Author: admin

April 6, 2023

* dollar gets bought on Wednesday

* Short time holders sell Gold… 

April 5, 2023

* Gold & Silver soar on Tuesday!

* The dollar continues to get sold… 

Good Day… And a Wonderful Wednesday to you! A very strange and eerie night here in my little river town, as storms blew through, and carried on through to morning… More storms are on the way this morning. My beloved Cardinals got their game in uninterrupted, and lost to the Braves…. Again!  Day game today at Busch, and I have tickets to the game, but… I just can’t answer the bell! I was up most of the night with that dang foot pain, and when it was time to get up and write, I said to hell with it!  Now, I know for the first time that I am actually retired! I would have never done that when I was working!  So, the letter is tardy today…  sorry…  Jimmy Cliff greets me this morning with his song: Hello Sunshine 

Well I guess were going to see if my take on Gold is going to play out, as Gold rallied $35 yesterday, and closed above $2,000 at $2,020.00… Silver… wait for it, wait for it… OK, Silver gained $1.04 on the day to close above $25! WOW! Gold’s next challenge will be to take out its all time high of $2.078… But first things first… it was NOT simply a case of the dollar losing ground, it did lose ground in the form of 3 Index points in the BBDXY, it was also a case of cash buyers piling into the metals, because…. Sounding like Alicia Silverstone, Because… Everyone has to access blame on something/ somebody, right? Well, yesterday’s culprit was the bad data in March Factory Orders, which followed up January’s print of -2.1%, with another negative print of .7%… Add them up and you get an average for the two months of -1.4%… And the people in Washington D.C. still believe this is going to be a soft landing?

The price of Oil slipped a bit yesterday after climbing above $81, it settled back in trading with an $80 handle to close the day… And talk about the safe haven buying in Gold & Silver, it was also seen in the 10-year Treasury’s yield, which dropped to 3.34%…  I want to circle back to Gold… Now is the witching hour/ day, when we find out if the price manipulators are going to take Gold down again, or if the buying momentum is so great that they can’t get a foot hold on the price, and Gold keeps climbing… If it’s the latter of the two, then I think Gold is off to the races, and not looking over its shoulder any longer… The same goes for Silver, as it has finally gotten back to $25…

I didn’t see Gold’s rally yesterday in real time, as I became quite sick to my stomach (no biggie, chemo reaction) and had to go sit down and rest, which led to a very long nap!  So, you can only imagine how pleased I was to see Gold close above $2,000… And Silver above $25…  I used to tell the folks on the trading desk at EverBank World Markets, that I had bought some Silver coins around $22 back in the 80’s, and that if Silver ever got to $25 I was going to sell them to break even after commissions…  But then when Silver went on its run in the 2000’s and it climbed to $50, I still didn’t sell, because I believed that Silver had become the “new Gold”…..   if only!

I wrote about how there were shortages of physical Silver and that to make the new Solar Panels, Silver would be needed, and then listed several other reasons for Silver to continue to rise…   If only!  My article, titled: Is Silver The New Gold? Was featured in a national publication, that for the life of me I can not recall the name… Shame, Shame, Shame… (best Gomer Pyle voice)

Our marketing group at EverBank used to keep copies of all the publications, news papers, magazines, etc. that I appeared in… But those folks have all move on to higher ground… So, I doubt contacting the new marketing people would do me much good!

In the overnight markets last night… The dollar was not the toast of the town, but it also wasn’t treated like Dr. Frankenstein’s monster! That’s a lot of words to say, there was not movement overnight in the dollar… Gold has added $6 to its value this morning in the early trading, while Silver is seeing some profit taking and is down 10-cents to start the day…  The price of Oil remains in the $80 handle, and the 10-year’s yield had dropped more to 3.30%…  Stranger than fiction, unless the bond boys know something about the next FOMC meeting that we don’t…

I’m still of the opinion that the FOMC will continue to throw peas at inflation, to show that they are true to their words… 25 Basis points  until something breaks… The Fed Heads are hoping that inflation I what breaks before something else does…  Now, there are a ton of writers and economists out there that believe the Fed Heads have hiked their last rate at the last meeting… And if that’s the case, then the bond boys are bang on… But let me remind everyone that the job of beating back inflation wasn’t completed, and that’s just going to allow inflation to run up once again, if all these people are correct that the last rate hike has been made…

The Big News last night came from the Reserve Bank of New Zealand (RBNZ), who hiked their Official Cash Rate 50 Basis Points to reach 5.25%!!!  That’s HUGE folks! And puts kiwi right up there with countries that boast higher interest rates, like the U.S. The rate hike news quickly got kiwi up and running higher, and within 1 hour after the announcement kiwi had gained 43 ticks… Look for kiwi to become the investment part of any carry trades…. I like it for that, and you should too!

Longtime readers may recall me making a BIG Deal out of the formation of the BRICS a trading pact among members: Brazil, Russia, India, China, South Africa, and said that one day they would make the calls in the world, as they had the largest populations… Well, that one day, appears to be coming very soon… The BRICS held a meeting among leaders of the respective countries, and they have decided to form a common currency… (A euro, if you will) One that could be used in trading amongst themselves, thus eliminating the use of dollars in the terms of transaction… 

I used to tell my audiences, that once Saudi Arabia drops the dollar for Oil transactions, the dollar would lose so much value that it’ll have to dig itself out of the hole it just dug for itself, with sanctions, shutting down SWIFT, and pushing its weight around… These countries see what the U.S. has done to Russia, and they know that it wouldn’t take much provocation to get their country on the “list”….  So, weaning themselves away from the dollar behooves them greatly, in my humble country boy opinion!

And we’ll be the ones, the common man/ woman (don’t start on me with pronouns, I’m not playing that game!) that has to suffer for our leaders mistakes, with high inflation that we can no longer export to other countries, and higher prices for commodities, like Oil, and higher prices for everything!  Thanks, remind me to send ya’ll a nice note thanking our numbskull leaders for putting us in this mess! At that point, it will be too late to say your sorry, and try to take back all the bad things you did to countries in the past…

So, yes, I think the BRICS new common currency, whatever it’s called, will quickly rival the yen, sterling, and eventually the euro, before taking over the dollar’s reserve currency status… For years, people kept saying, the dollar doesn’t have any challengers to its reserve status… The euro was created TO compete with the dollar, but after 10 year of its existence, the debts of the PIGS (Portugal, Italy, Greece and Spain were uncovered, and all hell broke loose for the euro… I called these countries: Club Med Back in the day, and whenever someone talks about any of the PIGS, I think ahhh… Club Med…

I know that a lot of people think that the Banking Crisis is over… Shoot Rudy, the stock jockeys act like it never happened!  I just think we’ve seen the tip of the iceberg… And remember what an iceberg did to the Titanic? Imagine what it will do to the U.S. economy? If the withdrawals continue out of banks, then banks will do what they always do when times get rough… They batten down the hatches, and hunker down, not giving out loans, not creating new financing for projects, nada, nothing, nil, zero, a big fat Goose Egg, of loan production, and that will bring pain and suffering to the U.S. economy…  I told you earlier this week that last week, ending March 22 (a great day indeed! HA) significant amount of withdrawals had been made from banks, so there’s no reason to believe they withdrawals will just stop on a dime!

The U.S. economy is heading to the stage to be the star performer of the Sh%^ Show!

I know, I know, I really sound jaded these days don’t’ I? Well after all the debt, the numbskulls unable to agree on a budget (read spending cuts) after all the manipulations, all the derivatives, and after a decade of zero interest rates, and people buying willy nilly stuff like cryptos, and NFD’s or whatever  they call them, and the everything bubble, how else am I supped to look at the markets?

The U.S. Data Cupboard yesterday had the aforementioned Factory Orders for Feb, and another price worth mentioning… For the first time in over 3 years, the number of Job Openings in the U.S. dropped below 10 Million… Today’s Data Cupboard has the ADP Employment Report for March. ADP the payroll company for nearly every company in the U.S. thinks that March’s payrolls increased by 210,000… This report is supposed to be a harbinger for the BLS Jobs Jamboree, but that never happens, as the BLS has the last say on what gets printed, and they like to massage and cook the books quite a bit each month before the print that is due this Friday, is produced… 

But being tardy, allows me to get the early economic prints from the Data Cupboard, and this morning, the ADP Employment Report really disappointed the markets, with a print of only 145,000 jobs added in March… That leaves the BLS with a real problem come Friday… What to do, what to do? I think they’ll side with the folks that provide their paychecks… And add plenty of jobs out of thin air to make ADP look stupid…  But in my opinion, the BLS are the ones that are stupid… I’m just saying…

To recap… What a day for Gold & Silver! WOW! And what a day for the 10-year Treasury! WOW! I guess we know now where all those bank withdrawals that were made last week they went! The dollar lost ground all day yesterday, and once again looks like its ready to jump off a cliff, and any time in the past 10 years that we’ve seen the dollar have that look, the PPT and their treasure chest full of ESF’s funds come in to save the dollar… I just keep wondering how much of those ESF’s monies they have left ? I just want asset classes to trade on their own merits, and not be influenced by price manipulators!

For What It’s Worth… Ok, I’ve said this before, but for those of you new to class, Ted Butler (no relation that I know of) is a metals guru, he watches, he calculates, he sees what’s going on with the paper traders, and writes about it, and whenever his stuff is out there for me to grab for free, well you can bet your bottom dollar that I’m going to use it in the FWIW section! This article is about how JPMorgan has accumulated so much Gold & Silver and they still manipulate the prices, and it can be found here: JPM Again | SilverSeek

Or, here’s your snippet: “A major development last week was the large amount of gold issued by JPMorgan over the first two days of the COMEX April contract. Total gold deliveries by JPMorgan of 14,326 contracts, including 10,682 contracts (1.07 million ounces) by JPM from its proprietary house account were the largest by JPM in history. This is big news because it demonstrates clear and blatant price manipulation by JPMorgan. With more than 19,000 contracts of gold standing for delivery, what would have been the price of gold, had JPM not delivered more than 10,000 contracts from its house account? Even the dimmest of wits (say at the Justice Department or the CFTC) should be able to conclude that without JPMorgan delivering this many gold contracts, gold prices would have had to increase enough to attract others to take JPM’s place.

Price manipulation cannot occur without a concentrated position. That’s what we witnessed, in full view, by JPMorgan over the first two days of the COMEX April gold deliveries. Back in 2020, JPMorgan entered into a deferred criminal prosecution agreement (DPA) with the Justice Department for manipulating precious metals on the COMEX (and other infractions) and agreed to pay a headline-grabbing $920 million (a pittance for JPM). The fine and the DPA only scratched the surface of JPMorgan’s long-term manipulation of silver and gold, because the case focused solely on spoofing and the short-term manipulation of prices. It ignored the much more serious price suppression of silver (and gold) and JPM’s accumulation of massive quantities of physical silver (more than a billion ounces, plus more than 30 million ounces of physical gold) over a decade. They did this while functioning as the biggest COMEX short seller (in order to keep the price down). Spoofing was peanuts compared to what JPMorgan was actually guilty of.

I always acknowledged that should JPM choose to do so, it could depress prices by releasing a portion of its physical holdings. I argued that because of the massive amount of physical silver and gold it had accumulated over the years at dirt cheap prices, JPM would choose to let prices fly upward. The recent large gold deliveries may suggest otherwise. But all may not be lost. I did suspect that if JPMorgan decided to unload some of its massive stockpile of physical silver and gold for the purpose of containing prices, that fact would quickly become obvious. That is precisely what just occurred in the COMEX April gold deliveries. A new dynamic is in play; just how blatant and obvious can it get that JPMorgan is still manipulating gold and silver prices, in complete violation of the law and its own deferred criminal prosecution agreement (whether active or recently expired), before the DoJ or CFTC is forced to react in some way?”

Chuck again… thanks to Ed Steer for highlighting this article on Silverseek.com… To me, this is so obvious, and should be the writing on the wall to shut JPMorgan’s metals business down… But then, if I were the king, that’s what I would do… And the line of metals traders in orange suits lined up to go to jail would be quite long!

