Author: admin

May 26, 2022

* Currencies gain VS the dollar in the overnight session

* Gas Pumps get reprogrammed to accept double digit pricing! 

May 25, 2022

* Currencies & metals have a good day on Tuesday… 

* A price manipulator pleas guilty! 

Good Day… And a Wonderful Wednesday to you! Well, I lost a bet… I have a good friend that lives in Toronto, Canada, and we bet on who would win the 2 game series between the Cardinals and Blue Jays, with a run differential the tie breaker… The Cardinals enjoyed a 4 game run differential after the first game, and my friend, Craig, thought that the 4 runs would be enough… I told him don’t worry, and I was right, with the Cardinals losing 8-1 last night, he won the bet… A Cold Budweiser! Firefall greets me this morning with their 70’s song: Strange Way… Not familiar with that? YouTube it, I think you’ll like it… 

Well, the dollar dominance certainly took another hit yesterday, with the BBDXY index losing 2 more index points, to end the day at 1,229…  The data from the U.S. yesterday could have something with the weakness in the dollar, as the Manufacturing Index slipped again, and new home sales dropped like a rock in April…  But, for the data to have any bearing on the dollar’s performance, we would have to be returning to fundamentals, and there’s no way, that’s happening!  So, we’ll just go with the thought that the dollar lost more ground yesterday, because it had been overbought, and the correction continued…  Oil gained $1 buck yesterday, and bonds… 

What can I say about bonds, that I already haven’t said? Bond yesterday rallied big time with a 6 basis point drop in the 10-year’s yield…  The 10-year was bought hand over fist yesterday, and the yield dropped to 2.75%…  And that begs the question, is the Fed/ Cabal/ Cartel buying bonds still?  The Fed Heads did say that they would begin their massive Quantitative Tightening in June, so that left them some breathing room to continue buying up to June, right? 

If the Fed Heads aren’t buying, then that opens another can of worms…  The Bond Boys aren’t thinking that the Fed will renege on their call for multiple rate hikes, are they?  Well, either the Fed Heads are still buying bonds, or the Bond Boys are calling them out for their lies… 

Everyone, and their brother, are talking about a recession coming to the U.S. and Big Recession, not you run of the mill recession either! When I say “everyone, and their brother, I’ talking about the people that I listen to, People like: Ray Dalio, Bill Bonner, Doug Casey, David Rosenberg, Evon Von Greyerz, Mathew Pipenberg, and others…  I certainly don’t listen to the Government, or the Fed Heads, or anyone else that speaks for the government.  So, if a Big Time Recession is coming…  Oh, well, I’ll save that for another day… 

So, a long list of analysts believe a Big Time recession is coming to America, and that Gold is the best way to combat the effects of the recession…  And that leads me to my usual question: Got Gold? 

Gold and Silver had good days yesterday with little interference. Gold gained 14.50 to end the day at $1,867.40, and Silver gained 32-cents to end the day at $22.19…  Volumes were light once again… 

In the overnight markets last night… Well, the dollar bounced back, with the BBDXY index gaining 3 points… The question now is this bounce back a dead cat bounce?  (no animals were hurt here, this is just an old markets saying)  And Gold is starting the day down… Gold is down $14 in the early trading today, and Silver has given back the 32-cents it gained yesterday, and more this morning…  With no interference yesterday, the price manipulators seem to be trying to catch up on a lost day…  I’m just saying…

Speaking of price manipulators… I saw this in Ed Steer’s letter this morning, and it’s a little long, but I think you should see this…. “Glencore International A.G. (Glencore) and Glencore Ltd., both part of a multi-national commodity trading and mining firm headquartered in Switzerland, each pleaded guilty today and agreed to pay over $1.1 billion to resolve the government’s investigations into violations of the Foreign Corrupt Practices Act (FCPA) and a commodity price manipulation scheme.

May 24, 2022

* Currencies continue to push against the dollar

* Bullard talks tough… 

May 23, 2022

Good Day… And a Marvelous Monday to you! I have to apologize up front and center this morning… I had my letter all written, 2 hours of writing, and research, and my stupid computer erased it all! I’m not one to redo things, so I’m going to hit the high points, and leave out all the commentary this morning, so this will be short-n-sweet…  I have to get a new computer, this one has driven me to the edge of crazy! 

OK, the things you need to know this morning are 1. The dollar has gotten sold big time in the last two trading sessions… The BBDXY has given up 15 points in those sessions. The dollar dominance is waning, quickly…  The euro has risen to trade with a 1.06 handle, while the A$ has also risen to trade with a 71-cent handle this morning. But the Big mover of the currencies is the Russian ruble, which is now trading stronger VS the dollar than it was before the Russians started a war. 

South Africa has joined the countries that have hiked rates to combat their respective inflation… The rand is a commodity currency, and therefore to me, that is, this rate hike was warranted. 50 Basis Points were added to their internal rate which is now 4.75%…  While the rate hike was warranted, to me, it sure took some time getting here… but I guess better late than never applies here.. 

Gold is up $14 in the early trading today… On Friday, last week, Gold had climbed intra-day by $26, only to see the sellers dominate the afternoon session and bring Gold back to only a $5 gain… Gold ended the week trading at $1,847.70, while Silver gave back 13-cents on Friday, and ended the week at $21.88…  

In the overnight markets last night, Gold has added $14, and Silver has added 26-cents, so we’re starting the week off on the right foot.

The U.S. Data Cupboard is empty today, and gradually adds data prints as the week progresses, with Friday’s offerings to be the datapalooza!  Tomorrow‘s  Data Cupboard  will have the ISM manufacturing index, which has been inching downward in recent months, although it still remains above the 50 level, at 58. The recent regional reports indicate that the national ISM will drop more in April.

To recap…. The dollar dominance is taking on water… It will be interesting to see if this selling of the dollar, continues… South Africa hiked rates 50 Basis Points, and the Russian ruble is proving that if you have a commodity that other nations not only want, but need, and you price the commodity in your base currency…. The currency will respond favorably…

Market Prices 5/23/2002: American Style: A$ .7113, kiwi .6477,  C$ .7820, euro 1.0665, sterling 1.2582, Swiss 1.0342, European Style, rand 15.7219, krone 9.6073, SEK 9.8296,  forint 359.15,  zloty 4.3314,  koruna 23.0552,  RUB 57.99, yen 127.52, sing 1.3736, HKD 7.8493, INR 77.41, China 6.6468, peso 19.80, BRL 4.8804,  BBDXY 1,232.06, Dollar Index 102.17,  Oil $111.06, 10-year 2.82%, Silver $22.14, Platinum $978.00, Palladium $2,033.00, Copper $4.23, and Gold $1,861.25

That’s it for today… Sorry for the shortness, but it wasn’t user error! Tomorrow I’ll be back to being by myself for the next two weeks… Hello Pizza Man, pizza? I was happy with my doctor visit last week… My A1C was just 5.6…. The doc even removed one of my meds! My left knee is hurting bad again… The last time I asked my son, Alex, the kid with the doctorate in physical therapy about my knee he replied, “it’s just old age”.. I then said “this is what I paid for ?”…. Oh well… Don Henley takes us to the finish line with his song: Not Enough Love In The World… (he’s got that right!) I hope you have a Marveleous Monday and please remember to Be Good To Yourself !

