Author: admin

November 23, 2022

* currencies & metals gain little on Tuesday

* Adam Sandler drops by the Pfennig today… 

Good Day… And a Wonderful Wednesday to one and all! Well, I told you Monday in my brief, Pfennig that it would be the only letter of the week… But my eye settled down, I can see again… Just a reminder that I only have one eye, so when that one’s on the fritz, I am too! Went to see my Primary Care Physician yesterday, Blood sugar is good, cholesterol, is good, BP is wonderful, lungs were clear… He is always surprised to see me in such good spirits. The first time I ever say him, he walked into the exam room and the look of shock on his face was priceless. He told me that he had been reading my medical history, and had in his mind a broken old man, and instead he saw me smiling at him! I told him, see you can’t believe everything you read! HA! He also told me that he too had experienced the same head cold / sinus problem that I had… But thought I was nearing the end of the ailment… Jack Jezzro and friends, from his Bossa Nova Christmas album play: Let It Snow for me this morning… I love this CD…

The dollar didn’t do much yesterday, while I was being stuck twice because they couldn’t find a vein, OUCH! The BBDXY was up 2 index points at the end of the day. It’s pretty interesting that on a day after a big gain in the dollar that it can’t follow up on that. Hmmm… Gold found a way to gain $1.70 on the day and finish at $1,740.90, and Silver gained 23-cents to move back above $21, and finish at $21.17… The price of Oil had gone south by a large margin before yesterday… The price of Oil had fallen to $78, but recovered a bit yesterday ending the day at $81… And investors are still buying the 10-year thinking they are locking in 10-year high yields… I can’t help but think they are so wrong that they are almost right… I also can’t help but think that yields will go higher, as the Fed Heads continue to hike rates…

Speaking of hiking rates, The Reserve Bank of New Zealand (RBNZ) hiked their Official Cash Rate (OCR) 75 Basis Points last night, and brought their internal OCR to 4.25%… That’s higher than the U.S.’s internal rate of 4.00%… In the old days, that would have brought on huge swaps of bonds from Treasuries to Kiwi Gov’t Bonds… But those days are long gone… I was a part of those days on a bond trading desk… I loved every minute of it, well, except for my arguments with Neil… But those were far in between…

Kiwi did rally on the rate hike news, and it outperformed its kissin’ cousin across the Tasman, the A$… I’ve always held a special place in my heart for kiwi… Many years ago, I was new on the foreign bond trading desk, and I had noticed that kiwi was on the move, and mentioned it to the boys on the desk, and I got a lot of flack about how it was too small a nation to look into… Funny thing, years later, kiwi bonds were the largest holding of foreign bonds that we had… Eventually people get around to hearing me…

In the overnight markets last night, the dollar got sold, along with Oil… The BBDXY has lost 6 index points overnight, and the euro has climbed higher in the 103 handle. Oil lost $4 overnight and trades this morning with a $77 handle. Gold is up barely this morning adding $2 to its value, and Silver is up 20-cents in the early trading today… The big mover overnight was kiwi, with sterling coming in second place… While I like the fact that sterling is stronger, right now, I still can’t get past the idea that the country has a mountain of problems that are being overlooked right now… Oh well, C’est Le Vie…

In other news… Tomorrow is Thanksgiving, and I can’t begin to thank all the dear readers who sent me a note on Monday… I truly appreciated each and every one of them! In Pfennig tradition, here’s Adam Sandler

“ Turkey for me, turkey for you
Let’s eat the turkey in my big brown shoe
Love to eat the turkey at the table
I once saw a movie with Betty Grable

Eat that turkey all night long
50 million Elvis fans can’t be wrong
Turkey lurkey doo and turkey lurkey dap
I eat that turkey, then I take a nap”

I crack up watching and hearing him sing that song… Well, now the Christmas shows will begin… You’ll shoot your eye out kid! Elf, and dozens of others… Bing Crosby and Danny Kaye in White Christmas is a real good one too!

Today’s Data Cupboard will have the Fed Heads Meeting minutes, that the markets will go over with a fine tooth comb to see if there are any hints of a pivot… As adamant as Jay Powell was after the last meeting about this is not the time to pivot, I can’t believe there would be any hints on that, but you never know what those rascally varmints, I mean Fed Heads have to say… We’ll also see Durable and Capital Goods Orders for Rocktober… Both of these have been very weak lately… And with the beauty of being so late with the letter we get to see what the Durable Goods for Rocktober were… They were up a nice 1.0% in Rocktober, and Capital Goods were up .7%.. So, not so weak as previously… Hmmm…

Next week’s Data Cupboard won’t have anything of real economics for us until Wednesday, and then on Friday we’ll see the BLS jobs creation report… or The Jobs Jamboree as I like to call it.

Market Prices 11/23/2022: American Style: A$ .6694, kiwi .6213, C$ .7564, euro 1.0349, sterling 1.2015, Swiss 1.0578, European Style: rand 17.0514, krone 100082, SEK 10.5105, forint 396.31, zloty 4.5432, koruna 23.5409, RUB 60.84, yen 140.20, sing 1.3802, HKD 7.8175, INR 81.85, China 7.1610, peso 19.36, BRL 5.3773, BBDXY 1,278.72, Dollar Index 106.62, Oil $77.67, 10-year 3.71%, Silver $21.37, Platinum $993.00, Palladium $1,1956.00, Copper $3.71, and Gold… $1,743.60

That’s it for today…No FWIW today, I just wasn’t in the mood… But I’ll be back on Monday with a good one, I’m sure, as I’ll have 5 days to work on it! This is a good year, in that all 3 kids will be here, with their families…Andrew & Rachel alternate years with his family and her family… I said, just invite her family here! But noooo, that’s too logical! I rarely see Alex & Grace these days, as both are working full time jobs, and living their life, so it will be good to catch up with them… I need Christmas gifts ideas for the girls in the family… I’ll figure something out, no worries, I just always run into a roadblock with buying for girls… Again, thank you to all who sent me get well/ Happy Thanksgiving messages on Monday… That meant a lot to me, so thank you very much! Jack Jezzro’s Bossa Nova Christmas is still playing, so he’ll take us to the finish line today with his version of the song: Christmas Time Is Here… I hope you have a Wonderful Wednesday, and a Very Happy Thanksgiving tomorrow, and please Be Good To Yourself!

Chuck Butler

 

November 21, 2022

* currencies & metals get sold on Friday last week

* the dollar gets bought in the overnight markets last night

Good day… And A Marvelous Monday to you! OK, let me get this out of the say… First of all this will be the only Pfennig this week… Second, this will be a very stripped down version of the letter, because I’ve got a cold in my eye, and right now I can hardly focus on the screen to write… It’s making things very difficult for me to focus on, so with that, I’ll give you the Market prices and some thoughts on Thanksgiving and then sign off for the week… Kenny G greets me this morning with his version of the song: O Christmas Tree

Well, my hopes that the dollar’s strong run had come to an end, have been dashed… The dollar, although, not strongly, came back last week, and proved once again that with the funds of the Exchange Stabilization Fund behind it, the dollar can remain strong… The BBDXY only gained I index point on Friday, but at the end of the week it had gained 10 index points for the week, and put to bed all the thoughts that the strong dollar trend was over. Gold finished the week on a down note, and once again our hopes that Gold had turned the corner were dashed too… Gold ended the week down $9.50 at $1,752.50. Silver didn’t fare any better and ended the week at $21.05. The price of Oil has fallen out of bed, and ended the week at $80, while bonds continued to get bought with the 10-year’s yield ended the week at 3.82%…

Spoiler alert.. I just finished an interview for the Miller On The Money letter, regarding bonds… and this crazy idea that the Bond yields have peeked… So, for you that have subscribed to Dennis’ letter, look for that in your email box in the next week or so…

In the overnight markets last night, the dollar got bought like it was going out of style… The BBDXY is up 9 index points to start the day today, and the euro has dropped back to a 1.02 figure. Gold is also off by $8 this morning, and Silver had given back 34-cents to start the day/ week. It appears that this week, albeit shortened because of the Thanksgiving Holiday, will be all about the dollar… So batten down the hatches and forget about the markets this week… It’s time to give thanks…

Market Prices 11/21/2022: American Style: A$ .6621, kiwi .6113, C$ .7441, euro 1.0244, sterling 1.1808, Swiss $1.0436, European Style: rand 17.3570, krone 10.2524, SEK 10.7240, forint 399.55, zloty 4.5932, koruna 23.7338, RUB 60.88, yen 141.84, sing 1.3822, HKD 7.8055, INR 81.84, China 7.1662, peso 19.46, BRL 5.3089, BBDXY 1,291.20, Dollar Index 107.51, Oil $79.51, 10-year 3.82%, Silver $20.71,
Platinum $980.00, Palladium $1,907.00, Copper $3.59, and Gold… $1,742.50

That’s it for today and this week, sorry for the shortened letter today, I’m just having a dickens of a time trying to see what I’m writing this morning… I thought I was on the road to recovery, ugh! I go see my primary care doctor tomorrow, for all the things not connected to heart and cancer… And then we’ll head to Thanksgiving… I sent Dennis a note a week or so ago, when he asked me about what I’m thankful for…
And in it I said that I am thankful to the Good Lord for allowing me to live and be where with you all today… There’s a story that goes with that, but I don’t want to steal Dennis’ thunder! So, when we all gather on Thursday, make sure you go around the table and have each person say what they are thankful for, it’s a nice way to start your Thanksgiving meal…

I’m sitting here thinking about when I was a young man and would eat two Thanksgiving meals. One at my home and one at Kathy’s home.. I could put away some food back then, not knowing then, what it would do my weight in the future! So, eat up, but don’t overdo it… But most of all… Be Good To Yourself!

Chuck Butler

 

November 17, 2022

* Currencies & metals get sold in the overnight markets

* What are the BRICS up to?

Good Day… And a Tub Thumpin’ Thursday to one and all! Our Blues sure looked like the Blues of old last night, and didn’t revert to the losing status they had for 8 games. They beat the Blackhawks last night, which used to mean something, I’m not sure the intensity of the old rivalry is still there… Well, I have errors and omissions for you this morning.. First of all, right after I hit send yesterday, I received an email from a news outlet letting me know that it wasn’t Russian missiles, as earlier reported, but Ukrainian defense missiles that entered Poland, and killed two. In addition, I also erred on the City 1 soccer game, saying it was Thursday night, when it was actually Wednesday night! UGH! So, there… that’s my mea culpa, for you.. Beegie Adair and friends greet me this morning with their version of my favorite Christmas song: The Christmas Waltz

Man I don’t like that when what happened yesterday, happens… I try to get the letter out on time each day, barring technical problems, and health issues, and sometimes when I do, I then receive a notice of some kind that what I talked about had a different spin on it… UGH! Oh, well, no harm, no foul, we move on to play another day…

Gold lost $5.40 yesterday to end the day at $1,774.80, and Silver, which was up big in the early trading gave all those gains back and lost 9-cents to close the day at $21.54…. Those were small losses, but losses that these two should not be getting given all the geopolitical stuff going on, all the unknowns, and markets on shaky ground at best… I’m just saying…

The dollar didn’t move much yesterday, the BBDXY held the same handle of 1,274 throughout the day, and so there was little to no movement in the currencies. The euro fell back below the 1.04 figure, but the fact that it had rallied that quickly to that figure, remains impressive. Because of their rate situations, the Aussie and kiwi dollars remain well bid.. And that old’ Russian ruble, just shrugs off all the bad news it received about what the country is doing, and remains strong… Well, not strong, but stronger than it used to be, for sure!

I’m going to go to this right here and now, because it plays well in the sand with the thoughts on Russia… This si Dave Gonigam in his 5 Minute Forecast newsletter, “India is the world’s third-biggest oil consumer after America and China. Before Russia invaded Ukraine, India imported about 2% of its oil from Russia. Now it’s about 23%.

Now as you might recall, Washington and its Western allies hope to impose a harebrained “price cap” scheme on Russian oil effective Dec. 5 — aiming to limit Moscow’s oil revenue.
Clearly, India is in no mood to cooperate.

Enter Treasury Secretary Janet Yellen: Last Friday, she said India is welcome to continue buying Russian oil at whatever price it likes — as long as it doesn’t do so with Western insurance, financing or shipping.
Yes, India can probably make other arrangements — so Yellen’s threat is as toothless as the price-cap scheme is brainless.” – Dave Gonigam 5 Minute Forecast

I told you last week that I didn’t think traders and investors were taking the news that the Suadis had agreed to sell Oil in rubles, or any other currency of the BRICS… So that means all that oil that the Saudis are selling to India, is no longer priced in dollars…

Do you see what I see going on here? That the BRICS countries are getting countries to go along with them and not the Western NATO states… Us against them, it looks like to me, and I don’t like that one iota!