Market Prices 4/5/2023:  American Style :A$ .6707, kiwi .6317, C$ .7436, euro 1.0943, sterling 1.2473, Swiss 1.1061, European Style: rand 17.9213, krone 10.3917, SEK 10.3420, forint 343.31, zloty 4.2802, koruna 21.4051, RUB 79.79, yen 131.04, sing 1.3288, HKD 7.8499, INR 82.00, China 6.8793, peso 18.17, BRL 5.0497, BBDXY 1,222.59, Dollar Index 101.65, Oil $80.48, 10-year 3.30%, Silver $25.00, Platinum $1,023.00, Palladium $1,536.00, Copper $4.00, and Gold… $2,026.60

That’s it for today… Well, the end of Lent is coming… this Friday, is Good Friday… I used to take that day and the day after Easter off… It’s time to be with family… Again, sorry for the tardiness today, but I need my sleep!  Well, college basketball is over, the hocky playoffs begin soon, the NBA playoffs begin soon, and then all that will be left is BASEBALL! It’s going to be a tough, grind it out year for my beloved Cardinals, their pitching isn’t what Championship teams have… But their hitting will win them a lot of games, at least that’s how I see the year playing out… Stevie Guitar Miller aka Steve Miller and his band take us to the finish line today with their song: Serenade…   Good friend, Kevin, aka Webbs, always wants me to play that song on the iPod…  I hope you have a Wonderful Wednesday today, and will Be Good To Yourself!

Chuck Butler

April 4, 2023

* Currencies & metals rally on Monday

* JPM on top of the world with short paper contracts… 

Good Day… And a Tom Terrific Tuesday to you! Well, it wasn’t a good night for my beloved Cardinals last night, taking one on the chin, losing 8-4.  Difficult to come back after giving up 5 runs in the 2^nd inning!  Yesterday was a gorgeous day here in my river town. I sat outside to eat my lunch and read a bit, until the day heated up to much for me, and I went inside, sat down in my recliner, and fell asleep… I’ve not been getting a good night’s sleet for a couple of months now. I’ve developed neuropathy in my left foot, and it only shows up in the middle of the night! UGH! So, it looks like I’m back on schedule for afternoon naps, after giving them up for Spring Training games… And on top of that! I have a slight cold, that is a pain in the ask me no more questions, I’ll tell you no more lies…  HA! Jefferson Starship greets me this morning with their great 70’s song: Miracles…

The dollar continued to get sold throughout the day yesterday. When I left you yesterday morning, the BBDXY had lost 2 index points, and then it continued to lose 3 more index points for a 5 point loss day. The euro is nudging up against 1.09, and the Swiss franc is nestling up to 1.10.. not yet, but it’s coming, in my humble country boy opinion!  Gold gained $ 14.60 on the day to close at $ 1,985.30, and Silver tried to come back yesterday and get out of red territory, but the paper traders saw to it that it didn’t, and so Silver lost 12-cents on the day, but retained the $24 handle at $24.06…..

The price of Oil remained well bid, and moved higher in the $80 handle… I’m very interested In the markets’ reaction to OPEC’s announced 1 Million barrels of Oil production cut… I just don’t see that as a large amount, sort of like a pimple on a …. No, no, no, Chuck, you can’t say that! There was more buying of the 10-year Treasury as its yield dipped to 3.42%…

The data yesterday was not good, but… in the past couple of years, what’s bad for the economy is good for the dollar, but not yesterday… The ISM Manufacturing Index slipped further down the greased pole and came in at 46.3% VS 47.7% in Feb… March’s below 59 reading was the 6 month in consecutive prints that the index was below 50… I know I’ve pounded this into your heads so many times in the past that I sound like a broken record, but just a reminder for those new to class.. 50 is the level that used as demarcation of whether the economy is expanding (above 50) or contracting (below 50)…

The reason I put the data out here front and center this morning, is it is what most pundits were writing about as to why the dollar got sold yesterday..  

In the overnight markets last night… The dollar bugs wrapped a tourniquet around the dollar, and stopped the bleeding, and the BBDXY gained 1 index point overnight. The BBDXY is still looking peeked… and that has the dollar bugs crying for more PPT help, which if the dollar had continued to weaken, we would have seen some intervention by the PPT…  The euro did move over the 1.09 handle this morning, so the dollar bugs work hasn’t stopped the euro from moving higher…  Gold is seeing some profit taking this morning, and is down $4 to start the day, while Silver is off 6-cents. The price of Oil bumped higher by a buck , and therefor trades with a $81 handle this morning… The 10-year Treasury’s yield is s strange bird these days, and has a 3.46% yield to pay…

I’m going to point out something, once again that I’ve viewed over the years… And that is, that whenever the Euro Wannabes, (Poland, Czech Rep, Hungary) start rallying, the dollar is in trouble… And that’s what we’re seeing right now, as all three have rallied VS the dollar, and I get a kick out of looking them up each day to see what they’re doing…  So, we have that going for us!  The Russian ruble has really been seeing some selling, which I understand, but then I don’t… Russian interest rates have plummeted from the 20% level they were paying when the markets went all armegeddon on the ruble… And you can’t get good rates of interest in Russia now, and that has a lot to do with the rubles problems… But with the price of Oil bumping higher, it should provide some cover for the ruble…

Well, I guess the markets believe that the banking crisis is over, because the Japanese yen has lost its shine, that was provided by an old title it once held…Safe Haven… Just 10 days ago, the yen was trading around 130 and getting all kinds of attention for finally waking up, but that was short-lived, and the yen soon returned to trading 133…  

Speaking of the Banking Crisis… it seems that the small banks added $6 Billion in deposits last week, while the 25 Biggest banks saw withdrawals totaling $90 Billion on a seasonally adjusted basis, according to the Fed. The total of withdrawals were $126 Billion, so banks everywhere were still seeing depositors withdrawing their money… This is a becoming a real problem folks… I’m just saying.

I received a nice note from a friend, and newsletter writer himself, Rich Checken, yesterday, he had copy and pasted what I had said about Gold hanging around $2,000, and once it got above it, there would be no looking back… And he then said, ‘I said those same words at the Investment U conference last week”, Does that mean great minds think alike?  I’ve known Rick for sometime, but I know his uncle even longer… Michael Checken is a cancer survivor like me, and he always reminds to be “live strong”…   

Well the pound sterling is at it again… What? I here you asking… Well, remember last year when sterling was rallying better than most currencies, sans the Russian ruble?   And I kept telling you to be careful here, because the U.K. had dept problems of their own, inflation problems of their own, and a currency that’s all their own, and so bad data can drive a currency downward quickly… And it did… But now sterling is back on the chain gang (Pretenders)  and is on the rally tracks again… And again, all I’ll say is be careful with this currency…

3 different people sent me this article that appeared on www.wallstreetonparade.com  and so when I received the 3^rd one, I decided I had better read it… The article was about how After Being Criminally Charged for Rigging Precious Metals, JPMorgan Chase Controls 53 Percent of All Precious Metals Contracts Held by Banks, that’s all the short paper trades folks… held by one entity… how does that make you feel about JP Morgan as an entity?  I like the article so well, I highlighted it in the FWIW section today, so you won’t want to have missed that !

Well, with all of the layoffs that have been announced lately, this one seemed to garner the most attention…Micky D’s, is going to layoff a large number of workers, the number hasn’t been announced yet, but will be soon… That one kind of gets to you, doesn’t it? I mean what’s been the one common thing across America no matter where you went, you could find a McDonald’s, and 1/4  Pounder With Cheese would be the same in Portland as it is in Miami… McDonald’s isn’t going down, but this announcement sure makes me feel like they are… The have been a constant in our lives…

My wife made me stop eating my beloved 1/4 pounder with cheese sandwiches quite a few years ago now, and every now and then I think, “I could eat it before I got home, but then what would I do with the trash?, darn evidence!” HA! 

I once got a call from head of King World Publishing, telling me to stop pasting stories from their publication, which at the time was printing a lot of Richard Russell’s works… So, I did… But now this article talks about the derivatives in Gold that JP Morgan has, and is written by Stephen Leeb, and it can be found here: Leeb – JP Morgan’s Massive Gold Derivative Short Position May Be Larger Than The Bank’s Assets | King World News

Or, here’s the snippet: “March 25 (King World News) – Dr. Stephen Leeb:  “What I lose sleep over is how much exposure does a bank like JP Morgan have to the [gold] derivative market. This is not fraudulent but it’s an open secret. In fact [laughter] it’s no longer a secret because they’ve been penalized so much for it. They’re trying to control the price of gold. I mean when you sort through all of these derivatives, what’s JP Morgan’s short position [in gold]? I can imagine it being much more than the assets in the company. And if gold takes off and it gets out of control then it’s ‘Katy, bar the door.’ You don’t know what is going to happen. So that’s the real threat in my opinion. I doubt that JP Morgan even knows how much of a threat it is but they’ll find out if all the sudden you see the price of gold shoot up $1,000. But this is a vicious circle because when gold gets set to move, and it’s creeping up toward all-time highs all the sudden…”

Chuck again… I recall my former colleague, Neil George, always bowing down to Stephen Leeb, and dying to get into his publication…  Anyway… that’s that! What’s the one thing, I’ve always told you would break the paper traders backs?  If everyone lined up to buy physical Gold…  I’m just saying…

The U.S. Data Cupboard today, has March Factory Orders, and by the looks of other related data and how badly they had performed in March, I’ll have to go out a limb here (don’t worry it’s a big fat limb) and say that I expect Factory Orders to be negative in March… So there!

To recap… The currencies and metals (not Silver) rallied yesterday, and most observers believe the dollar was sold because of the weaker than expected IDM Index… Here’s the markets thinking on this: Bad data makes the FOMC think long and hard about another rate hike… Therefore the dollar loses some steam power… Mickey D’s is laying off workers, what’s up with that? And if derivatives are your cup-o-tea, then you’re in for a treat with today’s Pfennig!

For What It’s Worth… I told you above that I had the, as Paul Harvey would say, “Now the rest of the story”… And you can find it here: After Being Criminally Charged for Rigging Precious Metals, JPMorgan Chase Controls 53 Percent of All Precious Metals Contracts Held by Banks (wallstreetonparade.com)

Or, here’s your snippet: “According to the Federal Deposit Insurance Corporation (FDIC), there were 4,706 federally-insured banks and savings associations in the U.S. as of December 31, 2022. Of those, according to the quarterly report released last Friday from the Office of the Comptroller of the Currency (OCC), a little less than one-quarter found a reason to engage in derivative trading activities.

As of December 31, 2022, just 1,139 FDIC-insured commercial banks and savings associations reported trading of derivatives in the fourth quarter of 2022, according to the OCC. Ostensibly, instead of running a derivatives casino, the other three-quarters of taxpayer-subsidized banks were doing what taxpayers want federally-insured banks to do: make business loans; provide affordable mortgage loans to homebuyers; provide checking accounts devoid of hacking, identity theft and predatory overdraft fees; and not blow up the bank by getting in bed with derivatives, crypto or dodgy Wall Street IPOs.

As it does each quarter, the OCC report rang this alarm bell:

“A small group of large financial institutions continues to dominate trading and derivatives activity in the U.S. commercial banking system. During the fourth quarter of 2022, four large commercial banks represented 88.2 percent of the total banking industry notional amounts [of derivatives] and 62.5 percent of industry net current credit exposure (NCCE).”

Those four banks are Goldman Sachs Bank USA with $52.6 trillion in notional (face amount) derivatives exposure; JPMorgan Chase Bank N.A. with $49.5 trillion in notional derivatives exposure; Citigroup’s Citibank with $47 trillion in notional derivatives exposure; and Bank of America with $19.4 trillion in notional derivatives exposure.

One area that particularly stands out in the current OCC report is data showing JPMorgan Chase Bank N.A. held $200.12 billion in precious metals derivative contracts at its federally-insured bank as of December 31, 2022, versus a total of $378.12 billion for all banks in the U.S. holding derivatives. That’s one bank holding 53 percent of all precious metals contracts in the U.S. banking system.”