Chuck Butler

May 19, 2022

* currencies rally for 3rd consecutive day… 

* Powell talks tough…  

Good Day… And a Tub Thumpin’ Thursday to one and all! Longtime readers know that my two oldest children, (Dawn, & Andrew) are both teachers, Dawn teaches kindergarten, and Andrew deals with high schoolers… Their last full day of school is today, and if I recall correctly, they’ll be smiling like Cheshire Cats at noon tomorrow… The Pond Scum (80’s name) have taken 2 of 3 so far from my beloved Cardinals… And a rain storm came through yesterday, and cooled down the temps for a few days… The Great Leon Russell greets me this morning with his song: Back To The Island…

Well, ever since Monday this week the dollar has been slipping, yesterday the BBDXY game up 2 index points, and overnight was even worse. More on that in a minute. I’m still not convinced that this brief dollar selloff is a long lasting trend, instead,  just a “correction”… But stocks are really getting sold these day, and a lot of those stock holdings were by foreigners, who then would sell the dollars that they just received for the sale of their stock, and convert them to their home base currency… I don’t know how much of this scenario has happened, but it’s difficult for me to believe that it hasn’t happened by the truck load…

Gold tried like the dickens to get back to flat on the day yesterday, but ended up short by $2.70, and ended the day at $1.822.20. Silver did get back to flat and more gaining 4-cents on the day, and ended the day at $21.74… The Price of Oil slipped again from its high on Tuesday of $115… And bonds continue to wallow around in the muck… I for the life of me can’t come up with a reason for an individual to buy U.S. Treasuries when the Fed/ Cabal/ Cartel is hell bent and whiskey bound to hike rates further…

Buying bonds now would be like a poker player calling another player’s bluff… Buyers now are going with the thought that the Fed/ Cabal/ Cartel can’t hike rates much further without getting the economy in a deep dive… That’s their story and they are sticking to it! Me, on the other hand, still won’t touch Treasuries with your ten-foot pole!

In the overnight markets last night… The dollar got sold more, and this is becoming quite interesting… The BBDXY lost 7 index points in all yesterday and last night… The euro is above 1.05, and the Russian ruble continues to rack up the gains VS the dollar. Gold is up early this morning, along with Silver, so we have that going for us today! I just talked about Treasuries, and then I look at the early morning level for the 10-year, and see that it has rallied to 2.83%… I don’t get it… but then I’m just a humble old country boy…

When I left you on Tuesday, I told you that the Fed/ Cabal/ Cartel Chairman, Jerome Powell, who has been confirmed to his second term now, was being interviewed… Well, let’s listen in on some of his interview;” Federal Reserve Chair Jerome Powell emphasized his resolve to get inflation down, saying Tuesday he will back interest rate increases until prices start falling back toward a healthy level.

“If that involves moving past broadly understood levels of neutral we won’t hesitate to do that,” the central bank leader told The Wall Street Journal in a live-streamed interview. “We will go until we feel we’re at a place where we can say financial conditions are in an appropriate place, we see inflation coming down.”

“We’ll go to that point. There won’t be any hesitation about that,” he added”

Chuck again… So, like I said above, the Fed/ Cabal/ Cartel is hell bent and whiskey bound to hike rates… And well, I think they will soon find that their rate hike didn’t stop inflation from rising… And why’s that? Well, I told you on our Tom Terrific Tuesday… The over $4 Trillion in new money supply in the past couple of years has already been issued, spent and son on… You can’t call it back now…

I will say this though, Seniors have to be thrilled that their CD’s will be getting increased rates when they rollover… This group of people have been the hardest hit by the ZIRP (zero interest rate policy), and then they had to take another arrow when inflation began rising! I’m now considered a “senior”, and I know first hand what kind of damage my investment portfolio has taken with ZIRP, and now inflation…

I want to spend some time talking about Gold (& Silver) this morning… Sure Gold has taken on water in the month of May, but… it’s still the commodity I want to own during a war overseas, rising inflation at home, and an overbought dollar.. I saw this quote by one of my fave founding fathers, Thomas Jefferson, so here it is: “Specie (gold and silver coin) is the most perfect medium because it will preserve its own level, because having intrinsic and universal value, it can never die in our hands, and it is the surest resource of reliance in time of war.” – Thomas Jefferson

What a smart man Thomas Jefferson was… Many of the things he’s known to have said, are still relevant today… I’m just saying…

Like I said above, Gold has been taking on water in May… That makes it cheaper for people that has shuffled their feet, hemmed and hawed, and had to be dragged to the watering hole! That’s why it’s so darn cheap these days… Because a very small percentage of individuals actually own Gold… If they were buying physical Gold like they do stocks or Bitcoin, they’re buying power would keep the price manipulators at sea… But when your stock broker, talks you out of buying Gold, what are you going to do? Listen to your broker? Or… go rouge, and open an account with a Gold dealer, someone trustworthy, like my metals guru, Tim Smith at 1-800-926-4922…

Here’s a good fact for you… Gold doesn’t really go up in price, it goes up only because the dollar goes down, or the pound sterling goes down, etc. Oh! Did you hear about the guy in the U.K. that has decided to pay his employees in Gold instead of sterling? Here’s a quote from the Employer…

““With the cost-of-living crisis going from bad to worse,” says TallyMoney CEO Cameron Parry, “it didn’t make sense to continue offering pay hikes in pounds when its value is being eroded further with every passing day. It was like putting a Band-Aid over an open wound,” he tells local paper City A.M.

Wow! Thinking back to the early 2000’s If I had demanded that I get paid in Gold…. I’d would be singing: We’re in the money, we’re in the money,… Of course my wife would say to me: Show me the money!

The U.S. Data Cupboard will only have the usual Tub Thumpin’ Thursday fare of: Weekly Initial Jobless Claims for last week… And then some housing data that doesn’t make me tingle all over… We will see the Leading Indicators for April, with a reminder that the previous month’s print was flat as a pancake! (Head East)

To recap… The dollar is showing signs of weakness… Chuck isn’t sold on it being anything more than a correction of the dollar’s extremely overbought position…Gold lost ground yesterday, while Silver eked out a 4-cent gain. The over night markets saw the dollar get sold some more… I have an interesting article for you in the FWIW section today, so you won’t want to miss that!

For What It’s Worth….i was talking about the Plaza Accord a few Pfennigs ago, and look what the cat dragged in… An article about a potential new Plaza Accord! And that article can be found here: Surging Dollar Stirs Markets Buzz of a 1980s-Style Plaza Accord (yahoo.com)

Or, here’s your snippet:” The dollar’s skyrocketing rise has some contemplating a rare, if not unthinkable, action: major nations agreeing to manipulate the U.S. currency until it falls.

It has happened before — most notably with 1985’s Plaza Accord — which took place against a backdrop of soaring inflation, an aggressive Federal Reserve rate-hike campaign and surging dollar. In other words, a scene that looks a lot like today — a parallel that won’t be lost on Group-of-Seven finance ministers and central bank governors as they meet this week.

Demand for the greenback has been relentless this year, the result of interest rates rising quicker in the U.S. than other developed economies and the war in Ukraine prodding a stampede to the ultimate haven. The dollar’s 6.3% surge since the start of the year has clobbered the yen to a two-decade low and put the euro almost back to 1-to-1 parity with the U.S. currency for the first time since 2002. Investors are lasering on the yen tumbling to 150 per dollar and the euro falling below 90 cents as a potential line in the sand.

