Author: admin

Rocktober 4, 2021

* Currencies & metals rally late last week… 

* We end this week with the Jobs Jamboree! 

Good Day… And a Marvelous Monday to you!  And Welcome to Rocktober! Well, the regular season ended yesterday, and I was rooting for a 4-way tie for the Wild Cards in the American League. But all the teams failed to cooperate, and the race didn’t end in a 4-way tie… My beloved Cardinals will travel to L.A. to play the Dodgers in a one game winner moves on, game on Wednesday…  It was a beautiful weekend here in S. Florida, this past weekend, and I was outside as much as possible…  I can’t even begin to say how embarrassed I was for my beloved Missouri Tigers on Sasturday… Their defense couldn’t have stopped a High School offense! This is NOT the Missouri Tigers defense I grew up with, when the other teams thought the M on the their helmets stood for “monsters”… Oh, well, at least the teams I followed back then never game up 62 points in a game!  The Classic IV greet me this morning with their song: Spooky, which was also done years later by the Atlanta Rhythm Section…

Well, there was no chaos on Friday last week…  As predicted, the lawmakers saw to it to kick the can down the road even further, and the Gov’t didn’t come to a halt…  The lawmakers are still arguing over what to cut from the 3.5 Trillion spendalooza…  And now it won’t come to vote until the end of the month…  Stupid, silly, games that people play… never saying what they mean, never meaning what they say. (Joe South)…  They just keep spending money we don’t have, or will have, on things that are not needed…

The House voted last week to suspend the Debt Ceiling until December 2022, but the Senate is set to block that and set the timer on the drop dead date of Rocktober 18, when Treasury Sec. Yellen says the U.S. will begin to default…  Don’t get caught up in all the drama here folks, in the end the debt ceiling will be raised, and we’ll kick the can down the road yet again… 

All this deficit spending is becoming a real problem for the U.S. folks… The lawmakers and the spin doctors won’t lead you to believe that this is all going to come back to haunt us, but it will…  There’s nothing in history that can prove otherwise…  I’m sorry that I don’t have the market updates right now, but this is something that I feel needs to be discussed…

Ok, all the silliness that’s going on in Washington D.C. makes me wonder what the heck are they arguing about? Raise the Debt Ceiling, pass the deficit spending bills, because, all this drama is just making it a smoke screen for them to do these things…   And as far as the Taper question goes… How can the Fed/ Cabal/ Cartel, taper, when their backs are against the wall? Ok, what I’m talking about here is the fact that 1. Our tax receipts don’t cover our interest expense now, and 2. Foreigners are backing away from our auction window, at a time when we need them the most! You see the dilemma here don’t you?  More debt means more Treasury issuance, which if we don’t have buyers to buy it all up, who’s left to buy it? That’s right, the Fed/ Cabal/ Cartel…  So, if they are buying Treasuries, they certainly wouldn’t be tapering now would they? 

I was reading yesterday and came across this from Matthew Piepenburg of Gold Switzerland, and this is important folks so pay attention: “With central-bank “accommodated” asset bubbles (from stocks to real estate to art) now at historically unprecedented levels, tax receipts flowing into the U.S. coffers from the ever-growing millionaire-to-billionaire class have been rising.

This may seem good for that punch-drunk Uncle Sam, but what no one is talking about is that despite even those “capital gain” receipts, the interest expense (i.e., “bar tab”) in D.C. is now an astronomical 111% of those same tax receipts.

In other words, U.S. tax income doesn’t come close to even paying interest (let alone that archaic concept known as “principal”) on growing U.S. debt obligations.

Can anyone say, “Uh-oh?”

You can read Matthew’s entire thoughts here: Hidden Bankruptcy: The Reality Behind Uncle Sam’s Inflated Bar Tab – Matterhorn – GoldSwitzerland

Chuck again…  And as far as the thought that foreigners aren’t showing up at the auction window, there’s this: Since 2020, foreigners have been selling Treasuries, instead of buying them…  Have you ever wondered, why the Treasury yield continues to rise? Selling of the bonds will do that folks… the price goes down and the yield rises…

So, given these two things, do you really believe that the Fed/ Cabal/ Cartel, can begin to not buy bonds each month (Taper)?   As I’ve explained previously, a Tapering is basically a tightening of interest rates… And if the Fed/ Cabal/ Cartel isn’t buying the bonds, who’s going to pick up the slack?

Oh, and there’s much more issuance of Treasuries coming down the pike folks, as we ramp up the deficit spending bills… 

Ok… the markets at the end of last week moved in the direction I would have thought them to be moving all along… The dollar got sold from Thursday morning to the end of the week on Friday. The BBDXY traded on Thursday morning at 1,167.60, and ended the week at 1,161.34…  That’s a HUGE downward move folks…  Gold got bought both Thursday and Friday, and the price of Oil saw a rebound from the brief selloff last week, while bonds were bought, for what reason I have no idea, but they were…

For those of you keeping score at home, Gold on Thursday rose $31.10, and Silver gained 65-cents, and on Friday Gold gained $3.50, to close the week at $1,762.00 and Silver gained 36-cemts to close the week at $22.65… So, the end of the week was kind to the metals…

The currencies also saw some love thrown their way on Thursday and Friday last week, and it was all about the Gov’t’s vote to kick the can down the road on Thursday… The euro climbed back above the 1.16 handle, and all the remaining currencies followed the euro higher. 

The overnight markets last night… There was some follow-up dollar selling but not by a large margin. the BBDXY is trading this morning down to 1,161.01…  But… Gold & Silver are getting sold in the early trading today, with Gold down $13 and Silver down 24-cents…  

The inflation in this country continues to rise.. This from MarketWatch last week: The cost of goods and services rose sharply again in August and left the rate of U.S. inflation at a 30-year high, with all signs pointing to price pressures sneaking into next year.

Chuck again…  I heard a joke this past weekend that I laughed  until I cried… The joker said that soon the only thing that Fed/ Cabal/ Cartel chairman Powell will see that is transitory will be his job! Apparently there are some influential folks on Capital Hill that aren’t too fond of Mr. Powell…  I will say that they are directing their angst in the wrong direction… They should be directing it toward the Deep State, but then that’s just me thinking out loud…

I saw this blurb on Bloomberg.com on Friday, and copied it for today’s Pfennig, “Inflation in the euro area hit 3.4% in September, a 13-year high, with core prices accelerating 1.9% when volatile components like fuel and food are excluded. There’s not much hope for an easing of inflationary pressures in the short term with natural gas prices hitting another record high.”