OK, onto last night in the overnight markets… Well, it appears that the brief selloff of the dollar was just that… brief. The dollar rallied overnight with the BBDXY Gaining 7 index points, the euro had fallen further back into the 1.03 handle, and the Aussie & kiwi dollars have given back some of their gains, as too have the krones, and yen of the world… It sure didn’t take long for the yen to get back to being on the skids… I told you last week or was it earlier this week? That I thought it ws too early to call for a change in the dollar’s strong trend, and that we needed to see what happened this week… Well, we’ve seen it… and it’s back the drawing board for those that want a week dollar trend…

Gold is getting sold in the early trading this morning and is down $12, as I write, and Silver has given back 54-cents! The price of Oil has slid further and trades this morning with an $83 handle… And someone somewhere, somehow is buying the 10-year Treasury, and the yield on the bond is slipping again, with it trading with 3.73% yield this morning.

I can’t rule out the PPT entering the markets stealth like to prop up the dollar this week, they do have a large treasure chest of currency in which to spend to prop up the dollar… So they have that going for them! 

Well, yesterday we saw the color of the Rocktober Retail Sales.. And the Rocktober Retail Sales did come in stronger than previous months, at 1.3% gain… But that’s not going move markets, as long as they recall that consumer debt is skyrocketing as evidenced in the credit card data I’ve been feeding you. And on top of that, Target says their profits will be lower… That’s because people are buying more stuff than they used to, they’re just paying more for it…Target sees price increases and passes them onto customers, no gain for them there… But the amount of retail sales goes up.. .Easy peasy…

I want to make sure everyone understands that point… Retail Sales were higher, because of higher prices that were paid for goods… period. And what makes it worse is the fact that the purchases were put on credit cards… Now, as long these folks pay their credit card balances each month, then there’s nothing wrong with that, but if they don’t… Well, that’s just like the U.S. gov’t and its annual budget deficits… They just get added to the previous deficit and pretty soon, you’re at an amount that’s going to be very difficult to pay, unless you win the lottery…

All right, I’ll get down from my soapbox now… I hate to tell those folks that believe they can build debts to the moon and the government will bail them out… There are no more bailouts coming… So, deal with it!

I told you earlier this week that our friends (NOT!) at OPEC were meeting to discuss further production cuts, and this news came to me from zerohedge.com: “OPEC revised down each of its 2022 and 2023 oil demand growth forecasts by 100,000 barrels per day (bpd) from last month’s estimates due to China’s still-strict Covid policy and economic challenges in Europe, the organization said in its Monthly Oil Market Report (MOMR) out on Monday.”

Chuck again.. Oh those Wiley veterans of Oil pricing, they sure are tricky aren’t they? At least someone out there in the world of trading things still understand supply and demand, eh?

The U.S. Data Cupboard today has the usual Tub Thumpin’ Thursday fare of weekly initial Jobless claims… I suspect that sooner or later we’ll begin to see all the layoffs from the Tech industries start to show up here… But then maybe not, for the gov’t sure know how to hide those things when it wants to… We will also see the Philly Fed Index (manufacturing in that region) which is normally looked at closely by the markets. Tomorrow’s Data Cupboard just has the Leading Indicators for Rocktober, of which the last couple of months had shown negative numbers…

To recap… The dollar index didn’t move much yesterday, but Gold lost ground, Silver lost ground, the euro lost ground, and Oil lost ground… I guess the losses were too small to show up in the index numbers… Chuck doesn’t think that Gold should taking any losses right now, given the geopolitical problems going on in the world, crunching inflation, shaky markets, and what ever else that’s out there! Chuck points out something that he thinks the markets are not paying attention to and that is Saudi Arabia buddying up with the BRICS… Something’s going on there, my spider sense is tingling…

For What It’s Worth… I love it wen great minds think alike… I’m referring to me of course, and Michael Burry, you know the guy from the Big Short? I know, I know, I’m stretching it calling myself a great mind, but I must be because Michael Burry is, and he’s saying the same things I’m saying about Gold right now! His comments can be found here: https://www.kitco.com/news/2022-11-16/-Big-Short-Michael-Burry-says-this-is-gold-s-time-cites-crypto-contagion.html

Or, here’s your snippet: “In a rare comment, “The Big Short” investor Michael Burry has weighed in on gold, stating that this is the time for the precious metal to rally because of the crypto contagion risk post-FTX collapse.

Burry, who runs the hedge fund Scion Asset Management, is known for spotting the mortgage crisis early and making a fortune against the U.S. housing bubble. In 2019, the investor also made millions by purchasing shares of GameStop, which was well before the Reddit frenzy took over the stock.

Burry rarely comments on gold, making this call much more unique for traders. According to him, the crypto chaos caused by the FTX saga sets the stage nicely for gold.

“Long thought that the time for gold would be when crypto scandals merge into contagion,” Burry said in a tweet that has since been deleted. Burry is known to delete his tweets shortly after posting them.

His Tuesday comment coincided with gold getting a lot of attention from investors after its impressive November gains — up nearly 8%. The move higher comes after seven months of consecutive losses. Analysts cite cooler inflation data, lower U.S. dollar, crypto risk, and a potential slowdown by the Federal Reserve as some of the main reasons behind the price gains.

At the time of writing, spot gold was trading at $1,776 an ounce.”

Chuck again… I don’t know about you, but I loved that movie the Big Short, because I was in the middle of all that and writing about it at the time…

Market Prices 11/17/ 2022: American Style: A$.6657, kiwi .6083, C$ .7472, euro 1.0338, sterling 1.1811, Swiss $1.0534, European Style: rand 17.4890, krone 10.1546, SEK 10.6240, forint 400.52, zloty 4.5496, koruna 23.5934, RUB 60.49, yen 140.04, sing 1.3772, HKD 7.8269, INR 81.64, China 7.1535, peso 19.44, BRL 5.4686, BBDXY 1,281.49, Dollar Index 106.76, Oil $83.79, 10-year 3.73%, Silver $21.00,
Platinum $994.00, Palladium $2,016.00, Copper $3.73, and Gold… $1,762.65

That’s it for today… Well, our Blues come home to play on home ice tonight after going on a road trip and winning all three games on the trip. The players were accompanied by the Moms for this trip, so, the boys didn’t want to disappoint their mamas… Well, I have just one more night, tonight, and tthen tomorrow to be here alone… I have to say that the week has gone by fast, well, that’s easy for me to say, given I slept most of that time… My beloved Mizzou Tigers play at home this Saturday, and hope to get back in the win column… The St. Louis U. Billikens basketball team is off to a great start! I doubt there are 25 better teams out there this year… I’ve long followed the Billikens Basketball team, all the way back to the time they were in the Missouri Valley Conf. and Harry Rodgers was the best player in the conference! They’ve gone through depressions of years, and fought back, they remind me of me… Jack Jezzro takes us to the finish line with a different sound this time he’s playing guitar to : Happy Holiday… I hope you have a Tub Thumpin’ Thursday today, and a Fantastico Friday tomorrow… And please Be Good To Yourself!

Chuck Butler

 

November 16, 2022

* currencies drift, Gold gains on Tuesday…

* Waller says markets have gotten ahead of themselves… 

 Good Day…And a Wonderful Wednesday to you! What happened yesterday and last night? I don’t know, because I slept most of the day yesterday, and then dozed off again at 7pm and slept through the night. I guess my body needed the rest, but that was a little too much I think! So, normally, I check things during the day and through the night, make notes about what I want to talk about, and then when I wake up the next day to write, it’s not like I have blank screen to work with… But not yesterday, so this morning, is a visit to the past, when I would write it all in the morning, meaning that I got to work at 5 am… That’s never going to happen like that again, trust me on that one! The Ramsey Lewis Trio greet me this morning with the toe tapping version of the song: Santa Claus Is Coming To Town… 

Well, at first glance this morning, I see that the dollar fell back from its early morning gain yesterday. I left you yesterday, with the BBDXY up 9 index points, but throughout the day, inch by inch, little chunks of the BBDXY were taken away and the index ended the day up only 4 Index points. Still up for the day, but you wouldn’t be able to tell that when looking at the currencies, as they seem to be trading in the same clothes as yesterday. Gold found a way to gain $7.60 on the day and end the day at $1,780.20. Silver, on the other hand, didn’t participate in Gold’s gains, and ever since Silver traded above 22-cents it has been sold… yesterday’s loss was 46-cents… I guess the short Silver paper trades were making their way into the Comex…

The price of Oil gained $2.50 yesterday, and ended the day with an $86 handle. Our friends, (NOT!) at OPEC announced that they are looking at further production cuts, and that news got Oil bubbling up through the ground, like Texas tea, no wait! This is no time to sing the Clampet’s song Chuck!  Well, OK, but that was what was on my mind there, you can’t get mad at me for that! OK, then just tell the dear readers what happened with bonds yesterday… OK, bonds got bought again yesterday, and the 10-year’s yield dropped to 3.78%… I guess there are more people out there thinking that the Fed Heads are going to pivot on rate hikes, and it’s time to buy the best yield you can get, right?   Not so fast there Tim… I still believe the Fed Heads will hike again in December… So, it’s not time yet… wink, wink…

I might as well talk about the Producer Price Index (PPI) because that’s what caused the dollar to weaken and bonds to get bought yesterday… The Rocktober PPI came in weaker than expected at .2% VS .4% expected. That got the folks that believe that the previous rate hikes have cooled inflation, all lathered up, and ready to go dancing in the streets! Does one print change things?  I don’t think so… just like I used to say, does one Swallow mean summer is here? Let’s not get ahead of ourselves here folks… This was one print, now if next month we see further weakening, then you might have something, but I doubt that will happen….

And you don’t have to take my view on that alone, Christopher Waller, a Fed Head, had this to say yesterday, “Waller said the Fed has got a ways to go before its stops hiking and the market got “way out in front” over the unexpected cooling in inflation last week.” – Bloomberg.com

In The overnight markets last night… The dollar got sold a little more, with the BBDXY index down  2 index points, to start the day, that will have some real economic news for us in Retail Sales and Industrial Production/ Capacity Utilization…  Gold is flat to up a buck this morning, while Silver has gained back most of yesterday’s loss, gaining so far this morning, 35-cents. Oil is up to a $87 handle this morning, and bonds are at the same level as yesterday’s close.

Another item that pushed the price of Oil higher, was news, not to be taken lightly, that 2 missiles from Russia found their way into Poland, killing two…  I don’t know if these were stray missiles, but I doubt that seriously, because of the technology that these weapons have these days, make them quite accurate. So, was this an attempt by Russia to draw more countries into this conflict? I sure hope not, and so far Poland has not returned fire, nor do I expect them to… But all of this saber rattling has got the price of Oil bubbling, and Gold well bid…

In a follow up of what I was talking about in a previous Pfennig, CNBC.com reports that: “Households increased debt during the third quarter at the fastest pace in 15 years due to hefty increases in credit card usage and mortgage balances, the Federal Reserve reported Tuesday.

 

Total debt jumped by $351 billion for the July-to-September period, the largest nominal quarterly increase since 2007, bringing the collective household IOU in the U.S. to a fresh record $16.5 trillion. That’s an increase of 2.2% from the previous quarter and 8.3% from a year ago.

The increase follows a $310 billion jump in the second quarter and represents a $1.27 trillion annual increase.”

Chuck again… yes, well I would think that inflation is a main culprit here, as all the things that people have been buying in recent times, have gotten very expensive, and the costs go up, so does the credit card balances, and the home loan balances, and so on…

OK, longtime readers know that I’ve talked about a supply crunch in Silver for years now, and it has never actually come to pass, because of outside interference. But… I saw this on Kitco.com today, and thought it was a good reminder of the supply crunch that Silver is currently in… here you go: “The stocks of silver held by the London Bullion Market Association and the Comex, in New York, are thinning out. Silver inventories in London (the LMBA) have fallen for 10 straight months and are now sitting at a new record low of just over 27,100 tonnes, or 871.3 million ounces.

On the Comex, registered silver totals just 1,186 tonnes, or 38.13Moz, a five-year low. In September the LBMA vaults lost 45.166Moz, more than the Comex’s entire registered category.

Analysts are keeping a close eye on declining silver stocks worldwide, including Sprott Money, which wrote an article on the subject. The article references a column by Bullion Star’s Ronan Manly, in which he states that “There is an unprecedented situation emerging in London, where the relentless hemorrhaging of one of the world’s largest stockpiles of silver is now well and truly under way.” -Kitco.com

Chuck again… As long as the Big 8 Bullion Banks are allowed to hold short positions in Silver that far outweigh the Silver that’s above the ground, then Silver will never be able to be priced correctly, as far as supply and demand are concerned… I’m just saying…

In Today’s Data Cupboard we have the Rocktober print of Retail Sales, which I told you earlier in the week, that I expected this to show some life after months of being either negative or flat. The BHI indicates that it will be a stronger print today. We’ll also see Rocktober prints of Industrial Production, I think it will show weakness, and Capacity Utilization, I think it will be steady Eddie…

You know, it make me want to yell at the walls, when I see all these Fed Heads our on the speaking circuit… Who pays for those boondoggles? Ahem… Besides, they never rally tell us what’s going on at the Fed HDQTRS….  We will see 2 Fed Head speakers today, and tomorrow there will be 4!  UGH!