For Stephen Miller, a four-decade market veteran and former head of fixed income at BlackRock Inc. in Sydney, the situation now is reminiscent of his time as a young buck in Australia’s Treasury Department, where he had a front-row seat watching the Plaza Accord unfold.

Through that agreement which France, Japan, the U.K., U.S. and West Germany agreed to weaken the dollar — a stance taken out of a belief that the dollar’s huge move higher was damaging the global economy.

“One of the options down the track could be some sort of coordinated intervention,” said Miller, now an investment consultant at GSFM, a unit of Canada’s CI Financial Corp. which oversees about $289 billion in assets.”

Chuck again… While that would be a welcome sight to non-dollar holders, I just don’t see it happening, but it sure is an interesting thought, eh?

Market Prices 5/19,/ 2022: American Style: A$ .6998, kiwi .6351, C$ .7801,
euro 1.0524, sterling 1.2417, Swiss $1.0239, European Style: rand 15.9693, krone 9.7979, SEK 9.9861, forint 366.54, zloty 4.4085, koruna 23.4682,
RUB 62.26, yen 129.80, sing 1.3846, HKD 7.8480, INR 77.48, China 6.7738, peso 19.99, BRL 5.1348, BBDXY 1,147.37, Dollar Index 103.30, Oil $107.94,
10-year 2.83%, Silver $21.63, Platinum $956.00, Palladium $2,008.00,
Copper $4.23, and Gold… $1,826.89

That’s it for today and this week, of course… I’m looking forward to the weekend, as I’ll be attending a wedding… the little girl that grew up next door to us, Jordan Yanker, will be walking down the aisle and saying “I do” on Saturday… Jordan and Alex are about the same age, and they used to play together all the time, but then they grew apart as the grew up… Congrats to the parents, Kevin and Lisa… I remember when Dawn got married, I was so proud to walk her down the aisle… Geez Louise, that was 19 years ago now! Where does the time go? The Cardinals and the pond scum at noon today… A good day to sit outside and watch them! Chicago takes us to the finish line with their uber hit, that was the make out song of the 70’s… Color My World… (I used to be able to play that on the piano, but not anymore! UGH!) I hope you have a Tub Thumpin’ Thursday today and please remember to Be Good To Yourself!

Chuck Butler

May 17, 2022

* Powell backs off his claim of being able to deliever a “soft landing”

* Gold & Silver start the week on a good foot… 

Good Day… And a Tom Terrific Tuesday to you! How dare Mother Nature rain out the mighty NY Mets last night… Doesn’t Mother Nature know that the Mets have a king’s ransom for payroll? OK, I’m having some fun here… The Cardinals and Mets were rained out last night, and they’ll play a double header today… As the great Ernie Banks used to say, “hey, let’s play two!” Our Blues start the second round of the Stanley Cup Playoffs tonight in Denver…. Let’s Go Blues! The Cornelious Brothers & Sister Rose greet me this morning with their song: Too Late To Turn Back Now…

Well… I think I upset the hornet’s nest yesterday, when I talked about the POTUS signing a document that we are at war with Russia… I know that it takes a vote of congress to commit the country to a war with bullets and bombs… But, I think what this document was referring to is that the U.S. is at war with Russia, and therefore will continue all sanctions, financial and otherwise going forward… And to the person that wrote me and told me to keep politics out of the Pfennig, I want to say, I do keep politics out of the Pfennig… I didn’t see the statement yesterday as political, period!

Ok… well, the dollar paused for the cause yesterday, and didn’t gain for once! We’ve really only had a couple of days in the past two months, where the dollar didn’t gain on the day… We began yesterday with the BBDXY at 1,257, and we ended the day with the index at 1,256…. The euro moved higher in the 104 handle, and Gold found a way to gain $11.70 yesterday to close the day at $1,824.90, and Silver gained 48-cents to close at $21.70… So, a good day for the metals…

I read two articles from different sources this past weekend that claimed that Gold was on the launching pad, and would soon be moving higher once again… Well, we can all hope so, eh? The price of oil gained $5 yesterday, and trades this morning with a $114 handle… And Bonds are stuck in the mud… and there’s no reason for anyone to get al mucky, wallowing around in the mud with bonds!

In the overnight markets last night… The dollar rally was halted! The BBDXY lost 3 index points, and the euro rose above 1.05… I won’t put too much stock into this brief sell off of the dollar, but it did come after Jerome Powell’s NPR interview yesterday. I have something on that in a bit, so hold your horses! Gold and Silver are trading up this morning, with Gold up $12, and Silver up 12-cents. The price of Oil rose another buck to trade with a $115 handle this morning, and bonds continue to be stuck in the mud.

Did you see the latest in wholesale inflation, aka pipeline inflation? Well, for April it was up 11%… That tells us that consumer inflation, while dropping a ibt in April, isn’t going to drop any more… And on top of that, well, I’ll let Bill Bonner tell you what’s on his mind regarding inflation: “Food, shelter, transportation – those are the ones that drain the family checking account. As for food, actual price increases are far above the BLS’s index. Beef is up 14%, chicken 15%, wheat flour 33%, orange juice 17%, coffee 70%.

Shelter, too, is much more pricey than the BLS says. Zillow computes the average rent people actually pay. It’s up 17% over a year ago, it says. The average price paid to buy a house is also 16% higher than a year ago.

And fuel? A gallon a gas averaged $3.11 last May. Now, it’s up 40%”

Chuck again… people that live on the margin… they calling Houston right now to report a problem! And wouldn’t you know it, the first summer in the last 3 that people can get in their cars and go on vacation, and the cost of gas is going through the roof… Ed Steer, had a cartoon in his letter the other day, of a man sitting at a bank, and the banker tells him he can get a home, auto, personal, loan, and what kind of loan was he looking for, and the man replied “ I need a loan to fill my gas tank”…

Every time Kathy goes to Costco, I ask her if she saw the loan officer giving out loans near the meat counter? All joking aside, the thing that really gets me is that most people believe that by hiking rates 50 Basis Points at a time, is going to squelch inflation… You see, this time inflation was caused by money supply, and sure the distribution chain problems added to the inflation that was caused by over $4 Trillion in new money supply since 2020… And so like the old saying that someone let the cat out of the bag, or the cows out of the barn, money supply allowed inflation out of the box it had been held in for a very long time…

And now, like water under the bridge, or spilled milk, the money has been printed and sent out, it’s out there, and you can’t call it back! Therefore I believe we’ll see the Fed/ Cabal/ Cartel attempt to hike rates at successive meetings, and all they’re going to do is cause a very deep recession, that could last over a year! Shoot Rudy, Elon Musk said that he saw the recession lasting 18 months! Now, I don’t know what kind of economics training Elon has had in his past, so I say we should take his 18 months with a grain of salt…

The Fed/ Cabal/ Cartel had an open window for a very short time to be proactive in combating inflation, and instead used that time to deny inflation existed! They should all be fired, and star anew! Did you know that Jerome Powell still hasn’t been confirmed for his second term? So, in reality his the Chairman pro-tempor, or something like that! So now, we not only have this group of Fed lifers, making the decisions about our economy without ever having lived and worked in it, but we also have their spokesperson not confirmed for his next term!

