ Thursday to one and all! I bet you were wondering where I slipped off to after Monday’s letter, eh? You might recall me telling you that I had gotten a nasty cold, and well, it took its toll on me on Monday, Tuesday, and Wednesday. I’m not in the clear just yet, but I’m, better… At least I’m awake… I basically slept for about 36 hours only waking up when Kathy would check on me… I still would much rather be asleep this morning, but… I made a promise to myself many years ago about writing the Pfennig when I didn’t feel like it… And this morning is one of those days… Neil Young brings us back to our regular programming this morning with his song: Four Strong Winds…

So… This week has been weird in the markets, wait! Hasn’t just about every week the past few years been weird? Well, yes they have, but none were the week’s trading that ended the year… The U.S.’s fiscal year ends in Sept. But a Ton of Companies have their books squared to close on 12/31…  So with that thought in mind, I looked out at the opportunities in the markets that presented themselves this week… I don’t see many, folks… And that’s what makes this week weird… Usually, end of the year, you have folks thinking about changes or things they want to do in the new year, and those announcements bring about movements in the markets…

The only opportunity in the markets that I see, for gains in 2020, is Gold & Silver… Many experts have gone on record saying that Gold will return to $2,000 in 2020…  The rest of the market is a demolition derby if you ask me…   Bond yields will continue to rise, we’ve been through that so many time in the past , that we don’t need to do that again!  Stocks are so overbought that they have almost come around full circle… And the Fed has stopped, or so they say, stimulating the economy…   Oil is interesting…  the price of Oil has gotten back on the rally tracks after a couple of weeks of weakness, and looks to be in the driver’s seat… Ooooh, ooooh, driver’s seat (Great song) But Oil is so tricky, it can be rising like the Phoenix one day, and the next day, be looking for cover… So with volatile markets like that I tray to stay clear of them.

In the actual markets yesterday, we saw some dollar selling, not much, but some nonetheless… The BBDXY closed at 1,177.04 last night, which is down quite a bit from where it was before I left on vacation (1,185.92)…  The price of Oil is up to almost a $76 handle this morning, trading at $75.98. Bonds keep getting sold, which they should be, and the 10-year’s yield this morning is 1.53%…  And Gold… Hmmm…

Last Saturday I was happy to see that the Commitment of Traders (COT) Report for the second consecutive week showed big changes that were favorable to Gold & Silver, and instead of coming into the office on Monday with that in mind… The price manipulators wanted to make sure that everyone got the message that fundamentals like COT’s are no longer important (in their minds), and pushed Gold down on the day to the tune of $1.40 to close at $1,805.80, and Silver was down too, by 16-cents to $22.94…

In the overnight markets last night, the dollar continued to get sold, not my large margins, but little chinks taken away from the dollar’s armor daily now it seems…   Gold is down a couple of bucks this morning and Silver is down one thin dime, as I write…

In the U.S. Data Cupboard today is only the usual Tub Thumpin’ Thursday far… Weekly Initial Jobless Claims, which haven’t been going in the right direction lately…  Tomorrow, there will be no data to end the year, so this is it…   We close the U.S. Data Cupboard today for 2021, not to be opened up again until Jan. 3^rd…

To recap… The dollar continues to sink, albeit slowly, but over time has sunk quite a bit since 2 weeks ago… Chuck looks for opportunities in the markets for 2022, but only sees one shiny asset class meeting his criteria… And the Data Cupboard gets closed up for 2021 today…

For What It’s Worth…  You know that I truly believe in the magc of the Christmas season , and how it brings out the good in most people, and for this one I’m going to have to make an exception and wish that all involved went to jail!  I’m talking about an article about JP Morgan settling to pay a $60 Million fine for metals price spoofing… And it can be found here: https://shiny-life.com/investors-get-preliminary-approval-for-60-million-settlement-for-alleged-jpmorgan-spoofing/

 

Or, here’s your snippet:” Commodities merchants have obtained preliminary approval for a proposed $ 60 million settlement to resolve class-action claims relating to JPMorgan Chase & Co.’s alleged manipulation of the dear metals futures markets.

 

A Manhattan federal decide mentioned on Monday that the deal, reached final month, eliminated an preliminary hurdle to approval and scheduled a equity listening to for July 2.

 

If in the end authorised, plaintiffs’ legal professional mentioned, the deal would construct on an earlier $920 million settlement with the federal authorities relating to the funding financial institution’s use of an unlawful enterprise observe. referred to as “identification theft”.

 

The approach, which Congress criminalized below the Dodd-Frank Wall Avenue Reform and Shopper Safety Act of 2010, is a type of business manipulation that creates a misunderstanding of provide or demand in a market, within the intention to have an effect on future costs.

 

Within the 2018 lawsuit, the group’s plaintiffs alleged that JPMorgan “often” positioned digital orders to purchase and promote futures contracts with out ever intending to truly execute the trades. The so-called fraudulent orders tricked merchants into paying artificially inflated costs for the metals, in line with the lawsuit.

 

JPMorgan’s allegations of misconduct prompted traders to file separate securities class actions, after a dealer within the funding financial institution’s treasured metals workplace pleaded responsible to fraud and commodity conspiracy in 2018.

Additional prosecutions adopted, and JPMorgan revealed in February 2020 that it was responding to inquiries from the USA Division of Justice’s Felony Division relating to its buying and selling practices within the metals market.”

Chuck again… And once again, I plead with the authorities to send these guys to jail… but my pleas fall on deaf ears.

Market Prices 12/30/2021: American Style: A$ .7265, kiwi .6837, C$ .7825, euro 1.1325, sterling 1.3492, Swiss $1.0922, European  Style: rand 15.9433, krone 8.8162, SEK 9.0487,  forint 326.79,  zloty 4.8589,  koruna 22.1288, RUB 73.84, yen 115.18, sing 1.3529, HKD 7.7989, INR 74.31, China 6.3679, peso 20.56, BRL 5.6536,  BBDXY 1,177.83, Dollar Index 96.05,  Oil $ 75.98, 10-year 1.53%, Silver $22.84, Platinum $970.00, Palladium $2,057.00, Copper $4.35, and Gold… $1,803.50

That’s it for today, this week, and this year! Quite a bit shorter of a Pfennig today for you holiday enjoyment… I’m feeling pretty good at getting down what I did! HA! Things around here this week have been weird for me, in that I slept through most of it… Little Evie is here, and she’s really growing up fast. I’ve had to stay away from her and her brother most of the time they’ve been here this week, and today they go home! UGH! I love the sound of the pitter-patter of little feat running across our hardwood floors upstairs…  So, if you are a New Year’s Eve celebrator, please be careful tomorrow night, make good choices and do NOT drive after drinking!  So, be safe, careful but have a great time! I’m listening to Celtic Woman, Kelly, sing Auld Lange Syne this morning, and getting a tear in my eye… I hope you have a Tub Thumpin’ Thursday, and a ball droppin New Year’s Eve tomorow… And please Be Good To Yourself…  Be Positive, Test Negative!

Chuck Butler

December 27, 2021

* Currencies & metals rally while Chuck was gone

* The Potus’s $2 Trillion deficit spending boondoggle is being held up… 

Good Day… And a Marvelous Monday to you! Did you miss me? I missed writing everyday to you, but I got over that quickly! I trust your Christmas was beautiful, blessed, and full of wonder and joy… Mine sure was!  Little Evie was adorable, and was able to unwrap her presents, and was so excited… It was 70 degrees on Christmas Day! I bet all the kids that got a bicycle were glad it was a nice day! But it wasn’t a record high for the day… Hmmm….  In past years, while I was away, we would see a rally in the currencies and metals, and this year, was no exception, albeit a muted rally, but a rally nonetheless!  I’m still listening to Pandora’s Smooth Jazz Christmas station, and will continue to do so, until the new year… This morning, and the Stephen Kummer Trio is playing their version of: Favorite Things…

Well, let’s see.. on 12/16, when I left you, Gold was $1,188.09 and Silver was $22.17… The BBDXY was 1,185.96, Oil was $71.17, the ten year was 1.46%, and the euro was 1.1315… And here’s how they all closed on Christmas Eve…  Gold was 1,810.20, Silver was $22.96, The BBDXY was 1,178.33, Oil was $73.79, the ten year was 1.43%, and the euro was 1.1340…  So, there were rallies in the asset classes, while I was away… And like I’ve said many times before when coming back… I would gladly stay away from writing for “X” dollars!  But I digress here…

The dollar was not so much in demand last week, as maybe, just maybe, cause you never know, traders and investors are finally seeing the writing on the wall, that spells out troubles for the U.S. going into 2022, and they lessened their respective loads of dollars.. the dollar still appears to be overbought, but at least it’s not flashing red any longer!

The Potus’s $2 Trillion boondoggle was put on hold for now that is, why wait? Why stay the execution? Get it over with, so that we can go on with the ending of our Empire! I’m in a rotten mood this morning, so don’t cross me! What’s $2 Trillion any-old-way? Chump change, right? Bus fare… Oh, do you remember when you would be going somewhere, that required transportation, and your mom would give you Bus fare, if you needed to leave early, or if things didn’t turn our just right?  And that takes me back in time… The late 70’s, early 80’s… I took the bus to work each day, and returned home on the bus… It took about 45 minutes to go downtown, and even longer to get home each day… I wonder if anyone takes the bus to work each day, these days?

In the overnight markets last night… Well, I don’t know if the senior traders overseas were returning last night, but the dollar selling that went on all last week, stopped on dime… But the feeling that the dollar’s days of being the king of the hill were waning, has subsided this morning… The euro has slipped to 1.1310, The BBDXY has risen to 1,180.39, Gold is down in the early trading by $2.30, and Silver is down 15-cents… Oil is holding steady Eddie above the $72 handle, and the 10-year Tresasury’s yield has risen to 1.49%… 

I’m still of the belief that the 10-year’s yield will be 2.00% by spring time…  So, it had better get it in gear, eh? Bonds have really been a real enigma for me… I used to trade bonds, and thought I had my finger on the pulse of the bond market… But these day, I sit on cornerstones and count the time in quarter notes… (Jackson Browne) I do, really, I sit there and ponder what the heck is going on! The Fed/ Cabal/ Cartel says that they are no longer buying as many bonds each month, and that should in my opinion bring about rise in the yields becuase they sellers need to attract buyers of the bonds that the Fed/ Cabal Cartel no longer get their mitts on… 

I had thought that we were well on our way to higher yields about 6-weeks ago, when the yields rose to the 1.70%’s…   But that was not to be! 

The Pfennig is short-n-sweet today, as I’ve got to slowly get back in the saddle without hurting myself … Besides, I’ve been told on occasion that too much Chuck at once is bad for you …  HA!

Well, Chuck’s back, so what did you expect? The rallies to continue? HA! All kidding aside, the currencies and metals are still showing to be oversold, and so we should expect the rallies to continue, but since when did fundamentals or technicals come into play in these heavily manipulated markets? 

I’ve been on the lookout, not seriously, while on vacation, but still on the lookout for someone to give me an inkling of information about what’s coming for the metals in 2022… No one really knows, for sure, but some have some really educated observances and I turn to those folks to help me with my thoughts… One such person to check out is E.B. Tucker… And when I saw him quoted on Kitco.com I immediately went there to see what he had to say, and I have that for you right here: “Everybody is a speculator, and so next year, I expect this speculation runs out of gas. There’s no more stimulus check coming. There’s more liquidity coming into the average person’s pocket. They got a raise this year, but everything they’re buying is going up in price. Sales are slowing down. The refinance boom is slowing down,” Tucker told David Lin, anchor for Kitco News. “Next year, you’re going to see a rotation out of [stocks] and you’re going to see a move into something real.”