Chuck again… Where’s Hans Tietmeyer? Wim Duisenberg? In case you’ve forgotten these fellows, they are former Presidents of the European Central Bank (ECB) and  the Bundesbank, and they were so anti-inflation that if you looked in the dictionary for the word “HAWK” you would see their respective pictures!  Germany, the Eurozone’s largest economy, has always been against any rise in inflation… And I would think that the German people are screaming from the rooftops about this rise in inflation… But the ECB just continues to sit on their hands, and allow this inflation to grow…  Shame, shame, shame…

The Norges Bank (Norway’s Central Bank) seems to be the only Central Bank around the world that gets that inflation is soaring and it needed to be dealt with…  

The U.S. Data Cupboard last week had the Initial Jobless Claims for the previous week and just like the two weeks previous to last week , the number of Claims being filed increased from the week before… And once again I’ll remind you that I told you that these increases would be happening…

We also saw that Personal Income and Spending were two data prints going in the wrong direction.. .Real Disposable Income fell -.3%, while personal spending rose .8%…   These are not a good set of number for the economy folks, given that we’re spending more than we make….  

But none of these data prints were responsible for the dollar sell off Thursday & Friday last week… It was all about the kicking the can down the road, as I said above…

This week’s Data Cupboard is lacking at best… We start the week today with Factory Orders for August…  And then there’s really nothing to talk about until we get to Wednesday’s ADP Employment report, and finally on Friday the BLS’s Jobs Jamboree for August…  Right now the so-called experts are calling for a 485,000 gain in jobs for August…  I don’t see how that works, given that the weeks in August saw the Initial Jobless Claims ratchet higher each week…  But then it’s the BLS and I think their reports are just a description that uses their name.. .BLS…    think about that… HA! 

To recap… Chuck goes into a long dissertation on why the Fed./Cabal/ Cartel, can’t Taper… The currencies and metals both rallied, along with Oil, and bonds… Stocks also saw a recovery of sorts.. Inflation continues to be a real problem now and going forward… And the only thing that will be transitory is Jerome Powell’s term at the Fed/ Cabal./Cartel…

For what It’s Worth….  Since late last week’s selling of the dollar is still fresh on our minds, Zerohedge.com ran an article about the AAA rating on Treasuries, which I find to be quite interesting, and it can be found here: Stocks Pressured After Fitch Warns Debt Ceiling “Brinksmanship” Threatens US AAA Rating | ZeroHedge

Or, here’s your snippet:”  As a reminder, just over 10 years ago, S&P downgraded the U.S. after that year’s debt ceiling debacle prompted the rating agency to do the unthinkable and lob an ‘A’ from the untouchable AAA U.S. rating (prompting a very unhappy response from both the market and the then-Obama administration). Well, moments ago Fitch lobbed the first official warning shot across the bow of the world’s reserve currency, writing that with the Drop-Dead Date in just 17 days, any debt-cap “brinkmanship” between Democrats and Republicans may put pressure on Fitch’s AAA rating of the U.S.

In the statement, Fitch said that the failure of the latest efforts to suspend the U.S. federal government’s debt limit indicates that the current stand-off could be among the most protracted since 2013. Additionally, the rating agency believes that the debt limit will be raised or suspended in time to avert a default event, but if this were not done in a timely manner, political brinkmanship and reduced financing flexibility could increase the risk of a U.S. sovereign default.

“It’s unfortunate when Congress uses this as a negotiating tactic, it’s a bad scenario overall,” said Randy Frederick, managing director of trading and derivatives for Schwab Center for Financial Research.

“Eventually, foreign creditors might be unwilling to buy U.S. debt and if that happens, rates are going to go sharply higher and if rates shot up because people were unwilling to buy treasuries that would have a very negative impact on the market.

And, as we have explained previously, Fitch also pointed out that prioritization of debt payments, assuming this is an option, would lead to non-payment or delayed payment of other obligations, which would likely further undermine the U.S.’s AAA status.”

Chuck again…  Boy do I recall that day when the U.S. ‘s bond rating lost its AAA rating!  And then the selling of the dollar lasted a while… We’ll have to see if that repeats…

Market Prices 10/4/2021: American Style: A$ .7279,  kiwi .6968, C$ .7927, euro 1.1620, sterling 1.3590, Swiss $1.0774, European Style: rand 14.9546, krone 8.6020, SEK 8.7297, forint 306.31,  zloty 3.9302,  koruna 21.7893, RUB 72.92, yen 111.30, sing 1.3571, HKD 7.7862, INR 74.27, China 6.4445, peso 20.55, BRL 5.3645,  BBDXY 1,161.01, Dollar Index 93.92,  Oil $75.60, 10-year 1.49%, Silver $22.39, Platinum $958.00, Palladium $1,978.00, Copper $4.15, and Gold… $1,748.60

That’s it for today…  As I said above my beloved Cardinals travel to LA. To play the Dodgers on Wednesday… The Dodgers will send their ace Max Sherzer to pitch against the Cardinals. Max is a St. Louis product and University of Missouri product… But I doubt he’ll let those home ties interfere with his task at hand… Ate dinner at friends, Pete & Karen’s last night, sat out on their balcony and talked about all kinds of things… It was simply a beautiful night! I’ll be sad to leave my winter home on Friday this week, but this coming weekend is my granddaughter Evie’s birthday… My little Evie will be 2!  I do believe that she’s already into her “terrible 2’s”, but she’s so darn cute!  The Charlie Daniels band takes us to the finish line today with their song: The South’s Gonna Do It Again…  I hope you have a Marvelous Monday and will Be Good To Yourself!