And remember when the Fed/ Cabal/ Cartel finally began to admit that there was inflation in the economy, and chairman Powell, said that the Fed would deliver a “soft landing”? And I immediately called him out on that, because of the fed’s history… Well… yesterday, Powell was being interviewed on NPR radio, and he has changed his tune about delivering a soft landing… Let’s listen in to some of the talk: “But in an interview on NPR’s “Marketplace,” Powell conceded that that balancing act — which many economists have said they doubt the Fed can achieve — could be undercut by economic slowdowns in Europe and China.

“The question whether we can execute a soft landing or not — it may actually depend on factors that we don’t control,” the Fed chair said. “There are huge events, geopolitical events going on around the world, that are going to play a very important role in the economy in the next year or so.”

Chuck again… Oh boy, here we go again, always blaming your problems that you created on someone else… First it was the distribution chain problems, then it was China, and now it’s the slowdowns in Europe and China that will prevent him from delivering on his call of a “soft landing”… Tsk, tsk, tsk… and in my best Gomer Pyle voice, Shame, Shame, Shame….

Ok, let’s talk about something other than the dolts at the Eccles Bldg. and the inflation they caused… And just to remind you, that… inflation is everywhere… The good folks at GATA sent me this note yesterday regarding the Bank of England (BOE), “The governor of the Bank of England has claimed that policy makers have been left helpless in the face of surging inflation.

Appearing in front of MPs today, Andrew Bailey admitted he had felt helpless to control soaring prices amid an energy market shock and the war in Ukraine, adding: “It’s a very, very difficult place for us to be in.”

Yes, the BOE is in the same corner as their cousin in the U.S. and once again their inflation was caused by money supply, and too much debt, that prevented the BOE was acting proactively with rate hikes… You know, remember about year ago, when pound sterling was performing like the best currency? And I said that, “the U.K. has too much debt, and it will come home to roost for them soon enough, I would be careful jumping on the pound sterling bandwagon”…

And while we’re in Europe… Remember when the EU announced that no country in the Union would be buying Russian Oil, since they had to use rubles or Gold to buy it? Check out this headline: European Sanctions Blown To Bits: Draghi Says “Most Gas Importers” Have Opened Ruble Accounts With Gazprom”

Hehehehehe… Sanctions, Smanktions… When you need Oil, you need Oil, or like me going down to Columbia, Mo over this past weekend, I needed to fill up my gas tank… and paid $4.80 a gallon… I needed gas, and I paid for it…

No wonder highway 70 that cuts through Mo. Has 100’s of trucks, big rigs, traveling, had the gas stops packed with trucks… I’m sure these guys drove until they were on fumes and then had to pull in for fuel, and then paid over $5 for diesel fuel…

And the truckers’ rising costs to travel, soon become the grocers and other retailers rising cost, and that becomes the consumer’s rising cost! Oh, come on Chuck, that’s elementary! Yes, I agree it is, but… sometimes you have to start anew to refresh memories!

Yesterday, I told you that the today’s Data Cupboard would be chock-full-o-data today, and so it will! April Retail Sales, Industrial Production and Capacity Utilization will all print this morning… And then later today, Jerome Powell will be interviewed by the WSJ… I wonder what lies he’ll tell them?

To recap… The dollar took a pause for the cause yesterday, and actually dropped 1 index point on the day! Gold & Silver gained on the day, Oil pushed higher by $5 and bonds were stuck in the mud. Chuck talks a lot about inflation today, and not just in the U.S…. And in the overnight markets… The dollar rally was stopped, and Gold & Silver are both trading up this morning, Chuck won’t put too much into the dollar rally being stopped, as we all will have to wait-n-see where it goes from here. 

For What It’s Worth… Well there were many candidates for this space this morning, but when it came to the cheese that binds, I thought that this one was best as it describes the fall in manufacturing in the NY region, and it can be found here: Empire Fed Manufacturing Survey Unexpectedly Crashes To Post-COVID Lows | ZeroHedge

Or, here’s your snippet: “Empire Fed Manufacturing Survey Unexpectedly Crashes to Post-COVID Lows

As Goldman lowers its U.S. growth forecasts for 2022 and 2023, the N.Y. Fed’s survey of manufacturers surprised with a drastic plunge into contraction in May, for the second time in 3 months. general business conditions index dropped over 36 points to -11.6 (against expectation of a +15 print)…Click to enlarge.

That -11.6 print is lower than the lowest forecast from analysts (-10) – an 8 sigma miss from expectations…

Under the hood, new orders dropped nearly 34 points in May to -8.8, and the shipments measure fell at the fastest pace since early in the pandemic, sinking about 50 points.

As in April, firms expressed less optimism about the six-month outlook than they did earlier this year. The index for future business conditions was little changed at 18.0. Increases in prices and employment are expected to continue in the months ahead.
The capital expenditures index fell to its lowest level in several months.

This is the first of several regional Fed manufacturing numbers set for release over the coming weeks. Is this the start of ‘weakness’ that offers Powell his ‘out’ from uber-hawkishness?

Or is this yet more signals that stagflation is becoming embedded… the central bankers’ nemesis.”

Chuck again… I’ve explained this before, but here we go again… I stopped reporting the regional manufacturing reports because they never, and I mean never had any indication of what the National ISM manufacturing index would show… But this one kind of made me sit up and notice it…

Market Prices 5/17/2022: American Style: A$.7035, kiwi .6370, C$ .7800,
euro 1.0541, sterling 1.2823, Swiss $1.0077, European Style: rand 15.9966, krone 9.6556, SEK 9.8888, forint 366.67, zloty 4.4065, koruna 23.4383,
RUB 65.12, yen 129.31, sing 1.3838, HKD 7.8495, INR 77.31, China 6.7259,
peso 19.96, BRL 5.0604, BBDXY 1,253.22, Dollar Index 103.30, Oil $115.51,
10-year 2.91%, Silver $21.84, Platinum $956.00, Palladium $2, 036.00,
Copper $4.24, and Gold… $1,835.42

That’s it for today… A Chamber of Commerce Day here yesterday! I sat outside to read for too long, as my allergies were acting up last night. Pollen is so thick around here, especially since my property is surrounded with trees! Our rose bushes really busted out all over these past few days… Spring has finally arrived! The days are warm, and nights are cool… April and the first two weeks of May had to be the coldest and rainiest start to spring I can ever remember! I’m so glad that’s over! OK, it’s the 2nd round of the playoff, Blues… Go to work, gotta skate, and gotta check! Paul Revere and the Raiders take us to the finish line today with their 60’s song: Kicks… . This song has lyrics that are so appropriate for now… “Kicks just keep getting harder to find”… I hope you have a Tom Terrific Tuesday today, and please Be Good To Yourself!

Chuck Butler

 

May 16, 2022

* Currencies & metals continue to get sold… 

* The ruble is the best performing currency this year! 