Chuck again.. And that “something real” would be Gold & Silver… He didn’t have to say the words, Gold & Silver, by calling it something real… Even I can figure that one out! HA!

Inflation is a real bummer man…  It’s running at an annual rate of 13.9%, according to shadowstats.com, and our country is still sitting on ZIRP… zero interest rate policy… Oh, sure the Fed/ Cabal. Cartel is talking about hiking rates in April of next year, but that’s till 4 months out, what will inflation be by then? I shake my head in disgust at our so-called Central Bank…

There’s very little on the docket for the U.S. Data Cupboard this week… It’s not unusual for this to occur, as the year comes to an end, most senior traders have taken the last two weeks off, and there’s nothing to be covered up or hidden in their trading logs, as they made sure of that before they left… The Gov’t bean counters tried to jam or cram all the data prints into last week, ahead of Christmas so that everyone’s eyes were taken away from the ball…  I had to gag when I saw one of the prints… The Stupid Consumer Confidence report for this current month, shot higher from 109 to 115… Really? What on earth does anyone have confidence in these days, besides the fact that Gov’t will continue to take down our Empire with deficit spending?

I mean, think about that for a minute… the stock market is teetering once again, waiting for the white knight to come save it, and the inflation rate is running at its hottest pace in nearly four decades, as widespread supply disruptions, high consumer demand and worker shortages fuel a surge in prices. The Fed/ Cabal/ Cartel, may be just jawboning, but they claim that they are here to remove the punch bowl at the party… The U.S. current debt is $29.3 Trillion, our Unfunded Liabilities are $85 Trillion… (from the U.S. Debt Clock), and we’re not going to stop our deficit spending any time soon… And from that short list of problems, people are Confident? Give me a Break!

To recap… The currencies & metals rallied while Chuck was away, and as usual he has offered to go away permanently if someone wants to pay him to go away… HAHAHAHA!  The $2 Trillion boondoggle that is being tossed around D.C. like a hot potato, no worries, it’ll get through eventually, because that’s what we do… We deficit spend! 

For What It’s Worth… Well, this article came to me via long time reader Bob, who lives “downunder”, and always has a different thought on things, and I love that!  This is an article about money… and it can be found Here: What is money and how is it changing? (brisbanetimes.com.au)

Or, here’s your snippet: “Money – it’s the grease that makes the world turn. It’s a means of exchange. We work for it to satisfy our needs and wants. It is used by some to measure their success in life. We even sing songs about it, how we’d like more and pine for it when it’s gone.

For decades, money has been largely unchanged. Sure, in Australia we’ve moved from paper to polymer notes, ditched the 1¢ and 2¢ pieces, added $1 and $2 coins. Instead of our pay being delivered to us via an envelope stuffed with cash, it is now electronically deposited into our bank account.

Yet starting with the global financial crisis and now the coronavirus pandemic, both money itself and our methods of spending it are changing at perhaps the fastest rate since societies moved from bartering to coin.

There are some people actively investing in alternative forms of money in the belief that what we know as money – backed by a central bank and the government – could change in the near future. More than $US3 trillion has been sunk into cryptocurrencies with advocates claiming that they will replace “traditional” money to pay bills and store value.

Meanwhile, as China tests out a digital yuan, many central banks, including Australia’s, are at least countenancing the idea of introducing digital currencies of their own backed by the government – an “eAUD”.

In an interesting twist – although sightings of $100 notes are akin to close encounters with extraterrestrials – there have never been more $100 and $50 notes in the economy. More cash, not less? How come? And what are to make of all these changes?”

Chuck again… and for those changes you’ll have to click on the link above and go to the article…  

Market Prices 12/27/2021: American Style: A$ .7216,  kiwi 6.800, C$ .7785, euro 1.1310, sterling 1.3405, Swiss $1.0877, European style: rand 15.5277, krone 8.8794, SEK 9.1276,  forint 327.62,  zloty 4.0735,  koruna 22.2135, RUB 73.54, yen 114.73, sing 1.3571, HKD 7.8012, INR 74.99, China 6.3727, peso 20.63, BRL 5.6945,  BBDXY 1,180.39, Dollar Index 96.21,  Oil $72.61, 10-year 1.49%, Silver $22.81, Platinum $969.00, Palladium $2,038.00, Copper $4.34, and Gold $1,807.90

That’s it for today… Well, it’s almost time to saddle up and head south for the winter… But before we go, we get to take care of grandkids, Braden and little Evie!  They’ve come to stay with us for a few days while their parents go on a real vacation! I’ve come down with another cold… I sat near a young child last Sunday who was sneezing her head off, and then 4 days later, voila!  I sure hope this one doesn’t turn into what I went through last summer!  So, far, just a cold… Kathy tested me for Covid and I was negative…  Speaking of Kathy, yesterday was her birthday!  I’m sure she wouldn’t want me to tell you how old she is now… But I’m sure most of you can guess… I said to myself yesterday, “Boy she sure still looks great, for being “x””…  I wish I could say that about myself, but I can’t, and so we move along…  Our Blues had their Canada trip cancelled last week, and they travel to New Jersey tonight to play the Devils… Wynton and Ellis Marsalis take us to the finish line today with their upbeat version of the song: Pebble Beach… I hope you have a Marvelous Monday today, and please Be Good To Yourself… And remember Be Positive, test negative!

Chuck Butler

December 24, 2021

Christmas tradition has Chuck sending out his Christmas Pfennig on Christmas Eve.. And So, to keep the tradition going, which, as you’ve been informed from Chuck, is a Big deal with him!  So, with no further ado, here’s Christmas 2021, A Pfennig Tale.. 

T’was the night before Christmas

And all across the states

Not a creature was stirring

But inflation was calling  Check Mate!

 

And mama in her kerchief

And I in my cap

Had just settled down

To a long winter’s nap…

 

When out on the lawn there arose such a clatter

I sprang from my bed to see what was the matter

And what to my wondering eye did appear

But a sleigh full of inflation and 8 Fed heads, oh dear!

 

With an informer of the inflation so lively and full of luck…

I knew in a moment it must be St. Chuck!

He whistled and shouted to his team…

To the top of the porch, to the top of the wall

Now dash away, dash away, dash away all!

 

St. Chuck shimmies down the chimney

And comes down with a thud!

And went straight to work

Filling the stockings with Gold

 

In his sack he has many Gold & Silver coins

But the people of this country are fickle

And they don’t want real money

They’d rather have things not worth a pickle!

 

He thinks of leaving the non-believers coal in their stockings

For at least it would heat their homes

Which would be better than their fake money, I’m sure

All those things that won’t be worth a bag of foam…

 

But, it’s Christmas, Chuck…

It’s time to ask for dolls and trucks!

Do kids still ask for those things?

Or, is it all about the bling?

 

So, reluctantly he gives out gifts that will bring gratification

Knowing all the while that they won’t last

Not like Gold, or Silver

Then turned around and with a finger beside his nose

Up the chimney he rose…

 

He left behind many presents for his Grandchildren to enjoy

And he hopes they like every little and big toy!

He climbs in his sleigh, and whistles and calls his team by name!

On. Delaney, Everett, Braden and Evie

You 4 will make the world better some day!

 

But he worries every single day

That the country’s debt clock is being abused

And that it will all come crashing down

Some very fine day…

 

He has left presents for his family

Friends, and dear readers

There’s no one else on his list

So, I heard him exclaim as he flew out of sight

Merry Christmas to all, and to all a Good Night!

Chuck Butler, Christmas 2021

P.S.

As you know… I’m a HUGE fan of Christmas, the true meaning, and everything else that comes along with the season…  And so I give you these heartfelt thoughts, that are different this year than in past years…

Merry Be Your Christmas

Peaceful Be Your Home

Joyful Be Your Family

Blessed Be Each Home…

December 16, 2021

* Currencies get sold on Wednesday… 

* What on earth is Powell smoking? 

Good Day… And a Tub Thumpin’ Thursday to one and all! Well, I had some technical difficulties with the letter yesterday, like, the FWIW article didn’t show up on your letter, I’ll try it again today… And there were other obstacles… But I carried on… So, I read T’was The Night Before Christmas to my darling daughter, Dawn’s kindergarten class yesterday… I had a blast doing it, as I do every year. (except when I didn’t get to read to them last year)  The little girls sat right in front and their focus was rapt on me and the book… The little boys… well, not so much! HA!  I forget to tell you about the spots on my head yesterday… Sorry… Turns out they aren’t cancerous yet, and I was given some cream to apply on them…  No burning, no cutting… YAHOO!  Yesterday, I told you how the night before I hadn’t slept but an hour or two… Well, I made up for that yesterday afternoon!  I was out like a light for hours!  Jack Jezzro is playing his guitar to the song: Home For The Holidays to greet me this morning…

OK, before we get going into the markets, economies and dolts this morning, I wanted to share this thought with you… This was in Tom Woods letter yesterday that can be found at www.tomwoods.com  , here’s Tom…. “The “You Can’t Make This Stuff Up” Department is going to need to open a five-story annex at this point, but get this:

Moderna just announced that it’s withdrawing from the upcoming J.P. Morgan Healthcare Conference because of — get this — COVID concerns.

You heard that right. The same people whose vaccine was described as extraordinarily effective are afraid to attend a conference full of vaccinated people in a city that requires proof of vaccination to enter a huge array of indoor venues.” – Tom Woods

I read Tom Woods every day, he’s a libertarian and that’s just fine and dandy with me! 

Ok… Well… The slippage in the dollar buying that we say in the overnight markets the previous night and reported on yesterday morning, faded into the woodwork, and the dollar buying was back!  The BBDXY, which started the day at 1,1867, closed the day at 1,188.09…  The euro remained below 1.13, and there was little movement in the other currencies on the day.  Even after the FOMC left rates unchanged, and in the press conference after the meeting, Chairman Jerome Powell, told the markets exactly what I told you he would say!  He basically told the audience and the markets that the Fed/ Cabal/ Cartel is going to step up their tapering effort, and will most like hike rates 3 times in 2022…   Chuck says… “Good Luck with that, J”

And in an effort to throw the scent of rate hike needs to combat inflation, he went on to say this: “Fed Chairman Jerome Powell on Wednesday cited asset valuations as one of four key areas the central bank looks at when assessing financial stability risk.

“I would say, asset valuations … are somewhat elevated,” Powell said.

He also said households are in strong financial shape, but that businesses have a lot of debt”

OMG! Are you kidding me? Asset Valuations are “somewhat elevated”?  I guess he’s right on that if the word “somewhat” has a different meaning!   And households are in good financial shape? Does he not read the reports on consumer finances that points out that many don’t have any retirement savings, or have any rainy day savings, or that credit card debt is high, as well as margin debt?  Dimwittery…   and What’s he smoking? That’s all I can say about that…

Gold AND Silver were allowed to gain on the day, with Gold adding $6.10 and closing at $1,777.30, and Silver adding 14-cents to climb back over the $22 and close at $22.17…  And they should have been much greater gains if the metals were allowed to trade free of manipulation… And yesterday was a good illustration of that… With the Wholesale Inflation (PPI) rising 9.6% year to year, that would lead to much higher Consumer inflation… Here’s something I read in the Bill Bonner’s letter yesterday, that Dave Stockman calculates that wholesale prices actually rose 13.6%…

Going back to the 70’s… What a great decade for rock music, but that’s not what I’m here to talk about… Back in the 70’s consumer inflation rose to 13.9%, and then Fed Chairman Volcker hiked interest rates to 20%, to bring that soaring inflation back to earth…  So, let’s say, the Fed does hike rates 3 times in 2022… They would still be under 1%… How’s that going to stomp out inflation that’s running at 14%?  (according to shadowstats.com)  

In the overnight markets last night… The Bank of England (BOE) surprised the markets with their first rate hike since the plandemic started… The rate hike was just 15 Basis Points, which left their internal rate at 25 Basis Points…  Now, what are 15 Basis Points going to do to snuff out soaring inflation in the U.K.?  More Dimwittery!  