To recap.. The dollar started the day up but by the end of day it was still up, but not by as much as the start of the day. Russia fired two missiles into Poland, and that got the world all jimmied up pushed the price of Oil higher, and Gold got well bid…  OPEC announced they will discuss further production cuts, and that too helped Oil to gain yesterday. The overnight markets kept the pressure on the dollar, and it will be interesting to see what goes on today, with a couple of real economic reports on the docket.

For What It’s Worth… This is a very good article that straightens out all the claims by the current administration that the inflation is “greedflation” and that companies are pushing prices up to gouge customers… I never believed that, and now there’s this article: Why “Greedflation” Isn’t Real – DollarCollapse.com

Or, here’s your snippet: “Even as price inflation slows and we move past June’s peak, progressives continue to push the concept of “greedflation”—that this year’s price inflation is caused by corporate greed and price gouging. This is inaccurate, based on bad economics, and it blames a consequence of the problem rather than the problem itself. If we want to address the real issues in the economy and avoid similar pain in the future, we need to get serious and drop “greedflation” from the discussion.

The standard response to the assertion that this episode of price inflation has been caused by greed is to point out that there is no reason to think the level of “greed” in the economy has suddenly increased. That is true, but it doesn’t address the core of the “greedflation” argument. Most proponents will admit that the price inflation was kicked off by supply shortages resulting from the lockdowns. But they will argue that in an environment where everyone is talking about and expecting inflation, companies can raise prices even higher than rising costs would have compelled them. Companies can then enjoy larger profits, the story goes, at the expense of already struggling consumers.

So what’s the problem with this? Well, it rests on a common but flawed understanding of prices. People often talk about prices in two contradictory ways. Either they frame them as objective measurements of value or as arbitrary numbers made up by businesses. Neither of these characterizations is correct. Prices are not an indication of objective value. In fact, they come about through exchanges between people with expressly different valuations of the goods and services being traded.

If you try to sell me a cup of coffee for $4, you demonstrate that you value the $4 more than the cup of coffee. Notably, the exchange will only occur if I value the cup of coffee more than the $4 I’d be giving up. So prices are records of exchange ratios brought about by differing subjective valuations. Whenever you choose not to buy something you can technically afford, you reveal the subjective nature of prices.

In that same way, prices are not arbitrary. As Thomas Sowell writes in the opening pages of his book Basic Economics, “While you may put whatever price you wish on the goods or services you provide, those prices will become economic realities only if others are willing to pay them.” Going back to the above example, you are free to jack up the price of your cup of coffee as high as you please, but you will not sell it until you charge a price someone is willing to pay. That’s why the very concept of price gouging is flawed. You may not personally like how high the price is, but others still consider it a worthwhile deal.

The fact that companies are charging higher prices these days does not mean those prices are somehow wrong. In fact, we know they are not wrong because people have demonstrated a willingness to pay them. In other words, this year’s higher prices are not the problem—they merely reflect the problem. Instead, the real issue is that State governments locked down businesses in 2020 while the Federal government created trillions of new dollars and injected them directly into the economy in 2020 and 2021.”

Chuck again… I know, I know, a very long snippet this morning, but.. the article is quite long, and if you have the time to click on the link and read it, well… then you’ll see why it was a long snippet…

Market Prices 11/16/2002: American Style: A$ .6777, kiwi .6170, C$ .7547, euro 1.0425, sterling 1.1908, Swiss $1.0640, European Style: rand 17.2217, krone 9.9425, SEK 10.4155, forint 390.28, zloty 4.5127, koruna 23.3474, RUB 60.47, yen 139.47, sing 1.3675, HKD 7.8225, INR 81.30, China 7.0794, peso 19.35, BRL 5.3260, BBDXY 1,272.13, Dollar Index 106.00, Oil $87.35, 10-year 3.78%, Silver $21.92, Platinum $1,021.00, Palladium $2,096.00, Copper $3.76, and Gold… $1,781.67

That’s it for today… Well, a couple of years ago, I told my kids that when their mom is away, and I’m all alone at home, they might want to check in with me, since my health history isn’t the greatest… And this year they’ve finally gotten the message. Thank you Dawn, and Andrew… Our Blues get back on the ice tonight VS the Blackhawks.. This used to be a HUGE rivalry, but in recent years, the two teams have been in different divisions, and don’t play each other that much… Let’s Go Blues! Tomorrow night, downtown St. Louis and nearby will be crazy, with two soccer games, and a hockey game going on… I hope all three are well attended, and ready to cheer! Our new soccer stadium will make its premiere opening tonight… That’s pretty neat… Vince Guaraldi Trio takes us to the finish line today with his song: Charlie Brown Theme… I hope you have a Wonderful Wednesday today, and please remember To Be Good To Yourself!

Chuck Butler

November 15, 2022

* Currencies & metals get sold early, rally late

* Overnight the dollar gets sold… 

Good Day! And a Tom Terrific Tuesday to you! Well, as you can tell, the Pfennig is a little later this morning than usual… The alarm went off, and I went right back to sleep, for I had a rough night, with my stomach… No biggie, just chemo stuff… I’m good to go today! I’m glad that years ago, I decided to take my chemo at night, so that if I had problems, they were during the night, and not during the day, when I needed to work, etc. From those dark days of a few years ago, when I was curled up in chair, and didn’t want to move, to these days, when I’m up moving, and going places… I have to say there’s a HUGE difference… The Stephen Kummer Trio greet me this morning from their album: Christmas In The City, and their song: When My Heart Finds Christmas…

Well, yesterday, was a strange one… The day started with the dollar being bought, and the BBDXY Index up 5 index points, and Gold down $12, and had all the inklings of a bad day for the currencies and metals, but that never came to fruition… And all day the currencies & Gold fought back, and at the end of the day, the BBDXY was up 3 index points, and Gold had turned that negative $12 loss into a 30-cent gain! I know, 30-cents is a long way from the $49 gain Gold had last Thursday, but hey! It was positive, and not negative, right? The euro remained above $1.03, and the Aussie dollar (A$) climbed over the 67-cents handle, and kiwi climbed over the 61-cent handle… These two have been the fastest moving currencies VS the dollar since last Thursday…  Yen has wrapped a tourniquet around the bleeding it has been experiencing for over a month now, and has rallied nicely VS the dollar… There’s something there that I have to say, that’s not good about either currency… you know the dollar was getting sold widely, when the yen rallies…

So, Gold ended the day at $1,72.60, and Silver ended the day at $22.08… That’s the first time we’ve seen Silver back over $22 since 2014… I know that couldn’t be right, no? Well, according to the dollar/ Silver chart I looked at last night, it was 2014…  Any way, it’s been a long time for Silver to get back into the game… Of course $22 is not what you and I would pay for Silver these days… The premiums are still outrageous, indicating the lack of supply in Silver… And it illustrates a picture that I’ve tried to paint for you previously, and that is… When the stars are aligned and the karma is flowing, and physical Gold & Silver are getting bought by the masses, the supply will become drained, and the premiums, if they are outrageous now, will be more than outrageous… So… What are you waiting on?

The price of Oil slipped again and ended the day trading with an $85 handle… That’s not the direction for Oil that our friends (NOT!) at OPEC wanted to see for Oil… Ahh, the best laid plans of mice and men, eh? I think they need to look further out on the horizon to see Oil climbing in price once again…

The 10-year’s yield rose yesterday and ended the day with a 3.88% yield. I told you yesterday, that I thought that calmer heads would come to the head of the class, and calm things down, an that is what it appears to have happened.

The overnight markets last night…  The dollar was sold to the tune of 9 index points off of the BBDXY dollar index. The euro is trading above 1.04 this morning, and the yen is moving in the right direction too. Gold is up $4 in the early trading today, while Silver sees some profit taking moving it back below $22 this morning with a 22-cent loss.  The price of Oil has slipped again, and trades this morning with an $84 handle, and Bonds are drifting… So, I guess that Oil’s future is all dependent on the timing of China’s opening / ending their zero Covid. You may recall that when it was rumored that China was going to open up, that all the anti-dollar assets, including Oil rallied strongly…

Well, I wanted to talk about this yesterday, and then plum forgot…Another “senior moment”…  Remember John Corzine? He of the Wall Street golden boys, and went to start his own firm, only to have the whole thing blow up in his face, as he was guilty of taking client funds and trading them like the Company’s money… And after all the shame was placed on him, a few years later, he ran and became the Gov. of New Jersey!

The reason I bring this up, is that the FTX, let’s call him SBF, stared the crypto clearing company, and then began to move client funds to his trading partner firm…Sound familiar? Oh, and now there’s $1-$2 Billion missing… Wait! What?  Yeah, it’s missing… And probably lost in the market…  So, and bets on whether SBF is absolved of his crimes, in few years?    I would almost bet on that one!

One of the things that propel inflation higher is “expectations”.. People believe that the prices they are going to pay for a new car will be higher in a couple of months, so they rush out to buy it now, and that propels inflation higher.. .So, expectations are very important to the Fed Heads when they look at inflation… I’ve told you before that the Fed Heads don’t really pay attention to the stupid CPI, but instead follow the PCE (personal consumption expenditures), and the expectations…  Well, a day after the stupid CPI printed, the preliminary November data showed that inflation expectations rose for the second straight month with 1-year expected up from 5.0% to 5.1% and 5-10Y expected up from 2.9% to 3.0%

I know, if you’re like me, Lord help you!, You are laughing at the irony of these reports… The Fed Heads and their expectations of inflation… So, did you ask yourself this question, like I did, “I wonder when they began to expect inflation when they flatly denied it existed a year ago? “

Recall that I drew the picture for you sometime back, about how eventually, these rising prices will get to a breaking point, and when they do, that’s when the mobs of people show up at the Eccles Bldg., and demand the Fed Heads… I said that back when Sri Lanka was throwing their leader out, for allowing inflation to soar in that country… Well, news this past weekend had worker in Greece and Belgium striking because their wages aren’t keeping up with inflation… See, how this all reached a boiling point? We, as a country, are more tame than other countries, but still… there will be plenty of people at the boiling point that need to vent their frustrations…

The city of St. Louis, is getting an MLS expansion team… This has been in the works for a couple of years now… Thanks to my former colleague and good friend, Ty Keough, I’m a part of the initial season ticket holders’ group for the new team that will begin play in Feb…  Those could be some really Cold games, brrr…   And I won’t be here to attend them! Rick? You’re up buddy!

St. Louis City FC…  not exactly a fancy name, but I think it works…

OK, back to the markets… Hey! I’ve got to have those breaks to clear my mind for a minute or two, and then pick it up again.. .So… here we go….  This past weekend I saw a Twitter comment from Sven Nordgren, of whom I’ve quoted before,  so I had to check it out to see what he was referring to… And this is it… read this slowly so you get what I’m aiming for: “FED’S WALLER: THE FED WAS CAUGHT OFF GUARD IN 2021 WHEN INFLATION APPEARED TO MODERATE BEFORE EXPLODING.”

Well, I’m with Sven on this one as he replied “That’s utter Bull238#: How can you say things like that with a straight face? I would be laughing out loud and spewing spit all over from how riotous this statement that they made me make! 

Maybe you got a little too descriptive there Chuck?   Oh, well.. I’m sorry if I disgusted anyone, it’s not the first time nor the last time I will do that!

I found this on zerohedge.com last weekend… “In all the chaos over the past few days, we missed the release of the Fed’s latest Senior Loan Officer Survey which came out Monday. The results were striking: as one would expect from an economy in recession (and in some cases, depression), in nearly all categories, banks are reporting both tighter lending standards and sliding demand for new loans — and nowhere more so than in mortgages, both qualifying and otherwise, where demand has collapsed to “depression” levels as a result of the fastest every surge in interest rates.

But loan supply and demand aside, the punchline from the survey is that “most banks assigned probabilities between 40 and 80 percent to the likelihood of a recession in the next 12 months, with no bank reporting a probability less than 20 percent. Although banks in general assigned relatively high probabilities to a recession occurring in the next 12 months, most banks reported expecting the recession to be mild to moderate, should one occur. In addition, most foreign banks assigned a probability between 40 and 80 percent that a recession would occur in the next 12 months.”

Chuck again… just another in our collection of signs of a recession…

The U.S. Data Cupboard just has the Producer Prices Index (PPI) for Rocktober for us today, and it should continue to show that wholesale inflation is still perking along and sending higher prices to the retail operations… Tomorrow’s Data Cupboard is the big print of the week, with Retail Sales for Rocktober… So, until then, we have to make do with PPI…

To recap… The day began yesterday with the dollar getting bought, and Gold down $12, but the day ended with the dollar only up a bit, and Gold closing the day with a 30-cent gain Maybe calmer heads prevailed yesterday… I guess we’ll have to continue to monitor the trading each day, like I don’t do that any way!