Good day… and a Marvelous Monday to you! I apologize up front and center this morning, for the short week of letters last week… I was really under the weather for most of the week, and just couldn’t sit down long enough and concentrate, so I passed on writing… On Saturday, we attended the graduation ceremony for one, Grace Ann Hambrechen, (sp) at the University of Missouri School of Law… Gracie, as I call her, is a part of our family, whether she wants to be or not! And we’re all so proud of her! Now it’s into the real world, Gracie… Good Luck! Dion and the Belmonts greet me this morning with their song: The Wanderer…

Well, what can I say today that will calm the fears of everyone that pays attention to what’s going in the world? Not to worry? No reason to be concerned? I can tell you that that I’ve never been one to try and smooth the feathers, and talk sunshine and rainbows about stuff that doesn’t deserve it… I mean did you hear that we are now officially “at war” with Russia? Now, there’s nothing I can say that will smooth those feathers… Not that I wanted to put the fear of God into you this Monday morning… But, I doubt everyone out there heard that news, and so, I thought it best to get it out front and center, this morning…

OK… The dollar dominance continues, and there’s nothing out there to stop it, right now… I mean that there are plenty of things to stop the dollar dominance but, they haven’t yet, so the dominance continues unabated… Shoot Rudy, the euro, is trading with a 1.03 handle and it never got that low back in the time when the Greek Debts were exposed! 1.05 had its low during those turbulent times, so 103 is a scary level for euro holders… The BBDXY gained another 1.10 index points on Friday to close the week at 1,258.63…

You know the thing that really catches my attention these days is the selling of commodities… And the Commodity Currencies… It’s as if the markets have decided that there’s no reason to fear inflation any longer… What a bunch of bunk! But really, that’s what the markets are telling us, with Copper dropping like a rock, and the Aussie dollar (A$ also dropping quickly… Countries around the world are faced with rising inflation, and they are hiking their internal rates, if not appropriately, at least they are hiking them . And that tells me inflation isn’t going anywhere but up…

Remember what I ‘ve told you about Producer Prices, right? Well, the lastest reading on Producer Prices showed no backing off of wholesale inflation, with an 11% gains in prices… Back in the 70’s we saw the same thing occur, with a surge in inflation, and then a backing off of inflation, giving everyone a false sense of security, thinking that they had defeated inflation, only to see it surge again and this time it was a HUGE surge… So, do you want to bet against another surge in inflation? That’s what the markets are telling us to do right now, and I just shake my head in disgust at this market reaction…

In the markets on Friday, I already told you the dollar continued to gain, and that the euro is looking weaker by the day… Gold Lost $9.30 Ans closed the week at $1,813.20, but Silver had a great day gaining 46-cents to close the week at $21.24… The price of oil slipped a buck to end the week trading with a $109 handle… Bonds continue to get bought, since the Fed/Cabal/ Cartel announced they would start their Quantitative Tighening, in June, an the 10-year’s yield finished the week @2.89%….

In the overnight markets last night… there was more dollar buying, and selling of Gold… Gold has fallen below the $1,800 figure this morning as it has started the day/ week, down $12… Here’s a quick question for you… Do you know what currency is the best performing currency this year? Well, if you said, the Russian ruble you win a Gold Star sticker! Wear it proudly! There’s not a lot of data this week other than tomorrow’s onslaught of data, so it could end up being a very ugly week for the non-dollar assets… I’m just saying…

Well I hate to be the bearer of bad news, but wwe all knew in our heart of hearts, that all the financial bubbles were bound to find a pin at some point…Well, I believe that a pin has been found, but for now, it’s a slow leak….

Here’s Alastair MacCleod on this idea…”those who have protected their wealth by investing in financial assets no longer have the following breeze of falling interest rates. Financial bubbles are now bursting. Understanding the causes and therefore being able to assess the likely losses involved is becoming urgent for anyone committed to financial markets …”

Chuck again… Yes, what he’s telling you is that the stock market bubble, the bitcoin bubble, the NFT’s bubble, etc., no longer have zero interest rates to aid and abet their ability to inflate their bubbles…

OK, there are other things I want to talk about today… Longtime reader, Bob, sent me an article the other day that talked about righing inflation and how Americans will adjust their behavior to deal with surprise inflation, to which I say, I’m from Missouri, they’ll have to show me that they will be able to adjust their behavior… And I’ll add this… If inflation gets as bad and lasts as long as I fear… The American citizen will be ready to storm the gates….

Americans will HAVE change their spending habits, but that’s different than them just adjusting to their loss of purchasing power from inflation… And the Americans I know and love, will not be happy about having to change their spending habits, because of a loss of purchasing power, and disposable income.

Last week I told you that there were several events that happened in the 70’s, and that I would go through these at some point in the future…. And that future is now! Aren’t you the lucky ones! Ok… Well, first thing that happened in the 70’s was a war going on in another part of the world, that didn’t, on the surface, seem to be leading us to WW111…..The next thing was a decision by the Saudi’s to embargo oil to countries not friendly to them. Then there was a period of time in the 70’s where inflation had begun to rise, and the Fed/Cabal/Cartel sat on their hands and refused to address it. And that will do it for today… there are more, so stayed tuned!

Remember WIN Buttons? Whip Inflation Now! The brain output of one Gerald Ford… As if pining a button on your jacket lapel was going to stop the rise of inflation….

The U.S. Data Cupboard doesn’t have any real economic data for us today, but tomorrow’s cupboard is chock-full-o-data…. Tomorrow we’ll see the color of April’s Retail Sales… I expect to see Retail Sales recover a bit in April, mainly because of the Easter shopping…Industrial Production and Capacity Utilization will also be on the docket tomorrow….

To recap…. The dollar dominance continues to wreak havoc. Gold continues its downward slide, the price of Oil remains very high, bonds have rallied ever since they found out that they won’t be subjected to Quantitative Tightening until June….Chuck points out some similarities of what’s happening now and what took place in the 70’s. And not to scare you to death, but did you know that the POTUS signed a document that said we are now at war with Russia?

For What It’s Worth…. Well, since I mentioned citizens storming the gates above, this article talks about a country that has seen just that because of rising food prices, and that story is told in the article that can be found here: https://www.zerohedge.com/markets/food-riots-sri-lanka-turn-deadly-protesters-beat-police-burn-down-politicians-houses

Or, here’s your snippet: “Two months ago, we noted the first Arab Spring 2.0 incident when, as a result of soaring food, energy (and everything else) prices, thousands of angry Iraqis took to the street to protest. Needless to say, their complaints did not get much traction, and in the meantime food prices have only exploded to fresh record highs, far surpassing the levels hit in 2011 when riots against, you guessed it, food prices toppled most MENA political regimes (not without some CIA backing).

And as food prices keep rising, the protests across poor nations keep escalating, and on Thursday protests broke out in Iran leading to at least 22 arrests, after the government cut subsidies for food, sending prices through the roof as authorities braced for more unrest in the following weeks…

and not just about Iran (and Iraq), but also Sri Lanka, where protesters angry at the soaring prices of everyday commodities including food, have burned down homes belonging to 38 politicians as the crisis-hit country plunged further into chaos, with the government ordering troops to “shoot on sight.”

Police in the island nation said Tuesday that in addition to the destroyed homes, 75 others have been damaged as angry Sri Lankans continue to defy a nationwide curfew to protest against what they say is the government’s mishandling of the country’s worst economic crisis since 1948.

The Ministry of Defense on Tuesday ordered troops to shoot anyone found damaging state property or assaulting officials, after violence left at least nine people dead since Monday, according to CNN; it is unclear if all of the deaths were directly related to the protests. More than 200 people have been injured.

The nation of 22 million is grappling with a devastating economic crisis, with prices of everyday goods soaring, and there have been widespread electricity shortages for weeks. Since March, thousands of anti-government protesters “have taken to the streets, demanding that the government resign.”