Don’t forget the European Central Bank (ECB) is meeting while my fat fingers fly across the keyboard!  But first, we had the dollar getting sold overnight. The downward move wasn’t huge in any way, the euro climbed back above 1.13, and the BBDXY fell to 1,185, from the 1, 188 figure that it closed at last night…   

Gold AND Silver are rallying this morning in the early trading, with Gold up $6, and Silver up 6-cents so far today, which should be a good day for the metals as everyone tries to digest the staggering news that PPI was up so strong, and that the BOE has hiked rates in the U.K.  Apparently this inflation thing is real, eh?  Welcome aboard the inflation train, BOE! Don’t you wish you would have acknowledged inflation existing before now? 

In the past 24 hours the price of Oil has risen again and trades this morning with a $71 handle…  Bond traders are lost, and in need of someone to lead them out of the woods… And no, I’m not volunteering! 

OK, so Jerome Powell, thinks household finances are in good shape, eh?  Well, let’s see, it’s Christmas shopping time, and November Retail Sales were only up 0.3%… Down significantly from Rocktober’s 1.8% gain…    Let me explain this phenomenon to you once again folks…  We’re Americans, and as Americans our nature is to spend money, whether we have got it or not, we spend, spend, spend…  Until the creditors say, no mas….  So, I find this Retail Sales report to be quite interesting, in that during a time when spending should be over the wall in left field, it wasn’t, and to me this lack of spending reflects on household finances….  I’m just saying…

I was also sad to learn yesterday that Bill Bonner’s daily letter is going to a paid subscription service, leaving me and Dennis Miller the only ones still writing for free…  Bill said yesterday that he basically invented the newsletter blog business… Ahem… Bill, I love you dearly, but… I was doing a financial blog before that! I’m not saying I invented it, just saying there were Vikings before the Pilgrims….

OK, back to the markets… What does the BOE think that 15 Basis Points are going to do for them?  Dimwittery… I really like my new word, dimwittery, it so applies to just about everything that goes on in the markets these days, don’t you agree?  Oh, of course you do… that’s why you read this letter, because I tell it like it is, and don’t hold back any punches… 

Speaking of punches… when do you think the Fed/ Cabal/ Cartel will pull away the punch bowl?  I’m betting that free undercoat that they’ll be dragging their feet to the altar… 

The U.S. Data Cupboard today has the usual Tub Thumpin’ Thursday fare, of the Initial Weekly Jobless Claims… In addition, we’ll also see the color of the Industrial Production and Capacity Utilization reports for November… Given the majority of the November reports that have already printed have been weak, I would suspect these two to also be weak this morning…  And tomorrow’s cupboard is bare…  Next week’s cupboard will also lack any depth, or interesting data, as we head into the Christmas holiday…

To recap… The slippage we saw in the overnight markets Tuesday night, faded into the woodwork yesterday, and it was back to buying dollars, even in the face of what had to be a very disappointing FOMC meeting press conference, where Chairman Powell, basically told everyong what I said he would tell them… Accelerating Tapering, and moving rate hikes up timewise in 2022…  Chuck says, “good luck with that”!  David Stockman says real finished goods increased 13.9%, not the 9.6% the BLS reported… And then Chuck takes us back to the 70’s…

For What It’s Worth…  I think I started the week with an article from Mathew Piepenburg, of Gold Switzerland, and I’ll finish the week with another of his excellent articles… This one is about the coming illiquid dollar… I know, difficult to believe, but he explains how, and that can be found here: Dollar Illiquidity — The Ironic Yet Ignored Spark for the Next Crisis – Matterhorn – GoldSwitzerland

Or, here’s your snippet:” n October of 2019, I began writing/warning of the ignored yet ominous signals coming out of the repo and Eurodollar markets and what the illiquidity (i.e., lack of availability) of U.S. Dollars portended for our markets in the coming years.

Well, those years have since arrived.

Such dollar illiquidity may seem hard to imagine in a world otherwise awash in printed currencies and expanding money supplies.

But what I warned then is no different than what is happening now: The Fed is gonna need to print a lot more dollars.

In other words, today’s hawks will once again become tomorrow’s doves.

Why?

Because there were and are just not enough liquid dollars today to meet the fantastic array of nuanced and complex dollar demand in both U.S. and global markets.

As Egon von Greyerz and I have said many times, the first overt signs of this danger in the cash-poor (i.e., illiquid) repo market which reared its “repo head” in September of 2019.

This was a neon-flashing signal of long-term trouble ahead. And it had nothing to do with COVID…

Informed investors in the autumn of 2019 had sifted through all the confusing minutia and noise behind the September panic in the otherwise open-fraud scheme that is the U.S. repo market (i.e., private banks levering GSE deposits for guaranteed payouts from Uncle Sam which the U.S. taxpayer funds).

Despite all this noise, and despite being completely ignored (and deliberately downplayed) by an otherwise teenage-savvy mainstream financial media, the entire repo story simply boiled down to this: There weren’t enough available dollars to keep it (and the banks) going.

As a result, the 2019 Fed printed more dollars and immediately dumped a $1.5 trillion rollover facility into the repo pits.”

Chuck again… I know, another long snippet, but you’ve got to click on the link above and read the whole article for a complete understanding of what Matthew is telling us.

Market Prices 12/16/2021: American Style: A$ .7213,  kiwi .6820,  C$ .7824, euro 1.1315, sterling 1.3353, Swiss $1.0833, European Style: rand 15.9517, krone 8.9771, SEK 9.0543,  forint 326.37,  zloty 4.0904,  koruna 22.3497, RUB 73.83, yen 114.15, sing 1.3637, HKD 7.8915, INR 76.09, China 6.3642, peso 20.96, BRL 5.6902, BBDXY 1,185.96, Dollar Index 96.12,  Oil $71.17, 10-year 1.46%, Silver $22.23, Platinum $939.00, Palladium $1,752.00, Copper $4.30, and Gold… $1,784.80

That’s it for today… And… until 12/27…  Oh, the humanity! How will we ever get by each day without words from Chuck! HA!  No worries, I’ll be back in the space again before you know it, and in between with my annual Christmas Pfennig… So, that was good news on Tuesday about those spots on my head… I guess my days of sitting out in the sun to read, have come to an end, unless I start wearing a hat outside!  I love the warm feeling of the S. Florida sun in the wintertime on my bald head… Oh well, I received my warning, and I must change…  I got a kick out of the kindergarten kids yesterday, they guessed that I was Dawn’s brother! HAHAHA! And then Grandpa? HAHAHA… and her Uncle? They never did guess that I was her dad!  I don’t want to speak badly of the kids, but I doubt there are any candidates for rocket scientist school in her class! They were sweet though, and wanted to show me how many missing teeth they have… I even got a few hugs from the kids after I finished reading to them…  Tomorrow is my former colleagues, Jen McClain and Ty Keough’s birthday, at least that’s how I remember!  So happy birthday both of you, hope your day is grand! Yesterday, while I was driving, I heard a Christmas song, sung by someone I never expected to hear singing it… Bob Seeger was singing Little Drummer Boy…   Now, that’s the spirit people look for at this time of year… I have a long story about the Christmas spirit, that I’ll share with you some day… Until then… I hope you have a Tub Thumpin’ Thursday, and a very Merry, and Blessed Christmas next week… And Please… Be Good To Yourself!

Chuck Butler

December 15, 2021

* Currencies & metals get sold on Tuesday… 

* U.S. debt is Ok’d to increase another $2.5 Trillion… 

Good Day… And a Wonderful Wednesday to you! I attended the Missouri Botanical Gardens, Gardens Glo last night with some family… it was amazing all the lights… But I was worn down by the time I had hiked all over the Botanical Gardens, my hip hurt, my knee hurt, and I was ready for bed! Which was a good thing, since on Monday night, I hardly slept a wink… I don’t know what was wrong, but I was wide awake, and couldn’t fall asleep… You may have noticed the much earlier timestamp on the Pfennig yesterday… If not, trust me, I sent it out very early! Beegie Adair is playing her version of the Christmas Waltz… I love this melody, and the words are brilliant…

Well, today’s the day, eh? The day that the FOMC meets to decide what lies they will tell the markets and U.S. citizenry… Wait, What? Do you mean to tell me that the Fed/ Cabal/ Cartel heads lie to us? Of course they do and if you don’t believe that they do, then I’ve got a bridge to sell you! Not to get too far off target today, but I’m still getting notes from the Fed Reserve St. Louis that they need someone like me to edit their publication… Now, don’t you just find that to be absolutely hilarious? Because I do, for sure!

I went through what the Fed/ Cabal/ Cartel chairman Jerome Powell, will say today, so if you don’t recall, simply go to www.dailypfennig.com and read yesterday’s Pfennig over! So, having done that already, that is, told you what he would be saying, it’s time to talk about the other Central Bank meetings this week… Not in all my years covering Central Banks do I recall seeing the major Central Banks of the World, all meet in the same week… In addition to the FOMC, the Bank of England will come first tomorrow, they will be followed by the European Central Bank (ECB), and then on Friday, the Bank of Japan will also meet… My spider sense is tingling, folks… I can’t put my finger on why it’s tingling, but, it could have something to do with the scenario I laid out for you over a year ago, about how we wake up one day, the financial system we all know and love has changed… This is the Perfect Storm, if you will, for that to happen, folks… think about that, and let that sink in…

Most likely nothing will come of this “meeting of the minds” NOT! This week… But one never knows, does one?

So, the markets yesterday, were ugly for the currencies and metals… The dollar continues to get bought hand over fist, kicking tail and taking names later.. Gold closed down $15.70 yesterday, and Silver closed down 38-cents… Silver was hanging on to the $22 handle by the skin of its teeth… The BBDXY rose to 1,188.09, from 1,183.20 yesterday morning… Even the recent run by the Chinese renminbi has been stopped. I don’t know what to make of this, folks… either these traders, investors, hedge fund managers, are the most dimwitted bunch in the history of mankind, or they are the smartest… Only time will tell how the cookie crumbles here folks… If I were a betting man, my money would be on the former of the two…

Gold closed yesterday down $15.70 to end the day at $1,772.20, and Silver was down $38-cents to end the day at $22.03… All I can say here folks, is to batten down the hatches, look for major dips to add to positions, or just stand pat with what you have, and wait out all this  silliness, and dimwittery… I think I just made up a new word there: dimwittery… Spell check sure doesn’t like it!

In the overnight markets last night… There has been some minor slippage in the dollar, but Gold & Silver are starting the day in the red…  I would have thought that everything would be on hold this morning, as traders await the FOMC Meeting results..  But apparently, that’s not going to happen.  The BBDXY has slipped overnight to 1,187.61… Still a lofty figure for the dollar, that in my opinion is so overbought, it’s nuts!  The euro is still oversold, and by association with the dollar, that means the dollar is overbought! 

The price of Oil has slipped below the $70 handle, and doesn’t look as perky as it did a few days ago… The Treasury’s 10-year yield is holding steady at 1.45%, which means that there is enough bond buying to support the level, without the support the yield would rise… And it should be rising, given the inflation numbers, but… We all know that the Fed/ cabal/ Cartel’s tapering isn’t really “tapering”, now don’t we?  well, if we don’t, we should find out more! 

The U.S. Senate has voted to increase the country’s debt ceiling by $2.5 trillion, enough to fund operations through early 2023.