For What It’s Worth… Well, a couple of years ago, I used to write a monthly letter for the Aden Sisters, Pamela, and Mary Anne, and in one of those letters I wrote about how the Central Banks were loading up with U.S. stocks, and pointed out that the Swiss National Bank (SNB) had really taken the Nestea plunge into U.S. stocks.. .Well, this article is about how they are now unloading those stocks… Uh-Oh… and it can be found here: https://wolfstreet.com/2022/11/11/the-swiss-national-bank-began-unloading-its-biggest-us-stock-holdings-incl-apple-microsoft-amazon-alphabet-meta/

Or, here’s your snippet: “The Swiss National Bank has spent years creating Swiss francs, buying dollars, euros, and other currencies with those francs, and then buying assets denominated in those currencies – including a vast portfolio of US stocks.

But that gig is up, it seems. Asset prices have fallen sharply, and the SNB is unloading. It doesn’t disclose details on its balance sheet, but it has to disclose its US stock holdings in quarterly regulatory filings with the SEC, and it now filed its Form 13F for its Q3 holdings. We’ll get to those in a moment.

The total of “Foreign currency investments” on its balance sheet – which includes US stock holdings plus its other foreign currency investments – peaked in February 2022 at CHF 977 billion ($1.04 trillion at today’s exchange rate). By the end of September 2022, they’d plunged by 17%, or by CHF 160 billion, to CHF 808 billion, the lowest since March 2020:

The composition of the CHF 160 billion plunge in its holdings is a mix of market prices, asset sales, and exchange rates of the CHF to the currencies involved.

From the SNB’s filings of Form 13F with the SEC, we can see that the SNB not only took losses from the price declines of its US stock holdings, but that it also sold down most of its largest positions, reducing the number of shares it holds in Apple, Microsoft, Alphabet, Amazon, Meta, etc.

From June 30 through September 30, the value of the SNB’s US stock holdings fell by 8.0 billion, or by 5.4”.

Chuck again… Well, I love it when a thought comes to fruition… you see in that letter about the SNB buying stocks I wrote about how when the stocks finally turn around, that the SNB would incur losses… of great magnitude, since their holding were HUGE!

Market Prices 11/15/2022: American Style: A$ .6748, kiwi .6158, C$ .7535, euro 1.0429, sterling 1.1956, Swiss $1.0429, European Style: rand 17.1947, krone 9.9235, SEK 10.3717, forint 389.83, zloty 4.5075, koruna 23.3222, RUB 60.57, yen 138.62, sing 1.3672, HKD 7.8267, INR 81.10, China 7.0378, peso 19.26, BRL 5.3260, BBDXY 1,2868.40, Dollar Index 105.81, Oil $84.82, 10-year 3.80%, Silver $21.86, Platinum $1,036.00, Palladium $2,094.00, Copper $3.77, and Gold… $1,776.01

That’s it for today… Tomorrow night we’ll have two soccer games in town… The City 2 team (mnor league) will play a team from Germany at our brand spanking new stadium, while across town the St. Louis U. Billikens men’s soccer team will play a 1^st round game in the NCAA Tournament. Our Blues have closed the book on their 3^rd period collapses, as they traveled to Colorado to play the defending Stanley Cup Champions last night and won!  Let’s hope they never revisit that chapter!   I’m waiting on any news of a Cardinals’ player acquisition… Free Agent signee, trade, waiver wire transaction, anything to keep baseball on our minds… Jack Jezzro takes us to the finish line with a song from his album: Bossa Nova Christmas, Home For the Holidays… I hope everyone can be near family at Christmas… I’m just saying… I hope you have a Tom Terrific Tuesday today, and please, pretty please with sugar on top, Be Good To Yourself!

Chuck Butler

November 14, 2022

* currencies & metals soar on Thursday & Friday 

* Consumer Debts begin to pile up… 

Good Day… And a Marvelous Monday to you! Man, it got cold here this past weekend… Have I told you lately how much I abhor cold weather? I don’t like winter coats, scarfs, gloves, etc. while it never got above 40 here, it was 80 in S. Florida, where my wife is… Why on earth am I still here, I asked myself?  Our Blues have seemed to have righted the ship, and have won two games in a row… That was a tough time to be a Blues fan, during their 8-game losing streak… My beloved Mizzou Tigers hung with the highly rated Tennessee team until late on Saturday, when the Vols decided to run up the score on the Tigers… We’ll just put that in our memory bank, and it will come back to them one day…   The Stephan Kummer Trio greets me this morning with their version of the song: My Favorite Things…

Well, bust my buttons! The dollar sure went into a free fall last week… After range trading for the fist part of the week, the BBDXY saw the index number begin to pile up in a negative way, once the stupid CPI printed on Thursday morning. So, let’s talk about this right here and now…  The stupid CPI showed that inflation had dropped from 8.2% to 7.7%, and you would have thought that it had dropped to 2%, by the way traders and investors reacted! Stocks soared, Gold Soared, and the dollar got sold. I’m not buying into the frame of mind going through the markets right now, that inflation is on its way down, and all will be right in the U.S. I know these people don’t read the Pfennig, otherwise they would know that the stupid CPI is just that… Stupid!

So, the BBDXY lost 26 index points on Thursday, and then followed that up with 17 index points lost on Friday, totaling 43 index points to close the week that the index lost, closing on Friday at 1,275.89. With the dollar getting sold like funnel cakes at a State Fair, Gold was the beneficiary… Gold gained $49 on Thursday and followed that up with a gain of $15 on Friday. Silver got into the fray, with a gain of 63-cents on Thursday, and then just 3-cents on Friday. I’m sure there were tons of shot Silver futures contracts/ paper trades to deal with on Friday…

The currencies saw some love thrown their way for the first time in a month of Sundays… The euro rallied to trade at $1.03…  The Aussie & Kiwi dollars really got bought, because of their interest rates structures compared to the rest of the world, and so it was, that they were sought out by traders and investors. So, is this the end of the strong dollar trend?  Well, I think that this week will tell us if that’s to be… If we continue to see dollar selling this week, after the dust has settled on the stupid CPI from last week, then we can be somewhat assured that this is a new trend, if we don’t see more dollar selling this week, then we can be somewhat assured that either 1. The PPT has stepped in to protect the dollar, or 2. Calmer heads have stepped in, and don’t believe inflation is tamed, etc.  

You see… that IF the Fed were to take the bait and cast their line into the “no more rate hikes pond”, it would allow inflation to grow even faster, and then when the Fed realized their mistake they would have to recover quickly, and aggressively… The markets at that point would be so through with the Fed, that they would take it out on the dollar…  I really do think that these “inflation is tamed so the Fed won’t need to hike rates further” folks, are going to get their rear ends handed to them…

The price of Oil gained $1 on Thursday and $2 on Friday, to end the week with an $88 handle… And it was never so clear or illustrated so well, that traders believe inflation is tamed, and that the Fed won’t be hiking rates again, than the trading of bonds… The 10-year’s yield dropped to 3.81%… That’s a ton of buying, folks… trust me on that, I used to sit on the bond Trading desk at Mark Twain Bank, and would watch the movements in Bonds… It takes a lot of buying or selling to move yields like that…

So, to me, if the traders and investors want to think that inflation is tamed, go ahead… I’ll be sure to point out how wrong you were, at some time in the future…

In the overnight markets last night, the selling of the dollar ended, with the BBDXY gaining 5 index points last night. But 5 index points aren’t going to move the currencies off their newfound levels. Gold is seeing some selling in the early morning trading, with Gold down $12, and Silver down 28-cents… There had to be some profit taking going on, and I think that this will iron itself out, as we go along… I’m sure the Fed Heads that will be out speaking in the coming days will be talking about how inflation pressures are slow to move, and that they will remain vigilant in their attempt to bring inflation back to 2%… At least that’s what I would be doing if I were in their shoes… No, wait! There’s no way I would be in their shoes! I would be shunned by the other Fed Heads, for being the rebel rouser, always voting opposite of the way they vote… Well, come to think of it, that may be fun… I’ll have to think on this some more…

OK… I know that most of your dear readers are of the same thoughts that I have that we’re doomed, to face a change of our monetary system, as we have beaten and destroyed this one to beyond recognition… But I look around and people are still spending money on gee gaws, and tchotchkes, and everything else that’s out there, and I wonder, “how in the world do they have that kind of disposable income, after paying for food, energy, housing, and cell phones?”  And then I see this data from the Federal Reserve Bank of St. Louis (FRED)… During the second quarter of 2022, credit card debt in the US rocketed to $887 Billion outstanding, up a whopping 13% since the same period last year. All in, total household debt is up 2% from Q2, 2021, an increase of $312 Billion to $16.5 Trillion. 

Mortgage balances, too, were up $207 Billion over the same period, totaling $11.4 Trillion as of the end of June.

In case you didn’t notice That’s a Billion and a Trillion with capital B & T!  And I know what’s on the mind of these folks running up their credit card accounts… At some point, the amount of credit will be so large that and underwater that the Gov’t will have to bail them out… I wouldn’t be hanging my hat on that happening any time soon, and in the meantime, these folks will be paying 19% interest on their debit balances… I don’t see how this ends without tears… I’m just saying…

Speaking of getting what you deserve… Nah, I don’t want to go here… I was going to talk about how the young folks voted, but I decided not to…let’s move on, here for these are not the droids we’re looking for…

Well, the news from La-La land last week was not good… Facebook, I mean Meta laid off 11,000 workers, and Twitter’s new boss handed out a lot of pink slips, and then there was this bit of news that really should be shaking the foundations of a strong economy… As FreightWaves reports, truck brokerage giant C.H. Robinson Worldwide Inc. is laying off between 1,000 and 1,200 employees, most of whom are at the vice president and general manager level, according to sources familiar with the situation. I’m sure there are many more to report here, but just the fact that Twitter, et al were axing people, should tell you where this is going…

OK… longtime readers know that I have a special place in my heart for the Canadian Loonie… Well, that is, did have a place… I learned this week something that I know I heard about back in the day, but didn’t think too much about, and that is that Canada sold all of its Gold holding back in the early 2000’s… This is from the website The record.com, but you have to subscribe to read it, so it’s onto what I could pull…

“Canada sold all of its gold holdings over the past 20 years, mostly at rock bottom prices in the early 2000s, much to the astonishment of the “hard-money” crowd and almost anyone who has read a book on economic history.

In a May 2022 interview with Kitco news, former Bank of Canada (BoC) Gov. David Dodge explained the reasoning behind the bank’s decision to off-load its gold holdings. “The issue is quite clear, that it costs to hold gold, whereas holding U.S. or Chinese or Euro bonds yields you a return,” said Dodge. “That was a strong view. And a view that our international monetary system was in a place that was sufficiently robust that holding this antique instrument of stability called gold really didn’t make any sense.”

To suggest he was flat out wrong would be kind. While storage costs are a factor in holding gold, it should be noted that since 2000, gold has gone up six-fold and outperformed numerous assets, including the S&P 500. And worse still, the bond returns Dodge was referring to have hovered close to zero since Canada dumped its gold.”

Chuck again, Yeah, about that statement, I can hear Mr. Dodge saying right now, “Did I say that out loud?”

That was some news about FTX eh? It is being reported that between $1 and $2 Billion in client funds are missing… Uh-Oh… The firm filed for bankruptcy last week… What on earth will the baseball umpires wear on their shirts now?  See? That’s how strangely my mind goes from one thing to another!

The U.S. Data Cupboard will only have one day this week, where it yields real economic data, and that day is Wednesday, when Rocktober prints of Retail Sales, Industrial Production, and Capacity Utilization come to life… Well, with the news I reported above about credit card balances going through the roof, I could see Retail Sales seeing a nice gain in Rocktober… The BHI is indicating that too…

To recap… The dollar got whacked and whacked badly on Thursday after the softer, stupid CPI printed and showed inflation had dropped in Rocktober… And Friday the dollar got sold again, and each day saw Gold put in nice gains, along with the currencies like the euro, A$ and kiwi. Oil gained, bonds rallied, and stocks, well, they skyrocketed… FTX has a problem, Houston…  And consumers are piling up their credit card debts… Uh-Oh…

For What It’s Worth… Since I made Big Deal out of consumer debts this morning, this article from zerohedge.com plays well in the sand with it… This is about auto loans and it can be found here: https://www.zerohedge.com/personal-finance/auto-loan-delinquencies-hit-10-year-highs

Or, here’s your snippet: With prices rising and real wages falling, many Americans are struggling to make ends meet. They are increasingly turning to credit cards and other debt to fill the gap. But that creates other problems. Debt has to be repaid and a growing number of Americans are struggling to keep up with payments.