Chuck again… Yes, inflation is not just a U.S. problem, but when other countries see this they will most likely follow the lead of Sri Lanka… I’m just saying

Market Prices 5/16/2022: American Style: A$ .6922, kiwi .6280, C$ .7736,
euro 1.0420, sterling 1.2257, Swiss $1.0050, European Style: rand 16.2505, krone 9.8074, SEK 10.0844, forint 370.26, zloty 4.4775, koruna 23.7125,
RUB 64.24, yen 129.57, sing 1.3943, HKD 7.8497, INR 77.66, China 6.7917, peso 20.08, BRL 5.0604, BBDXY 1,257.61, Dollar Index 104.47, Oil $109.60,
10-year 2.92%, Silver $21.11, Platinum $935.00, Palladium $1,931.00,
Copper $4.10, and Gold… $1,799.75

That’s it for today… Well, I’ve been to two games and have seen huge offensive outputs by my beloved Cardinals, including last night. The problem is the rest of their games have no offensive output… UGH! But I saw two winners! Now, if the Cardinals want to take me to every home game I’m available! HA! I have another doctor appt on Wednesday this week, and so no Pfennig on Wednesday, but I’ll be back for Thursday! So far, so good on all my medical appts… Weight is back down, still more to lose though, blood work was all good… But not seeing my oncologist for 3 months, had her worried… I told her, there’s nothing to worry about, I was in Florida soaking up vitamin D, and was stress free! Cat Stevens takes us to the finish line today with his 70’s song: Moonshadow… I hope you have a Marvelous Monday today, and please remember to Be Good To Yourself!

Chuck Butler

May 10, 2022

* The U.S. Empire is in decline… 

* Silver, yes, Silver is actually up this morning!

Good Day… And a Tom Terrific Tuesday to you! No baseball for me last night, so I had to find something else to do… So, I went to Amazon and bought 3 new books, one of them for my granddaughter, Evie… Speaking of Evie, that’s exactly what she’s doing these days,  saying all Kinds of things, most of which I can understand, and some, well, she’s still jabbering a bit. She’s just so darn cute, and loves to try an steal my seat, when I get up…Three Dog Night greet me this morning with their big 70’s song: Mama told Me Not To Come

Well, if you came here this morning to see if the dollar had begun its burn out, like a failing star, then you came to the wrong place,as the dollar’s dominance continued yesterday, especially against the metals… Gold lost $29 on the day, and Silver lost 58- cents….Speaking od Silver… last Sayurday, in Ed Steer’s Saturday letter, he posted a graph, as he always does on Saturday, that shows the number of days of production it would take to equal the ounces of metals sold short… The number of days of Silver production that it would take to equal thr ounces of Silver that’s sold short is…. 162 days! Gold’s number is 88 days!

I find these numbers to be shameful for a nation that boasts about its free markets…. There should be a law the prohibits shorting more metal than they have in position available for sale…But as I’ve maintained all these years is that this whole idea of shorting the metals like this originated in the U.S. government to keep people from losing faith in the dollar… Henry Kissinger ans a senator that I can’t recall his name right now, discussed how they would need to defend the dollar after President Nixon, removed the Gold from backing the dollar…

Their initial fears were confirmed, as the dollar went into a 7 year down trend, that had traders scrambling for answers… and it took Volker’s’ 20% interest rates as the decade ended to entice foreign investors to but U.S. Investments to stop the decline of the dollar…

So, Gold closed at $1,855.10, while Silver closed at $21.86 yesterday. The price of Oil lost $5, and seeing that the Fed/ Cabal/ Cartel isn’t going to begin their Quantitative Tightening ( stopping their bond buying), bonds rallied and the yield on the 10_year dropped below 3%….. Oh! And the BBDXY closed yesterday at 1,253.05

In the overnight markets last night…. The dollar was steady Eddie, with little movement. A pause for the cause if you will… Gold ID up $8 early this morning, and Silver is up, yes I said up, 14-cents… The price of Oil staid in the $102 handle during the night and bonds didn’t move off their 2.96% rate… So, little movement in anything, as we start today…

I was reading Bill Bonner’s daily letter yesterday and he wrote something that I think everyone should read… So, here’s Bill: “But America is no longer getting richer… it’s going the other direction. 

Disposable personal incomes are dropping – down 20% from March’21 to March ’22. Of course, the steep drop is the result of winding down the feds’ Covid gimmie/stimmie programs. But ignoring the ‘transfer payments,’ still shows falling incomes. While wage increases are running at about 5%, consumer prices are rising at nearly 9%.

GDP is falling at a 1.4% annual rate.

The trade deficit just hit a new record high – at $109 for the month of April.

Productivity is in retreat – down at a 7.5% annual rate… the worst since 1947.

Consumer prices are rising at the fastest pace in 40 years…

Rents in Miami are up 40% year-to-year… 22% in Orlando… 17% in Las Vegas…

…the stock market just had the worst first quarter since 1939…

…and investors are realizing that many of the most promising breakthroughs were just fads.  NFT sales are down 92% from the peak. An NFT of Jack Dorsey’s first tweet sold for $2.9 million a year ago; now it’s on sale… top bid so far: $14,000.”

Chuck again… Remember when I had a cow about what the heck were NFT’s? Well, maybe that chicken will come home to roost.

Well what came to your mind last week when the stock market lost nearly 1,000 points, only to see it gain those lost points the next day? And the closed the week down nearly another 1,000 points, and so on? Given the fact that there are no free of manipulation markets anymore… I immediately thought of the PPT… The Plunge Protection Team, was created in 1987 after the October crash of the stock market… Their initial charge was to make the stock market operate smoothly… But in recent years they’ve added to their job, and a protection of sell offs became their charge de affairs….

And thinking of that, Russ and Pam Martens of: www.wallstreetonparade.com talked about this yesterday, let’s listen in: “Wall Street On Parade has been witnessing a new pattern in the stock market for several months now where the market plunges at the open and then shortly thereafter, on no major news, turns on a dime and spikes higher.

This suggests one of two things to us: 1) either the New York Fed is manipulating stock trading out of its second office close to the futures markets in Chicago; or 2) big money at Wall Street trading houses and/or hedge funds is doing it. Either way, the Securities and Exchange Commission and the Justice Department have not nipped this activity in the bud. …

Chuck again, again… I would put my money on manipulation…

The U.S. Data Cupboard doesn’t have anything for us today, well make that for us to be interested in…All this talk today regarding manipulated markets, it’s not just the markets that get manipulated, think about last Friday’s Jobs report from the BLS, where they added 330,000 jobs to the surveys from employers. I can tell you that the reason the BLS gets away with these shenanigans is that nnot everyone knows how to look under the hood, and see their actual numbers…

To recap… dollar dominance continued yesterday and it especially showed up in the pricing of Gold & Silver qwhich both took on significant losses on Monday. Chuck goes through manipulation today in several things… Stocks, bonds, commodities, currencies, and even data prints, get the manipulation treatment… there are no more free trading markets…

For What It’s Worth….Here’s an article that I feel is very important in the future of our economy, and it can be found here: https://www.zerohedge.com/economics/shocking-consumer-credit-numbers-everyone-maxing-out-their-credit-card-ahead-recession

Or, here’s your snippet:”While it is traditionally viewed as a B-grade indicator, the March consumer credit report from the Federal Reserve was an absolute shocked and confirmed what we have been saying for month: any excess savings accumulated by the US middle class are long gone, and in their place Americans have unleashed a credit-card fueled spending spree.

Here are the shocking numbers: in March, one month after the February print already came in more than double the $18 billion expected, consumer credit exploded to an absolutely blowout $52.435 billion, again more than double the expected $25 billion print, and the highest on record!