Passed by a 50-49 party line vote, the plan is to send it to President Biden’s desk for his signature. Sure, why not? Just keep adding on to our already unpayable debt… I shake my head in disgust at these dolts, who are so out of touch with what’s going on in the country and economics… they are totally clueless… Think about that for a minute…  You have a Central Bank that has stated its intentions to taper, which means they aren’t going to buy bonds any longer, and you have lawmakers who decide to up the ante on the Debt issuance, which means even more Bonds will have to be sold to finance this ever expanding debt…  

But, hey! You’ve got to get, while the gettin’s good, right? And right now, the country is so tied up with the fear factor of Covid, that they don’t have their eyes on the ball (debt) right now… Don’t ever let a good crisis go to waste, eh?  Besides, by the time the mid-terms come around, inflation will be so strong that most of the bums will be voted out, for what voters will feel is the bums inability to control inflation… So, like I said, you’ve got to get, while the gettin’s good… 

This news became available over the weekend, that an offer by President Xi to help the USA with the Midwest tornado damage had been made… I like the olive branch that Xi has offered to the U.S., but know that since we as a country have made CHINA out to be a villian that no acceptance of the olive branch will be made… And to me that’s a real shame… In the long run, folks, it isn’t behooving to us to keep China at an arm’s distance and portray them as villians… I’m just saying…

Circling back to the metals yesterday… the selling in the metals took place even as PPI, a key inflation gauge showed that US prices continued to climb in November as pandemic-era supply chain chaos and a labor shortage continues. Yes, PPI is often referred to as “pipeline inflation”, because these price increase eventually show up in Consumer Inflation… So, yesterday, PPI for November increased .0.8%, which annualized is a 9.6% rise, which just happens to be the highest level ever recorded by the data set, which began reporting wholesale inflation with the PPI in 2010…

I find this news to be very disturbing, folks… for 1. It means that consumer inflation is probably heading even higher in the coming months, and 2. With Gold & Silver getting sold, there had to be note playing by the boys in the band, and their price manipulation scheme… For, if you asked anyone on the street that had a college economics course, what they thought would be the outcome for the metals given the fact that PPI is soaring, they would tell you that Gold & Silver should be rallying on that news…

I rest my case, your honor, so plase do your duty and judge the price manipulators guilty as charged, and put them away for many years!

Ed Steer, of www.edsteergoldandsilver.com, had this to say in his letter this morning: “You don’t need me or anyone else to tell you what happened either at the COMEX open, or when the Producer Price Index number was released at 8:30 a.m. in New York yesterday morning. Just Google the word ‘egregious’ — 

Precious metal prices should have been screaming higher on that news, but ‘da boyz’ were there to make sure that it was seen as a non-event in everyone’s eyes.

I didn’t think that the commercial traders of whatever stripe could be more brazen or in your face than they’ve been in the past…but I was wrong about that.” – Ed Steer

Well, it appears that the Eurozone is headed for the same inflation dilemma that the U.S. is experiencing, as the Russian gas pipeline, Nord Stream 2, was blocked for not meeting European law. And all that means is that gas prices in the Eurozone are going to skyrocket…  

Over the last month, a series of setbacks for the new Russian pipeline have been seen. German energy regulators suspended Nord Stream 2’s certification process, and the US has also sanctioned companies affiliated with the pipeline’s construction. As once again the U.S. has stuck their nose in other people’s business…  The U.S.  has just about killed oil production in the U.S. and now they want to stop Europe from getting the gas they need ahead of the winter that could be cold…  Why, oh why, does the sun keep on shining? Why does the sea rush the shore?   Why do the birds go on singing? Why do the stars glow above?  Don’t they know, it’s the end of the world, ’cause no one can get the gas they need?  

Today’s Data Cupboard is a doozy! Not only will we have the outcome of the FOMC Meeting today, but also the Nov. print of Retail Sales, and a slew of 2nd and 3rd Tier economic prints. But the Big Kahuna today is the FOMC meeting and the press conference that will follow the meeting and be keyed by Jerome Powell… And this is where the lies begin, folks… Whether or not he decides to tell the truth or dare… will go a long way toward rebuilding or destroying his credibility…

To recap… Yesterday, Producer Prices soared in Nov, and reached 9.6% on an annualized basis, which means that higher Consumer prices are in the pipeline. And guess what Gold did? Well, it didn’t get bought, and being as brazen as one could be, the price manipulators came, saw and defeated Gold’s rise on higher inflation data… Today, the FOMC will conclude their meeting with a press conference afterward, in which time, Jerome Powell, will tell us that the Fed has decided to quicken their pace of tapering, which will allow them the room to hike rates earlier next year than expected… oh, boy! By the time the Fed/ Cabal/ Cartel gets around to addressing the soaring inflation, they’ll be so far behind the inflation 8 Ball… It’s a sad thing to wath folks… it really is…

Market prices 12/15/202: American Style: A$ .7144,  kiwi .6749,  C$ .7768, euro 1.1266, sterling 1.3259, Swiss $1.0814, European Style: rand 16.1552, krone 9.0891, SEK 9.1097,  forint 327.67,  zloty 4.1037,  koruna 22.4315, RUB 73.59, yen 113.87, sing 1.3675, HKD 7.8013, INR 75.35, China 6.3641, peso 21.21, BRL 5.6738,  BBDXY 1,187.61, Dollar Index 96.51,  Oil $69.97, 10-year 1.45%, Silver $21.91, Platinum $920.00, Palladium $1,686.00, Copper 4.23, and Gold… $1,770.90

That’s it for today… Today is the birthday of my younger sister, Teri… She lives in Houston, which means I don’t see her very often.. So happy Birthday, sis, hope your day is grand! December 15th was traditionally the day my dad would bring home our Christmas Tree… And the Christmas celebraton at the Butler House would begin, and not end until New Years Day… Our Blues played well last night and beat the Dallas Stars 4-1… the Blues still have a ton of players out on Covid protocol But are playing well… With their top goalie out, the defense has really buckled down and protected the backup goalie… Well, it’s college Basketball, and NHL hockey that’s all that’s left until spring training… Oh, we will have the winter Olymipics, like we as Americans get most of those winter sports… I’m just saying… Leif Shires and his Cool Jazz Christmas band, take us to the finish line today with their version of the song: Silver Bells… this is the first true Christmas song I remember singing, as a child… I hope you have a Wonderful Wednesday, and please Be Good To Yourself!

Chuck Butler

December 14, 2021

* The dollar is bought throughout Monday’s session

* Gold AND Silver rally on Monday… 

Good Day… And a Tom Terrific Tuesday to you! Well… Besides NFL football, there was little else in the way of sports for me to watch last night, so I did some research and reading instead…  Kathy was gone for the evening, and I was alone, all by myself once again, so I rang Mr. Pizza Man Pizza for my dinner! Hey, it wasn’t all bad for me, I had a salad with my pizza! Besides the right kind of pizza, has all the food groups, so to me, it’s healthy! HA! Well, today is the day I see what those spots that won’t heal are on my head… I’ve been told by my doctor that he believes its cancer, and given my history with that awful dreadful disease, I’m pretty sure he’s correct, but… I’ll find out for sure today… Chris Botti greets me this morning with his version of the song: O Little Town of Bethlehem… 

Ok, so yesterday, I forgot to mention that on Wednesday this week we’ll get the FOMC meeting results, and from I saw going on in the currency markets yesterday, traders must be darn tootin’ ready for a rate hike from the Fed/ Cabal/ Cartel, to happen NOW!  Because…. The dollar was bought by the bushelful yesterday, with the DDBXY moving upward to 1,184 and change… from 1.180 it ended the week on last Friday…  I think yesterday I might have conveyed the BBDXY price from Friday incorrectly at 1,182.01, when it was really 1,180.48…   UGH! 

So, the dollar got bought yesterday, but so did Gold AND Silver! These two metals didn’t get bought with the vigor that was being used to buy the dollar, but they got bought, and that’s all that matters to me! Of course, who knows, what the daily upward moves could be if not for price manipulation?

Gold closed up $4.00 on Monday to close at $1,787.90, and Silver closed up 13-cents to close at $22.41…  you know how I keep repeating the thought that the Central Banks around the world keep buying physical Gold, and not Bitcoin?  Well… There’s something else to think about, a meltdown of the electric grid, could cause some major problems for Bitcoin, but would the same meltdown cause major problems to Gold?  No… so I say, Got Gold? 

In the overnight markets last night…  We started off the overnight session with the dollar getting bought, but as the night went on, I figure calmer, smarter heads decided that owning dollars right now is not the smart thing to do… It was either that, or they finally got around to reading the Pfennig! I mean, I did call dollar traders out yesterday, calling them twits, dolts, knuckleheads, pick one and I’m sure I used it! 

Gold & Silver are both down a bit in the early trading today, with Gold down $2.40 and Silver down 16-cents…  Not much of to have to overcome to get these two back in the green… 

Tomorrow, the FOMC will meet… Oh boy! We’ll get to hear the chairman, Jerome Powell, say that inflation is no longer transitory, but instead, persistent… And that the members of the Fed / Cabal/ Cartel have voted to step up the pace of the tapering so that they get to rate hikes faster… of course there is still no explanation as to who is going to pick up the slack of their lack of bond buying each month… And to me, that’s the biggest worry about their Tapering…  And one of the reasons I truly feel that they will reverse course on Tapering before they reach the end…

I can’t see the Fed/ Cabal/ Cartel saying or doing anything different than I’ve just described… And if Powell proves me wrong, it will be the first time! And the last time!  And if/ when I’m proven to be correct about what Powell will say, I’ll then want to know what all the dollar buying was about On Monday…  Opposites… I have to keep those in mind, for in today’s trading opposites are usually the thing that is behind market movements…

 So what if the Fed/ cabal/ Cartel actually gives a date they think they’ll make their first rate hike in years….  It’ll only be 25 Basis Points, 1/4% , for all you non-money people out that don’t know there are 100 Basis points in 1%…   Ok, now that we’ve established that, if the FOMC hiked rates tomorrow, it would mean that the 10-year Treasury’s real yields was still negative by 5.05%…  I shake my head at these twits that keep buying Treasuries and losing money… Oooohhh, can I have another please?  NOT!

But in reality, the FOMC is not even close to being ready to hike rates, and so we’ll just have to suffer with the rising inflation the best we can… I can already feel the pain that will come on when I pull into the gas station this morning, and fill my gas tank… UGH!  Everything, and I mean everything costs more, and it’s beyond being barely noticeable the rising costs of everything you can think of, is taking a HUGE chunk out of our disposable income, folks… And it will continue to do so unabated to the quarterback! Wait, no, I mean to say unabated for the near future… 

Because… even if the Fed/ Cabal/ Cartel speeds up their tapering, it won’t be until late next spring before they finish, and like I keep saying, I’m of the opinion that the Fed/ Cabal/ Cartel will reverse their tapering before they reach the end…  That’s my story, and I’m sticking to it! 

This came to me yesterday in the form of Dave Gonigam’s 5 Minute Forecast, in which he pointed out that tweet from the PM telling people that India had adopted bitcoin was false…. And then had this to say, “Somebody briefly hacked the Twitter account of India’s Prime Minister Narendra Modi — long enough to declare the Indian government had acquired 500 Bitcoin and would distribute them to the people.

It seemed credible at the outset because of the way El Salvador’s President Nayib Bukele has embraced Bitcoin as — among other things — an official currency alongside the U.S. dollar.

But no. Indeed, “The latest hack comes as India prepares to crack down on a booming cryptocurrency trade,” reports the BBC, “with a new law likely to be put before parliament this month.”