“TransUnion tracks more than 81 million auto loans in the United States. According to the consumer credit reporting agency, 1.65% of auto loans were at least 60 days delinquent in the third quarter. That is the highest rate for 60-day-plus delinquencies in more than a decade.

TransUnion senior vice-president Satyan Merchant told CNBC inflation was making it difficult for people to keep up with their car payments.

Consumers still want to stay current as best that they can. It’s just this inflationary environment is making it challenging. It leaves fewer dollars in their pocket to make the auto loan payment, because they’ve got to pay more for eggs and milk and other things.”

Unsurprisingly, subprime borrowers are having the most difficult time keeping up with their payments.

With loan-accommodation programs implemented during the pandemic, some borrowers managed to avoid delinquency. As those programs have ended, delinquencies have spiked. Merchant told CNBC that these programs pushed some delinquencies into the future.

According to TransUnion, 200,000 borrowers who took advantage of the pandemic-era auto loan accommodation programs are now listed as 60 days delinquent.

Like mortgage rates, auto loan rates have increased significantly since the Fed started pushing up rates to battle inflation. The average interest rate on new-vehicle loans rose to 5.2% in Q3. Interest rates on used vehicle loans average 9.7%. Combined with the rising cost of both new and used vehicles, along with rising fuel prices, the cost of owning a car continues to rise dramatically.”

Chuck again… I’ll say this one more… Debt is slavery… I’ll say nothing more…

Market Prices 11/14/2022: American Style: A$.6685, kiwi .6082, C$ .7525, euro 1.0317, sterling 1.1800, Swiss $1.0580, European Style: rand 17.2817, krone 9.9962, SEK 10.4328, forint 394.60, zloty 4.5454, koruna 23.5384, RUB 60.46, yen 140.33, sing 1.3739, HKD 7.8352, INR 81.26, China 7.0650, peso 19.47, BRL 5.2905, BBDXY 1,280.45, Dollar Index 106.78, Oil $87.78, 10-year 3.88%, Silver $21.52, Platinum $1,009.00, Palladium $2,008.00, Copper $3.75, and Gold… $1,760.24

That’s it for today…  Well, I’ve come down with something… it feels like a head cold, but I don’t feel sick, real strange, although I am sleeping longer each day now… That’s my body telling me I need the rest… 10-days to 2 weeks, and it’ll be gone… Just in time for Thanksgiving! I’m all alone by myself here again, that means I can turn up the volume on the music that I play in the morning! HA!  All by myself, don’t wanna be all by myself, any more… (Eric Carmen) And I didn’t call Pizza Man Pizza once this past weekend!  I see where we might get some snow on Tuesday this week… that would top of my dislike of November even more! Oh, well, I’ll be in S. Florida by year end, so I’ll just have to be patient!  Beegie Adair takes us to the finish line today with her version of the song: Home For the Holidays…  I hope you have a Marvelous Monday today… And Please Be Good To Yourself!

Chuck Butler

November 10, 2022

*currencies & metals drift ahead of the CPI print

* Don’t Forget to say, “Thank You” to a veteran… 

Good Day… And a Tub Thumpin’ Thursday to one and all! Well, no baseball, no hockey, and some MAC college football game on, led me to my writing desk to read emails that I hadn’t gotten to yesterday, during the day, because it was so darn beautiful outside. The weather people tell me that we’ll have one more day of unseasonably warm weather, and then the bottom drops out and we return to normal, gray skies, cold raw, dreary, November days… In my reading last night, I came away convinced that I’m on the right track here with my thoughts that I’ve shared with you all…  The Eddie Higgins group greet me this morning with their version of one of my fave Christmas songs: The Christmas Waltz

The dollar stopped getting sold yesterday, and maybe just for a day, it would appear to me to be a brief correction of sorts. During the last weak dollar trend, not every day saw the dollar getting sold, and I would always remind people that “A Trend Is Not A One Way Street”…  So, unless we see consecutive days of dollar buying, then I would not be afraid to say that that a prolonged dollar selling period is upon us… The BBDXY gained 6 index points yesterday, but as soon as the U.S. trading session ended, the BBDXY was already giving back a couple of index points. The euro remained above parity with the dollar, and that was a good sign toward the thought I had above…

Gold is up one day, down the next, and the up days are monster days of gains, while the down days are meh… So, that leads me to believe that Gold has turned the corner… Gold lost $5.90 yesterday to close at $1,707.70, and Silver lost 29-cents to close at $21.13…  The price of Oil lost $2 in trading yesterday and ended the day with an $85 handle… Proving once again that Chuck gave it the kiss of death, when he talked about how he saw Oil returning to the $100 level… Not so fast Tim!   With China still on Covid lockdown, the demand is watered down, and so I get why the price of Oil has slid this week…

The 10-year Treasury rallied yesterday, with the yield dropping to 4.09% from 4.13%, to start the day. Remember, when bond yields go down, the price of the bond goes up, and vice versa…  So, someone was buying the 10-year yesterday… Why? Oh, well, it is, what it is…

In the overnight markets last night…  There was little to no movement in the currencies or the metals, with the BBDXY only off pennies, and Gold up just pennies… I think the traders were of the mind to just sit back and wait for the stupid CPI print that will come to us this morning. As I told you yesterday, traders are of the mind that has consumer inflation falling below 8% for Rocktober, and if that’s what happens, then they believe the Fed Heads rate hikes won’t continue to be so aggressive, and that thought brings us to a weaker dollar… The thigh bone is connected to the knee bone, that’s connected to the shin bone, etc. Sometimes you have to follow the string of events to get to what’s really eating at Traders…

The price of Oil is weaker by pennies this morning and trades with an $85 handle, and Bonds didn’t move one iota overnight… So, everyone is on board with the wait-n-see what CPI brings us thought of mind this morning… To me, I don’t think today’s stupid CPI will actually tell us anything important… Inflation is not getting beaten back, and any slippage of consumer inflation is a matter of how much the data was massaged, marinated and cooked, in my opinion…

I’ve been quite wordy this week in each Pfennig…I hope to put an end to that trend, today…  Well, I was surprised to see that my fellow Missouri voters, voted to legalize pot… The image of folks in Missouri by those on the East Coast, is well deserved…We are steady in our ways, we don’t jump off cliffs for the latest fads, we don’t go hog wild with false idols, etc. and therefore, I was sure that the legalize pot vote would e no…  Hmmm… 

OK… onto the ways of the world, and other things…  I read last night that consumer confidence in housing hit the skids in Rocktober, and Just 16% of consumers said they felt it was a good time to buy a house in Rocktober, according to Fannie Mae’s monthly survey. That figure marked a record low since the survey was first conducted in 2011. It was only a matter of time before the housing sector succumbed to the aggressive rate hikes by the Fed Heads.. .But the housing bubble was in need of finding a pin to pop it, and I do believe that the rate hikes have become that pin…

So, we have that going for us, coming up soon… Bill Bonner refers to the markets before this all began, as the Bubble Epoch…or the everything bubble…   That included stocks, bonds, housing, and then the list becomes crazy, with the likes of Bitcoin, and the other things that have been brought to the market, that have been outrageously priced..

So, the next bubble to pop after housing, will be stocks… I don’t know when or how deep it will be, but the bubble will be popped…  Once again last week, James Rickards, said that the stock market would collapse at 2:00 pm EST last Wednesday, after the Fed announced their rate hike… This was the 4^th time he had noted a time and date for the stock market collapse… Yes, the stock market is off 20-something percent, but collapsed? Well, I’ll let you make that call… I just don’t think putting dates an times on things that might happen, even if you’re absolutely certain that they will happen is just nuts…   I’m just saying..

I carried on yesterday with regard to what if we, as a country, had remained on the Gold Standard… That got me thinking about when I told you that Rep. Alex Mooney (R-WV) introduced bill HR9157 to congress to put the US back on a gold standard…  Now you and I know that the bill has a snowball’s chance in hell to get passed, but when asked about it, Rep. Mooney had this to say: “”The gold standard would protect against Washington’s irresponsible spending habits and the creation of money out of thin air,” Rep. Mooney said in a statement. “Prices would be shaped by economics rather than the instincts of bureaucrats. No longer would our economy be at the mercy of the Federal Reserve and reckless Washington spenders.”

Now, doesn’t that sound like a monetary policy we all would want to see in place?  So, why does the decision to go or not go to a Gold Standard, rest with Congress, and not with the American People? We The People… Everyone should send a note to their elected officials and tell them you want the U.S. dollar to be backed by Gold… 

Just think… I wouldn’t have anything to write about, and I would be put out to pasture, yet again… Let’s see, I was first put out to pasture by Mercantile Bank, then it was TIAA Bank, then the Gold Standard…Pretty good as far as I’m concerned, then I could write a blog about music… I’ve been asked to do that by a few readers through the years…

The U.S. Data Cupboard finally gets back on board today with some data prints that mean something… First up will be the usual Tub Thumpin’ Thursday fare of Weekly Initial Jobless Claims, then that will be followed by the Rocktober print of the stupid CPI, and finally the Real Hourly Earnings report…  Last month the Real Hourly Earnings Report showed that in Sept wages actually saw a drop…  So, wages certainly are not keeping up with inflation, and that can only go on for so long, before Moms and Pops all over the country throw their hands up in the air, and say “no mas!” Honey? Where’s that pitchfork? I need to call on someone….

To recap… The dollar’s consecutive days of getting sold came to an end yesterday… The BBDXY gained 6 index points yesterday, but the euro remained above parity with the dollar.  Gold & Silver also got sold yesterday, so it’s been up one day, down the next, with these two this week… That would mean that today is an up day… I guess we’ll see, eh?   Consumer Confidence with housing is at an all-time low, since records were being kept… Chuck called this the inevitable… The rate hikes by the Fed Heads were bound to become the pin the room to pop housing’s bubble…

For What It’s Worth… It’s been some time since I highlighted a report by Pam & Russ Martens, but that ends today, as they recently did a bang up job writing about the Fed’s Stability Report, and their report can be found here: Quietly, the Fed Releases Its Financial Stability Report and Lines Up a Scapegoat (wallstreetonparade.com)

Or, here’s your snippet: “One minute after the stock market closed on Friday, the Federal Reserve mailed out a link to its newly-released Financial Stability Report to folks who have signed up to get press releases from the Fed.

For those of you who have been reading our reports on the Fed for years – its unaccountable money printing and bailouts of Wall Street, the opaque activities of the trading floors owned by the New York Fed, its unchecked conflicts of interest, and its brazen, and as yet unprosecuted, trading scandal – you might suspect that the Fed would have pulled a lot of punches in its “Financial Stability Report.” You would be correct.

On the topic of derivatives, which remain the greatest risk at the mega banks on Wall Street, the word “derivatives” is mentioned just eight times in the report – with little clarity. For Wall Street On Parade’s multitude of warnings on the actual risks posed by derivatives, see our “Related Articles” below.

Another key risk to financial stability in the U.S. is the “interconnectedness” of the mega banks on Wall Street. This means that if one mega bank becomes insolvent or starts to teeter – as Citigroup did in 2008 – the systemic contagion spreads to the other mega banks that are counterparties to its derivatives, which in turn infects the entire financial system.

The word “interconnected” appears just four times in the Fed’s Financial Stability Report. The following text provides a picture of what the Fed would rather not talk about in any depth.

“Disruptions to economic activity or financial markets abroad can affect the United States through several channels. A pullback in risk-taking worldwide may cause further declines in asset prices and tighter credit conditions abroad and in the United States. Some U.S. investors would incur losses on foreign exposures, and foreign financial institutions would likely reduce lending to U.S. businesses. Foreign investors could sell Treasury securities and other safe U.S. assets, potentially adversely affecting financial-market functioning and the transmission of monetary policy. Foreign official holders might sell reserves to defend home currencies, and private holders might sell Treasury securities in the context of a widespread surge in demand for dollar cash buffers. Broader pressure on large internationally active foreign banks could — if sufficiently severe — result in material spillover to U.S. financial stability through strains on dollar funding markets (in which foreign banks are large participants) and interconnectedness with U.S. banks, although the effects would be mitigated by the resilience and sound capitalization of the U.S. banking system. More generally, modern financial markets are interconnected, so stresses abroad could lead to strains in U.S. markets and challenges for U.S. financial institutions.”

Chuck again… The Fed needs a scapegoat for when this all blows up in our faces… And Pam and Russ point out that “the Fed also wants to have a scapegoat lined up to point the finger at when things blow up, so it adds: “More generally, modern financial markets are interconnected, so stresses abroad could lead to strains in U.S. markets and challenges for U.S. financial institutions.”