And while non-revolving credit (student and car loans) rose by a relatively pedestrian 21.1 billion (which was still the 6th highest on record)…

… the real stunner was revolving, or credit card debt, which more than doubled from the already elevated February print of $14.2 billion to a stunning $31.4 billion, the highest print on record… just in time for those credit card APR to starting moving higher, first slowly and then very fast.

While this unprecedented rush to buy everything on credit at a time when there were no notable Hallmark holidays should not come as much of a surprise, after all we have repeatedly shown that for the middle class any “excess savings” are now gone, long gone…

… the fact is that most economists – such as those at Goldman Sachs – had previously anticipated that continued spending of savings by consumers (who they fail to realize are now tapped out) is what will keep the US economy levitating in 2022. Unfortunately, as today’s consumer credit numbers clearly demonstrate, any savings that US middle class households may have stored away courtesy of stimmies, are long gone.”

Chuck again… this article tells the same story that Bill Bonner wrote about, and that is… the free money is all gone…

Market Prices 5/10/2022:American Style: A$ .6976,  kiwi .6327, C$ .7708,euro 1.0566, sterling 1.2336, Swiss 1.0085,  European Style: rand 16.0727, krone 9.6835, SEK 10.0367,  forint 358.79, zloty 4.4226,  koruna 23.6437, RUB 69.57, yen 130.03, sing 1.3885, HKD 7.8497, INR 77.01, China 6.7221, peso 20.28, BRL 5.1187, BBDXY 1,253.17, Dollar Index  103.60, Oil $102.24, 10-year 2.96%, Silver $21.94, Platinum $986.00, Palladium $2,068.00, Copper $4.20, and Gold $1,862.58

That’s it for today..A simply beautiful day here yesterday,as it didn’t get as hot as the weather app said it would… I sat outside for a few hours yesterday, soaking up some vitamin D… I find that the sun always makes me feel better…Speaking of feeling better, remember two weeks ago when  I had an appt with my oncologist, but had to cancel it because of the head cold I had? Well, it got rescheduled for this Thursday… So, once again a short week for the Pfennig. I have my fair share of doctors… therefore I have my fare sure of doctor appointments! In 2020, I thought that going to see the doctor was like going out! The great Carlos Santana takes us to the finish line today with his rollicking version of the song: She’s Not There… I hope you have a Tom Terrific day today, and please Be Good To Yourself!

Chuck Butler

May 9, 2022

* Powell still believes he can deliver a soft landing… 

* Gold & Silver remain on the selling blocks… 

 

Good Day… And a Marvelous Monday to you! I hope all the wonderful mothers out there had a marvelous day yesterday… I tried to get out Happy Mother’s Day texts to most of the moms that I could think of… My brain was still a little fuzzy, from a few days of being very sick… The stomach bug that I said that our little Evie had passed onto to Kathy, was passed onto me, and well, with my immune system nonexistent, that stomach bug took it out of me for 3 days! Not a fun end of the week for me! I was so bad I had to cancel my dentist appt, and instead sat in my recliner all 3 days, covered up with a blanket, and hoping the next day would be good… And, I was home alone to top it off! So, enough about me… I hope everyone had a wonderful weekend! Al Wilson greets me today with his song: Show And Tell…

Well, a few things have happened since I last wrote to you… The Fed/ Cabal/ Cartel’s FOMC did hike rates 50 Basis Points, and Chairman Powell, had a lot to say, so I’ll let the folks at the Washington Post tell you about what he had to say: ““Inflation is much too high,” Fed Chair Jerome H. Powell said at a Wednesday news conference. “We understand the hardship it is causing, and we are moving expeditiously to bring it back down. We have both the tools we need and the resolve that it will take to restore price stability on behalf of American families and businesses.”

The rate increase is the sharpest since 2000 and the second of seven hikes forecast for this year. Powell added that additional interest rate hikes as high as 0.5 percentage points are “on the table” in the coming months but said policymakers had not seriously discussed even sharper hikes. Major financial markets edged higher during his remarks, as investors signaled relief that the Fed wouldn’t move more aggressively.

Faced with soaring prices and a hot job market with record numbers of job openings, the Fed is betting that a steady series of hikes will slash inflation, cool the economy and get the coronavirus recovery on more even path.”

Don’t you just love it? First, inflation was non-existent, and then we weren’t suppose to fear it, for it was only transitory, and it would be gone soon, then the folks at the Eccles Bldg, had an “aha” moment, and decided that inflation was a problem, and now they admit that inflation is “much too high”… So, no, you know what, Sherlock!

We didn’t need to have an Ivy leaguer tell us that inflation is “much too high”, now did we? Does anyone else get the feeling that we’re experiencing déjà vu? I mean all that’s going on here now, has been gone through before, unfortunately, for all you youngsters, it was the 70’s… Stuff you’ve only heard rumors about…

OK, I plan to spend a lot of time on the comparison to today with the 70’s, at a future date, but first, we need to review the markets late last week after the FOMC hike rates 50 Basis Points, which still has out internal rate below 1%… I might add…

After the announcement, the markets reacted like I thought they might. Remember last week when I said that the dollar’s trading looked like a sign that it was a buy the rumor sell the fact? Well, immediately on Wednesday afternoon, the dollar got sold, and Gold got bought…

But you, me, and the guy down the street, knew that the price manipulators weren’t going to allow this trading pattern to continue… And so on Thursday, the dollar got bought, and Gold got Sold… The price of Oil rose above $110, and bonds got sold…

On Friday, the dollar continued to get bought, but so did Gold… The BBDXY ended the week at 1,252.54, up for the week, and Gold gained $6.20 to close at $1,884.10, while Silver got sold again at 13-cents to end the week at $22.44.. the Price manipulators just won’t loosen their jaws around the throat of Silver, and I find that to be downright shameful…

In the overnight markets last night… There was little dollar buying, with the BBDXY hanging in at 1,252, but Gold & Silver are getting sold again… In the early trading today Gold is down $16 and Silver is down 47-cents, bringing Silver below $22.. The 10-year Treasury’s yield is above 3% at 3.15% this morning, and doesn’t appear to be settling in… that means that the yield should be heading even higher… And the price of Oil has slipped to a $107 handle in trading this morning… I read where the price of Oil fell from Thursday’s $110 handle is that Oil traders fear of the European Union haggling with Russia over whether they will or will not ban Oil from Russia.

I guess it’s turning to spring in the Eurozone, and they’re feeling their oats, about not needing heating Oil any longer.. OK, whatever… Memo to the EU… You needed the Oil before, so what makes you so sure you won’t still need it?

In a case of showing everyong that fundamentals mean diiddly squat these days, after the Reserve Bank of Australia hike rates last week, the A$ has lost over a cent in value… This whole business of moving currencies on Trader Sentiment is just wrong… And the dollar dominance right now is something to behold.. write it down in you journals that Chuck thinks the dollar dominance is akin to a failing star, for the star burns the brightest right before it flames out…

I am one person that truly believes that the U.S. economy is headed for a recession, the likes we’ve never seen before… But we’ll have to wait-n-see when that happens, eh?

The U.S. Data Cupboard last week had the April Jobs Jamboree and the BLS conjured up 428,000 jobs created in April…. With the word “created” the operative word here, as the BLS added 340,000 jobs to the surveys they received… So, when the surveys came in, there were less than 100,000 jobs created, and they had their marching orders from the Gov’t that they have to created this vision of a strong employment situation, to take people’s minds off of the fact that they sinking deeper and deeper in this inflation spiral, and so they added 340,000 jobs out of thin air to the surveys, and voila! Strong employment!