Chuck again…  This social media stuff is really getting on my nerves, folks…  Stephen Pastis summed it up for us in his Pearls Before Swine article on Sunday, when he drew a doctor asking rat why he feels so bad these days, and after a ton of questions he asks this: “Hey wild guess here but do happen to have a device on you that has turned all 7 Billion people on earth into full time critics, made us feel inadequate, and constantly exposed us to all the world’s worst news?”

Pearls Before Swine is my fave cartoon… 

Ok… So, today we will be entertained by the Small Business Index, which last month still was printing high, even in face of the “great resignation”… But then this is a government issued report, so you can put as many grains of salt in it that you wish… Me? I’m taking grains of salt out! We’ll also see the November print of PPI (Wholesale inflation)… Talk about things being out of whack, with the way they used to be… PPI used to always print before CPI… which makes sense given that Wholesale Inflation will filter into Consumer Inflation…  But these days, they print them in opposite order, and it’s probably just to get me all riled up about fundamentals, and order…

To recap… The dollar was bought Sunday night, and all through Monday’s U.S. session, and then in the overnight markets it was bought some more, before turning around and ending the overnight session down…  Dollar traders were all giddy about the FOMC meeting tomorrow, where they believe that Jerome Powell, will make some mention of a rate hike… Just the mention of a rate hike, will get these guys all giddy, like school girls, and I just have one question to ask them… How much of a rate hike do you see coming, if and when it does come?  Gold AND Silver both gained yesterday, but is getting sold in the early morning trading today… And Chuck points out the silliness of social media…

For What It’s Worth….  I had this article sent to me by long time reader Bob, and it points out the same things I’ve been pointing out regarding the dilemma the Fed/ Cabal/ Cartel are in with regards to rising inflation and them needing to hike rates… And it can be found here: U.S. Consumer Survey Expectations of Inflation at Least Doubling Wage Gains – Middle Class Storm Building – The Last Refuge (theconservativetreehouse.com)

Or, here’s your snippet: “The New York Federal Reserve survey reflects the obvious.  Consumers see staple food and energy price increases far outpacing any wage gains, and the outlook moving forward does not show signs of improvement.

The distance between the inflation line and the wage line is the intensity of the hurricane coming our way.

We are in this very weird place where the politically motivated Fed cannot stop purchasing debt created by legislative spending.  At the same time, the political Fed is going to have to raise interest rates or we will enter an impossible spiral of policy caused inflation.  There are three options:  (1) stop buying debt; (2) increase interest rates; or (3) deploy some COVID mechanism to shut down people and hit the demand side.

Considering that Omicron didn’t work, and further panic pushing does not seem politically viable, that only leaves the two options of the Fed stops buying debt, and/or the Fed raises interest rates. Now, considering that these same political ideologues will not stop pushing the Build Back Better legislative agenda, that means the Fed cannot stop buying debt.  That leaves one option remaining, increase interest rates.”

Chuck again…  I wouldn’t put it past the government to create another fear factor and shut things down again, but, I don’t think the people of this country will be the sheeple this time… I’m just thinking out loud here…  But the dilemma is real for the Fed/ Cabal/ Cartel, but they made their bed, and now they must lay in it!

Market Prices 12/14/2021: American Style: AS .7124,  kiwi .6760,  C$ .7806, euro 1.1315, sterling 1.3237, Swiss $1.0875, European Style: rand 16.0435, krone 9.0602, SEK 9.0724,  forint 323.70,  zloty 4.0961,  koruna 22.4224, RUB 73.41, yen 113.56, sing .13676, HKD 7.8027, INR 75.79, China 6.3631, peso 21.06, BRL 5.6330,  BBDXY 1,183.20, Dollar Index 96.19,  Oil $71.16, 10-year 1.43%, Silver $22.25, Platinum $937.00, Palladium $1,776.00 Copper 4.30, and Gold… $1,785.50

That’s it for today… thanks to Ty Keough, who read the Pfennig yesterday, and saw that I was scratching my bald head hoping to come up with a present for Kathy, and sent me a link to use… for all you other guys out there that in the same boat as me on this, try this website: Abbykeough.com…   I hope I don’t get in trouble with her for doing that… Just drumming up business!  Ty is a good friend of mine, we’re about the same age, he’s younger, by a year or two, and he too had a very bad year last year health wise, but is all better now, and looking marvelous I tell you! (in my be Ricardo monteblan voice)  So hard times did make him stronger!  Dennis sent me another funny yesterday that I’ll share with you here:  If Liar, liar pants on Fire really catch fire, watching the evening news would be a lot more fun! And isn’t that the truth! Jack Jezzro has me swinging in my seat this morning as his trio plays their version of the song: Favorite Things, this comes from their album titled Bossa Nova Christmas!  I hope you have a Tom Terrific Tuesday today, and please Be Good To Yourself!

Chuck Butler

 

 

December 13, 2021

* Gold AND Silver both rally on Friday… 

* Countries hold cyber attack war games… 

Good Day… And a Marvelous Monday to you! What a fun packed weekend, that got started off on Friday, and again on Saturday! Fun stuff! My StL U. Billikens won their basketball game VS Boston College on Saturday, but my Missouri Tigers lost their game…The Blues beat Montreal 4-1 on Saturday and then came back on Sunday to lose in OT… But they did pick up a point! Well, another week went by, which means I’m even closer to my annual Winter Vacation! YAHOO! I’ve scratched my bald head over and over again trying to come up with a gift for Kathy, the woman that basically buys what she wants and needs all through the year… Last year, I thought I nailed it, but since she’s never worn the necklace with all 4 grandkids names on it, I guess I didn’t! UGH! Oh, well, can’t blame me for not trying! HAHAHAHA! Beegie Adair greets me this morning with her version of the song: Winter Wonderland…

Well, Gold AND Silver both rallied on Friday, and the dollar got sold a bit, after the stupid CPI for November showed the cost of a wide-ranging basket of goods and services, rose 0.8% for the month, good for a 6.8% pace on a year over year basis and the fastest rate since June 1982. So, after seeing that I went straight to shadowstats.com to see what John Williams shows what inflation really is… 14.9%, which beats the 14.8% top inflation rate of 1980.. And it just keeps getting worse, folks… And where’s the Fed/ Cabal/ Cartel while we are being eaten away with inflation?

Ok… So, as we go deeper into inflation, the negative rates in the U.S. get even more negative! Even using the BLS’s watered down CPI of 6.8%, that means the real yield on a 10-year Treasury is negative -5.3%… Now who in the U.S. would be buying that bond? And that’s the question the dolts at the Eccles Building have to asking themselves, as they attempt to walk away from the auction window and not buy as many Treasuries each month… Pretty soon, it will become very clear to these knuckleheads that they can’t continue to taper, because they have become the buyer of last resort, when it comes to Treasuries…

So… The dollar got sold a little on Friday, the euro climbed back above 1.13. It’s been a back and forth around the 1.13 level for the euro, and I suspect that they too will soon be experiencing higher inflation and then who knows what will happen? One currency that has really turned the tables on the dollar is the Aussie dollar (A$). It was just about 10 days to 2 weeks ago that the A$ was slipping and sliding nearly every day, and it briefly traded below 70-cents… But look at it now, the A$ is back to rallying and is trading this morning around .7140… A long way from a 69-cent handle for sure!

I’ve been talking a lot lately about the Chinese renminbi and how it has been performing, even in the face of a defaulting very large builder in China… I saw a blurb on Bloomberg this past weekend that said that the Chinese renminbi had had a better year than the U.S. dollar… I saw that and chuckled, at the thought, because it was just 3 years ago that I chastised the then POTUS for making a big deal out the trade war with China… And I pointed out that there should have been no celebrating the trade deal, because there were no named auditors of the deal, and who was going to stop China from cheating? Oh, and then there’s this record Trade Surplus they just booked… So much for the Trade War, eh?

So, Gold closed up $7.30 on Friday to end the week at $1,783.90, and Silver closed up 23-cents to end the week at a paltry looking $22.28… , BBDXY slipped every-so slightly on Friday falling from 1,182.49 on Thursday to end the week at 1,182.01… After Friday’s CPI print, the air was pulled from the dollar, as traders are coming to the realization that while higher inflation could mean higher interest rates, it won’t in this case… Uh-Oh…

In the overnight markets last night… Apparently the foreign traders didn’t get the message that the dollar needed to be sold, because they bought the dollar and drove the BBDXY up to 1,183.18 this morning… Gold is up $3, and Silver is up 15-cents in the early trading… 

I just realized that I left you hanging above with regards to what happens to the euro when inflation begins to really rise quickly in the Eurozone… Well, if the dollar buying in the face of rising inflation is any indication, then the euro should be set to rise!  The fundamentalist that I am just chastised my alter ego for saying that, but, in times when opposites rule, fundamentals aren’t a dog that hunts any longer…  Technicals don’t come into play either, because there’s no rhyme or reason for the moves we’re seeing in the asset classes these days…  That’s my story and I’m sticking to it! Yes, and my first wife was a young Elizabeth Taylor!  HA 

I pulled this next part from Ed Steer’s Saturday letter: “Energy prices have risen 33.3% since November 2020, including a 3.5% surge in November. Gasoline alone is up 58.1%.

Food prices have jumped 6.1% over the year, while used car and truck prices, a major contributor to the inflation burst, are up 31.4%, following a 2.5% increase last month.

The Labor Department said the increases for the food and energy components were the fastest 12-month gains in at least 13 years.”

Chuck again, but… the fool on the hill sees the sun going down, and the eyes in his head sees the world spinning around… (Beatles) The fool on the hill is represented by the Fed/ Cabal/ Cartel… They seem to think that we as citizens don’t use food and energy each and every day of our lives…. Maybe they’re so “protected” from these things, but we aren’t! Man am I glad I didn’t listen to the devil on my left shoulder last year, and went out to buy a new gas guzzler… Instead I kept my now 11 year old car…

Don’t you just love it when I go on tangents like that? Like who cares what I drive? I really don’t go anywhere any longer, but to doctor appts. And my local watering hole is less than a mile from my house…

Did you hear about this news? Israel led a 10-country simulation of a major cyberattack on the global financial system in an attempt to increase cooperation that could help to minimize any potential damage to financial markets and banks.

The simulated “war game,” as Israel’s Finance Ministry called it and planned over the past year, evolved over 10 days, with sensitive data emerging on the Dark Web. The simulation also used fake news reports that in the scenario caused chaos in global markets and a run on banks.”

Chuck again… that came curtesy of the good folks at GATA… And doesn’t it just scare you a bit, that countries are playing war games in anticipation of a cyber attack?  Sends chills down my spine, I don’t know about you, but I’m thoroughly rapt into this… 

The U.S. Data Cupboard late last week had the stupid CPI print, that even as watered down as the BLS’s version of inflation is, it was enough to cause concern…. On Thursday last week, we saw the Weekly Initial Jobless Claims fall by a large amount, which leads me to believe that there was some adjustments from the previous holiday shortened week…

I have a quote from economist David Rosenberg on the Jobless Claims data from Twitter… “Initial jobless claims plunged to 184k in the December 4th week from 227k in the November 27th week. This is the lowest level since September 6th, 1969! Bullish statistic? No. A recession came out of the blue exactly three months later.” – David Rosenberg on Twitter

Today and Friday this week the Data Cupboard is empty… And we’ll have to wait until Wednesday this week before we see some real economic data, and then it will be the Nov. print of Retail Sales… I can submit for your review that the BHI (Butler Household Index) indicates that Retail Sales will be strong, as the Christmas shopping season was already taking place in Nov. And there’s not a day that goes by that the Amazon delivery truck doesn’t stop at the Butler house! 