Chuck Butler

September 30, 2021

* currencies & metals get sold on Wednesday… 

* Today is a BIG DAY, with a vote in Congress & the fiscal year end… 

Good Day…  And a Tub Thumpin’ Thursday to one and all! It’s the end of the week for me, and the end of the month, and the end of the fiscal year for the U.S.  There are many things going on that could occur tomorrow, folks… But I doubt that will happen.. I’m talking about a default for the U.S.  And I  doubt that this is the time that this will happen, but… There’s always a chance… My beloved Cardinals’ 17 game win streak came to and end last night…  Oh well… who’d thunk that this team that had a difficult time hitting its way out of a wet paper bag, would put together a 17-game win streak?  I sure didn’t! But the fans are still behind the team, and we’ll keep going until the Ferris Wheel stops.. The Little River Band greets me this morning with their song: Happy Anniversary…

Well, another day brought on another day of dollar buying folks… While all the chaos that could occur in the next couple of weeks hangs over the markets like the Sword of Damocles.. Dollar traders and investors are playing no attention to it, and  just keep buying dollars… The currencies continue to take one shot to the gut after another… And Gold & Silver keep getting sold down the river…  Bitcoin finally found a bid yesterday, after seeing days of selling take its price to a level that could have brought it below $40,000… Bonds didn’t move much on Wednesday, and the price of Oil didn’t move much either.. So we can’t blame all the dollar buying on Bond  Or Bitcoin purchases….

Gold lost $7.70 on the day to close at $1,727.10, and Silver lost 92-cents  to close at $21.62… I told you yesterday, that we are in a batten down the hatches time, and I hope you have heeded my call, and are not paying attention to all this dollar buying.. All this selling is really frustrating for me, folks, as I know it is for you too, but we have to maintain our hedges against the collapse of the dollar, and carry on my wayward son… 

In the overnight markets last night… Not much of anything went on… the currencies are basically trading in yesterday’s clothes, as is Gold & Silver, with both of them flat as a pancake (Head East!)  The BBDXY, which closed yesterday at a whopping 1,167.88, is trading this morning just a shade lower at 1,167.60…  In Congress today, with the fiscal year ending, they will try once more to agree on a spending bill that would allow the Gov’t to continue to operate… As I’ve said before this is usually a rubber stamp but this time seems to have hang ups, lawmakers with a conscience, who’d a thunk that could happen? 

I was taken aback last night, while I sat out on our balcony, watching the stars dance around, when I read an email that talked about how the current President is proposing that the military give start giving out dishonorable discharges to military personell that refuse  to be vaccinated… Wait! What? That’s preposterous! These people have put their lives on the line for our country, and we’re going to give them dishonorable discharges?  I draw the line there folks… I will not sit idle, and watch this farce to go on…

OK, I know that has nothing to do with markets, economies, but it does have to do with DOLTS! And I will always be here to point out the DOLTS, folks… You can count on that!

On a different front…  Back home in Missouri, there were tons of protestors out in force to object the current evictions going on…  These folks can’t believe that owners of homes can evict them for not paying their rent.. . The gall of these owners!  HA!  I really can’t get my arms around the idea that folks, can’t believe that they’re being evicted for not paying their rent.  I will point out again that there are 10.9 Million job openings in the U.S. and there are 8.4 Million people unemployed…  Need I say more?

Did you hear about the French mansion that was being renovated, and they found Gold coins in the walls?  Here’s the skinny from the good folks at GATA: “Hundreds of rare gold coins dug out of the walls of a remote French mansion fetched more than one million euros ($1.2 million) at auction on today.

Stonemasons discovered 239 pieces of gold, minted before the French Revolution, when they began renovating the property near Quimper in the western Brittany region, auctioneers Ivoire/Deloys said.”

Ok, so I can see French mansion holders all taking sledgehammers to their walls to see if there are Gold coins in them… I find that thought to be funny, I don’t know about you, but I find it to be amusing… 

Remember when I told you about the guys that were calling for stock market collapses on “X” day?  I said that they were like the boy who cried wolf, and that eventually the stock market would collapse and they could crow exuberantly that “they called it”…  Well, the stock market hasn’t really collapsed, but it did hit  a 6-week low yesterday…  So, maybe these guys will be “half right”, as the rot on the stock market’s vine gets exposed over time, and not all in one day… 

And that brings me to the Cartel, what will they do to protect the stock market? They could slowly walk away from any talk of Tapering… And they could repeat their comments that interest rates won’t rise until 2022, late… But maybe that’s all run its course, and the stock jockeys won’t see this as helping… I can see that happening, just like my taking of chemo, about every 1.5 years, it begins to not be effective, and I have to switch to a different chemo… Oh, shoot, that 1.5 years is now! Uh-oh! 

Today’s U.S. Data Cupboard has the usual Thursday fare of Initial Jobless Claims, which the last two weeks have surprised to the upside… I would think that to continue, but like I said not like the increases we saw in March of 2020, just increases that keep adding up…  The final revision to 2nd QTR GDP will print today… What a crock of data!  Gov’t spending dominates this data print, just keep that in mind… 

There will be 4 Cartel members out speaking on the economic outlook today, hopefully they will all be singing from the same song sheet, which rarely happens when they go out to speak… Confusion is their normal cup-o-tea, so we’ll have to see what today’s brings us here… 

Tomorrow’s Data Cupboard will have Personal Income and Spending for August, and the Core Inflation data for August… But the whole world will be watching to see what happens today with the vote in congress, and how the U.S. reacts tomorrow…  Big Day today, folks, and even Bigger day tomorrow… 

For What It’s Worth… This is crazy folks… I found this on Ed Steer’s letter last night, and when I went to click on the link, CNBC said it no longer existed…  So, I don’t have a link for you to click on and read the article in its entirety this morning…   All I have is the snippet, which talks about Cartel chairman Powell and his visit to Capital Hill…

And here’s your snippet: “ Federal Reserve Chairman Jerome Powell, in remarks to be delivered Tuesday, cautioned Washington legislators that the causes of the recent rise in inflation may last longer than anticipated.

In a speech that he will deliver to the Senate Banking Committee, the central bank chair said economic growth has “continued to strengthen” but has been met with upward price pressures caused by supply chain bottlenecks and other factors.

“Inflation is elevated and will likely remain so in coming months before moderating,” Powell said. “As the economy continues to reopen and spending rebounds, we are seeing upward pressure on prices, particularly due to supply bottlenecks in some sectors. These effects have been larger and longer lasting than anticipated, but they will abate, and as they do, inflation is expected to drop back toward our longer-run 2 percent goal.”

The remarks are part of mandated testimony Powell must give to Congress regarding the Fed’s economic response to the Covid-19 pandemic. He will speak Thursday to the House Financial Services Committee.”

Chuck again…  yes, isn’t it nice to see the Cartel come around to our way of thinking that inflation is NOT transitory? I do find this interesting that again he takes no credit for fueling the inflation with all their currency printing and near zero interest rates…    What a Twit, dolt, and any other name you can think of that describes someone that’s either not so bright, or lies between his teeth!