Chuck again… the article is long and should be read at the website provided for the full story…

Market prices 4/4/2023:  American Style: A$ 6754, kiwi .6297, C$ .7445, euro 1.0908, sterling 1.3494, Swiss $1.0944, European Style: rand 17.8432, krone 10.3057, SEK 10.3273, forint 345.28, zloty 4.2828, koruna 21.4819, RUB 79.41, yen 133.02, sing 1.3270, HKD 7.8499, INR 82.33, China 6.8833, peso 18.09, BRL 5.0649, BBDXY 1226.07, Dollar Index 102.03, Oil $81.09, 10-year 3.46%, Silver $23.94, Platinum $1,002.00, Palladium $1,480.00, Copper $4.05, and Gold… $1,981.66

That’s it for today… Congratulations to UConn for winning this year’s NCAA Men’s Basketball Championship… On Sunday LSU had won the women’s Basketball Championship!  I tore up my bracket after the first weekend of games in the men’s tournament! UGH! One of these days, I’ll get it right… And if you believe that, I’ve got a bridge to sell you! Things are just so darn crazy in the world these days, makes you want to just hunker down and close the hatches so you can ignore it all, and maybe, just maybe it’ll all go away… And then again pigs may fly, right?  Well, our Blues fooled around and didn’t make the playoffs this year, and that’s a real shame if you ask me… Time to get the golf clubs out boys… see you next fall… The Temptations take us to the finish line today with their great song: I Wish It Would Rain…  I hope you have a Tom Terrific Tuesday today, and will Be Good To Yourself!

Chuck Butler

April 3, 2023

* Currencies & metals rally in the overnight markets

* OPEC announces a surprise production cut! 

Good Day… And a Marvelous Monday to you! Well after all the pomp and circumstance at Busch Stadium last Thursday for Opening Day, my beloved Cardinals laid an egg in the game and lost… The rest of the weekend games VS the Jays, went  \the right way, and the Cardinals won the series 2-1… The Final Four took place on Saturday, with San Diego St. and UConn 5 as the final combatants for tonight’s Championship Game… Oh, and our new soccer team the Stl. City SC, is now   5-1. As they lost their first game 1-0…  I’m waiting for reports from grandson Everett, and dad Jerry, on how the experience was at the game… I made it back home to my little river town late Saturday night, So, this morning, I’m back at my writing desk in the basement, and still trying to get used to being here instead of at my writing station in Florida, where I look straight out and see the ocean and the sunrise! Now, I look at my writing desk wall with tons of pictures, of which I added a new one to upon my return.. The band, Shooting Star greets me this morning with their rock classic song: Last Chance….

The dollar saw it getting sold on Thursday last week, and then getting bought on Friday… I don’t get it, the U.S. data was not THAT GOOD, that it got the dollar bugs all excited… But as I’ll point out later today, there’s some real numbskull thinking going on around the markets, and so I’ll leave it at that! The BBDXY dropped to 1,227 on Thursday last week, only to turn it around on Friday and gain 3 index points…

Friday last week, was the opposite of Thursday for Gold… Thursday saw Gold gain $15.90 to finish the day at $1,980.10… But on Friday, Gold lost $10.80 to close the week at $1,970.80… Silver didn’t see the up and down of Gold, gaining both days, with Thursday’s gain of 7-cents and Friday’s gain of 17-cents, Silver climbed over $24, and finished the week at $24.18…

To me, Gold has flirted with $2,000 a couple of times in the past 10 days, and each time the paper traders (Price manipulators), saw to it that the shiny metal didn’t gain further… But… this is like an asset that keeps bumping higher against a psychological level, and then finally does, and never looks back…  I think that once Gold closes over $2,000 and opens the next day up, that we could be off to races…  I’m just saying… So… use this dip in the price of Gold as your (as the song above says) Last Chance to get gold below $2,000…

The price of Oil ended the week trading with a $75 handle! That’s a nice turnaround for the anti-dollar price of Oil… I have to wonder how many bank deposits were withdrawn last week… The reason I say that I the 10-year Treasury saw it’s yield drop over 10 Basis Points to 3.47% to end the week… See, what I’m getting at there?  I knew you would! ( in my best Mr. Rogers voice)

In the overnight markets last night…. Well, our friends (NOT!) at OPEC announced a surprise 1 Million barrels a day production cut yesterday… That was BIG news folks, for it pushed the price of Oil over $80, and it looks like it could be headed for even higher ground. The dollar has gotten sold in the overnight markets, with the BBDXY down 2 index points as we start the day. Gold is up $5 in the early trading, while Silver has run into a roadblock, and has dropped back below $24, with it down 20-cents this morning.  The price of Oil is trading with an $80 handle this morning.. Chuck, you dolt, you already told people that! Why would you want to repeat it? Oh! Sorry!   The 10-year Treasury is 3.49% this morning, there’s been some major buying of this bond… Can you say, The Fed/ Cabal/ Cartel? I knew you could!

The petrol currencies are up on the Oil production cut news, except the Russian ruble… it used to be the ruble as the only currency gaining VS the dollar, and now that the dollar is weakening, the ruble can’t find  a bid… But the news did help the Canadian dollar/ loonie, the Mexican peso, Norwegian krone, and Brazilian real… So, they all had that going for them this morning…

Well, well, well, what have we here, a conundrum? A enigma? Or… just plain stupidity?   Here’s the skinny, of what I’m talking about… It seems the stock jockeys last week were rejoicing and marking up stocks because they said, and I quote: “That the Banking Crisis is over, and  The Fed won’t need to hike rates any more”… Wait! What?  If the banking crisis is over, then that gives the FOMC the green light to get back to their work at hand, which is fighting inflation with a pea shooter…  And vice versa… If the Banking crisis isn’t over, then we have a problem Houston!   You can’t have your cake and eat it too, stock jockeys… I’m just saying…  I want to thank long time friend, Dave Gonigam, at the 5 Minute Forecast for brining this craziness to my attention!

Remember years ago, when the U.S. had gone through the Financial meltdown that the numbskulls in Congress decided to write more rules for the banks?  And I pointed out then, and will point out again now, that what the banks didn’t need was more rules, they just need good regulation over them to prevent them from going bad…  Let’s see what James Rickards has to say about this latest call to put more rules on banks… here’s Jim “The White House is calling for “tougher rules for midsize banks,” as The Wall Street Journal But as Jim pointed out here on Tuesday, the existing rules were more than enough to prevent the failure of Silicon Valley Bank — if only the Fed and other agencies bothered to enforce them. So now, responsibly run banks will face costly and cumbersome new rules to cover up for the authorities’ failures.”

Crazy people do crazy things… those numbskulls in Congress are crazy!  I’m just saying…

Well, the data last Friday, was interesting… Sometimes it takes a mathematical genius to get through all the caveats of a data print… Well… I don’t know if he’s a mathematical genius (probably is) but the economic genius, David Rosenberg, did have something to say about the GDP report last Friday… This is from his Twitter account: “No recession? Well, there sure is one in corporate profits, with today’s revised Q4 GDP report showing that pre-tax earnings collapsed at an -18% annual rate for the second straight quarter and contracting on a YoY basis for the first time since 2020 Q2.”

The U.S. Data Cupboard showed us that Personal Income was only up  .3% VS .6% the previous month, and Personal Spending was only up .2% VS 1.8% the previous month…  So, not the great gains in wages, and not a great gain in Spending…  like I’ve said in recent days… The U.S. consumer is tapped out…   The Weekly Initial Jobless Claims for last week saw a bump higher in the claims, for the first time in a month of Sundays… Could all the layoffs in the U.S. finally be showing up here?  I guess we’ll see if that’s the case next week.

To recap… Can I get off this rollercoaster? When youngest son Alex was a lad, he loved Rollercoasters, and he would always ask the guy if he could go again, and I would be like, can I get off this rollercoaster?  That’s what these last three days of trading have me feeling like… Up, down, up, of course if the powers that be would remove all manipulation of markets, and allow them to be traded based on fundamentals, things would be better for all of us…  The dollar is getting sold to start the week, so let’s see how far this goes, before the price manipulators come to its rescue. OPEC announced a 1 Million barrel production cut yesterday, and that sent the price of Oil above $80, and the petrol currencies, sans rubles, all to higher ground VS the dollar.

For What It’s Worth…. This is an article from MarketWatch that the famous Nouriel Roubini was interviewed about the Banking Crisis… He seems to believe that we’re all in deep dookie, and it can be found here: Opinion: ‘Most U.S. banks are technically near insolvency, and hundreds are already fully insolvent,’ Roubini says – MarketWatch

Or, here’s your snippet: “‘Most U.S. banks are technically near insolvency, and hundreds are already fully insolvent,’ Roubini says, and he has more to say….

Higher inflation would lead to higher bond yields, which in turn would hurt stocks as the discount factor for dividends rose. But, at the same time, higher yields on “safe” bonds would imply a fall in their price, too, owing to the inverse relationship between yields and bond prices.

This basic principle — known as “duration risk” — seems to have been lost on many bankers, fixed-income investors, and bank regulators. As rising inflation in 2022 led to higher bond yields, 10-year Treasurys lost more value (-20%) than the S&P 500  SPX, +1.44% (-15%), and anyone with long-duration fixed-income assets denominated in U.S. dollars DX00, +0.10% or euros USDEUR, +0.57% was left holding the bag.

The consequences for these investors have been severe. By the end of 2022, U.S. banks’ unrealized losses on securities had reached $620 billion, about 28% of their total capital ($2.2 trillion).

Making matters worse, higher interest rates have reduced the market value of banks’ other assets as well. If you make a 10-year bank loan when long-term interest rates are 1%, and those rates then rise to 3.5%, the true value of that loan (what someone else in the market would pay you for it) will fall. Accounting for this implies that U.S. banks’ unrealized losses actually amount to $1.75 trillion, or 80% of their capital.

The “unrealized” nature of these losses is merely an artifact of the current regulatory regime, which allows banks to value securities and loans at their face value rather than at their true market value.

In fact, judging by the quality of their capital, most U.S. banks are technically near insolvency, and hundreds are already fully insolvent.”

Chuck again… I hold Nuriel Roubini at a high level of knowing what he’s talking about… And that plays nicely in the sand box with my thought that this banking crisis is not over….

Market Prices 4/3/ 2023: American Style:  A$.6735, kiwi .6267, C$ 7429, euro 1.0865, sterling 1.2369, Swiss $1.0911, European Style: rand 17.8664, krone 10.3823, SEK 10.3622, forint 348.88, zloty 4.3050, koruna 21.5740, RUB 78.14, yen 133.30, sing 1.3308, HKD 7.8499, INR 82.33, China 6.8876, peso 17.97, BRL 5.0640, BBDXY 1,228.80, Dollar Index 102.42, Oil $80.39, 10-year 3.49%, Silver $23.98, Platinum $994.00, Palladium $1,471.00, Copper $4.05, and Gold… $1,975.57

That’s it for today… Well, welcome to April… and Pfennig tradition calls for my April joke… If April Showers bring May Flowers, what do May Flowers bring?…. . Pilgrims!  HAHAHAHAHA!  I can hear my darling granddaughter, Delaney Grace, saying: “Awe General! That’s silly!….  Delaney is going to be 16 this summer, and driving!   Now that’s crazy! That Child loves to dance! I sure hope the craziness at the new soccer park has settled down a bit by the time I go to my first game on 4/15…  Everyone else can stand for the entire game, just not the 10 rows in front of me! Last year, a Canadian friend of mine, and fellow baseball fan, started a wager with me on the Cardinals/ Jays games, and the loser owed Budweisers to the winner, so far, I’m down a 6-pack or more!  UGH! Of course you’ll have to come to Jupiter Florida during Spring Training to collect, Craig! The Amazing Rhythm Aces take us to the finish line today with their 70’s song: Third Rate Romance….   Don’t know that one? One of my faves… just YOUTUBE it… I hope you have a Marvelous Monday today, and will continue to Be Good To Yourself!

Chuck Butler

March 30, 2023

* the currencies & metals trading has slowed… 

* why aren’t the dollar bugs seeing the writing on the wall? 