Market Prices 11/10/2022: American Style: A$.6393, kiwi .5843, C$ .7370, euro .9995, sterling 1.1375, Swiss 1.0105, European Style: rand 17.8020, krone 10.4358, SEK 10.9375, forint 402.88, zloty 4.7356, koruna 24.5002, RUB 61.29, yen 146.49, sing 1.4038, HKD 7.8485, INR 81.81, China 7.2533, peso 19.57, BRL 5.1967, BBDXY 1,319.22, Dollar Index 110.89, Oil $85.27, 10-year 4.09%, Platinum $993.00, Palladium $1,849.00, Copper $3.62, and Gold… $1,707.96

That’s it for today… I hope all my neighbors in S. Florida have taken precautions with the strong Tropical Storm that will turn into a hurricane bearing down on our region… Hurricane Nicole, is going to give the Florida Treasure Coast a major headache… It had been a relatively quiet hurricane season in Florida, with only the devasting Ian that hit Florida last month on the Gulf side.. Well, we’re on our way to Thanksgiving, that will come in 2 more weeks… I know, how’d that happen, right? But first, we have Veteran’s Day tomorrow…This is a BIG DAY as far as I’m concerned, as I used to always take the day off of work,  to drive to Gerald Missouri, and visit my Dad’s, a WWII Veteran, grave site…  I’m thankful for all the veterans who fought wars to keep us safe and free… At Roger Dean Stadium, before each spring training game, they ask all veterans to stand so they can be recognized… I think all stadiums should do that!  Ok… Former colleague, Antione, sent me a note yesterday telling me his has Pandora’s Smooth Jazz Station on too! So, Jack Jezzro takes us to the finish line today with his version of the song: Here Comes Santa Claus… I hope you have a Tub Thumpin’ Thursday today, and don’t forget Veteran’s Day tomorrow… Please remember to Be Good To Yourself!   

Chuck Butler

November 9, 2022

* currencies & metals rally on Tuesday

* Gold turns the corner? 

Good Day… And a Wonderful Wednesday to you! Well, I decided that I needed to do something to bring the Blues losing streak to an end yesterday, so I donned by Blues hoodie, and Blues ball cap, over a blue and white shirt, and went to lunch! I received a couple of comments on it, and about the Blues losing streak, and all I could say was, “It’s my team, win, lose or draw”… It’s not like I haven’t gotten used to watching a team I adore lose… My beloved Mizzou Tigers can’t help but shoot themselves in the foot each and every game… It’s not always the Tigers’ fault, sometimes it really bad referee calls, like the one on last Saturday, and who can ever forget the 5 downs they refs gave to Colorado?  Our Blues lost  the game in Philly last night, so I guess it didn’t work, as The Philharmonic Symphony Orchestra greets me today with their version of the song: Sleigh Ride

The dollar got sold again yesterday… The markets, I read, were fearful of a red wave taking over the reins from the Blue crew. Why? Won’t it be the same-o, same-o, only with different guys and gals?  When push comes to shove in the economy, and corporations need bailouts, there won’t be one of the new crew to put their foot down, and say, “no!”, “you made your bed, now lay in it!”   Ok, I digress, but I just didn’t get the part about being fearful of new deficit spenders…

You see how jaded I’ve become about the whole election process? I don’t want to be this way, but it just creeps up on me, and the next thing I know… I’m saying things like I said above…   So, no matter what they said yesterday, the dollar lost ground, yet again, marking 3 consecutive trading days of losses… This time the BBDXY lost 9 index points to end the day at 1,312,  The euro climbed back above parity with the dollar, and the other currencies followed the Big Dog euro, as it left the porch to chase the dollar down the street…  It’s been some time since I’ve used that phrase… I’ve missed saying it!

And yesterday, I told you that the $4 loss that Gold was seeing in the early trading wouldn’t be that difficult to turn around… And turn it around Gold did just that, rallying all day, and ending up closing with a $37.10 gain, to close at $1,713.50… And Silver gained 53-cents to move over $21, AT $21.43…  Now let’s see if Gold & Silver can follow through on those nice gains yesterday… We ended Rocktober with Gold at $1,638…  That’s $75 in gains in 7 days… with most of the gain coming the last 3 trading days.

Has Gold turned the corner? The technical people would say that Gold passed the $1,680 and $1,700 levels that should bode well for it to continue to rise… Well, then who am I to argue with the chartists?

The price of Oil slid by $3 yesterday, and ended the day trading with an $88 handle… And Bonds hardly moved on the day…

So, with the dollar apparently in a free fall, I have to ask the question… “When does the PPT, come in with their treasure chest of funds in the Exchange Stabilization Fund to prop up the dollar once again?”  Just like the cancer wolf… I know he’s always at the door… And as Frank Sinatra sang, You can be riding high in April, and shot down in May… or something like that. (Hey, I can’t remember every lyric of every song I’ve ever heard, although I do try to!)

Or, maybe, just maybe, cause you never know, the PPT will sit on the sidelines this time? OK, I know that’s wishful thinking, but one has to wonder about their mental capacity if they buy dollars to prop it up and then the markets still take it down, ala the yen and the Bank of Japan?

In The overnight markets last night… Well, the currencies are trading in the same clothes as yesterday, as there was little to no movement in the dollar overnight. The BBDXY is up less than 1 index point this morning, and the euro remained above parity to the dollar. Gold is seeing some selling in the early trading today, and starts the day down $7, and Silver joins Gold trading in the red, and is down 19-cents this morning. Again, nothing out there that prevents these two from turning around on the day. 

The price of Oil has dropped another buck, and trades this morning with an $87 handle… The reports/ rumors earlier in the week that China was going to open their economy up, proved to be false, and now the fear that the Zero Covid program will continue longer, has traders questioning the demand for Oil, and so it sees some weakness…  Bonds remained unchanged during the night, so we start today with the 10-year Treasury’s yield at 4.13%… Certainly not as high as I would think it should be, but then when does logically thinking come into play in these manipulated markets?

Well… I had a very important lunch yesterday, with my former Boss, Frank Trotter, who brought me up to date with everything that’s going on in Kansas City, no wait, everything that’s going on with his new venture, Battle Bank…  They’re not ready for prime time yet, still getting their ducks in a row, and waiting on regulators… I think he mentioned next March for the virtual opening of www.Battlebank.com  if you go there, you can put your name and email info on a Waiting list, and when they are ready to launch, you’ll be notified… How’s that for service?  I personally, can’t wait for the opening, so I can move my banking balance from TIAA to BattleBank!   

Frank is gathering some very good people to join him in his new bank, and they will be service oriented, so look for that good personal service that EverBank used to give you!

Ok, now back to our regular programming…  A lot of news headlines last night, talked about how the dollar is getting sold ahead of the inflation data that will print on Thursday, and they all talked about how traders are looking to “risk on trades”, which means Gold…   Remember when every day I report whether it was a “risk-on day” or a “risk-off day”?  Those were the days my friend, I’m so glad that the ended!  But every now and then some writer pulls the phrase out of the closet, and brings it to show how smart he sounds… 

The thought for the stupid CPI is that it will show a weakening below 8% in Rocktober, and if that’s the case, then the markets feel that the Fed Heads have no choice but to pull back the size of their rate hikes…. Remember, these are the Wall Street guys that only care about stocks, and don’t care about inflation… To me they are just crybabies…   But what happens if the stupid CPI doesn’t show that much of a weakening in inflation?  Ahhh,  grasshopper, good question… I guess we’ll have to wait-n-see the color of the stupid CPI tomorrow…

Good friend, Dennis Miller of www.milleronthemoney.com sent me a link to the U.S. Treasury’s final balance sheet for fiscal year 2022, which ended Sept 30^th…  Total tax receipts and other income totaled $4,896 Billion, and total outlays were $6,272 Billion, for a total deficit for 2022 of $1,375 Trillion… The thing about the chart that stuck me as weird…The largest outlay for the U.S. is Social Security… But wait, didn’t we all pay into that fund? Yes, we did, and the Gov’t spent it… So, now when all the baby boomers, like me, retire and take their social security payments, it becomes a deficit for the Gov’t to pay out…   If they had only kept their dirty mitts out of the cookie jar, back in the day…

I have to say this now… I’ve been lucky, and so have just about everyone else that reaches retirement age, in that we lived during the greatest growth of wealth every recorded here in the U.S.  The Fed St. Louis, through their FRED division issued this statement: “U.S. national wealth has surged in the past decade, dwarfing the peaks seen in the past: specifically, from $69 trillion to $153 trillion between 2012 and 2021, a 220% rate of increase. National wealth has continued to rapidly increase even after controlling for inflation and economic growth.”

I would have to say that most of that growth in wealth has come from the decade long stock market bubble.. I wonder how that’s going to look in a couple of months from now?  And that brings me to say something that I told a group of bankers and lenders in Atlanta years ago… I said, “if the U.S. had remained on the Gold Standard, our quality of life would not see the excesses that we see today, because there wouldn’t be easy credit, or currency printing, instead there would be deficit adherence… So, we could do without some gee gaws, or tchotchkes,  100 inch tv screens, and what have you, but we wouldn’t have $31 Trillion in current Debt and $172 Trillion in Unfunded Liabilities hanging over our heads like the Sword of Damocles”…  We should have known better, that given free rein to print currency, that it would lead to what it has… But our leaders didn’t know better, or they thought that it was OK… as long as inflation didn’t rise up…Uh-Oh…

Last week, the Eurozone printed consumer inflation at 10.7% for the previous month… As far as I can tell, there are no substitution games, and weighting games played with their consumer inflation calculations… So, the ECB is so far behind the inflation 8 ball right now that it can hardly see the rest of the table… So, expect more 75 Basis Points rate hikes from the ECB, as they attempt to play catch-up… And this thought that more rate hikes are to come, even though the Eurozone is in negative real interest rates territory, is helping the euro climb out of its below parity hole…  These are the same thought regarding rate hikes coming that helped fuel the dollar’s surge this summer and fall, until now that is…

The U.S. Data Cupboard is still lacking today, so let’s move along, for these are not the droids we’re looking for…

To recap… The dollar got sold big time yesterday in the U.S. session, as the BBDXY lost 9 Index Points on the day, and the euro climbed over parity with the dollar. Gold has seen new life recently with a move being made because of inflation fears… Gold gained $37 yesterday, and Silver gained $53-cents, both moved beyond what was considered major levels or resistance… Chuck gives an update on the new BattleBank.com and says he can’t wait for it to open its virtual doors…

For What It’s Worth…  I found this on Ed Steer’s letter this morning, and you know that I’ve told you several times that if Ed thinks the article is worthy, then it’s a no-brainer for me!  This is an article about a Big Hedge Fund calling for armegeddon and it can be found here: Hedge-fund giant Elliott warns looming hyperinflation could lead to ‘global societal collapse’ (msn.com)

Or, here’s your snippet: “That’s executives at leading hedge-fund firm Elliott Management Corp. warning that the world is heading toward the worst financial crisis since World War II.

In a letter sent to investors, and reportedly seen by the Financial Times, the Florida-headquartered firm told clients that it believes the global economy is in an “extremely challenging” situation that could lead to hyperinflation.

Elliott did not respond to MarketWatch’s request for comment.

The firm, led by billionaire Paul Singer and Jonathan Pollock, told its clients that “investors should not assume they have ‘seen everything’ ” because they have been through the peaks and troughs of the 1987 crash, the dot-com boom and bust, the 2008 global financial crisis, and previous bear and bull markets.

It added that the “extraordinary” period of cheap money is coming to an end and has “made possible a set of outcomes that would be at or beyond the boundaries of the entire post-WWII period.”

The letter reportedly said the world is “on the path to hyperinflation,” which could lead to “global societal collapse and civil or international strife.”

Elliott reportedly argued that markets have not fallen enough yet and that an equity-markets decline of more than 50% would be “normal,” adding that it couldn’t predict when that would happen. The S&P 500 has dropped 19% from its peak at the beginning of the year.

Elliott executives warned clients that the idea that “ ‘we will not panic because we have seen this before’ does not comport with the current facts.”

They blamed central-bank policy makers for the current global economic situation, saying they had been “dishonest” about the reasons for high inflation. They said lawmakers had shirked responsibility by blaming it on supply-chain disruption caused by the pandemic instead of citing the loose monetary policy imposed two years ago during the COVID-19 peak.”