Apparently, Cartel Chairman, Powell, is on the hot seat as his term comes up for renewal… There are some influential lawmakers that don’t feel that Powell is up to the grade that they need to guide the economy to higher ground…  I don’t know how Powell can sit there and listen to the bunk from the lawmakers, without standing and pointing his finger at them and saying, “If you people would stop with your deficit spending, it would make my job easier”…  And then he could pretty much know that his job is toast…  I’m just saying… 

To recap… The dollar buying continued throughout yesterday, but overnight the dollar buying has taken a pause for the cause… Bonds and Bitcoin didn’t get bought yesterday, so we can’t blame buying them for the weakness in the currencies and metals…  Chuck thinks the vote in congress today will be a BIG ONE, with the fiscal year ending today in the U.S. they need something to continue tomorrow…   Could be chaotic tomorrow, folks… 

Market Prices 9/30/.2021: American Style: A$ .7195,  kiwi .6865, C$ .7850, euro 1.1581, sterling 1.3442, Swiss $1.0688, European Style: rand 15.1690, krone 8.8025, SEK 8.7845,  forint 311.42,  zloty 4.005,  koruna 22.0340, RUB 72.78, yen 111.99, sing 1.3608, HKD 7.7883, INR 74.22, China 6.4663, peso 20.52, BRL 5.4239, BBDXY 1,167.60, Dollar Index 94.44,  Oil $74.23, 10-year 1.52%, Silver $21.63, Platinum $962.00, Palladium $1,974.00, Copper $4.12, and Gold… $1,726,80

That’s it for today… Well, first we had a very scrumptious dinner last night, and then sat out on our balcony that overlooks the ocean, and talked.. Good friends Pete and Karen  were our guests on the balcony, and we swapped stories, and memories, until it was late… I had my Bose wireless speaker on the balcony playing Sirius XM’s station, The Bridge… that’s one that I listen to all the time!  So, today is the final day of the U.S.’s fiscal year… What will happen tomorrow? When we turn the page to Rocktober?

I laughed the other day when reading Dave Gonigam’s 5 Minute Forecast, when he called the $3.5 Trillion deficit spending bill, “the spendalooza”… I don’t think there’s a better way to describe it! Well, when I talk to you next it will be Rocktober!  And what an interesting month it should be…  My beloved Cardinals play a day game at Busch today, but I won’t be in town to attend, UGH! Then they finish the regular season with 3 games with the Cubs…  Gotta keep winning! I hope you have a Tub Thumpin’ Thursday today, and please Be Good To Yourself!

Chuck Butler

September 29, 2021

* Currencies, metals, bonds, bitcoin all get sold on Tuesday

* Fitch improves Russia’s economic outlook! 

Good Day… And a Wonderful Wednesday to you! Well, my beloved Cardinals won their 17^th consecutive game last night… And clinched a spot in the playoffs, albeit a one-game winner moves on playoff game… But, they’re in… and if you get in, there’s always a chance, and right now, my beloved Cardinals are playing the best baseball I’ve seen in all my years… I was up very late last night, as I’m on the East Coast, and that means the game didn’t end until around 11 pm, and then silly me, I stayed up to watch the celebration… So… Im draggin’ the line a bit this morning! Edwin Starr greets me this morning with his song: Twenty Five Miles…  “Twenty five miles from home girl, my feet are hurting mighty bad”…

Well, what can I say this morning that will provide solace for non-dollar investors? Don’t worry, about a thing, ‘cause every little thing is going to be alright…  But I do believe that with the rising Treasury yields, that it could very well be a batten down the hatches time…  Shoot Rudy, the stock market is even being sold to buy Treasuries these days…  In actuality, Treasury yields are still negative when you calculate them with inflation…  But look at it this way… In Japan, they have no inflation, and their yields are negative, so at least U.S. treasury yields are better than that!

So, yesterday, we saw the dollar get bought like funnel cakes at a State Fair, and anything that was considered anti-dollar got sold… Currencies, metals, bitcoin, and Oil…  To follow up on something I talked about on Monday… Bitcoin is really feeling the heat, from the announcement by China that they were banning cryptocurrencies…  The BBDXY rose 4 whole points to close the day at 1,159.93…  Oil fell by almost $2’s… and Gold lost $15.90 on the day to close at $1,734.80, and Silver lost 17-cents to close the day at $22.54…   From my view in the cheap seats, I would say that the boys in the band are still very active in pushing Gold lower… Hmmmm

It’s all about higher rates, and the markets are flying with blinders on… They’re refusing to see the chaos that could incur in Congress, with the $1.5 Trillion deficit spending bill now in peril…  But then, when all this dollar buying begins to get reversed it’ll be just as ugly for dollar holders…  I read yesterday that the final vote on the bill will has a deadline of Rocktober 18^th… But… they’ll be lots of hemming and hawing about the bill from here on out.

In the overnight markets last night… The dollar buying just keeps going on and on… The BBDXY has risen to 1,162 in the overnight trading…  Speaking of the BBDXY it’s about time for it to be recalculated, or recalibrated based on the trade numbers from the different countries, so we might see a move here that doesn’t correlate to dollar buying or selling…  

Gold is in positive territory this morning, which is surprising given the rot on the vine in the other metals, Silver, Platinum and Palladium…  Shoot Rudy, Palladium has fallen below $2,000! I guess all those catalytic converters are now safe, eh?  Gold is up $7 in the early trading today, and Silver is down 20-cents…  What on earth is in the minds of the price manipulators these days regarding Silver? They just keep pushing it down. Is there a price they are working toward? 

The price manipulators have gotten to brazen with their engineered takedowns, that if they keep going like this, we will eventually see them announce their moves ahead of time… “Tomorrow we’re going to take Gold down by 5%,” or something like that…  I kid, and attempt to bring some levity to these takedowns, but I do believe I fail miserably… 

Ok.. onto other things… The RT.com reported the other day that, “International ratings agency Fitch has improved its forecast for Russia’s economic growth this year to 4.3% from the previously expected 3.7%, said Douglas Winslow, Director at Fitch Ratings.”