Good Day.. And a Tub Thumpin’ Thursday to one and all! It’s Opening Day in baseball! YAHOO! I said yesterday that this should be a national holiday, and while it’s not, it doesn’t mean that many workers, and school kids, won’t be sneaking out early to attend an Opening Day ceremonies and game near them! It’s the next best thing to Christmas Day in my book! My beloved Cardinals will play the Toronto Blue Jays this afternoon, but before the game begins, we’ll have the coaches, and players brought into the stadium in convertible cars to wave to the fans… Then the Cardinals Hall of Famer Players will meet the current players at home plate, and then, the piece de resistance… The Clydesdales will enter the park and take a route around the ballpark… These are the most magnificent animals on earth, in my opinion… Jackson Browne greets me this morning with his song: These Days… 

That song is the song I quote the line from all the time: These Days I sit on cornerstones, and count the time in quartertones to ten, my friend, don’t confront me with my failures, I , had not, forgotten them…

So, what did the markets do yesterday? The dollar got bought, but not by the bushelful, instead in dribs and drabs that added up eventually to a 2 index point gain in the BBDXY. Gold lost $9.20 on the day, and Silver gained… are you ready for this? Drum roll please…. Ratatatatat.. 1-cent! That’s right I said 1 Abe Lincoln… Pretty crazy that the powers that be couldn’t just round down and have Silver trade flat for the day…  Gold ended the day at $1,965.60, and Silver $23.43…

The price of Oil slipped just a tad, yesterday, but still traded with a $73 handle at the end of the day. And the 10-year Treasury got sold a bit, with its yield rising to 3.57%

In the overnight markets last night… There was little to no movement in the dollar, the BBDXY is trading in the same clothes as yesterday, along with the Dollar Index doing the same. Don’t know what to make of this non-moving market last night… There are no Central Bank meetings to be weary of, there is very little in the U.S. Data Cupboard, and no banks have raised a white flag.  Gold is up $4 in the early trading today, which is a good start to a day that could see the shiny metal reach for the sky… Silver is going gangbusters this morning already up 30-cents!  

The price of Oil slipped a  little in the past 24 hours, but still has a $73 handle… Someone in the Oil trading area, said, “Hey wait! We’re marking the price of Oil higher, but the demand is not there? So, what are we doing here? “  That makes sense to me… while I believe that the price of Oil will eventually move higher, we have to get through this patch of low demand…

The 10-year Treasury at 3.57% is more than 100 basis points lower than the 1-year Treasury at 4.59%.. And inverted yield curve that has remained inverted for some time now, as if to say, “Psst, Hey! Over here! Look at me, I’m inverted, and you know what that means? But still you numbskulls continue to buy stocks like I don’t exist!”

Ok, right out of the starters blocks this morning, I have this from the good folks at GATA: “China and Brazil have reached a deal to trade in their own currencies, ditching the U.S. dollar as an intermediary, the Brazilian government said today, Beijing’s latest salvo against the almighty greenback.

The deal will enable China, the top rival to U.S. economic hegemony, and Brazil, the biggest economy in Latin America, to conduct their massive trade and financial transactions directly, exchanging yuan for reais and vice versa instead of going through the dollar”

Uh-oh! Now China has gotten Saudi Arabia to price their Oil in renminbi, and add to that China has gotten Brazil to turn its back on the U.S.  Chalk that up to another chink in the armor of the dollar!

Did you all hear the story about how while reporter Matt Taibbi was testifying before Congress regarding, regarding Big Tech (particularly Twitter) and its connections with the federal government when it came to suppressing dissident speech, the IRS was visiting his house? The IRS left a note on his door, saying that they would like to talk to him… Coincident? I don’t think so!   See what happens when you tell the truth about the Government?  I guess I had better what my back, eh?

I can’t begin to tell you how upset I was to read about that…  It just makes me sick to my stomach, and I don’t have time to deal with an upset stomach today, not on Opening Day!

I’m on a roll this morning, don’t stop me now!

Well… longtime readers will recall me talking about Japan being a basket case…  Well, they remain one, even with the change in the Bank of Japan Leadership… Mr, Kuroda, who cut interest rates and bought bonds like no man before him, has stepped down, and the new BOJ Chairman, is thought to want to dismantle Kuroda’s, zero interest rate policy, and stop buying bonds…  What that will bring about is a HUGE amount of funds that have been sent overseas by Japanese Investors in search of higher yields… And that could lead to inflation getting a hold of the Japanese economy… Something that hasn’t happened in a generation or two!

And here we go again with Saudi Arabia and China… I told you about how these two countries have agreed to trade Oil in their respective currencies and not use dollars… I told you how China has agreed to build a refinery in Saudi Arabia, and now this, from the good folks at GATA: “Saudi Arabia is joining an anti-Western influence bloc formed by Russia and China, in a sign of Riyadh’s deepening ties with Beijing as the U.S. pivots away from the Middle East.

The kingdom’s cabinet approved a plan to join the Shanghai Cooperation Organisation as a “dialogue partner,” a precursor to being granted full membership, state news agency SPA announced today.”

Chuck again… I still can’t believe that dollar traders haven’t seen the writing on the wall here… What’s it going to take to get them to sell dollars the way dollars need to be sold?  This set of news is HUGE, and the dollar traders are just shrugging it off…  I’m just saying…

I had a fellow down here ask me if I thought the dollar was undervalued? You should have seen my expression that was on my face! I was astounded that he thought it was undervalued…  I immediately began to list off the items that should be weighing down on the dollar, and he just sat there and then said, when I had finished, that none of that matters, because the dollar is the reserve currency, and nothing else matters… 

I walked away shaking my head, knowing that no mater what I said, it was going to fall on deaf ears… I then wondered what it was he was doing asking me if it was undervalued? Oh, I did a V-8 head slap, and said, I get it! He just wanted somebody to agree with him!  Well, he picked the wrong partner to dance with that’s for sure! 

I have always been one of those guys that says what’s on his mind, no matter what the odds are in the room… 

For What It’s Worth…  I have a treat for you today… It’s another video from Matthew Piepenberg, of Gold Switzerland…  Here’s the link to the video: Bond Destruction, Banking Waste and the Tilt Toward CBDC – Matterhorn – GoldSwitzerland   in the snippet today, I’ll give you a preview of what to expect in the video, which is 21 minutes long, so if you don’t have the time… here’s the snippet:

Or, here’s your snippet: “In this extensive and now English-translated, interview with Jan Kneist of Investor Talk, Matterhorn Asset Management principal, Matthew Piepenburg, addresses the critical themes of the ongoing banking crisis. In this substantive, 21-minute conversation, Piepenburg squarely addresses the ripple effects and larger implications of the current banking crisis, namely: 1) its bond crisis origins; 2) the ultimate pretext for (and direction toward) political and financial centralization culminating in CBDC; 3) increasing consolidation away from the smaller banks toward larger banks; 4) the nearly inconceivable waste behind the Credit Suisse bailout; 5) the percolating and equally inconceivable dangers within the derivative markets; 6) the collapse of trust in the USD as evidenced by the rise of the BRICS; and, of course, 7) the growing importance and role of gold in a world heading inevitably toward more centralized controls and currencies. As Piepenburg has warned and repeated throughout 2022 and 2023, all debt-soaked systems inevitably resort to desperate measures and greater controls, of which currency debasement and increased centralization, symbolized by the drift toward CBDC, is no surprise or exaggeration”

Chuck again… I behoove you to check out the video when you have the time to devote to it… I try not to miss anything that Matthew Piepenberg puts out there…

Market Prices 3/30/2023: American Style: A$ 6700, kiwi $6236, C$ .7380, euro 1.0865, sterling 1.2343, Swiss $1.0914, European Style: rand 18.0617, krone 10.4294, SEK 10.3969, forint 350.76, zloty 4.3094, koruna 21.6718, RUB 77.21, yen 132.76, sing 1.3287, HKD 7.8499, INR 82.23, China 6.8870, peso 18.07, BRL 5.1353, BBDXY 1,232.00, Dollar Index 102.47, OIL $73.60, 10-year 3.57%, Silver $23.73, Platinum $981.00, Palladium $1,446.00, Copper $4.10, and Gold… $1,969.90

That’s it for today, and this week… I honestly thought that if I think today should be a holiday, then I shouldn’t write! HA!   But here I am…   back home, March came in like a lamb, and is going to go out like a lamb, it was lion in the middle of the month! Just two weeks ago, it was snowing and freezing cold there for the soccer match!  Our Blues get back on the ice tonight in Chicago to face the Blackhawks! These two teams used to be HUGE rivals, but not so much so any longer… But it’s always still nice to beat them! My time down south is winding down, just two more days here before I head back home…  It was a great winter down here… I did have that stroke in January, but besides that I’ve been in good health and getting plenty of vitamin D! (Florida is known for sunshine!) Smokey Robinson takes us to the finish line today with his song: Cruisin’   ( I love this song!) I hope you have a Tub Thumpin’ Thursday today, and a Fantastico Friday tomorrow, and all that time, please Be Good To Yourself!

Chuck Butler

March 29, 2023

* currencies & metals rebound on Tuesday… 

* the price of Oil continues to rebound… 

Good Day… And a Wonderful Wednesday to you! Tomorrow is Opening Day in Baseball! I’ve long said that Opening Day should be a national Holiday!  But, I’m a dying breed of Americans that believe that Baseball is our National Pastime, the way for fathers and sons (& daughters) to bond, by playing catch, and going to games and learning how to keep score… I like the new speedup rules in baseball, as long as they don’t impede a player’s ability to get ready to pitch or hit! But that’s tomorrow, Opening Day, that is, and I’ll be like a kid at Christmas… And no team does Opening Day like the St. Louis Cardinals! America greets me this morning with their song: This Is For All The Lonely People…

I figure all the times during the year, that I get left alone, that could be my theme song! HA!

Well, when I left you yesterday, I was wondering if the currency and metals traders and participants would get right back on the horse, an ride it into the sunset, or… would they cower under the weight of the PPT, and paper traders (price manipulators)… Well, it was the former of the two.. .The dollar, which was sold overnight, Sunday night, continued to get sold throughout the day yesterday, bringing its day to show a 6 index point loss in the BBDXY…  And Gold, got back on the rally horse, and gained $17.50 on the day to close at $1,974.90, and Silver gained 26-cents to close at $23.42…

I think the fact that traders and participants went right back to work selling dollars, and buying metals, is proof that the PPT and paper traders were in the markets last week… Not that I needed any proof that they were in on Friday! 

In the overnight markets last night… The dollar selling faded out, but no new dollar buying took its place. The BBDXY is up 1 index point overnight, so no biggie there… Gold, however, is down $8 in the early trading today, probably some profit taking there, so let’s hope that’s all there is to this early morning trading. Silver is down 4-cents this morning,  The price of Oil continues to rally and is within spitting distance of $74 this morning, and the 10-year is stuck in the mud at 3.55% 

Well, leave to The FOMC to makes statements under the cover of radar… Check this out:” Projections released on last Wednesday morning revealed that officials from the Federal Reserve expect a significant rise in the US unemployment rate by the end of this year. While the current unemployment rate is at 3.6 percent, Fed’s officials expect it to reach 4.5 percent, meaning that millions of US citizens could lose their jobs over the next few months as the country’s economy grapples with the consequences of the current banking crisis and interest rate hikes affect the economy.

OMG! I can’t believe they came out with that the day they were to hike rates for the 9^th consecutive time later that day!   But then they do feel like they are Gods… And that they control our future… Well, if they are in charge of our future, I’m just sure I want to be part of it! Oh well, one of these days, someone with far more gray matter than I, will come up with a better hula-hoop for the economy that by passes the Fed/ Cabal/ Cartel…  Let’s hope they are in the pipeline, because we need them now!