Chuck again…  WOW, a stock jockey that called out the Fed’s loose money printing… Now that’s something to write home about, eh?  The “investors should not assume they have seen everything” statement is quite true in my opinion… for whatever that’s worth.Market Prices 11/8/2022: American Style: A$ .6468, kiwi .5904, C$ .7440, euro 1.0046, sterling 1.1483, Swiss $1.0176, European Style: rand 17.7940, krone 10.2776, SEK 10.7963, forint 401.56, zloty 4.6807, koruna 24.2285, RUB 61.20, yen 145.79, sing 1.39997, HKD 7.8595, INR 81.43, China 7.2537, peso 19.55, BRL 5.1701, BBDXY 1,312.49, Dollar Index 109.70, Oil $87.46, 10-year 4.13%, Silver $21.24, Platinum $995.00, Palladium $1,732.00, Copper $3.64, and Gold… $1,706.25

That’s it for today… Now that the voting has taken place, now all the playing of musical chairs begins, with claims of wrong doing, etc. Same stuff we went through in 2004, remember hanging chads?  UGH!  I received my new Harry Bosch, Renee Ballard Book yesterday, and will begin reading it today… I thoroughly enjoyed my time with good friend, Frank Trotter yesterday… He showed me a video of the “mule path” hike he went on last week, simply beautiful around Sedona, Ariz… We talked and talked, until everyone in the restaurant had left to go back to work, or whatever… A dear reader sent me a note and asked me if I was rushing Christmas with me listening to Pandora’s Smooth Jazz Christmas… I responded, maybe I am, but I love this music style so much, and I only listen to it at this time of year…   Sam Whitmire plays his piano on his version of the song: Silver Bells, to take us to the finish line today… I hope you have a Wonderful Wednesday, and will continue to Be Good To Yourself!

Chuck Butler

November 8, 2022

* Currencies & metals rally on Monday

* Chuck’s history lesson… 

Good Day… And a Tom Terrific Tuesday to you… Well the wheels have fallen completely off our Blues wagon, as they lost their 7^th game in a row last night, in Boston. They played, and skated better in this game than the previous 6 losses, but… There are no participation trophies in professional sports… And if you ask me, the making sissies out of everyone started with participation trophies… But that’s a discussion better had on the Butler Patio…  I had to get outside yesterday to take advantage of the nice weather, because later on this week, it’s going to turn to more November weather… UGH! I’ve got Pandora’s Smooth Jazz station up and going again this morning, and today I’m greeted with The Vince Giaraldi Trio playing: The Christmas Song…

Well, the massive dollar selling that took place on Friday last week, was taken down a notch or five yesterday, as the BBDXY lost 4 index points on the day, and saw the euro climb back to parity with the dollar… You know, I can’t help but think that the news last week that Saudi Arabia has asked the BRIC’s nations to join their cabal, has had an effect on the dollar selling… You see, seeing the Saudis pin their colors to the Brics mast, is very concerning, and at first I thought the markets were shrugging it off, but not now… You see, here’s the problem for the dollar… The dollar is used in most oil terms of trade, but if the Saudis don’t feel as though they need the U.S. protection any longer, they could very well begin to trade their oil in rubles, euros, renminbi whatever floats their boat…  Think about that for a minute and see if you see this news as a positive for the U.S. dollar…

I found this quote on Bloomber.com regarding the recent change in the dollar’s forturnes… “News that would have been very dollar positive a few months ago now seems to have marginal impact,” Steve Englander, Standard Chartered Plc’s global head of G-10 foreign-exchange research, wrote in a Monday note. This suggests “further dollar strength needs a wallop rather than a dollop of dollar-supportive news.”

Chuck again… It seems to me that in recent trading days the appetite for risk assets remained strong ahead of the stupid CPI/ US inflation data and the results of midterm elections. We’ll have to see hos this all shakes out, but it could be something big for nondollar investments…

Gold didn’t get to participate in the dollar selling yesterday, and closed down $7.20 , to end the day at $1,676.50. Silver lost a plug nickel… to close at $20.90…  I also think that the news that Central Banks went hog wild buying physical Gold in the 3^rd QTR hasn’t really gotten to the Gold investors yet… And by Gold investors I mean the Bid Money guys, and the Fund Managers, etc. My day always told me to “follow the money”, and in the 3^rd QTR that was to Gold… But like I pointed out last week, Gold didn’t gain, instead it lost ground in the 3^rd QTR, even in the face of all that physical buying… That has to be a full illustration of price manipulation in paper contracts if you ask me…

The price of Oil slipped by a buck yesterday and ended the day trading with a $91 handle… And Bonds… Well the 10-year’s yield rose again and ended the day trading with a 4.22% yield… The 2-year Treasury’s yield is 4.74%, so our yield curve is still inverted… I read an article the other day where the writer tried desperately to convince his readers that an inverted yield curve doesn’t mean we’re going to have a recession…  I wasn’t buying it one iota, but it’s always good to hear the other side’s version, right?

In The overnight markets last night… The dollar ended the selling… The dollar got bought, and the BBDXY gained 2 index points overnight. The buying wasn’t swift, it wasn’t strong, it was just meh… But the euro fell back below parity to the dollar, and the rest of the currencies drifted asea… The price of Oil dropped 75-cents to trade exactly at $91.00 this morning, and Bonds stayed weak overnight.

Gold just can’t seem to follow through, on its $52 gain last Friday, and is down again in the early trading today $4.. Not that that can’t be turned around quickly, it’s just the inability for Gold to follow through, is an indication to me that it’s still not ready to move forward, like I suspect it to do, at some point. Gold is not ready for prime time… But it will be ready, soon…  this is not important, but the song by Yes, Soon, just popped into my head… here are some lyrics to the song:” Soon oh soon the light, Ours to shape for all time, ours the right, The sun will lead us, Our reason to be here”… Yes, was one of those bands that you really needed headphones on to listen to… I’m just saying

Well, things sure have changed in the last 3 trading days for the dollar, eh? Recall I told you that there wouldn’t be any warning that the strong dollar trend was ending, we would just end up at the end of a month, and look back and say, “it looks like the strong dollar trend is over”…  And we’ve had so many false dawns with the thought that the strong dollar trend was over in the last 5 years, that I’ve given up trying to find something that will indicate that we’re about to turn… The one caveat that we have these days in the dollar trading that we didn’t have the last time the dollar went into a weak trend, and that caveat is… The Exchange Stabilization Fund (ESF), or the price manipulators…

Back in 2008, during the last weak dollar trend, Bear Stearns closed up shot… And no one thought at the time about JPMorgan buying their foreign exchange business… You see Bear, at the time, had the largest short position in Silver… And JPMorgan bought that business, and the rest is history…For, you see, Bear’s short position in Silver was nothing like exists today, it has been grown expotentially…  ( I think that’s a word, and spell check isn’t coughing or wheezing at the word, so it’s a go with me!) 

Did you ever wonder why the U.S. Gov’t allowed Lehman Brothers to collapse, but found a buyer for Bear Stearns? Well, there are books written about this piece of our history, and from what I read it had to do with personality conflicts, between the head of Lehman and the Gov’t…   Hmmm…

Ok, back to today… Well not so much… yesterday, having read every book that I have here, and waiting for the delivery of a new Harry Bosch book, I picked up Addison’s Wiggins “Little Book of Shrinking Dollar” that was written in 2012, and featured some input from me!  In it I said the following: “I tell people at every stop I make that I believe the dollar will lose its reserve currency status in the next 10 years and maybe even sooner. I can’ point tone country that has its eyes focused on removing the dollar from its lofty position, and that’s China. China’s President Hu, has said that, “The dollar currency system is a product of the past”…

To my defense, here, I would point out the Covid plandemic really threw a spanner in the works of the Chinese, and has pushed back their timeline for removing the dollar from its lofty status… It will take at least one year if not two, to get China’s economy back and running on all 8 again… And only then will the Gov’t turn its attention to the dollar once again…

The book was issued in 2012, the year the dollar finally began to come out of its decade long weak trend…. But how were we to know that then? Everything that was discussed in the book as being bad for the U.S. still exists, but only worse…  So, here’s a memo to Addison, who I know reads the Pfennig, it’s time to do an update on this book… don’t you think?

The need for a Gold Standard was a prominent discussion in the book… Addison highlighted, Ron Paul’s book: A Case For Gold…   James Rickards did an update on that book, but it came after 2012… 

Well, this morning I read a report that says that inflation is really hurting small businesses… Here’s the skinny: “Small businesses are struggling to pay rent due to higher rent inflation and fewer customers. The struggles vary by type of business…

Due to ongoing economic challenges, small business owners’ ability to pay their full rent on time in October took a major hit based on a new Alignable poll. In fact, the U.S. rent delinquency rate among small businesses jumped 7% in just one month, marking the largest, most rapid increase in 2022.

37% of small business owners in the U.S. were unable to pay their rent in full and on time in October, compared to just 30% in September.”

Chuck again… Awww, don’t worry about these guys, there’ll be a bail out just for them! 

Speaking of bailouts… Ok, the airlines here in the U.S. received tons of currency from the Fed / Gov’t during the plandemic. Now they are back to normal capacity in planes, but… Instead of shoring up their businesses with the bail out money, they used it instead to buy back contracts, and retire people early, and now, guess what the Airlines need more than anything? Pilots… The bought them out, and now they need them! Talk about a bad business plan!  But not to worry, there’ll be a bailout for them too… Bailouts for everyone! The bartender down the street, the kid that mows lawns, the little kids at the illegal lemonade stand, they’ll all get bailouts!

Ok, stop me… I’m getting out of control this morning… It’s election day here in the U.S. and since most everyone voted early, the lines should be shorter, eh? Yeah, and I have a bridge for sale… But bigger than the election day outcome, is the drawing of the $1.9 Billion Power Ball!   Can you imagine, what you could do with $1.9 Billion?  I heard a TV reporter yesterday, say, “if you win it, maybe you could share it”… Wait, What? That’s a real socialist statement there, but I let it go, not wanting to get my blood pressure rising!

The U.S. Data Cupboard still is lacking today, and will remain that way until Thursday this week… No data today because of election day…  So, we more on…

To recap… The dollar continued to get sold yesterday, but recovered in the overnight markets by a small amount. It’s election day, but more important is the drawing of the $1.9 Billion Power Ball! I kid of course, what else can one do with set ups like that? Chuck goes all ape on the airlines… and small businesses are having problems, once again, but Chuck figures that there will be a bailout for them, and everyone else that has not made it in business!  Chuck goes through some recent history, that right now seems like eons ago, but it isn’t, it’s just 15 years ago… Go Vote!

For What It’s Worth… Well, remember my rant a few weeks ago about how the Gov’t is going to spend billions on green energy and forget about the energy that made the country what it is?  Well, I also talked about how it will be a very cold winter in Europe, right? Well, Germany is doing something about that, and that’s what this article is about, and it can be found here: Germany Dismantles Wind Farm to Expand Coal Mine (needtoknow.news)

Or, here’s your snippet: “I should probably give our readers a moment to double-check and ensure that you didn’t inadvertently wander into an article from the Babylon Bee or The Onion. But the title of the article stands as is and it’s legitimate. German energy company RWE operates several different types of power generation operations in the state of North-Rhine Westphalia. At one location, they have a large lignite coal mine and a wind turbine farm located side by side. (A rather startling juxtaposition given the divisive nature of the ongoing green energy debate.) But some changes are coming, and not the sort that green energy enthusiasts are cheering about. RWE has begun taking down some of its wind turbines to make room to further expand the coal mine. A spokesperson for the company said that they realize that this development may be seen as “paradoxical.” (Townhall)

In the throes of an energy crisis, a German energy company is moving forward with plans to dismantle a wind farm adjacent to its coal mine in order to expand operations.

The removal of one of the wind farm’s eight wind turbines occurred last week, with two more coming down next year and the rest getting removed by the end of 2023.

Recognizing the “paradoxical” nature of the situation, Germany energy company RWE, which operates the Garzweiler coal mine, said it’s necessary.

“We realize this comes across as paradoxical,” RWE spokesperson Guido Steffen told the Guardian. “But that is as matters stand.”

Chuck Again… I applaud the Germans for realizing that wind farms and solar panels aren’t going to replace the energy that we’re used to… As you can tell, I’m not a green person, in the manner that they speak of them… I truly believe in weather trends, and that is proven by Time Magazine, that has had 4 different covers on its magazine through the years, with each one alternating the viewpoint that it has either gotten too hot or too cold… Check it out, I don’t make this stuff up folks… And I’ll stop there, because I don’t want 1,000 emails to have to contend with… Just stating my point of view, and in these days that can get you cancelled… Hopefully, that doesn’t happen… But then the DHS, is on the prowl, and looking for people that make statements that aren’t in line with the Gov’t’s viewpoint… What? Is that someone knocking on the door, Kathy? Oh, no! It’s the Gov’t and they want to talk to me about my letter…   Well, it’s been fun while it lasted folks…  

I’m just playing around there, I hope you see that…

Market Prices 11/8/2022: American Style: A$ .6468, kiwi .5933, C$ .7410, euro .9995, sterling 1.1454, Swiss $1.0091, European Style: rand 17.8512, krone 10.2856, SEK 10.8436, forint 400.77, zloty 4.6975, koruna 24.3652, RUB 60.99, yen 146.30, sing 1.4025, HKD 7.8500, INR 81.91, China 7.2543, peso 19.46, BRL 5.2253, BBDXY 1,319.12, Dollar Index 110.35, Oil $91.00, 10-year 4.21%, Silver $20.75, Platinum $980.00, Palladium $1,893.00, Copper $3.60, and Gold… $1,672.66

That’s it for today… I’ve got to get going, to get to the polls and vote…I’m beginning to become jaded about voting, and I don’t like that… I’ve got this nagging idea in my head that my vote doesn’t mean a hill of beans in regard to changing the country… I don’t like that at all, but it’s there, and there’s nothing I can do about it… Kathy was supposed to be on plane this morning to our winter home, with her mother, but a late hurricane is headed that way, so being the cautious one, she changed here trip to leave on Friday… Then I’ll be all alone by myself once again… Hello? Pizza Man, Pizza? I need a pie, large, extra cheese! Now do that Pizza man bit in an Elvis voice… That’s funny! The Stephan Kummer Trio takes us to the finish line today with their version of the song: White Christmas…  I love the album that this is on, by the Stephen Kummer Trio, called: Christmas in the City…  OK… I hope you have a Tom Terrific Tuesday today, and please remember to Be Good To Yourself!