I keep telling everyone that the Russians won’t be brought down by the economic sanctions placed on them by the U.S. and Eurozone. And that the ruble is one of the few currencies in the world where you can still get some interest on a deposit. And that ivestors need to get over their USSR fear… The USSR is gone, and this is the new Russia.. So get over it and think seriously about buying some rubles! 

Wanna know what two stocks Congress owns that will make your head spin?  How about Pfizer, and Johnson and Johnson…  No wonder the Gov’t keeps the fear factor going!  I shake my head in disgust…

Do you want to hear something that’s what I consider to be funny?  I received a note from LinkedIn that the Fed Reserve St. Louis is looking for an editor for their financial review…  Now that’s funny! Those folks at the St.Louis Cartel would take one look at my resume and run for the hills! HAHAHAHAHA! I’ve got to make sure that my friend, the great Mogambo Guru hears about this… He’ll laugh until his stomach hurts!

The folks that bought EverBank, did the same thing… The CEO of the new bank was a former Cartel Head, and I do believe he read a few of my letters for due diligence, and decided that they wanted no part of me… And I was told I needed to retire… So, see I’ve experience the wrath of the Cartel previously… 

OK… back to things that are worth reading about… Now hear this! A Cartel member doesn’t think the Cartel has done enough to spur higher inflation…  I got this from Bloomberg.com and here’s the skinny from Cartel head Evans… “The U.S. central bank needs to keep monetary policy easy to raise the public’s inflation expectations even after the current bout of inflationary pressures from supply-chain disruptions fades, Federal Reserve Bank of Chicago President Charles Evans said.

“I do not think the supply-side-induced transitory surge in inflation we are seeing today will be enough to do the trick,” Evans said Monday in remarks prepared for a speech at the annual National Association for Business Economics conference in Arlington, Virginia. “I expect that we will need a period of sustained, monetary-policy-induced overshooting of 2% inflation to boost long-run inflation expectations enough to deliver on our mandated goals.”

Chuck again… OK, notice how he immediately throws the supply side disruptions for the inflation we have now… Notice he doesn’t mention andthing about the currency printing that the Cartel has been involved with…  he must be young, because he did what all millennials do… find someone to blame the problem on, because it can never be their own problem!

And speaking of inflation / rising prices… in my hometown of St. Louis, Mo, they announced yesterday that the fee for parking meters is going up 50-cents and hour, which will bring the total per hour to $2…  I know in some places that’s not much, but for us here in the Middle of the country, where we’re the last place you see rising prices, we’re seeing them…

And keeping in line with our successful programs (NOT!) of The War of Drugs, The War on Poverty, the War in Vietnam, the War in Afghanistan, the war on Covid, and any other wars our leaders threw trillions of dollars on , now the Gov’t is talking about fixing the food problem…  What did President Reagan say were the scariest words to hear? “Hi, I’m from the government, and I’m here to help”… Heaven please help us!

The Housing data that I told you would show even higher home prices, the Case/ Shiller Home Price Index for July reported that home prices increased 19%…  Ok, Mr. Evans, he of throwing supply-side disruptions under the bus, Who’s to blame for this new Housing Bubble we have going on? Could it be the Cartel who have kept interest rates near zero for so long?  You had better believe it could be!

And the stupid Consumer Confidence fell this month from 115.2 to 109.3… That’s a HUGE downward movement in this data folks… But I would add that even though the index fell this month, it should have probably fallen more, given the chaos that’s about to be unleased on the country…

To recap…  Everything under the Sun that wasn’t dollars, got sold yesterday… The currencies got whacked, the metals got whacked, Oil got wracked and so did Bitcoin… It was an ugly day for the anti-dollar investments… And from what I read the dollar buying was all about the higher yields in Treasuries… Chuck points out that these higher yields in Treasuries are still negative when accounting for inflation…  And in the overnight markets the dollar buying continued… It’s a run-away train right now, folks, so get off the tracks! 

For What It’s Worth…  Well, it was bound to happen… Eventually people would wake up and realize that if it weren’t for the Cartel’s near zero interest rates, and all the stimmy checks, that the stock market they think represents the economy, was being manipulated…  That’s what this article is about, and it can be found here: Is Stock Market Rigged? Insider Trading by Executives Is Pervasive, Critics Say – Bloomberg

Or, here’s your snippet: “Most Americans Today Believe the Stock Market Is Rigged, and They’re Right’ New research shows insider trading is everywhere. So far, no one seems to care.

In the U.S., an insider is defined as a senior executive, board member, or any shareholder who owns 10% or more of a company. There are about 82,000 of them, and every time they trade they’re required by law to file a disclosure, known as a Form 4, within two days. These filings can be viewed on the U.S. Securities and Exchange Commission’s website, but scores are added each day, and most don’t offer much insight. “You have to know where to look,” says TipRanks Chief Executive Officer Uri Gruenbaum. Directors typically receive a proportion of their compensation in stock options, giving them the right to buy shares at a set price before a certain date, so if an executive is simply exercising an expiring option, it probably doesn’t reveal a great deal about how he views the company’s prospects. Selling may not tell you much either, because there are all sorts of reasons an insider might want to cash out—to buy a boat, for instance. It’s when insiders use their own funds to buy stock on the open market that it’s most worth paying attention.

t’s not just those at the top of the rankings who constantly beat the market. Purchases made by U.S. executives outperformed the S&P 500 over the ensuing 12 months by an average of five percentage points between 2015 and 2020, according to a TipRanks analysis. The gap might seem scandalous to those with only a passing acquaintance with U.S. insider trading rules, which make it illegal for insiders to trade using material—or financially significant—nonpublic information. And yet on Wall Street it’s long been an open secret that insiders trade on what they know.”

Chuck again… And well, no one seems to care about this type of manipulation… I mean, look at the Cartel members that resigned because they were trading stocks based on inside knowledge of how the Cartel would implement monetary policy, will they be prosecuted? Hell no…

Market Prices 9/29/2021: American Style: A$ .7228, kiwi .6930, C$ .7878, euro 1.1643, sterling 1.3477, Swiss $1.0757, European Style: rand 15.0852, krone 8.7233, SEK 8.7573,  forint 308.98,  zloty 3.9786,  koruna 21.8801, RUB 72.67, yen 111.42, sing 1.3535, HKD 7.7842, INR 74.21, China 6.4573, peso 20.54, BRL 5.4077,  BBDXY 1,162.80, Dollar Index 93.88,  Oil $74.87, 10-year 1.51%, Silver $22.34, Platinum $976.00, Palladium $1,980.00, Copper $4.17, and Gold… $1,742.70

That’s it for today… What a beautiful sunrise this morning, just like most days down here, except when the clouds block it out… it comes out of the ocean like an orange ball and the whole horizon is orange/ red… Simply beautiful… How about those Cardinals? 17 games in a row they’ve won, with 5 more to play… Shoot I suggest they go to the Wild Card playoff game with a 22 game winning streak!  The Moody Blues takes us to the finish line today with their song: The Voice…   And not the silly voice competition on TV…  I hope you have a Wonderful Wednesday, and please Be Good To Yourself!