To recap… The stupid CPI printed on Friday last week, and it showed that inflation had increased to 6.8% from Nov. last year…  Shadow stats says that inflation is 14.9%, which beats the Jimmy Carter era inflation rate… That allowed Gold AND Silver to rally on Friday… The dollar slipped just a little on the day, and the Aussie dollar continues to recover… While the Chinese renminbi is having a better year than the U.S. dollar… In the overnight markets the dollar got bought again, for some reason unknown to mankind, but Gold AND Silver are both up a bit this morning. 

For What It’s Worth… This comes to us curtesy of Gold Switzerland and it’s another article by Matthew Piepenburg of whom I’m becoming a fan of for he says the things I wish I had thought of! This article can be found here: Fear and Inflation — The Timeless Policy Tools of Discredited Systems – Matterhorn – GoldSwitzerland

Or, here’s your snippet: “If you’re wondering why the media, markets and mandates are making less sense despite a constant flow of hard facts contradicting their message, it’s critical to watch what is done rather than said by the policy makers behind the fear and inflation “new normal.”

To the extent there’s anything exciting about a cornered Jerome Powell, he was at least able to drop some bombshells at his November 30th meeting before Congress, including a truly cutting-edge observation and fear that inflation forces are “more persistent” and that it’s now time to retire the word “transitory” regarding the same.

Well, Jerome, we could have told you that long, long ago, but this, of course, is no shocker…

Perhaps more “exciting” was his not-so-subtle announcement that the Fed plans to begin a discussion at its next meeting to accelerate the Fed taper by a few months.

Hmmm…

Despite the fact that any Fed Taper will in substance be a “non-taper” given backdoor liquidity tricks from the Standing Rep Facility and FIMA swap lines, the optics of such continued taper-talk will be negative for almost all assets save for the USD, the VIX trade, so-called “safe-haven” Treasuries and possibly gold.

The Treasury Market’s Bigger Troubles
Longer term, however, there is very good reason to worry about the $22T Treasury market should the Fed begin reducing portions of its $80B per month of UST support in a backdrop of steady and now undeniably “persistent” inflation.

As we noted elsewhere, the Treasury market, with less Fed “accommodation,” is not nearly as liquid as the Fed would otherwise wish you to believe.

In short, if stocks and bonds begin to fall in concert, as is likely, such malfunctioning of an otherwise rigged securities market will get harder to contain without a quick reversal of the “forward-guided” taper strategy signaled by Powell.

Even the best rated corporate bonds lost 2% in the last 60 days as sell-offs continue, pushing yields up as dollar liquidity in the C-suites gets harder to come by.

For now, of course, everything about the ever-supported (and hence ever-rising and rigged) stock market is a screaming indicator of record-high over-valuation by every metric.”

Chuck again… I know, I know a very long Snippet this morning… But you should click on the link above and read the whole article, and then you come away saying, the Snippet wasn’t that long compared to the article!

Market Prices 12/13/2021: American Style: A$ .7140,  kiwi .6775, C$ 1.7840, euro 1.1280, sterling 1.3250, Swiss $1.0829, European Style: rand 15.9349, krone 9.0066, SEK 9.0660,  forint 325.27,  zloty 4.0950,  koruna 22.5183, RUB 73.38, yen 113.64, sing 1.3672, HKD 7.7996, INR 75.66, China 6.3685, peso 20.88, BRL 5.6112,  BBDXY 1,183.18, Dollar Index 96.30,  Oil $71.01, 10-year 1.47%, Silver $22.43, Platinum $952.00, Palladium $1,840.00, Copper $4.31, and Gold… $1,787.60

That’s it for today… OK… I’ve got a funny for you. This was sent to me from Dennis Miller, who, like me has seen hard times with our respective health. “If the hard times make you stronger, then I should be able to kick Superman’s Ass by now”!!!!! Now that’s great! Tomorrow I head to the dermatologist about the spots on my head… I totally dislike going to new doctors, for I have to go through my health history all over again… UGH! I’m also going to be going to the Garden Glow with some family tomorrow night… Thank you Terri! Saturday night I got to see some former colleagues, Christine, Antoine, Aaron, Tim, Chris, Ty, and Jack at Dane Moody’s wedding reception that was delayed a year by the plandemic… A fun time was had by all! Dane was probably just 5 when his parents moved into our subdivision, right down the street… And we used to have some killer street hockey games in front of the house!  The Stephen Kummer Trio takes us to the finish line with their version of the song: Baby, It’s Cold Outside….  I hope you have a Marvelous Monday today, and will you please Be Good To Yourself! 

Chuck Butler

 

 

December 9, 2021

* Currencies rally on Wednesday, but metals don’t… 

* Communists needn’t apply… 

Good Day… And a  Tub Thumpin’ Thursday to one and all…  well, I Have nothing for you this morning regarding St. Louis sports, and I’m sure y’alll will have no problem with that! I made myself dinner last night again, and this time I really outdid myself! Yummy!  I used white wine for my pasta sauce, and then drank the rest of the bottle myself!  I’m sure Kathy is not happy about the fact that I emptied her bottle of wine in the fridge, but I don’t care, as I was alone by myself, and when I cook, I use everything! I was informed by my darling daughter, Dawn, that I would be reading to her class next week, outside, as the weather is supposed  to be nice, and I’m happy as a lark about that! Each year, except last year, I read the T’was the Night Before Christmas to her class, and each year the kids want to know if I’m Santa Claus..  Well, maybe not this year, as I’m down nearly 100 lbs since a year ago!  But, kids will be kids, right?  And I love their imaginations! Up On A Housetop is the song that greets me this morning by the David Ian Trio…

Well, the dollar was sold on Wednesday… I guess traders finally got tired of waiting for a direction from economic data, to trade the dollar… The BBDXY started the day yesterday at 1,18201, and ended the day at 1,178.96.. The euro rose above the 1.13 handle once again, and all the currency looked perky.. albeit, well below where they were before the dollar went on this recent run higher…  Gold and Silver never found a consistent bid yesterday and ended the day basically flat, but down pennies., with Gold down 70-cents to close the day at $1,784.40, and Silver down 8-cents to close the day at $22.52..  

The data yesterday was not really to blame for the dollar selling, as we only had the Outstanding Job Openings and Job quits to deal with…  So, there was something that pushed currency traders over the edge with regards to the dollar yesterday.. But they did sell dollars ,and that is about time as far as I’m concerned!  The U.S. has a record debt that has now reached $29 Trillion, and the U.S. GDP is roughly $23 Trillion… Which means that our debt is greater than our GDP… And our Unfunded Debts are more than $161 Trillion… , and get this.. U.S. Personal Debt is greater than $22 Trillion!!!   Who’s going to pay for these debts?  Well, if things got really bad, you might get a letter in the mail telling you that your portion of the debt, as a taxpayer is $229,700..

Reuters tells us why the dollar got sold yesterday, “The dollar fell against several of its major counterparts on Wednesday, as easing concerns about the economic hit from the Omicron COVID-19 variant helped support riskier currencies, with the Australian dollar on pace to notch a third straight session of gains.”

In the overnight market last night… When will these two markets get together and sync up their thoughts on the dollar?  As I just said, the dollar got sold in the U.S. session yesterday. But, in the overnight session the dollar was bought… C’mon guys, pick a lane!   So, overnight the BBDXY has risen to 1,182.49, from yesterday’s close of 1,178.96..  That’s not a tiny move like we’ve seen lately as the dollar drifted..  The euro remains above 1.13, but doesn’t look as strong as it did yesterday… 

The Chinese renminbi and Russian ruble take center stage again this morning, as both defy the dollar buying and see buying of their respective currencies.  As I said yesterday, China’s current level VS the dollar hasn’t been seen since 2018. A record trade surplus was recently reported in China, and I think traders are of the thought that China will trade surplus their way out of the housing mess they are in…  

How can China be printing trade surpluses when there is a distribution chain debacle going on?  Well, apparently a lot of China’s exports are in the region, where they don’t have to be put on cargo ships, and sent around the world…  I’m just saying… 

The price of Oil slipped a bit overnight, and is trading this morning with a $71 handle, albeit a very high 71 handle! And the U.S. Treasury 10-year’s yield has inched higher once more, this morning to a 1.49% figure..  I still contend that by the time I’m sitting in my seat at Roger Dean Stadium this next spring that the 10-year’s yield will be 2%… 

And now we’re going to talk about.. debt… I said many years ago, that “debt was slavery”… And now that U.S. consumers are in debt to the tune of $15 Trillion, they have to work to pay that off, and their work becomes associated with paying down their debt..   You know, I do get it, that people have taken on more debt at these uber low interest rates, but it still means they working to pay off the debt..  We, as consumers, are not the Gov’t, and we can’t just print dollars to pay our debts… So think about that for a minute, before you sign up for another loan… There’s going to be no one to bail you out of that debt… 

Edward Griffen, author of The Creature from Jekyll Island, that I recommended to readers years ago to read, sent me this note yesterday: “The Fraternal Order of the Police reported that 314 officers have been shot in the US this year, more than any other year, with 58 of them being killed by gunfire, and there is still another month left in the year. Ambush attacks on cops are up 126% since 2020.” 

I don’t know about you, but I’m appalled at this information.. You know… when the police decide that the risk is too great, and they go home, who’s going to protect the citizenry?  

Ok, getting back to markets…  The price of Oil continues to ratchet higher on news that the reserves are being restocked… And that means that the reserves aren’t getting released to sell and lower the price of Oil..  So much for that release that the POTUS made about 10 days ago, eh? I do believe I told you at that time that I didn’t think it would do much to the price of Oil…  And look where we are now?

And look at the 10-year Treasury’s yield rising.. .This morning it’s trading with a 1.49% yield, when just last week it was trading with a 1.38% yield…  Last week’s drop in yields had me telling you that the there were signs of short coverings going on, but once those cleared we could very well see the yield rise where it should be going… And voila! That’s what we’re seeing once again!  I don’t want to get bursitis from slapping myself on the back here, so I’ll just let that ride…

I read an article in our local newspaper yesterday that detailed how stressful the Covid Plandemic has been on the Gen Z’s…  (the young folks)…  And I though back to my most stressful time as a young adult, the Vietnam War…  There was no one out there patting us on the back and telling us that we needed a safe place to express ourselves… We got our draft number in the mail and reported for duty if we were called… I’m not saying that my generation was better than the Gen Z’s, I’m just saying we didn’t have people writing about how it was affecting us… And while I could be way off base here, I would think that being sent off to war, was more stressful than a plandemic…

The U.S. Data Cupboard yesterday show that there are 11 Million job openings up from 10.6 Million in Sept, and that the job quits were 4.2 Million in Rocktober…  how can an economy grow when you have so many job openings that people refuse to fill, and that you have so many people quitting their jobs each month?

Today’s Data Cupboard has the usual Tub Thumpin’ Thursday fare of Weekly Initial Jobless Claims, and some new data prints… Real Household Debt, and Real domestic nonfinancial debt… While those won’t move the market because they have nothing to compare them with, they do set the base for future prints…

And in Japan, this is important because as I’ve been saying for over a decade now, “We’re turning Japanese, yes, I really think so”… Japan’s economy shrank 3.6% in the third quarter, worse than the initial estimate of a 3.0% contraction, revised government data showed on Wednesday, posting a decline as private spending took a hit from a resurgence in Covid-19.  So, we have that to look forward to folks… 

To recap.. The currencies found some room to rally VS the dollar yesterday, and it wasn’t just the Petrol Currencies rallying this time. Gold & Silver drifted lower on the day, but by pennies not by large chunks…  The dollar got sold because the fears of the Omicron variant abated…  Hmmm… The data yesterday showed that there where more job openings and more jobs quits in Rockober, and the great resignation continues…  And then Chuck stops back on to his soapbox…

Before we head to the Big Finish today, you may recall me telling you about the nut that POYUS had nominated to be the Comptroller of the Currency, right? Well here was the news yesterday: Yesterday, Cornell Law Professor, Saule Omarova, withdrew from her nomination to become the head of the Office of the Comptroller of the Currency (OCC), the regulator of national banks. Emily Flitter, reporting for The New York Times, said it was because Omarova had been “painted as a communist.” In terms of the full story on why Omarova had to withdraw, that is like pointing to a single droplet of rain as the cause of a hurricane.