Chuck Butler

November 7, 2022

* Currencies & metals have strong rallies on Friday

* The Bank of England tries to play catch up with Inflation… 

Good Day… And a Marvelous Monday to you! And Congratulations to the Houston Astros for winning baseball’s World Series, hopefully without cheating this time. I rooted for the National League team, the Phillies, because they were from the National League, but called the Astros as the winner before the Series started, based on what I had seen so far. My beloved Mizzou Tigers got “Mizzoued” again last Saturday… And lost to their kryptonite foe, Kentucky, yet again. It was a beautiful weekend here in the MidWest, and on Saturday, we sang Happy Birthday to my darling second daughter, Rachel… Then we brought Braden and Evie home with us, and I woke up yesterday to the sound of little feet running down the hallway… I love that sound! Well, I turned on my fave station for the rest of the year… Pandora’s Smooth Jazz Christmas on Saturday, and this morning I’m greeted by Beegie Adair, and her instrumental version of the song: Winter Romance…  Dean Martin sang that song the first time I heard it, and loved it!

Well, how about that day for Gold last Friday?  Gold hot higher and ended the day up $52.10 and closed the week at $1,683.70… Silver was not to be outdone, by Gold, and it outperformed Gold, on a percentage basis, as it is wont to do when the two rally like that. Silver ended the week up $1.39, at $20.95!  The dollar got sold, like I have rarely seen it get sold for one day, on Friday, with the BBDXY losing 23 index points from Thursday morning’s 1,344…   The Currencies were up VS the dollar, as the BBDXY indicated, but there were no major movers, all the currencies just rallied a bit, and combined to beat up on the dollar for once.  The price of Oil squirted higher by $4 to end the week with a $92 handle…Bonds saw a slight increase of the 10-year’s yield, to 4.15%, to end the week

So, to me, watching this dollar selloff had me thinking that it was a case of one major seller, begetting another major seller, and then before you knew it the dollar was in a free fall… So, I think that Gold benefitted from this dollar selling, but to me, it also appeared to be a lot of short covering…  But when Gold moves $52 in one day, there has to be a combination of things moving it…

So, do you think it took a couple of days for the Fed’s Jerome Powell’s message on “I don’t think this is any time to pause” message? That’s what it looked like to me, but there could also have been a major reaction to the Jobs jamboree number… If hiring is still strong, then that fuels the Fed Heads push to hike rates further, and that probably scared the bejeebers out of the naysayers… And since it is a “given” that the Fed Heads rate hikes are going to bring the economy to ground zero, that’s probably what got the dollar sold to begin with.

Speaking of the Jobs Jamboree, I found this to be quite amazing…The BLS said that there were 261,000 jobs created in Rocktober… A quick look at the Fed’s site to get their Birth/ Death additions, and I was flabbergasted to see that in Rocktober the BLS added 455,000 jobs to the surveys… Wait, What? Yes, that’s right 455,000 jobs were created out of thin air, so therefore the surveys showed a different result, and it would have been a negative – 194,000… So, for once, I was glad that the markets didn’t look under the Fed’s hood, and see that addition…

In The overnight markets last night… Well, at first, the rhetoric going around the markets was that Traders were taking back their bets of a huge China opening… but then things turned around and the dollar selling continued, with the BBDXY losing 2 more index points overnight, and the euro nearing parity with the dollar. Gold, however is not gaining in the early trading today, and is down $5 to start the day, while Silver is down 26-cents… Certainly not the kind of sell offs that can’t be turned around, so we can only hope that happens today. I really don’t believe that we’ll see much movement in the markets the next couple of days, as the mid term elections in the U.S. are tomorrow, and then it’ll take a day to sort out the madness, and chaos of elections outcomes. I don’t know what to expect in these elections, so I won’t offer a guess, but if I were voting for every American, I would be voting for change… Get the news buffoons in, and see if they can do any better than the previous buffoons…  That’s my take, and I’m sticking to it!

The Price of Oil slipped a bit, and then rebounded to remain trading with a $92 handle this morning. Our friends (NOT!) at OPEC, are happier, now that the price of Oil has reach the $90 handle, as that is what their goal was for Texas Tea, when they cut their production levels. I see Oil as something that is needed every day by everyone, and therefore, the demand is great, while the supplies are diminishing, with the OPEC production cuts, and the loss of Oil rigs here the U.S. producing Oil. So, where does that lead the price of Oil to? Well, without intervention, I would suspect it returns to plus $100…  But, that caveat that it trades without intervention is just wishin’, and hopin’ and prayin’ that it will happen… I’m just saying…

Under the heading of “you can’t make this stuff up”… I read yesterday that “Majority of Americans back new stimulus checks to combat inflation”… Really? Are you kidding me? I have a dear reader that always replies to the Pfennig, reminding me that “you can’t fix stupid”…   I agree 100%, and this is living proof! The Gov’t deficit spending is what got us in this inflation mess to begin with, and now you want them to create more inflation so you get a stimmy check?  OMG! I can’t believe this is happening…  If only these “majority of Americans” were required to read the Pfennig! They would know that money supply equals inflation, and to get a stimmy check you have to increase money supply… I say no more…

Well… in keeping you up to date with the call that I made two years ago, that the U.S. Gov’t will issue a digital currency, and your dollars will be replaced with digits… There was a report that I read, that can be found here: https://www.theblock.co/amp/post/183076/new-york-fed-completes-experiment-using-on-chain-digital-dollar  

And in this article it explains that “An office within the Federal Reserve Bank of New York has completed a test of a central bank digital currency for wholesale, cross-border transactions, exchanging a U.S. digital dollar with experimental foreign currencies on separate blockchains.

The experiment known as Project Cedar: Phase One focused on the potential for central bank digital currencies to become viable options for large foreign currency transactions, though Federal Reserve Chair Jerome Powell and other board members of the U.S. central bank have made clear that the creation of a digital dollar is not a foregone conclusion.”

Chuck again… She’ll be coming around the mountain when she comes… And she’ll be spending digits! The Gov’t will know everything that you spend digits for, and they will be able to automatically deduct digits from your account if you fails to spend enough of them.. .And Bank fees?  They’ll be coming through like a hot knife through butter… And you won’t be able to do a darn thing about it!   Got Gold?

Sure, they’ll tell us that this is just for Gov’t spending, and then cross their fingers behind their backs!  Baby steps… Let’s just say that there are 5 steps to the next floor, and right now the Gov’t has moved up to the second step.. I’m just saying.

Oh, I almost forgot this… I have no idea why I just remembered it but, I did, so here goes… Some of the dollar’s problems on Friday came from rumors that China is going to open back up… China’s economy has been shut down for some time now with their ‘zero Covid” policy, but when it does open back up, it will be going like gangbusters to play catch up, and that knocked some the stuffing out of the dollar on Friday.

OK, this is something I rarely do…. I’m going to relay to you a note I received in the Pfennig Replies box last Friday… I think this person makes some real good points here…. I sure hope it’s not as dire as it appears though, for all of our sakes!  Here goes…

“I cannot find any hope no matter where I look. Everything is fake, overmanipulated, or lied about. And no one really cares. Everyone is describing the water while we are about to drown. Pick a subject, inflation, wealth disparity, plain ass lying elected misfits, fake fed counterfeiting, possible fake fed crypto planning, gazillions of bad bet derivatives, fuel supplies gone, Russia talking nukes, North and South Korea daring each other with missiles, everything happening at the same time.

I got a real bad feeling this is about to hit the fan big time. The majority really do not give a shit. They are all atwitter about the bullshit on social media instead. No one is taking any steps to solve even one of the problems. Unfortunately, it has to collapse first, everyone saying it was a black swan that no one could see coming, and more extend and pretend occurs. Until.

And if you expect any candidate elected after the election is going to even address the real problems, there is a certain bridge for sale again.”

Chuck again, now… if only traders would take this point of view… We could get to busting bubbles all over the place, and it wouldn’t take long.

I came across a website this past weekend that was titled: Stop Spending Money On The 4 Stupid Things…  #3. Was stop paying your Credit Card debt in monthly increments… I call that stating the obvious!

The U.S. Data Cupboard last Friday, had the aforementioned Jobs Jamboree… So nothing else to talk about there…  And this week’s data agenda, doesn’t really have anything to write home about until Thursday, when the stupid CPI for Rocktober is printed, of course after it has been massaged, basted and cooked…

To recap… The dollar got sold for a number of reasons on Friday, but when it all added up, the dollar went into a free fall! The BBDXY lost 23 index points, and Gold gained $52! China is rumored to be ready to open their economy again, the Jobs report was strong, that is if you take it on face value and don’t look under the hood. And there was a ton of short sells being bought back/ covered in Gold & Silver… and Chuck wants to know what the “majority of Americans” were taught in school?  

For What It’s Worth… OK, longtime readers know that I have a good relationship with my friend, Dennis Miller… Well, Dennis included my thoughts on his latest letter that came out last week, and can be found here: My Dad Was Dumb Like a Fox! – Miller on the Money

Or, here’s your snippet: “DENNIS: We read about people getting clobbered in the bond market. I continually remind readers that we are NOT bond traders.

Any bond you buy should be held until maturity. While interest rates fluctuate, when they mature, you will get your money back. The real threat is inflation, you can lose a lot of buying power along the way.

What is happening to those who bought trillions in bonds yielding 1-2%? I know you’ve mentioned that certain pensions, etc., were required to hold a certain amount in bonds.

CHUCK: Well, this is a two-pronged answer. First, let me explain that there are institutions that must buy Treasuries, no matter what the current yield is.

Pensions, Insurance Companies, State and City Gov’ts. They have investment mandates that require them to own only Treasuries… So, these folks are now holding some underwater bonds, meaning they could not currently resell them without taking a big loss. They are the “Big Boys” and can deal with losses much better than you and I.

Speculators who thought the Fed was going to pivot and begin to cut rates are looking at red ink in their bond holdings right now. That red ink will continue as long as they hold the bond.

If they sell before maturity, they will take a loss. If they hold on to maturity they will get their principal back, but the interest they receive will be well below the current market rates. They hope the Fed will panic and cut rates radically so they can resell the bonds for a profit, but that is a real gamble. It’s not a situation that I would want to be in.”

Chuck Again… yes, we talk about bonds, and when they should be bought, etc. so take a look at this letter of Dennis’ and then subscribe if you don’t already, it’s free, and he writes once a week, so it won’t fill up your email box every day, like someone else I know… HA!

Market Prices 11/7/ 2022: American Style: A$ .6263, kiwi .5920, C$ .7418, euro .9978, sterling 1.1444, Swiss $1.0102, European Style: rand 17.8405, krone 10.2508, SEK 10.8458, forint 401.23, zloty 4.6966, koruna 24.3905, RUB 61.02, yen 146.67, sing 1.4035, INR 81.91, China 7.2284, peso 19.48, BRL 5.0815, BBDXY 1,319.59, Dollar Index 110.52, Oil $92.16, 10-year 4.13%, Silver $20.69, Platinum $965.00, Palladium $1,865, Copper $3.55, and Gold… $1,677.73

That’s it for today… Oh! I almost forgot to add this morning that the Bank of England (BOE) hiked rates 75 Basis Points last Thursday!  Playing catch up with inflation is hell, isn’t it BOE?  OK, now onto the finish… Little Evie was a treat yesterday, she came downstairs with me, and talked to me for 20 minutes straight, and I only understood about ½ of what she was talking about, but… she was so darn cute doing it! Braden had said on Sat. night that he wanted to go to Wally’s Sunday morning, so I got ready to go, and he was online playing a game with one of his friends, and I guess he forgot about going to Wally’s!  Oh well…  I just finished reading a book that was different than my usual reading material… It’s a book about Clint Hill, Special Services Agent that served under 5 presidents!  The chaos of the Nixon Administration, brought back so many memories of that time… Steve Oliver and his acoustic guitar is playing God Rest Ye Merry Gentlemen as we head to the finish line today…  I hope you have a Marvelous Monday today, and please…. Be Good To Yourself

Chuck Butler