Chuck Butler

September 28, 2021

* Two Cartel Heads resign over trading activity

* China bans trading in cryptocurrencies… 

Good Day… And a Tom Terrific Tuesday to you…  I apologize for the tardiness of yesterday’s Pfennig… The service that we use to distribute the letter, wanted additional verification that I was who I said I was… And that had to go through a level of verification that I was not able to provide… Hopefully today’s letter is not held up at the border once again. Well, my beloved Cardinals didn’t play yesterday, so they begin the last 6 games of the season at home… Just keep winning, is all I can say to them!  It was a beautiful day here yesterday, and I sat outside reading for most of the afternoon, absorbing as much Vitamin D as I could. And once again today I’m greeted by the late great Leon Russell, as he sings his song: Stranger In A Strange Land… (that marks two times for that song in the last couple of weeks. Oh well, it’s a great song! )

 

While I’m no stranger, I do feel like I’m in a strange land these days… Fear factor is prevalent among us, manipulation of all markets is among us, and did I mention, the fear factor? Oh, yes I did… But it is so prevalent among us, everything from shortages in groceries, at the gas pump, and the variants of the Covid virus, are here and I know what’s going on… You see if we keep the fear factor going, the Gov’t can control us… I find this to be very shameful of our Gov’t, and I just don’t know what I can do about it… Remember the Patriot Act? Well, the Gov’t told us that terrorists were among us, and they needed to take away some of our Civil Liberties to insure no terrorists acts were performed on our shores…  What a croc!

And then 19 years later, the COVID 19 virus was upon us and the moves the Gov’t implemented upon us are down right shameful. They destroyed the strong economy that had been growing in the U.S., they ruined the growth of young people in this country for many years, and they’ve ruined our finances of this country with one stimulus plan after another ala Japan…

Ok.. enough of that… I know I’ve probably ticked some people off with this tirade I went on, but for those of you who are ticked off, at least I speak my mind, without fear of someone cancelling me!

So… the markets were not impressed by the Durable Goods Orders data that printed yesterday… Durable Goods were up 1.8% in August, which beat expectations for the data…  The dollar gained some ground during the day, but not as much as you would expect, given the strong Durable Goods Orders data… The BBDXY began the day yesterday at 1,154.41 and ended the day at 1,154.05, which would tell you that the dollar lost ground… But not to the euro, which I’ll remind you is the top offset currency to the dollar, so when the euro loses ground, the dollar should be stronger on the day.  The euro fell through the 1.17 handle yesterday, and is once again looking like it’s cowering to the dollar.

But the Petrol currencies continue to move higher along with the price of Oil, which today is trading with a $76 handle… The threats of a slowdown due to the Covid virus variants hasn’t hurt the price of Oil, as It continues to ratchet higher and higher…

In the overnight markets last night… The overseas traders and investor ambushed the currencies and metals. Apparently they WERE IMPRESSED with the strong Durable Goods Orders data yesterday, and they bought dollars by the bushelful… The BBDXY, which closed at 1,154.05 yesterday, is trading at 1.158.14 this morning… the index gained over 3 whole figures during the night. Gold is getting sold this morning to the turn of $15, and Silver, which had in recent days been stronger, is getting sold this morning to the tune of 45-cents… 

Bonds continue to get sold, the 10-year Treasury yield is 1.53% this morning… It does appear to me that the 10-year’s yield is headed for 1.75%, which would mean that this particular bond that’s used to price mortgage rates, will push mortgage rates higher… 

Did you hear the news about the two Cartel members that I told you about last week that had been caught trading securities with insider knowledge?  Here’s a snippet from the email I received from the good folks at GATA: “Dallas Federal Reserve President Robert Kaplan became the second regional central bank leader to resign today, saying he was stepping down early following a recent controversy over stock market trades he made.

Kaplan’s early retirement follows an announcement earlier in the day from Boston Fed President Eric Rosengren, who said he will leave as well but cited health concerns and not the issue over his investment portfolio activity.”

Chuck again… yeah right, he didn’t resign over the recent controversy over stock market trades… What? Does he think we are fools?  I find it very interesting that these two Cartel heads resign a day before Cartel chairman Powell comes before Congress…  I guess the only question the lawmakers will have now, is “what controls will you implement to prevent this from happening again?”

Well… remember when I told you that eventually, the U.S. will opt for a digital currency system, featuring their own digital currency, and that the Gov’t would then outlaw all cryptocurrencies so that they can’t compete with their own digital/ cryptocurrency?   

The Chinese have already begun that process… They’ve been testing their own version of a cryptocurrency, and now are taking steps to outlaw all other cryptocurrencies…  This was the news as reported, “China expanded its escalating crackdown on cryptocurrencies on Friday when its central bank declared that all activities related to digital coins are “illegal” and must be banned.

In a statement the People’s Bank of China said the latest notice was to further prevent the risks surrounding crypto trading and to maintain national security and social stability.”

So, do you still think that the U.S. would never do something like that? Well if you do, I’ve got a bridge I can sell you!  Oh, and the cryptocurrencies took one to the mid-section on this news from China…

Congress continues to argue over the need for a $1.5 Trillion  in deficit spending, along with the $3.5 Trillion boondoggle deficit spending bill … We, as a country, continue to dig ourselves a big deep hole, with deficit spending folks… 

It all began when President Nixon removed Gold as the backing of the dollar… A new Credit system, was created, and every year since we have increased the amount of debt/ credit we allow…  And if you’ve ever wondered, wondered what ever became of me, No wait!   If you’ve ever wondered why the debt ceiling gets raised year after year, it’s because it is a known fact that if a country doesn’t increase its credit each year, it will collapse… Well, Von Mises said it best, let’s listen to his words, and then think about how Gold will be the “go-to” when this all comes crashing down on us… “There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.” – Von Mises

I’ve been banging the drum about our deficit spending for 20 years folks… I think the first Pfennig I ever penned talked about how our deficit spending would be the end of our world as we know it… And now, we’re spending more than the tax receipts we receive by a large margin… And no one on Capital Hill seems to care… it’s all money grown on trees, the magic money Tree, as far as they are concerned…

Ok, I’ve yelled and ranted enough today… let’s go to the Big Finish..