For What It’s Worth…. Well, this article comes to us from Ed Steer’s letter this morning, and it’s about the stupid, circus show that the debt ceiling talks are… And it can be found here: Debt ceiling: House takes step toward preventing U.S. default (cnbc.com)

Or, here’s your snippet: “The House took a first step Tuesday toward preventing a possible default on U.S. debt.

The chamber passed a bill that would allow the Senate to raise the country’s borrowing limit with a simple majority vote. Lawmakers attached the provision to legislation that would prevent automatic Medicare cuts set to take place at the end of the year.

The measure will head to the Senate. It will need 10 Republican votes to pass and go to President Joe Biden’s desk.

Once the president signs the bill, the House and Senate can hold separate votes to raise the debt ceiling with a simple majority — or without Republican support. GOP leaders have said the party will not join Democrats in hiking the borrowing limit, but as part of a new strategy, Republicans also are not expected to block their counterparts from preventing a default.

Chuck again.. It’s all a dog and pony, circus show folks… The debt ceiling is not really a ceiling, it’s just a suggestion for lawmakers to make a big deal out of so their voters think they are really working on something!  What a bunch of bunk! 

Market prices 12/9/ 2021: American Style: A$ .7140,  kiwi .6790, C$ .7881, euro 1.1313, sterling 1.3133, Swiss $1.0841, European Style: rand 15.9104, krone 8.9704, SEK 9.0551,  forint 323, 25,  zloty 4.0734,  koruna 22.4780, RUB 73.71, yen 113.54, sing 1.3659, HKD 7.7964, INR 75.55, China 6.3488, peso 21.04, BRL 5.5822,  BBDXY 1,182.49, Dollar Index 96.14,  Oil $71.94, 10-year 1.49%, Silver $22.30, Platinum $948.00, Palladium $1,916.00, Copper $4.33, and Gold… $1,778.50

That’s it for today.. A very slow newsday yesterday, had me scrambling looking for stuff to talk about..  There was one article yesterday that was interesting.. it was the end of Angela Merkel’s end as Chancellor of Germany, ending her 16 year reign as Chancellor, in which she presided over the meltdown of the European Union, when the debts of Greece and others were uncovered…  I believe she did a good job throughout all of that, in her effort to save the European Union..  It will be interesting to see if the new Chancellor of Germany has the same thoughts about preserving the European Union, over the soveign duties of the country of Germany…  OK… I’m off the rest of this week, and will enjoy my sleep later time tomorrow…  And I hope my friends are back in town to meet up at our local drinking hole for Friday afternoon!  I’m listening to my Christmas in the City CD by the Stephen Kummer trio this morning, and they are playing the song: When My Heart Finds Christmas to take us to the finish line today… I hope you have a Tub Thumpin’ Thursday today, and please Be Good To Yourself!

Chuck Butler

 

 

December 8, 2021

*Currencies & metals rally on Tuesday… 

* The price of Oil rebounds… 

Good Day… And a Wonderful Wednesday to you! In the Blues game last night VS Florida, it appeared, early on, that the Blues were getting outskated and outshot by a Huge margin and that it would become an ugly game… But that didn’t happen… And the Blues came out in the second period and from then on it was a different game, with the Blues winning  4-3 in Overtime…  Our Blues are very shorthanded right now, with players out for the COVID Protocol, and injuries.. .I bet that was a very tired bunch of Blues last night… I cooked dinner last night, parmesan crusted pork cutlets… Man they were yummy!  I’m listening to my new CD, Winter Romance by Biggie Adair this morning, and she does a wonderful version of the song: A Child Is Born…

Well, it was another day of drifting at sea for the dollar yesterday, with no real economic data to give traders any direction to trade. The movement the dollar did make was a slight downward movement as illustrated by the BBDXY. The BBDXY started the day at 1,184.98 and end it at 1,184.41… So, as you can see the downward movement was very small…  The euro remained below the 1.13 handle, but moved ever so closer to the figure as the day went along.  The Chinese renminbi, of which I’ve talked a lot about lately, saw another strengthening move on Tuesday, and ended the day there with the strongest it’s has been VS the dollar since 2018… 

Gold & Silver were able to gain on Tuesday, yes, I truly mean that Silver did gain, as difficult as it is to imagine that these days!  Gold closed up $5.60 to end the day at $1,785.10, and Silver ended the day up 12-cents to close at $22.60…  I’m truly amazed these days when these two metals get to actually show a gain on a day… They should be gaining daily, but we all know that’s not what’s been going on…  UGH!

The price of Oil added to their gain on Monday, throughout Tuesday.. At one point in the day the price of Oil briefly traded above the $72 handle, finally settling down at $71.87…  Here’s Bloomberg.com on their thoughts on the price of Oil: “Crude has surged more than 8% over the past two sessions — rising along with other financial assets — on cautious optimism that the omicron virus variant is unlikely to derail the global economic recovery. There’s few deaths from the new strain so far and little sign of a major impact on oil demand.”

Chuck again… OK, in the overnight markets last night… there was some dollar selling that was quite evident… The euro is within spitting distance of 1.13, and the  BBDXY has dropped from 1,184.41 to 1.182.01 this morning… The Petrol Currencies are giddy with excitement this morning, as the price of Oil has moved into the $72 handle… Shoot Rudy, even the Mexican peso is rallying alongside its Petrol brothers… 

Gold & Silver are basically flat this morning…  But could very well move higher as the day goes on, with the fear of a geopolitical event on the horizon, after the Potus talked to Russian President, Putin yesterday. There have been no reports of the meeting, but given what I know about the situation, I would think that Putin downplayed his country’s involvement in Ukraine, while crossing his fingers behind his back! 

I’ll have more on data prints in later in the letter, as usual, but first I wanted to talk in depth about productivity…  Part of the data yesterday was 3^rd QTR Productivity… I’ve always disliked this data because it simply reports how hard people are working…  Well, I told you yesterday that I expected this data to remain negative, and it did, in fact, go negative more, which does tell us something, folks… It tells us that Companies are getting less work out of people, while they are having to pay higher wages…  That doesn’t bode well for this country, I’m just saying…

Yesterday, I bared my thoughts on the U.S. thinking it’s the policeman of the world…  And then I read a piece where it was described that the U.S. has so-called iron-clad agreements to defend both Ukraine and Taiwan… And immediately, my spider sense went to work… What if, all this working together by the Chinese and Russians yields a two pronged attack in order to thin out the U.S. Military?  Another reason for the U.S. to step back and not play policeman, for I don’t believe we, as a military, are not ready for those moves…  I could be wrong, but why risk it?  The U.S. doesn’t need the increased debt accumulation it would take to fund wars, and we certainly don’t need to expose our young people to wars…

You can tell that yesterday was a slow news day, because I’m going out on limbs today… Oh, there are more to go out on in bit, so stay tuned!

The U.S. Data Cuboard yesterday had those three prints I talked about in Tuesday’s letter, and I was bang on with all of them…  As aforementioned the Productivity in the 3^rd QTR printed more negative than in the 2^nd QTR, The Unit Labor Costs for the 3^rd QTR were larger than in the 2^nd QTR, and Consumer Credit (read debt) didn’t print as scheduled, but did print after all, as it was slipped through under the cover of radar, and showed that Credit Card purchases by U.S. consumers dropped in Rocktober… So, in my mind that is an indication that the U.S. consumer is maxed out on their Credit cards, and that doesn’t bode well for the consumption part of GDP… 

There also was the preliminary print of the Trade Deficit for last month, and it narrowed!  But that has to because the dollar strengthened in Nov. by a large margin… 

Today’s Data Cupboard has the Job Openings and the Job Quits for Rocktober…  just a friendly Spiderman reminder that the Job Openings were over 10 Million and the Job Quits were over 4 Million in September… 

But this data won’t be enough to get traders to make a directional call today, so expect more drifting…

To Recap…. The currencies gained a smidgen yesterday VS the dollar, as the dollar drifted out to sea yesterday, with no economic data to give traders a direction…  Gold & Silver, both gained on the day, and yes that was not a typo on the Silver gaining yesterday!  Chuck seems to be on his soapbox a lot today, and there’s more and here it comes….

Before we head to the Big Finish today, I wanted to talk about something that just seems stranger than fiction to me…  The news from NYC was that even kids from age 5 are now to be excluded from restaurants and theaters and everything else, unless they show their vaccination proof… Wait! What?  I can only say that just when you thought that this whole plandemic response couldn’t get any stranger, this comes along…  And now the question has changed from “have you gotten jabbed”? to…  Is it safe to associate with the Unboostered?   Please, Good Lord, deliver me the strength to deal with all this mania, for I am but a human that will react to this negatively without your help….

For What It’s Worth… So how many of you recall me telling you about 2 years ago about my vision for the future of the folding currency, and that we would eventually wake up one day to find that our bank account didn’t reflect dollars any longer, only digits and that would be the end of our civil liberties and so on?   Well, just to refresh your memory, I found this article on Bloomberg.com and it’s about the end of cash, and it can be found here: We Are Almost Cashless Societies But Let’s Not Rush Too Quickly Into the Future – Bloomberg

Or, here’s your snippet: “The demise of cash is near. As consumers, though, we should hope that the end doesn’t arrive too soon.

It isn’t the pandemic that’s putting this popular means of payment out of existence. All that Covid-19 has done is to accelerate a trend that was already with us. When Steve Jobs unveiled the first iPhone in 2007, he began killing the need for banknotes. Autonomous cars, self-ordering refrigerators and our digital avatars in the metaverse will put the final nails in King Cash’s coffin.

Covid-19 shifted $5 trillion in global retail sales from offline to online. To the extent that a big chunk of this value was transacted in cash (47% in the euro area), the idea that central-bank-issued currency was a must for purchasing daily essentials took a knock. After an initial bump in precautionary cash hoarding, curbs on mobility and the fear of catching germs from handling paper money forced a change in habits.

Where governments gave out vouchers to perk up spending — like in Hong Kong — millions of consumers and thousands of merchants became new users of online payment systems just to utilize the handouts. Many will likely continue using these new ways to settle bills.

But just how crucial were these changes in the overall scheme of things? The different trajectory of banknotes in China and India provides a natural experiment to gauge the relative importance of temporary shocks and steady technological change.

Cash use plummeted in India after Prime Minister Narendra Modi cancelled 86% of the existing legal tender overnight as part of a botched economic experiment. That was five years ago. Nowadays, digital payments are booming, but cash is once again 14% of the broad money circulating in the economy — the same as before demonetization. In China, where physical currency was made irrelevant by the growing ubiquity of Alipay and WeChat Pay, the central bank’s IOUs to the public account for only 4% of money.

Technological progress lacks the drama of a behavioral shock, but it’s no less stunning. As JPMorgan Chase & Co.’s Jeremy Balkin and Neha Wattas remind us, the fastest way to move money from New York to London as recently as 2010 was to catch a flight from JFK to Heathrow and deliver it in person. Their report, provocatively titled “Payments Are Eating the World,” notes several shifts taking place in unison. In China, super-app platforms transformed money; elsewhere, the rise of a creator and gig economy is doing it. Globally, 50 million people are blogging, making short videos or telling people what to buy on the internet — and getting paid online as well.”