I read an article this morning that talked about abolishing the Fed… Now that would be something to get behind, wouldn’t it? When I was a young man I used to answer the phone at home by saying “Impeach Nixon”…  If I were still a young man I would change that answer to “Abolish the Fed”… 

Changing gears here… I was talking with a friend the other day, who’s from Canada… She was in agony about the cheap level of the Canadian dollar VS the USD…  I told her that I was actually surprised that the loony had retained its level above 73 cents, given the results from the new Trudeau Budget last week… Spending out of control, and taxation widening…  A bad combination for a currency… I then mentioned that the people of Canada should be rethinking their votes for Trudeau…And I could tell she was getting a little hot under the collar at that last statement from me, so I stopped and said, “Well, a currency is the stock of a country…  And walked away…

OK… remember when I told you that it was not a good thing, when China’s leader, Xi, met with Saudi officials? Well, this last week there was news that China will build a refinery for Saudi Aramco…. Now that’s cooperation, and will lead to Saudi oil being sold to China… and not in dollars! Could this be the beginning of the end to the petrol dollar?  And instead be called the Petrol Renminbi?   I sure hope not, but, China could provide the security to the Saudis, just like the U.S. does… and you don’t see the U.S. over in Saudi Arabia building a refinery… I’m just saying…

Well, as I’ve told you for years now, the euro is the offset currency to the dollar, and when traders go to sell dollars, the main beneficiary of those dollar sales is the euro… And a year ago, the euro was as low as 1.05, since then the dollar has been weaker, especially this year, and the euro has recovered to 1.08 and change… I would expect the euro to return to 1.10 should the dollar selling that’s going on now, continue to reflect dollar weakness…

And one more thing to talk about today and that is the fact that the Fed Heads are performing QE once again, under the cover of darkness… Their balance sheet grew by a large amount earlier this month, so much for reducing their balance sheet, eh? This to me, is the first step by the Fed Heads to put an end to their rate hikes… Remember what I had told you, that the reduction of their Balance Sheet, or QT, was the same as rate hikes? Well, if they stop doing those rate hikes, then the actual physical rate hike stopping won’t be far behind… I’m just saying…

Oh, and that would be a HUGE boost for Gold… Got Gold?

I just watched the sun rise out of the ocean with no clouds or marine layer obstructing it… And orange orb, that peeks over the ocean and then emerges out of it, and lights up the day… Simply beautiful!

The U.S. Data Cupboard doesn’t have anything worth looking at today, and the same holds true tomorrow, we won’t see real economic data until Friday when the Feb reports for Personal Income and Spending are printed, and the PCE (personal Consumption Expenditures) will print…  But I’ll be packing for home on Friday, so I’ll pick it up over the weekend, when I get all hooked up again back home.

To recap… The dollar was getting sold yesterday morning from the overnight markets, and that selling was picked up in the U.S. session and continued throughout the day… The BBDXY lost 6 index points, and Gold rebounded from Friday’s trip to the woodshed with a gain of $17.50, and Silver gained 26-cents!   The FOMC made some nasty forecasts for Employment that you didn’t hear about except from me!

For What It’s Worth… Well, I’ve stated my case against Cryptocurrencies in the past, so I wont’ go down that rabbit hole again today… But what I have for you in the FWIW section today is an article on Bloomberg.com about how Binance crypto firm is in some deep dookie, along with the CFTC (commdoities exchange) and other firms that had dealing with Binance… And it can be found here: Binance Crackdown Threatens US Firms Trading Crypto, Alarming Market – Bloomberg

Or, here’s your snippet: “A top US regulator’s case against Binance Holdings Ltd. is mushrooming well beyond Changpeng Zhao’s company and rattling American firms that officials say worked with the exchange to trade crypto.

The Commodity Futures Trading Commission’s scrutiny of arrangements that three trading firms had with the exchange has already sent chills across an industry, which relies on US licenses to make markets for securities. The firms weren’t identified in the CFTC’s lawsuit.

The stakes are particularly high for American trading firms because even as many have dabbled in crypto, equities and other more traditional assets remain their bread and butter. A serious regulatory misstep could have repercussions on their broader ability to conduct business.

“The risks to US firms are far greater than the risk to Binance,” said Urska Velikonja, a professor at Georgetown Law. “The big risk to them is the ‘lights out’ risk that they lose their license to operate as broker-dealers in the US.”

Chuck again…  I know it seems that I only ever produce articles that are negative toward cyrptos… And that would be correct, because all I ever read is pro-cyrptos, and there needs to be some balance!

Market Prices 3/29/2023: American Style: A$ .6674, kiwi .6234, C$ .7355, euro 1.0854, sterling 1.2347, Swiss $1.0886, European Style: rand 18.1097, krone 10.3982, SEK 10.3902, forint 349.57, zloty 4.3170, koruna 21.7717, RUB 76.09, yen 131.93, sing 1.3291, HKD 7.8499, INR 82.33, China 6.8850, peso 18.16, BRL 5.1667, BBDXY 1,230.50, Dollar Index 102.46, Oil $73.98, 10-year 3.55%, Silver $23.25, Platinum $959.00, Palladium $1,452.00, Copper $4.06, and Gold… $1,966.73

That’s it for today… This sure is a crazy world we’re living in these days… if you went out to dinner at a restaurant, you would look around and think, well, the U.S. economy must be doing well, because this restaurant is packed! But that’s the illusion that’s going on folks… The economy is in the danger zone, and I’m not talking about the song from Top Gun 1…  Crazy, world… Our soccer team, St. Louis City SC… is 5-0, and coming back home for a match this Saturday… Grandson Everett, and dad Jerry, will be going to the game in my seats, which I understand is a misnomer…   Because everyone stands the whole game! UGH! I wonder what it is that paid for? Standing room only, or seats?   The Moody Blues take us to the finish line today with their great song: I’m Just A Singer (in a rock and roll band)…  I hope you have a Wonderful Wednesday today, and please Be Good To Yourself!

Chuck Butler

March 28, 2023

* Paper Traders put the kyboshes on metals buying

* Paring Down banks to a workable number? 

Good Day… And a Tom Terrific Tuesday to you! Well, I threatened to not return, but here I am, it’s early morning, the sun hasn’t even rose out of the ocean yet, and I’m back! I’ve been writing the Pfennig for over 31 years now, it’s a part of me, it’s what I do… I guess it will be very difficult for me to walk away from it when I do decide that I’ve had enough!   Well, the Final Four is in place for the NCAA Basketball Tournament, and I didn’t pick one of them! YIKES! My beloved Mizzou Tigers got beat by an Ivy League team… UGH!  And the Cardinals finished their spring training at Roger Dean with a win… They head north now, and I’ve always said that when the Cardinals go north, I will too…  Jimi Hendrix greets me this morning with his song: Fire

Well, how was last week without me? Fun, eh? Nobody, telling you the sky is falling, and being a Chicken Little… And asking you if you’ve Got Gold?  Let’s do a quick review of last week, before we get into today,.. Well, the data last week wasn’t what a good strong economy is made of… Durable Goods for Feb followed Jan’s negative result with a negative result of its own… The S&P Flash PMI (manufacturing) remained under 50, which means contraction, and on top of that, the FOMC hiked rates 25 Basis Points…  Thus continuing their battle with inflation with a pea shooter…  No more banks failed last week, but there are a few on the edge of failing… Credit Suisse got taken over by UBS, and Deutsch Bank is reeling.. again!

Gold & Silver were having a wonderful week until they weren’t… I was looking at Twitter one day last week, and a pundit said, “Gold is really performing nicely this week, how far will the paper traders take it down this time?”   It WAS just a matter of time, WASN’T it? Gold had touched $2,000 once again, and then the rug was pulled out from under it… One of these days, Alice! 

And the dollar was getting sold like funnel cakes at a State Fair, until it wasn’t…The PPT had to spend some of that Exchange Stabilization Fund that they have, and proceeded to wrap a tourniquet around the dollar’s bleeding, at least for a day… We’ll, have to see if the non-dollar traders still have the intestinal fortitude (guts) to still short dollars…  I think the currency traders all over the world are seeing what’s going on in the U.S. and don’t’ want any part of owning dollars… But there’s always that pesky PPT that keeps throwing a spanner in their plans…

The BBDXY was 1,252 when I left you on 3/16… Last week, the BBDXY had fallen to 1,228, when the PPT stopped the bleeding…  The euro was nearing 1.10 last week, and this morning it’s trading 1.0825… That’s a drop that probably was needed to clean out the profit takers, but now we’ll see where the euro goes now..  The currencies, as a whole, were all looking much healthier last week, until they weren’t…

So, to tie it all together… Last Friday, Gold lost $21.90 to close the week at $1,957.30, and Silver lost 14-cents to close the week at $23.16… The BBDXY ended the week at 1,235… The Price of Oil had rebounded to $72, and the 10-year was 3.53%…   That was how we ended the week last week…

So, that brings us to the overnight trading last night…  The overnight traders didn’t seem to get the memo from late last week, about not selling the dollar any more, because they sold the dollar overnight!  The BBDXY lost nearly 3 index points overnight, and starts the week at 1,232…  There has bee some saber rattling going on with the U.S. and Iran (again!), and that has furthered the need, as the markets participants see it, for more safe haven buying…

Gold is off by a buck this morning, no biggie… Silver has lost 12-cents to start the day, but remains above $23 as I write…  The saber rattling with IRAN HAS THE PRICE OF Oil on the rebound, and Treasuries are a mess these days. I have more on Treasuries in the FWIW section today, so don’t miss that!

This safe haven buying was behind the big move by Gold last week, and the strong moves higher in euros, sterling, and you won’t believe the next currency I’m going to say is a safe haven… The Japanese yen! As amazing as that is, the yen has seen its level rise VS the dollar, to 130…  This is one thing that has me believing my thought that this is a world of opposites, these days… For yen, which is a basket case at best, to be considered a “safe haven” is beyond my comprehension.. .But it is what it is…And we move along..

So… the dollar was on the run last week away from the dollar sellers… And it appears that it will begin this week on the run once again… It’s about time, but that’s a discussion for another day, right now, let’s talk about what happens if the dollar continues to get sold… Well, a weaker currency has always been to blame for allowing inflation enter its respective borders… And what do we, as a country, not need in any shape or form right now?  More inflation!  

And what do we have for a Central Bank that is supposed to protect the dollar’s value to keep inflation from eating the value away? We have a Central Bank that is going after inflation with a pea shooter… 25 Basis Points rate hike? What was that all about? That’s not going to slow inflation one iota! Our Fed Funds rate is still below the rate of inflation, and that’s even using the watered down inflation rate that the BLS puts out each month that would be funny if it weren’t what they try to get the markets to believe is real inflation.. The BLS should be required to meet John Williams at www.shadowstats.com  now I would love to be a fly on the wall at that meeting!   

I read a piece from Ed Dowd, who explained that all these bank problems will lead to the shrinking of banks all over the country, down to just 6 major banks, and that will make the introduction of digital currencies easier… Hmmm… now there’s some real food for thought there folks…  That would mean that we’ve still got some time before they take away all our folding cash…  Banks defaulting, or getting taken over is not a good thing, folks…

Ok, remember when I wrote that we would see defaults, because of debt to the eyeballs of Corporations, States, Countries, etc. and that the default of these entities would then be the reason for the Gov’t to issue digital currencies?   Well, while I was on vacation, Paul Craig Roberts, wrote this: “There is, of course, the question:  Is this real stupidity or is a plot unfolding to collapse the financial system as we have known it in order to “save” us with the introduction of central bank digital currency?  Are we passing from the remnants of democracy and self-government into total tyranny?”

Chuck again… yes, the loss of the last of our civil liberties, will be the result of the introduction of digital currencies… The Gov’t will then know everything they need to know about you… Does this sound a bit like 1984? The book, that is… By George Orwell…  Now that’s some scary stuff, folks, but it’s what is going to be the result of digital currencies… Mark my words on that… One day, in the future, you’ll tell your grandkids, or great grandkids, that Chuck Butler, warned them and very few listened…. Got Gold?

I read this morning, that $286 Billion has been taken from banks and deposited in money market funds… Uh-Oh… These are not the FDIC insured money market funds, folks, these are the uninsured funds that had to bailed out in the financial meltdown of 2008…  Look, the U.S. was in a pickle in 2008, but the debt they held was no where near the $30 Trillion they’ve racked up since then… So, for the gov’t to think that they will be able to bail out Tom, Dick and Harry, they are sadly mistaken, the financial system will be strained to the end… I’m just saying…

The U.S. Data Cupboard today just has the Case/ Shiller Home Price Index for Feb… I do believe that home sales were still iffy at best in Feb.. We’ll see this morning if that’s right…   The rest of the week is lacking any real economic data, until we get to Friday… So, section of the letter will be a big bore, this week!