The U.S. Data Cupboard today has the Case/ Shiller Home Price Index for July… I would expect this to show yet another increase in home prices…  We’ll also see the stupid Consumer Confidence report… If the pollsters asked me if I were confident they would sure get an earful of reasons why no one in this country that pays taxes should be confident!

If these pollsters decided to ask 1,000 people that just came across our border illegally, they would certainly fell very confident!  I’m just saying…

To recap… The dollar continued its assault on the euro yesterday, pushing the euro below the 1.17 handle… But the BBDXY actually showed some weakness in the dollar on the day.  The two Cartel Heads that were caught trading securities while being on rate policy committees resigned yesterday… They should go to jail, like Martha Stewart had to for inside trading, but that won’t happen… China outlaws cryptocurrencies, and Chuck talks about how that is entirely possible in this country at some point in the future… And the price of Oil just keeps ratcheting higher…

For What It’s worth… I came across this article written by Ron Paul, yes that Ron Paul, of which if the country had taken more seriously when he ran for President, we wouldn’t be in this mess we are today, and he talks about the real reason the economy slowed so much last year, and other things, and it can be read here: The Ron Paul Institute for Peace and Prosperity : The Biggest Federal Reserve Scandal

Or, here’s your snippet:” Following revelations that Federal Reserve officials made trades in financial assets while the Fed was taking extraordinary efforts to “stimulate” the economy, Federal Reserve Chairman Jerome Powell ordered a review of the Fed’s ethics rules. While these trades appear problematic, they pale in comparison to the biggest Fed scandal — the Fed’s impoverishment of ordinary Americans, enrichment of the elites, and facilitation of government debt and deficits.

The depression induced by coronavirus, though really caused by so-called public health actions government took in response, was the official reason for the Fed’s increased asset purchases last year. However, the Fed actually started ramping up its money creating activities in September of 2019, when it began pouring billions a day into the repo markets, which banks use to make short-term loans to each other, in order to keep repo market interest rates low.

Coronavirus was just a convenient excuse for the Fed to do more of what it was already doing. Now, the Fed is using the limited reopening as a scapegoat for rising prices. Of course, anyone who understands Austrian economics understands that rising prices are a symptom, not a cause, of inflation. Inflation is the very act of money creation by the Fed.

Rising prices that diminish the average American’s standard of living are not the only result of the Fed’s manipulation of the money supply. The manipulation distorts economic signals, producing results including booms, bubbles, and busts.

Inflation has always benefited the well-connected elites who receive the Fed’s newly created money before the new money causes widespread price increases. The true motivation behind Fed policies was revealed by former Fed official Andrew Huszar in 2013. Huszar, writing for the Wall Street Journal, confirmed that quantitative easing kept stock prices high, instead of helping Americans struggling with the aftereffects of the 2008 meltdown.”

Chuck again… Well, if you want to know more, I suggest you click on the link above and read Ron Paul’s article in its entirety…  Remember two  years ago when I began talking about the repos the Cartel was doing and how it showed the Banking industry was hurtin’ for certain? I’m glad Ron Paul pointed that out… And oh BTW, the Cartel’s repo program is now totaling $1.338 Trillion, and that’s just a small portion of the $3.593 Trillion submitted… And we keep getting told that the banks are strong? 

Market prices 9/28/2021: American Style: A$.7248,  kiwi .6963, C$ .7907, euro 1.1676, sterling 1.3517, Swiss $1.0773, European Style: rand 15.1109, krone 8.6508, SEK 8.7345,  forint 307.74,  zloty 3.9540,  koruna 21.8509, RUB 73.58, yen 111.43, sing 1.3589, HKD 7.7825, INR 74.08, China 6.4582, peso 20.22, BRL 5.3511,  BBDXY 1,158.14, Dollar Index 93.64,   Oil $76.29, 10-year 1.53%, Silver $22.26, Platinum 976.00, Palladium $2,012.00, Copper $4.19, and Gold… $1,735.60

That’s it for today… Man I was feeling my oats this morning, and ready to take on the world, eh? For all of you who have taken my  advice and subscribed to Dennis Miller’s Miller On The Money letter, you might want to know that Dennis has suffered a set back with his health, and will not be able to write for a while… He asked me to relay that info to you… I  trust a prayer will be said for my good friend Dennis Miller… It was just two months ago, that Dennis had to tell his readers that are also Pfennig readers that I had a health setback…  Dennis and I talk on the phone at least once a week , and we talk about everything from health, to baseball… I enjoy our talks, as I  hope he does too!  Well, here’s my hope that he recovers quickly, and is back to being the “Retirementor”!  The Stray Cats take us to the finish line today with their song: Rock This Town…  Brian Setzer is a great guitar player, and I really like his big band sound that he plays with now…  I hope you have a Tom Terrific Tuesday and please Be Good To Yourself!    and… Go Cardinals! 

Chuck Butler

 

 

 

September 27, 2021

* The FOMC Meeting brought out the “long knives”

* Gold & Silver see yet another engineered takedown… 

Good Day… And a Marvelous Monday to you! 16! in the words of Jackie Gleason, How Sweet It Is! Yesterday, my beloved Cardinals won their 16th game in row! 3 weeks ago, I would have thought they were ready to put their golf clubs in the trunk of their respective cars and drive off, after not making the playoffs… Skip ahead 3 weeks to now, and they have turned this season into something very exciting down the stretch.. There’s only 6 games left in the season, and they have a 6 game lead on the nearest team to challenge their playoff run… I won’t say it would be impossible for the Cardinals to not make the playoffs, because this is baseball, I’ve seen stranger things occur….  Chicago greets me this morning with my all-time fave Chicago song: Hard Habit To Break… 

Well, there were a lot of things going on late last week… We had the FOMC meeting send bonds to the woodshed. We had the Norges Bank, Norway’s Central Bank, become the first country to hike rates since the pandemic began in March of 2020. We had yet another brazen engineered takedown of the metals. We had the Weekly Initial Jobless Claims climb higher for the second consecutive week. (just like I said they would, last week) And we had the dollar kick some tail and take names later… All that and more to be discussed this morning!