Chuck again… so as the article illustrates, it’s not just the U.S. that will end cash, but it will be worldwide effort to do so…  my only hope is that there will be a black market for cash deals…

Market price 12/8/2021: American Style: A$ .7133,  kiwi .6780, C$ .7914, euro 1.1292, sterling 1.3293, Swiss $1.0828, European Style: rand 15.7835, krone 8.9543, SEK 9.0821,  forint 326.47,  zloty 4.0671,  koruna 22.5429, RUB 74.20, yen 113.75, sing 1.3643, HKD 7.7962, INR 75.37, China 6.3662, peso 20.93, BRL 5.6592,  BBDXY 1,182.01, Dollar Index 96.24,  Oil $72.15, 10-year 1.47%, Silver $22.50, Platinum $964.00, Palladium $1,930.00, Copper $4.37, and Gold… $1,785.70

That’s it for today… A great win last night for our Blues, but not so much for the St. Louis U. Billikens who lost their basketball game.  So, a mixed results night overall for St. Louis sports… I don’t have any other doctor appts until next Tuesday, when I see a dermatologist about some spots on my bald head that won’t heal, and my PCP tells me it’s probably cancer, that they’ll burn off, and be done with it… So, that’s exactly how I’m looking at this…  The Pfennig was shorter than normal today, because of the slow news day yesterday, and the markets not really moving in one direction…  So, take it while you can! HA!  Biggie Adiar’s version of Auld Lang Syne takes us to the finish line today… I said this last year, and I’ll say it again, that the Celtic Women’s Lisa, does the best version of this song I’ve ever heard… It brings tears to my eye…  And with that, I hope you have a Wonderful Wednesday today, and Please Be Good To Yourself!

Chuck Butler

December 7, 2021

* Currencies & metals get sold on Monday… 

* What on earth is Madame La Garde thinking? 

Good Day… And a Tom Terrific Tuesday to you! Today is our remembrance of our first day of infamy… Pearl Harbor… It turned cold again yesterday, the sun was out, but it wasn’t doing anything to warm the air… I had to break out my winter coat again. UGH! Not to worry though as it will be warm again by Thursday this week!  My trip to see Holly, was a piece of cake… She told me I did great… And I relayed a story to her that one time in the hospital Kathy asked me why I was so nice and accommodating to the nurses, and I replied, “Because they have the needles!”  HA!  Speaking of needles, last week at the oncologist, the lab person had to stick me 3 times before they found a vein.. OUCH! I had never had anyone say they had a difficult time finding my veins before… Am I getting Old? Don’t answer that! I know darn well I’m getting old…  Ellis Marsalis greets me this morning with his version of the song: O Tannenbaum…  (Oh Christmas Tree)

No data in the Data Cupboard yesterday, meant no direction for traders to take, and why would they trade on Friday’s awful labor data? I’m being facetious there…  And with no direction to take, they decided to allow the dollar to drift on the day… The BBDXY was 1,185.40 in the morning when we started and it ended the day at 1,185.54… The euro remained below 1.13, and the Aussie dollar kept its overnight gains. The two renegades, if you will, that keep the pressure on the dollar when all other currencies fade, the Chinese renminbi and Russian ruble are the kings of the hill…

Gold & Silver could never find a bid all day, and closed down on the day, with Gold down $4.10 to close at $1,779.50, and Silver done 14-cents to close the day at $22.48…  This has been a very bad year for these two metals, especially Silver, but they didn’t go to zero, they don’t have debt obligations tied to them, they aren’t issued by Gov’t’s, so they’ve got  that going for them!

In the last 24 hours the price of Oil has risen and this morning it trades with a $71 handle… I had thought that the selling of Oil last week was way overdone, and this move back above $70 confirms that…  The 10-year Treasury Bond also saw some weakness with the yield rising to 1.44% this morning… Of course, the yield on the 10-year should be much higher and moving toward 2%, but yield manipulation by the Fed/ Cabal/ Cartel, continues to weigh on the 10-year’s yield…  UGH! 

In the overnight markets last night… There was more drifting, but this drifting led to dollar weakness! The BBDXY dropped from 1,185.54 at yesterday’s close to 1,184.98 this morning… Again, no big move, just a “drifting”, if you will…  Gold & Silver begin the day on the plus side of the ledger, with Gold up $4.30 and Silver up a plug nickel!  There just doesn’t seem to be any real force to move the markets this morning.  And the Data Cupboard today, isn’t going to change that… So… another day of being adrift at sea for the dollar today… 

I received an email on Friday from a well known analyst, that told me that the stock market was going to drop like a rock on Monday, and then in a follow-up email on Saturday, he told me that time was running out…  And then Monday came and went, and stocks gained on the day…  Well, so much for that.. .What does that make this kind of end of the world as we know it claim? The 4^th time we’ve heard this?   Listen, I know the stock market is a major bubble floating around the room looking for a pin, to pop it, but so far it has avoided that pin… I get it, but why try to pin down a particular day that it’s going to happen? One of these days, Alice, the stock market bubble will find that pin, and he’ll say “he told you”… 

I’m thinking back to 2011, when I told an audience in Orlando Florida, that the Chinese renminbi would be a reserve currency within the next 10 years…  See what I did there? I gave myself a very long time frame for this to happen…  But that’s not hype… And it doesn’t sell… I’m just saying…

I saw on Twitter yesterday, something from one of my fave writers, Grant Williams, who commented on a news item from the European Central Bank, that said that ECB President, Christine LaGarde was going to change the looks of the euro notes…  And that brought Grant to say, “Would someone please tell Madame Lagarde that she has a few more pressing priorities…” -Grant Williams on Twitter…

The Eurozone has the same problems as the U.S. does…  Very high Debt, negative yielding bonds, rising inflation, and a Central Bank that refuses to admit they were wrong about inflation…  There is one difference here, and that is the U.S. owns the reserve currency of the world…  And they should be held to a higher standard because of that ownership…

In yesterday’s 5 Minute Forecast edited by David Gonigam, he had this quote from James Rickards in the letter, in which Rickards was commenting on the Fed…  Let’s listen in.. “The plan is to cut off the supply completely sometime next spring, and then start raising interest rates to a point where they’ll be something approximating “normal” by late 2023.

Just one problem: “The Fed can’t make an accurate six-month forecast,” says our Jim Rickards, “so the idea that they can forecast the economy and set monetary policy two years in advance is absurd.” – James Rickards in the 5 Minute Forecast 12/6/21

I thought the timing of this article that appeared in my local paper, The St. Louis Post Dispatch yesterday, was bad…   Here’s the title of the article: Economy booms, but Americans see gloom

GDP is growing rapidly, unemployment is down and wages are rising, but measures of consumer sentiment show that Americans hold negative views about the economy.”

Ok, where do I start this this?  I could point out that 1 the economy isn’t booming, 2, the GDP is at 2.1%, you call that rapidly growing?  And the stupid Consumer Confidence isn’t a measure of anything but the performance of the stock market…   I used to think that the economics guy at the Post Dispatch knew his stuff, until this article came out…

In today’s U.S. Data Cupboard we’ll see three prints that put together wouldn’t make a real economic data print, but we’ll see them nonetheless… First up will be 3^rd QTR Productivity, which will be negative again… Then we’ll see the 3^rd QTR Unit Labor Costs , which will remain high, and finally the Rocktober print of Consumer Credit (read debt) which sometimes prints on a scheduled data, and other times it prints when its good and ready…

To recap… The dollar drifted all day yesterday, and did close the day up a smidgen… Gold & silver never found a bid all day, and both closed down on the day.  The Dynamic duo of Chinese renminbi and Russian rubles continue to hold steady Eddie while all other currencies get sold.  And then Chuck gets into some articles that he has found to be interesting.. . And in the overnight markets the dollar got sold a bit, but really it’s all just drifting away at sea… 

 

For What It’s Worth…. Ok, first off this is NOT a political statement, I’m not pointing fingers at any party or person, just pointing out that we, as a country are toeing up to a very dangerous war, and that scares the bejeebers out of me… So, this article can be found here: Biden Mulls Cutting Russia Off SWIFT Ahead Of Putin Call In “Nuclear Option” Ukraine Response | ZeroHedge

Or, here’s your snippet: “CNN and others are reporting just a day ahead of the much anticipated video call between Russian President Vladimir Putin and US President Joe Biden that the White House is mulling “nuclear option” level actions against Moscow should it launch a military offensive against Ukraine – which US intelligence has lately said could be imminent based on assessing that some 175,000 troops have been mustered in the Crimea and regions near Ukraine’s eastern border.

This includes discussion of the possibility of disconnecting Russia from the SWIFT international payment system, seen as the most drastic potential measure which further includes fresh sanctions on Putin’s inner circle and on Russian energy producers.

The Kremlin has of course vehemently rejected the Ukraine threat accusations, saying it’s free to move its own troops wherever it sees fit within the Russian Federation’s sovereign territory and borders.

But the White House is now threatening the following, according to CNN on Monday:

People familiar with the discussions said new economic sanctions could target a variety of sectors, including energy producers and Russian banks. The new sanctions could also go after Russia’s sovereign debt.

They are also likely to go after top Russian oligarchs, limiting their ability to travel and potentially cutting off access to American banking and credit card systems.

And in particular, the “nuclear option” – which is now grabbing headlines…

Officials have also been weighing disconnecting Russia from the SWIFT international payment system, upon which Russia remains heavily reliant, according to two sources familiar with the discussions. This is being considered a “nuclear” option. The European Parliament passed a nonbinding resolution in the spring calling for such a move should Russia invade Ukraine, and the US has been discussing it with EU counterparts.”

 

Chuck again…  This move would be very challenging to the Russians, folks, and is the reason they were working on a their own version of Swift, along with China… I guess they’ll be finding out if it works or not, very soon… But, why tick off the bear? I just don’t get it… We are NOT the policemen of the world, and the sooner, the leaders of our country figure that out, the better the whole world will be…  There! I said it!  and I know many will send me nasty emails today, and that’ll be my penitence for speaking my mind… 

Market prices 12/7/21: American Style: A$  .7102, kiwi .6770,  C$ .7888, euro 1.1260, sterling 1.3250, Swiss $1.0801, European Style: rand 15.9661, krone 9.0508, SEK 9.1061,  forint 325.04,  zloty 4.0779,  koruna 22.6290, RUB 73.92, yen 113.52, sing 1.3664, HKD 7.7969, INR 75.35, China 6.3717, peso 21.33, BRL 5.6683,  BBDXY 1,184.98, Dollar Index 96.40,  Oil $71.57, 10-year 1.44%, Silver $22.53, Platinum $968.00, Palladium $1,974.00, Copper $4.35, and Gold… $1,783.80

That’s it for today… The weatherman said last night that we would see snow flurries today, I always get a kick out of the first snow of the season… But then I’m ready to go south!  It has occurred to me that somewhere along the way, our months got jiggied…  the weather we used to get in Nov, we now get in Rocktober, and so forth… But like my call that baseball’s Opening Day should be a National Holiday, this call to adjust the months will fall on deaf ears… Congrats to former Cardinals pitcher, Jim Kaat, for his induction to the Hall of Fame… It took long enough, but at least he’s still alive to enjoy telling people his a Hall of Famer! In 2009, my beloved Missouri Tigers played Navy in a bowl game. I had a dear reader bet me a shiny quarter that his Navy team would win, and they did, running the ball down the Tigers’ throats… I have a bad feeling about the upcoming bowl game with Army, who also runs the ball all the time… UGH!  The Dave Brubeck Quartet takes us to the finish line today with their version of Santa Claus Is Coming To Town… I hope you have a Tom Terrific Tuesday, and Please Be Good To Yourself!

Chuck Butler