To recap.. last week was a good week for the currencies and metals until it wasn’t… The price manipulators and PPT decided enough was enough, and stopped the dollar selling, and metals buying in a heartbeat… Now we begin this week starting over, and see how far we get this time… Banks are still in trouble, folks… and that could lead us to an eventual number of banks that would make introducing digital currencies easier… We’ll see where that goes from here…

For What It’s Worth… Well, while on vacation, I read a piece from Matthew Piepenberg, from Gold Switzerland, and his words, once again are ringing true… This article is about how U.S. Treasuries have lost their shine, and it’s the debt and tons of issuance of the Treasuries that have them getting sold, and not wanted any longer.. the article can be found here: Je T’Accuse: To Bond Killers & Other Villains Destroying Our World – Matterhorn – GoldSwitzerland

Or, here’s your snippet: “As I recently observed, there’s something very unsettling when the most important bond in the global financial system–one for which 1) bank safety and liquidity levels are measured, 2) derivative markets are collateralized and 3) global sovereign nations hold (> $7 trillion) as reserve assets—suddenly loses its shine, trust and credibility.

In short: The UST matters.

Sadly, however, after years of backing unsustainable debt levels and exporting U.S. inflation around the world, no one trusts this critical sovereign bond anymore.

In fact, Uncle Sam’s infamous IOU is less of a promise of “risk-free-return” than it is an objectively corrupted symbol of “return-free-risk.”

Hard to believe?

Well, let’s just look at the unprecedented (and so-oft predicted/warned) volatility in the UST market of recent days.

Last week, for example, liquidity in US Treasuries (and German bunds, btw) sank like a rock, with ripple effects throughout the world.

On Monday, the 2-Year UST saw yields fall in single-day trading to levels not seen since 1987.

By Tuesday and Wednesday, intra-day volatility levels in the UST market surpassed those of the Great Financial Crisis of 2008.

But that’s not the real record-breaker. Far from it.

As Bloomberg’s David Ingles confirmed, last-week’s extreme volatility and yield-moves in the 2-Year UST posted 3-sigma moves, something that MIT mathematicians argue should only occur statistically once every 50+ million years.”

Chuck again… As I always say when using a snippet from Matthew Piepenberg, it would behoove one, to click on the link and read the entire article.. .

Market Prices 3/28/2023: American Style: A$ .6673, kiwi .6225, C$ .7316, euro 1.0825, sterling 1.2318, Swiss $1.0896, European Style: rand 18.1969, krone 10.4330, SEK 10.3656, forint 354.56, zloty 4.3260, koruna 21.9099, RUB 76.61, yen 130.79, sing 1.3284, HKD 7.8499, INR 82.19, China 6.8811, peso 18.19, BRL 5.1967, BBDXY 1,232.30, Dollar Index 102.62, Oil $72.92, 10-year 3.54%, Silver $23.02, Platinum $969.00, Palladium $1,411.00, Copper $4.02, and Gold… $1,956.63

That’s it for today… I’m back in the saddle again, Out where a friend is a friend, Where the longhorn cattle feed, On the lowly gypsum weed… Ahhh, Gene Autry, the singing cowboy! Yes, I’m back, and this time for a long time until my annual summer vacation comes along, but that’s not for a few months… my new iWatch tells me that I’ve reached my Activity goal 19 straight days! Woo Hoo! But there’s no more walking to the ball park, etc. so I’ll have to get out and move during the day… UGH!   How about that STL City SC that’s 5-0 to start their inaugural season?  Now that’s exciting!   I sure hope it warms up in St. Louis for my first game which will be 4/15!   I don’t know how I’ll get through a game there, as the fans all stand the entire game!  I can stand about 5 minutes… Uh-Oh!   The late great Marvin Gaye takes us to the finish line today with his song: Mercy, Mercy Me…   I hope you have a Tom Terrific Tuesday today, and please Be Good To Yourself!

Chuck Butler

March 16, 2023

* currencies get sold, Gold get bought on Wednesday

* Bond traders think the rate hikes are over? 

Good Day… And a Tub Thumpin’ Thursday to one and all! This being the last Pfennig before my annual spring vacation starts, will hopefully be chock-full-o-stuff that interests you, and prods you into making a decision about your investment portfolio! I say that, because, you can’t project that I will absolutely, with no reservations, return… I’m just saying… OK, on the upbeat note (NOT!) Team USA won their game last night and therefore moved on to the knockout round. I stayed up to watch the game, and am regretting that decision this morning, as I’m dragging the line as the sun rises…  Bob Marley greets me this morning with his great song: Three Little Birds…  You know… “don’t worry about a thing, ‘cause every little thing going to be alreight”.. yeah, that song…

The dollar started yesterday roaring, with it up 8 index points to start the day, and then went on to add 3 more index points during the day to end up 11 for the day… But dollar weakness wasn’t the cause for Gold to soar yesterday… Gold was up more than $20 yesterday, before the price manipulators showed up, and pushed the metal down, but Gold still booked a gain of $15 on the day to end at $1,919.40. Silver got bought too, and saw the same price action as Gold, with it rising nicely during the day, only to see ti get whacked later, but hang onto a gain of 6-cents to close at $21.88…

The price of Oil has really lost a lot of ground in the last 2 weeks… In the past 24 hours, the price of Oil has dropped $3 to trade with a $67 handle… That looks strange to me, that $67 handle, but it is what it is, and I move along, for I talked about Oil traders yesterday… Forgot what I said? Well, simply go to the website for the Pfennig, and read it there: www.dailypfennig.com 

In the overnight markets last night, the dollar saw some selling, and the BBDXY lost 2 index points, the shine has been taken from the Mexican peso folks… Well, that was fun while it lasted, eh? With the price of Oil slumping badly, the Petrol Currencies are seeing lots of selling, and the peso has had the best run recently, so it makes sense that profit taking is setting in…  Look what the weak Oil price has done to the Russian ruble… And the Norwegian krone, and Canadian loonie, etc…. 

The best performing currency this week has been the Japanese yen… Yes, I had to recheck that a couple of time (measure twice, cut once) (belt and suspenders) cause that’s the kind of person I am…

Yen performing well, is just as strange as it sounds… But that’s the case, and I can’t deny it… I thought it was just last week that the Bank of Japan, announced more bond buying… But then opposites still rule, so there you go!

I read an article that talked about how bond traders are now betting that the Fed Heads are not going to hike rates any further, and so bonds are getting bought like funnel cakes at a State Fair!   What are these guys/ gals smoking? There has been on indication that the Fed Heads are going to do a knee jerk reaction to two failed banks, so why would you go out on a limb like that and say that the Fed Heads are finished with their rate hikes?  Aye, Aye, Aye….

Well, I saw this on Twitter yesterday… “Moody’s cuts outlook on entire U.S. Banking system to negative from stable, citing a “rapidly deteriorating environment”… 

See? Didn’t I tell you that the two bank failures last week, would lead to more problems for banks? Even Moody’s, the rating agency, that can’t seem to find its rear end with both hands, sees the problems for banks going forward…  It’s not often that I see the ratings agencies, one of the main culprits of the housing bubble in 2008, and I on the same page…  Better write that one down, for all eternity! HA!

I have a serious situation in the For What It’s Worth section today, regarding talking about Bank failures, you’ll want to make sure you read that section today!

But wasn’t that warning from Moody’s sort of like: Too little, too late? Well, yes it was… too late to help anyone that had invested in the Bank… Unless of course, the Gov’t decides to bail out all investors too! I shudder to think what kind of precedence that would set…  Because, the Good Lord, knows how many stock losses I’ve had over the years, and if the Gov’t is going to make reparations for stock losses, can you imagine the problems that would incur?    I shake my head in disgust that we’ve gone this far with bailouts!

Well, Credit Suisse had a good day yesterday… It received a 50 billion Swiss franc credit line with the country’s central bank.  But even that news isn’t stopping the Swiss Federal Council from convening a  special meeting on Thursday (this morning)  to discuss the situation at Credit Suisse Group AG, according to Swiss news service AWP.

The Swiss government usually holds regular meetings on Fridays, and it’s unclear if it will make any immediate decisions, AWP said, citing a report by affiliated news service Keystone SDA. That cited unidentified sources familiar with the matter. 

I got some of that info from Bloomberg.com…  

The U.S. Data Cupboard yesterday has the Feb Retail Sales, and like the BHI indicated the Retail Sales report was very disappointing, printing a negative -.4%, and that was including the Valentine’s Day sales, that are usually enough to prop up Feb Retail Sales, but not this year… I’ll say it again, and maybe this time it will sink in… Consumers are tapped out… They need more stimmy checks, they need the Gov’ to bail them out of their debt that’s up to their eyeballs, they need to find a genie, and a lamp!

Today’s Data Cupboard has a lot of minor prints, but the usual Tub Thumpin’ Thursday fare is head and shoulders above the minor reports, and that is the Weekly Initial Jobless Claims… Pretty soon, this data is going to show the increase of employees getting laid off…. Maybe this week?

To recap… The dollar fought back yesterday but only gained 2 index points on the day, and in the overnight trading last night it gave back those 2 index points!  Gold soared yesterday for a 1/2 of the day, before the price manipulators took their pound of flesh from Gold, but the shiny metal was able to eke out a gain of $14.90 on the day…Silver saw the same price action… In the early trading today, Silver has climbed back above $22…  The shine is off the peso, and the yen is the best performing currency this week… Yes, I meant to write that!

For What It’s Worth…  And now… first we had censoring of people’s thoughts on Twitter, then YouTUBE, then Facebook, or whatever it is called these days, and so on… Then they censored anyone talking about the Biden laptop fiasco, before the election… And guess what’s on their censoring agenda now?  Well, I’ll let the folks at the Burning Platform tell you what: this article can be found here: https://www.theburningplatform.com/2023/03/15/censoring-social-media-to-prevent-bank-runs/

Or, here’s your snippet: “The people within the system know when a bank is failing, as we saw with SVB’s recent collapse.  Senator Mark Kelly (D-Arizona) asked the Federal Reserve, Treasury Department, and Federal Deposit and Insurance Corp (FDIC) if it would be possible to censor information that could lead to future bank runs. Kelly is denying the claims despite people on both sides confirming his question.

The government implements bots on social media to support its agenda. Elon Musk exposed Twitter prior to the takeover. Twitter admitted when filing with the Securities and Exchange Commission (SEC) that around 5% of its 300 million users are in fact fake accounts. Once Musk began to crack down on fake accounts, members of the Democratic Party saw sharp declines in followers.

So Kelly’s proposal is not merely a method to avoid bank runs. This is infringing on our Constitutional right to the freedom of speech to control the masses via media. Let us not forget that nearly all social media platforms heavily lean left and support the same message.”

Chuck again… This really ticks me off! What the hell happened to “Freedom of Speech”? Have we become a communist nation overnight? Really… I’m asking a serious question here? Freedom of Speech, is one of the backbone’s of our Free Country! Take it away, and what have you got? 

I’m really upset here folks, you should see me, I’m hammering on the keyboard like the keyboard is to blame for this doltness!   I sure hope that someone with an ounce of gray matter reminds Mr. Kelly that there is this thing called a Constitution….  I’m sure he is unaware of the Constitution and the Bill of Rights,  just like most of his colleagues…  

I’m going to keep writing about this banking situation, as long as I can, you can bet your last bottom dollar on that! Well, then you ARE going on vacation, Chuck… Oh, that’s right! Ok, I’ll write about when I get back, because I’m sure there will be more to write about!   