Today’s Data Cupboard is basically emply with some Consumer forecasts of future inflation on the docket… They won’t ask “real people” about inflation, so this data is worthless…

To recap… Last week saw the FOMC hike rates 50 Basis Points, which puts the U.S. internal rate at .75 to 1.00%… I still don’t get how that’s going to combat inflation , but so be it… the dollar is showing dominance over the currencies, and Gold / Silver… Chuck is convinced that the dollar dominance is akin to a failing star… And the BLS totally stuffed the Job report last week with made up jobs…

For What It’s Worth… I spent some time above on Jerome Powell, but there’s always more that can be talked about, and this article does just that pointing out how wrong Powell, will be shown to be and it can be found here: Powell Confident in “Softish Landing” for the Economy, But We May Keep Inflation. Markets Can Figure Out their Own Landing | Wolf Street

Or, here’s you snippet: “Nowhere in the statement does the Fed explain that the raging inflation followed $4.6 trillion in money-printing in two years that unleashed all kinds of craziness, including in the markets. But that party is over.

“Soft or softish landing” for the economy. Markets on their own.
Tightening might be “unpleasant,” Fed Chair Jerome Powell said, but labor markets are very strong, and the balance sheets of consumers and businesses are solid, and they can handle higher rates, and “we have a good chance to have a soft or softish landing,” he said. “The economy is strong and is well-positioned to handle tighter monetary policy,” he said.

He was speaking of the economy – employment, GDP, etc. – and not the financial markets, which are on their own and can figure out their own landing amid higher rates and QT.

QT starts on June 1. The whole thing is going to take place in a “predictable manner” by letting maturing securities roll off the balance sheet, subject to “caps.”

During the phase-in period in June, July, and August, the Fed’s securities holdings will drop by $47.5 billion per month: $30 billion in Treasuries and $17.5 billion in MBS. Reductions will come from maturing securities being redeemed, and from pass-through principal payments for MBS.”

Chuck again… Hey, wait a minute here! I thought QT was supposed to start May 1st? Why the change of date, Jerome? Why not explain what the delay is? Nah, he can’t do that, that would mean the Fed/ Cabal/ Cartel was transparent! How can we ever believe anything that comes out of his mouth again? Softish Landing, my word!

Market Prices 5/9/2022: American Style: A$ .7024, kiwi .6373, C$ .7741,
euro 1.0570, sterling 1.2398, Swiss $1.0105, European Style: rand 16.1908, krone 9.5131, SEK 9.9970, forint 361.85, zloty 4.4310, koruna 23.6295,
RUB 69.96, yen 130.60, sing 1.3881, HKD 7.8498, INR 77.21, China 6.7122,
peso 20.24, BRL 5.1259, BBDXY 1,252.58, Dollar Index 103.54, Oil $107.20,
10-year 3.15%, Silver $21.89, Platinum $945.00, Palladium $2,047.00,
Copper $4.42, and Gold… $1,867.45

That’s it for today… I’m a little wound tight this morning, I’m sure you can tell… I’ve just about had it with the price manipulators, the Fed/ Cabal/ Cartel, the Treasury, the Gov’t… they all make me sick to my stomach, and I do know something about that! Our Blues evened their series with the Wild at 2 games apiece yesterday, boy did they need that game, and they got it! My beloved Cardinals split their 4 game series in San Francisco with the Giants… They come home to play the Orioles, and I’m going to the game Wednesday with my sons, Andrews and Alex, and then going to the day game on Thursday with good friend Duane… for those of you who don’t know, The Orioles used to be the St. Louis Browns… The Righteous Brothers take us to the finish line today with their song: Unchained Melody. I hope have a Marvelous Monday today, and please remember to Be Good To Yourself!

Chuck Butler

 

May 4, 2022

* RBA hikes rates! 

* Traders wait for the FOMC announcement… 

Good day… And a Wonderful Wednesday to you! It’s also Star Wars Day, so May the 4th Be With You! A quick reminder that there will be no Pfennig tomorrow…. My Cardinals bats were missing again last night, and they lost a game to their interstate rivals, The Royals…this lack of hitting is getting to be a real problem for my Redbirds… UGH! Pitching and Defense can go a long way, butter has to be some hitting at some point! Supertramp greets me this morning with their song, which is also my fave Supertramp song: Hide In Your Shell

After getting sold in the overnight markets the night before, the dollar rallied back during the U.S. Session on Tuesday. The BBDXY gained 2 index points to close the day at 1,2446.29. The trading in the dollar, the last two days leads me to wonder if this will be a case of “buy the rumor, sell the fact”?  With the rumor being that the FOMC will hike rates by 50 Basis Points this afternoon… For there’s been a ton of dollar buying leading up to today…

Gold found a way to gain $4.60 yesterday, while Silver made it 11 consecutive days of getting sold… Silver lost 6-cents, to close the day at $22.63, and Gold closed the day at $1,869.00. I hope you all had the opportunity to read the FWIW snippet yesterday. and took my opinion on holding Gold to heart!… The price of Oil slipped a buck yesterday, and bonds were stuck in the mud.

Speaking of bonds…. There was an article somewhere that I read the other day that talked about how the largest buyer of Treasuries has been unloading them… I told you all that this would happen…. I have something for you regarding a problem with Treasuries in the FWIW section today… So make sure you stick around for that…

In the overnight markets last night…. There’s been little movement of all the asset classes that I follow… Everything is stuck in the mud this morning, with all traders waiting on the FOMC…

Well, today is The DAY isn’t it? The long awaited, and much talked about, 50 Basis Points (1/2%) rate hike will come to be this afternoon. I’m more interested in what the chairman, Jerome Powell, has to say about future rate hikes, because…. Even if there aren’t any real financial journalists to hold his feet to the fire, when he backs off. I’ll be here to call him out…you can bet your bottom dollar on that!

Another $33 Billion is being earmarked for Ukraine…. The Fed/ Cabal/ Cartel has been making overtures about fighting inflation, and the White House keeps racking up the deficit spending, which will require more dollars to be printed… And dollars getting printed is how we got into this inflation mess!  The Reserve Bank of Australia (RBA) hiked their internal rate 25 Basis Points last night, their first rate hike in a decade! The RBA must be taking a page from the Fed’s book on how to combat inflation… This rate hike brings their internal rate to .35%….

The U.S. Data Cupboard had some interesting prints yesterday… 11.5 million job openings in March, and the Great Resignation continues with 4.5 Million job quits in March… Factory Orders were up 2.2% in March but that makes no sense given the negative 1.4% GDP print for the first QTR…. Today’s Data Cupboard has the ADP Employment Report for April…

To recap… The dollar rallied yesterday after getting sol the night before. And last night’s trading was all stymied as traders fear the FOMC this afternoon… Gold & Silver are flat this morning… And we found another $33 Billion laying around that we don’t need! The Reserve Bank of Ausralia hiked rates 25 Basis Points last night…

For What It’s Worth…. Well, this is the aforementioned article about the problem with treasuries, and it can be found here: 12ft | Stress emerges again in Treasuries market | Financial Times

Or, here’s your snippet: “At the beginning of this month, major financial market participants trading in the US Treasury bond market had difficulty meeting the demands for collateral made by their counterparties.