You know, I never talk about my birthday, but this year I am… Next week is my birthday, and one that I’ll appreciate even more, due to my two recent near death episodes… So, Happy Birthday to me, next week… 

Market Prices 3/16/2023: American Style: A$.6648, kiwi .6163, C$ .7273, euro 1.0607, sterling 1.2043, Swiss $1.0765, European Style: rand 18.3820, krone 10.7743, SEK 10.5673, forint 373.89, zloty 4.4293, koruna 22.6086, RUB 76.26, yen 132.79, sing 1.3480, HKD 7.8494, INR 82.73, China 6.8963, peso 19.04, BRL 5.2684, BBDXY 1,252.80, Dollar Index 104.45, Oil $67.57, 10-year 3.45%, Silver $22.02, Platinum $968.00, Palladium $1,456.00, Copper $3.87, and Gold… $1,925.15

That’s it for today…  And for this week, and until March 28…  What the heck happened to our Blues this year? They lost a game last night on home ice, giving up 8 goals! YIKES! After a 2-game road trip, my beloved Cardinals return to Roger Dean Stadium today, and I’ll be there! By myself! It was an ugly day here yesterday, with clouds and rain, and wind… You’ve got to have those kinds of days, to appreciate the beautiful ones even more! I forgot to mention the other day that it was Kathy’s Mom’s Birthday! She turned 87, and is still on the move!  Happy belated Birthday, Kathleen! Or Granny as my kids call her!  The Outlaws take us to the finish line today with their near 10 minute song: Green Grass and High Tides… I hope you have a Tub Thumpin’ Thursday today, and a Fantastico Friday, St. Patrick’s Day tomorrow! I sure hope someone kisses me since I’m Irish!  I hope you will Be Good To Yourself!

Chuck Butler

March 15, 2023 

* Currencies & metals see profit taking on Tuesday

* Banks in Europe have the same problems… 

Good Day… And a Wonderful Wednesday to you! And Welcome to the Ides of March! The cold front that moved through Monday night, left temps in the high 70’s yesterday, beautiful! Even with the ocean acting up, it has still maintained some beautiful colors in recent days… And the sea breezes have been wonderful too! I love it here, in the winter, and now next week the early spring… I took Kathy to the airport yesterday evening, and now I’m all by myself for a couple of days until. Dawn, Jerry, Delaney, and Everett come to see me on Friday afternoon… Speaking of Friday, it will be St. Patrick’s Day!  Go Green!  Kiss me, I’m Irish, and all of that! I’ll be wearing my special St. Pat’s Day shirt, it’s a real winner! Wild Cherry greets me this morning with their song: Play That Funky Music

Well, I guess when you have two days of major buying of Gold & Silver, and major selling of the dollar, that there was bound to be some profit taking from the short term investors, and that’s what I believe we saw yesterday… This from Kitco: “Gold prices are weaker in midday U.S. trading Tuesday, on a normal downside correction following strong gains posted Monday.”  So… for the record, Gold lost $10.40 for the day, remaining above $1,900, and ending the day at $1,904.30, and Silver lost 12-cents on the day to close at $21.7…   The BBDXY was up for the day in the morning, but gave way to selling in the afternoon, finally ending up down 2 index points at 1,243…  

The Big News yesterday was the stupid CPI remained above 6% on an annual basis in February… Like I’ve said before, inflation is sticky, and it will take all the rate hikes that the Fed Heads can muster/ stomach, to defeat inflation… There are still those cry babies out there in the stock jockey land, that continue to whine and cry about the high interest rates, and that the Fed Heads should pivot…   I really don’t agree with them, because they are only looking out for their own investment portfolios, or their ability to sell more stocks…  

I would warn them that they should be careful what they wish for… In the Bonner Private Research newsletter yesterday, Dan Denning had this to say: “Remember, history shows that recessions and stock market corrections usually begin AFTER the rate hiking cycle, when the Fed CUTS.” 

Chuck again… WOW! Now that’s something that we all should take into account, for I obviously hadn’t researched that previously, so it was news to me!

In the overnight markets last night… the dollar got bought like funnel cakes at a State Fair! The BBDXY gained 8 index points overnight, and has the feeling that currency traders know something that we don’t! And it can’t have anything to do with the solvency of U.S. Banks, because, in my opinion, that’s tenuous at best…  Gold has eked out a gain in the early trading today of $3, and Silver has added 12-cents this morning.  The price of Oil has fallen out of bed, and trades this morning with a $70 handle…

I think the Oil traders are the only asset class traders that see what’s going on in the World, right now with debt up to each country’s ears, inflation rising, and being sticky, and the rot that’s on the vine of each country’s economy, and know that demand for Oil is going to wane in the coming months, and so , they have seen to it that their fears, are expressed in the price of Oil.

I forgot to mention something else that good friend, Dennis Miller and I talked about the other day, and that is the new program that the Fed Heads introduced that will provide funding to banks in trouble… Here’s some more from Bill Bonner’s letter: “The facility will allow banks to take advances from the Fed for up to a year by pledging Treasuries, mortgage-backed bonds and other debt as collateral. By allowing banks to pledge their bonds, they can meet customer withdrawals without having to sell their bonds at a loss, which is what Silicon Valley Bank did last week, sparking a run on the bank.…the Fed won’t look to the market value of the collateral, which in many cases reflect big unrealized losses due to the jump in interest rates.” 

Chuck again… So, isn’t that just another form of QE? Buying bonds to help a bank keep its head above water, no matter what condition the bonds are in?  To me this is just another lame brained idea from the PHD’s at the Fed/ Cabal/ Cartel… Screw the people, they are not worthy!   Only the select few among the crowds in the bank that have more than $250,000 on deposit are worthy!

I had better stop there before I go and say something that gets me shut down! I could be labeled a “domestic terrorist”…   Now getting a moniker like that would certainly increase my readership now wouldn’t it! HA!

The banking news from Europe isn’t any rosier than here folks… Yesterday, trading was halted on several banks because of selling pressure. Credit Suisse shares slid 24% after Saudi backer rules out further assistance, and other banks are reeling from the news from Credit Suisse…  You know, the ruling class thinks the rest of us are all walking, talking idiots, dolts, twits, and any other word that describes how they fell about us… They can’t believe that the walking talking dolts, have seen the banks for what they are and are pulling money out of them…

And this has been a major piece of the problems for banks… The Banks were flush with cash that was deposited, thru profits from Companies, and stimmy checks from the walking talking dolts… They had to put the money to work, to make an interest rate spread… Since they weren’t paying much in interest, they’re goals of making an interest rate spread , weren’t that difficult… They looked at the Treasury yield curve, and bought bonds…

Now what have I been warning you all about for over a year now? That buying bonds was a bad idea, as long as the Fed Heads had their interest rate hike hats on… That buying bonds with a low yield, was not a good idea, if the next bond that’s issued has a higher yield, and the next bond has an even higher yield, etc…  I’ve explained that one should wait until the Fed Heads indicate that they are nearing an end of their rate hike adventure, and THAT would be the time to buy bonds…  

Apparently bank CFO’s don’t’ read the Pfennig… Because they did the exact opposite, and bought zero and 1% yielding bonds, that had unrealized losses on the books, that didn’t have to be taken, until… The Banks had to sell the bonds to shore up their capital…  Uh-Oh!   Well, you can’t say that I didn’t warn them, just because they didn’t think it would be worth their precious time to read the Pfennig, doesn’t remove the fact that I warned them!

So… the crybabies are calling for the Fed Heads to pivot and cut rates at the next meeting that will take place on March 21-22… One of those two day meetings where all the board games get brought out for the Fed Heads to play while they wait for their time to announce another rate hike! You know, in the beginning of the rate hike adventure, I really didn’t think that Chairman, Powell, had the  intestinal fortitude to carry out the mission of defeating inflation that they themselves had created…  But, so far, Powell, has carried out his mission like a real trooper… And so, to me, now is NOT the time to pivot, for the Fed Funds rate is still below the inflation rate!  You can’t defeat inflation like that! Rates have to go much higher…

Remember when I told you that we were in a position that the lawmakers, and Treasury, and Fed Heads had backed us into… And that position is to either throw out all the work in fighting inflation (rate hikes), and allow inflation to rise and take over the economy thus brining it to its knees… Or… we can decide to fight inflation with much higher interest rates and bring the economy to its knees that way…  As Bill Bonner has said for some time now… Inflate or Die…

My position on this is that we need to defeat inflation, and worry about the other stuff later, we need to get households back on terra firma, and if that causes a long recession, then so be it… We, as a country, have lived through long recessions before, and even though the Fed Heads have prevented a recession for years now, we’ve lost sight of how to do this… But, we will need to hunker down, spend wisely, and not cause any commotion… The excesses of the previous boom, will be cleaned up, and we’ll start over again, stronger, because inflation isn’t hanging over us like the Sword of Damocles…

Ok, I’ll step down from my soapbox now… I always seem to tick off some readers when I decide to opine on the soap box… But, somebody has to do it, and it might as well be me!

Before I head to the Big Finish today, I wanted to mention that the corporate layoffs had been quiet lately, until this was announced yesterday: Meta Platforms CEO Mark Zuckerberg wrote in a blog post on Tuesday that the company will “reduce our team size by around 10,000 people and to close around 5,000 additional open roles that we haven’t yet hired.”

And the economy is so strong, that not only are employees of this company are being axed, but also that the open positions have been erased… deleted…

The U.S. Data Cupboard yesterday had the aforementioned stupid CPI… Today’s Data Cupboard has the Feb Retail Sales for us… The Butler Household Index (BHI) indicates that this report will be very disappointing… Consumers are really feeling the pinch of their what is left for disposable income… And this report should show that, but then who knows? The Gov’t bean counters could decide to manipulate this report too… UGH!   We’ll also see Feb PPI (wholesale inflation)… This is a preview of what we will see in consumer inflation in the coming months… Remember, I keep telling you that inflation is sticky…

To recap… Yesterday looked like a normal day of profit taking after two days (Friday & Monday) of huge gains in Gold & Silver, and shorting the dollar… The BBDXY lost 3 more index points on the day, thus signaling that the major selling of the dollar was over… And that was proved to be correct in the overnight markets where the BBDXY gained 8 index points!  Today is the Ides of March… the day that was forecast to be the day that the digital currency was announced… I don’t think that will happen today, so go on, move along for these are not the digital currencies we’re looking for…  HA!   

For What It’s Worth…  well talk about saying oops! That’s what this article is about… The Good folks at GATA sent me this note, and it’s about how the two failed banks last week had just gone through examinations and got a bill of good health, this is a Wall Street Journal article, so you have to have a subscription to read it.. but fear not… I have the particulars in a snippet for you… but it can be found here: KPMG Gave SVB, Signature Bank Clean Bill of Health Weeks Before Collapse – WSJ

Or, here’s your snippet; “Silicon Valley Bank failed just 14 days after KPMG LLP gave the lender a clean bill of health. Signature Bank went down 11 days after the accounting firm signed off on its audit.

What KPMG knew about the two banks’ financial situation and what it missed will likely be the subject of regulatory scrutiny and lawsuits.

KPMG signed the audit report for Silicon Valley Bank’s parent on Feb. 24.

Regulators seized the bank on March 10 after a surge of withdrawals threatened to leave it short of cash.

“Common sense tells you that an auditor issuing a clean report, a clean bill of health, on the 16th-largest bank in the United States that within two weeks fails without any warning, is trouble for the auditor,” said Lynn Turner, who was chief accountant of the Securities and Exchange Commission from 1998 to 2001.

Two crucial facts for determining whether KPMG missed the banks’ problems are when the bank runs began in earnest and when the bank’s management and KPMG’s auditors became aware of the crisis.”

Chuck Again… that reminded me of something I once said to a group of bankers at a meeting… That I would be the best bank examiner there ever was, because I know where the bones are buried… And apparently these auditors didn’t!

Market Prices 3/15/2023: American Style: A$ .6640, kiwi .6200, C$ .7275, euro 1.0626, sterling 1.2086, Swiss $1.0845, European Style: rand 18.3792, krone 10.6880, SEK 10.5637, forint 372.03, zloty 4.4316, koruna 22.5119, RUB 75.91, yen 133.56, sing 1.3459, HKD 7.8478, INR 82.60, China 6.9950, peso 18.86, BRL 5.2538, BBDXY 1,251.56, Dollar Index 104.41, Oil $70.45, 10-year 3.54%, Silver $21.83, Platinum $970.00, Palladium $1,449.00, Copper $3.93, and Gold… $1,907.16

That’s it for today… Whew! I did a quick look at my bank account this morning, and found that it hadn’t been converted  to digits… I still think that when the announcement is made for digital currency, that will be done on a weekend, and we’ll start Monday with digits… Well, have you completed your NCAA Tournament Bracket? I filed mine… I always used to say, “here’s my $20 annual contribution”… Usually by the time the Sweet Sixteen are left, I have torn my bracket up and thrown it away! UGH!  I’m all by myself again… Hello, Pizza Man Pizza? HA!   My darling granddaughter, Delaney Grace, will be here for the St. Pat’s Day celebration here at the Condo… Can you believe that little d, will turn 16 this August? Where did those 16 years go?  Oh well… se la vie…   Jay & The Techniques take us to the finish line today with a song that we used to play in my first band: Apples, Peaches, Pumpkin Pie…  What? Don’t know that one? YOUTUBE it, I think you’ll like the song… I hope you have a Wonderful Wednesday today, and will continue to Be Good To Yourself!

Chuck Butler

March 14, 2023

* currencies & metals rally on Monday

* Banks are sitting on a mountain of unrealized losses! 

Good Day… And a Tom Terrific Tuesday to you! Another beautiful day here yesterday… We got a brief bit of rain last night, and that’s the only rain we’ve seen in month! But cold front moved in, again… That means the highs for the next couple of days will be in the 70’s…  cold front, he he he…   Whenever there’s a cold front that come through, the ocean gets very angry… Our Blues had won 2 straight games, before falling on the ice again last night, and losing… It has been a lost season for the Blues this year… There’s always next year! I’m excited about the NCAA basketball tournament that will begin tonight with play-in games… My beloved Mizzou Tigers play on Thursday afternoon, while I’m at the baseball game. UGH! Brian Setzer and his orchestra greet me this morning with their version of the song: Sleepwalk…

Well, the fear that’s in the markets from consumers/ investors, has greatened… I really don’t know what else to call it, other than fear…  And when there’s fear, there’s a run to Gold… And that’s exactly what we saw yesterday… Gold gained $45.80 on the day, to end the day at $1,924.70, and Silver outperformed Gold on a percentage basis, gaining $1.28, to end the day at $21.90… The dollar got sold again yesterday, as it followed up the overnight selling. The BBDXY lost over 6 index points from Friday’s close yesterday, and looks to be in trouble right now… The euro climbed back over the 1.07 figure, and all the other currencies followed the Big Dog euro, as it chased the dollar down the street.   But what will the currencies be when they are compared to a digital currency?  Ahhh, that’s the $64 question, folks… Stay tuned, same bat time, same bat channel!

My longtime friend, and best selling author, Bill Bonner, has maintained that the Fed will continue to hike rates until they break something…  Well, did the breaking of two banks last week, equal a real breaking of something? I doubt it… But it could, be the reason the Gov’t decides to go to digital currency, and not wait any longer…  But I did read an article yesterday where the pundit said that these two bank failures will push the Fed to pivot and cut rates by 100 Basis Points!  Wow, now that was from left field!  But what would happen if the Fed/ Cabal/ Cartel did decide to pivot now, after telling everyone that would listen that they are in the rate hike business until inflation is back to 2%?   

It would mean that the Fed/ Cabal/ Cartel has decided to hell with all of us suffering from inflation! Changing horses in the middle of the stream is never a good idea, and changing their position in the fight against inflation now, would also be bad idea…  Now, I’m not one to think that people should suffer from a bank failure, but… All of us with deposits in the bank, no matter what bank it is, are adults, and we know that the limit for a join account is $250,000 , FDIC insurance…   Any amount over that figure, is each depositors risk… And when you put funds at risk, you could lose them…  So, for the Gov’t to step in and say that all depositors’ funds will be available to them, is NOT, what should be done here…

I won’t go on and on about the bank’s failure, the regulators’ failure, and the depositor’s failure, to monitor what the heck was going on with these two banks… But in the end, why does the Gov’t need to stop in and cover up all their sins?   

Bank stocks all over the world took a hit yesterday… Here’s Reuters with their call on this: “Shockwaves from the collapse of Silicon Valley Bank further pounded global bank stocks despite President Joe Biden’s efforts to reassure markets. Emergency U.S. measures to shore up banks by giving them access to additional funding failed to dispel investor worries.”

In the overnight markets last night…The selling of the dollar came to and end. Apparently, currency traders were satisfied with the drop in the dollar that was associated with the failure of 2 U.S. banks last week. The BBDXY gained 1 index point overnight, and Gold is seeing some selling in the early trading today. Gold is down $11 this morning, and Silver has lost 15-cents to start the day. I had a conversation with a guy on Saturday, and he asked me if I thought the dollar was trading where it should… And I emphatically said no! The dollar is overpriced, and has been for sometime now… He then wanted to know why I thought that, and I reeled off a list of things that would make you wonder if I sat up nights thinking of these things… But, as I explained to the man, just because I think that the dollar is overpriced, doesn’t mean a hill of beans to the markets, for they don’t see it that way…

The price of Oil keeps slipping by the day, with it trading with a $73 handle this morning… The Oil price is really playing heck with Petrol Currencies… The darling Mexican peso has lost its shine, with the weak Oil price, and the Norwegian krone is cheaper than the Swedish krona, and that’s a phenomenon that rarely occurs… The Russian ruble has lost its shine, and Canadian dollar/ loonie, can’t stop stepping on its own feet… 

Well, here’s where I draw the line of being believable or not… Remember when now Treasury Sec. Janet Yellen said that “the U.S. wouldn’t experience another financial crisis”?   Kind of reminded me of when then, Fed/ Cabal/ Cartel chairman, Ben Bernanke, said that there was no housing crisis in 2008?  These public figure heads are there to make sure that the regular folks, don’t panic and sell… When the fit hits the shan, later, they just go hide and you don’t hear from them again…  But the rot on the economy/ markets vine has been exposed, and everyone knows it, but they have forgotten that they were told there was no crisis… But I don’t forget these things… and I find it to be my job to remind everyone!

Well then, thank you Chuck! Wait! What? Don’t be thanking yourself you dolt! Well, my dad taught me long ago that if you don’t toot your own horn, who else is going to do it?  So there! And don’t be calling me a dolt!  Even if sometimes I write like one! HA!

Ok, back to being serious… The good folks at GATA sent me a note on SVB and other banks that took a snippet from, here it is: “Silicon Valley Bank’s collapse last week sent tingles of panic down investors’ spines as it highlighted a larger problem across the banking sector: The widening gap between the value large lenders place on the bonds they hold and what they’re actually worth on the market.

SVB’s downfall was tied, in part, to the plunge in the value of bonds it acquired during boom times, when it had a lot of customer deposits coming in and needed somewhere to park the cash.

But SVB isn’t the only institution with that issue. U.S. banks were sitting on $620 billion in unrealized losses (assets that have decreased in price but haven’t been sold yet) at the end of 2022, according to the FDIC.

What’s happening: Back when interest rates were near zero, U.S. banks scooped up lots of Treasuries and bonds. Now, as the Federal Reserve hikes rates to fight inflation, those bonds have declined in value.”

Chuck again… yes, these are “Unrealized losses”, and they don’t have to be taken… Unless, there’s a run on their deposits like SVB had… And once again, I don’t believe these two bank failures is enough to get the Fed Heads to pivot and reverse their rate hike agenda… So, in that case, interest rates will continue to rise, and thus worsen the unrealized losses of banks…  They’ve got that going for them, eh?

The U.S. Data Cupboard today has the stupid CPI report for Feb.  I really don’t get why the markets still look at the stupid CPI, for it doesn’t properly reflect what the real inflation rate is, and how could it, given all the hedonic adjustments that have been added to the stupid CPI calc over the years… And those hedonic adjustments just keep getting added, there was a change to CPI made just a month or so ago!  As I’ve talked about previously, several times, that is, John Williams at www.shadowstats.com does the calc the way it was done before Clinton and Greenspan began the spiral of hedonic adjustments to CPI, and his calc is the only inflation calc that counts in my book!

To recap… The dollar got sent to the woodshed yesterday, with Gold & Silver being the main beneficiaries of the failure of two U.S. Banks last week.  Chuck doesn’t believe that these two bank failures will be the end of this…  And investors are fearing that there will be more rot on the vine exposed, and therefore the safe haven investments of: Gold, Silver, Swiss francs, and Treasuries have been the end choices of investors… Bank stocks are taking a hit, and well they should!  There has to be many a bank that has the same makeup as SVB out there folks…  And the Unrealized losses of the Banks is going to get worse, as interest rates continue to climb… And the price of Oil keeps slipping, and that has really weighed heavily on the Petrol Currencies…

For What It’s Worth… This came to me from long time reader, Bob, who thought it might be important, and I agree! This is an article about the SVB failure, etc and it can be found here: Ellen Brown: The Looming Quadrillion Dollar Derivatives Tsunami  – scheerpost.com

Or, here’s your snippet: “A fuller report on the collapse of SVB will have to wait on developments that occur over the weekend and soon thereafter.

This column, meanwhile, focuses on derivatives and is a followup to my Feb. 23  column on the “bail in” provisions of the 2010 Dodd Frank Act, which eliminated taxpayer bailouts by requiring insolvent SIFIs to recapitalize themselves with the funds of their creditors. “Creditors” are defined to include depositors, but deposits under $250,000 are protected by FDIC insurance. However, the FDIC fund is sufficient to cover only about 2% of the $9.6 trillion in U.S. insured deposits. A nationwide crisis triggering bank runs across the country, as happened in the early 1930s, would wipe out the fund. Today, some financial pundits are predicting a crisis of that magnitude in the quadrillion dollar-plus derivatives market, due to rapidly rising interest rates. This column looks at how likely that is and what can be done either to prevent it or dodge out of the way.

“Financial Weapons of Mass Destruction”

In 2002, mega-investor Warren Buffett wrote that derivatives were “financial weapons of mass destruction.” At that time, their total “notional” value (the value of the underlying assets from which the “derivatives” were “derived”) was estimated at $56 trillion. Investopedia reported in May 2022 that the derivatives bubble had reached an estimated $600 trillion according to the Bank for International Settlements (BIS), and that the total is often estimated at over $1 quadrillion.  No one knows for sure, because most of the trades are done privately.

As of the third quarter of 2022, according to the “Quarterly Report on Bank Trading and Derivatives Activities” of the Office of the Comptroller of the Currency (the federal bank regulator),  a total of 1,211 insured U.S. national and state commercial banks and savings associations held derivatives, but 88.6% of these were concentrated in only four large banks: J.P. Morgan Chase ($54.3 trillion), Goldman Sachs ($51 trillion), Citibank ($46 trillion), Bank of America ($21.6 trillion), followed by Wells Fargo ($12.2 trillion).”

Chuck again… ahhh, those darn derivatives… I’ve been talking about them for years now, and this is coming to a big bottle neck, folks… With interest rates rising, these derivatives, have all accounted on them remaining low, things are sure to go bust… But when? Ahhh, that’s the $64 question… But in the meantime, Got Gold?

Market Prices 3/14/ 2023: American Style: A$ .6668, kiwi .6222, C$ .7291, euro 1.0714, sterling 1.2152, Swiss $1.0975, European Style: rand 18.2590, krone 10.6280, SEK 10.5863, forint 366.40, zloty 4.3731, koruna 22.2091, RUB 75.31, yen 134.40, sing 1.3461, HKD 7.8467, INR 82.49, China 6.8769, peso 18.85, BRL 5.2473, BBDXY 1,246.53, Dollar Index 103.78, Oil $73.20, 10-year 3.60%, Silver $21.68, Platinum $992.00, Palladium $1,468.00, Copper $3.92, and Gold… $1,903.54

That’s it for today… I had a long conversation with good friend Dennis Miller on the phone yesterday, we both were fired up about the SVB failure and the Gov’t’s intervention… If the NSA was listening, they got an earful of thoughts on how this bank failure could have been averted… Team USA took their loss to Mexico out on the Canada team last night, pounding them into submission with a 12-1 victory… These games come on so late for me, I fall asleep in the my chair watching them, and then I wake up and wonder where I am!  My beloved Cardinals get back on the field after a day off, yesterday, but they’ll be on the road until Thursday… Paul McCartney, takes us to the finish line today with his solo song: Every Night… I hope you have a Tom Terrific Tuesday today, and please Be Good To Yourself!

Chuck Butler