First on the docket this morning to talk about is the FOMC Meeting last week where the Fed essentially said that it isn’t “tapering” its bond purchases yet, though it might (or might not) do so soon, nor is it raising interest rates, though it might (or might not) do so some time next year. Those words came from Dave Kranzler in a note from the good folks at GATA… I couldn’t have said it better myself… The Fed didn’t really change anything in their press conference that followed the no action meeting from the previous meeting 6 weeks ago, but…. As Ed Steer described it, “Da Boys got the long knives out”, which translates to the price manipulators for the dollar and metals, took the dollar higher, and the metals lower… 

These attacks have become so brazen that sooner or later they will blow up in the faces of the price manipulators, for they’ve gotten so cocky… But remember this folks… They can only affect the paper price of Gold (& Silver) The physical price is still higher than the paper price…  So, the price of paper Gold was taken down $25 on Thursday… And Silver was pushed even lower than one might think it could be pushed, losing 16-cents, taking its paper price to $22.50…   

The markets are wrong… I was taught many years ago, by the first trader I worked with that “the markets are never wrong”…  But I’m going to say that they have what the Fed is trying to say, which is that they’re going to talk a good game of tapering and raising rates, but when it come down to the Cheese that binds, they aren’t going to do anything, wrong… Very wrong… But then I can’t do anything about these morons, so I’ll just move along… 

The  message from the Chairman of the Cartel was taken by the bond boys as a bad thing for bonds (since the potential there was to not have the Cartel buying up the bonds that nobody else wants), and the yield on the 10-year Treasury rose to 1.48%.  Remember bonds are priced where as the yield on the bond rises, the price of the bond goes down, and vice versa… So with the yield on the 10-year rising from 1.32% last week before the FOMC Meeting, to 1.48%, that represented a BIG LOSS in the price of Bonds…  Hope you weren’t needed to sell those bonds before maturity… 

As I said above the price manipulators were out in force in both the dollar and metals… Dollar traders went on a buying spree after the FOMC Meeting, and for what reason I’m not buying it… These boys and girls are truly believing that the Cartel is going to taper next month, and signal rate hikes in 2022… The BBDXY (Dollar index) rose from 1,150 before the meeting to 1,153.90 to end the week…   

I’m reminded of a great quote from the Germans about the Big Lie… “If you tell a lie big enough and keep repeating it, people will eventually come to believe it. The lie can be maintained only for such time as the State can shield the people from the political, economic and/or military consequences of the lie. It thus becomes vitally important for the State to use all of its powers to repress dissent, for the truth is the mortal enemy of the lie, and thus by extension, the truth is the greatest enemy of the State.”

I suggest you replace the word “state” in the quote to the “Fed/ Cartel”, and you’ll come away with a better understanding of what they are attempting to do here, folks… 

But… there was one central bank in the world that DID raise rates last week, and that would not be the Fed/ Cartel, but the Norges Bank, who said that with the reopening of their economy they wanted to keep inflation nipped in a bud… Now doesn’t that sound like a very prudent Central Bank? And for their efforts the Norwegian krone was the best performing currency last week… The krone has zipped past its kissin’ cousin, Sweden’s krona, and against the falling euro… 

Will the Norges Bank’s rate hike impel other countries to take the leap? I’m thinking… no… I can hear the Central Banks of the world, all saying, “let them go out on the limb and hang themselves”… While their respective currencies get sold… Reminds me of The emperor Nero, playing his fiddle while Rome burned…  (actually, the fiddle was not invented in the day of Nero, he instead played the lyre… )

So, on Friday, Gold actually tried to rebound, and gained $7.40 on the day, to close the week at $1,751.20… And Silver got sold once again on Friday, this time by 11-cents to close the week at $22.49… 

In the overnight markets last night, there was some additional dollar buying, with the BBDXY rising from 1,153.90 on Friday to 1,154.41 this morning.  Gold is down $2 in the early trading, and believe it or don’t, Silver is up 19-cents! 

Don’t look now, but the price of Oil is trading this morning with a $74 handle…  I don’t see the price manipulators forcing the price of Oil down, as that market is tightly held…  Just a point that inflation is still rising folks…  And that rise in the price of Oil has the Petrol Currencies holding strong VS the dollar… The Russian ruble is leading the Petrol Currencies to higher ground. 

Well, the Initial Jobless Claims last week rose for the 2nd Consecutive week, and early last week I told you that I expected this data to show increases in the Claims filed because of the Virus variants going through the U.S. right now..  On Friday, in the 5 Minute Forecast,  this is what they had to say about the jobless claims: “The one economic number of note today points to still more job-market sluggishness: First-time unemployment claims in the week gone by jumped to 351,000. Literally no one among dozens of economists polled by Econoday expected that outcome.”

And I said this in the Pfennig on Monday 9/20… “But another data print that we saw on Thursday was the Weekly Initial Jobless Claims, and unlike previous weeks, the number of ,Claims didn’t go down, they went up! And I’m going out on a limb here to say that I think given the COVID virus variants that are present today, that we could very well see these Claims continue to go upward each week. Certainly not like in the spring in 2020, but move higher each week and take the euphoria out of the folks that continue to say the economy has recovered… 

Just in case you forgot what I had said, and were thinking that I was tooting my own horn in error…  

The U.S. Data Cupboard has the Durable Goods and Capital Goods Orders from August today, but after those two print today, the Data Cupboard will have very little for us the rest of the week with regards to real economic data, and on Friday, Rocktober 1st, there isn’t even a Jobs Jamboree! Usually the first Friday of a month, is reserved for the Jobs Jamboree, but not this week. Hmmmm…..  

To recap…  It was an ugly week last week for the currencies and metals, as the Cartel’s FOMC Meeting brought out the “long knives”, and slicing of the currencies and metals took place… The Cartel didn’t really say anything different, it’s just that they decided to repeat their lies… And the markets took the bait, hook, line and sinker…  The Norges Bank was the first to hike rates, and probably will stand alone in that regard for the foreseeable future. 

For What It’s Worth…  There I was on Saturday morning, reading Bill Bonner’s latest Diary issue, and thought, this is a FWIW article for sure! So, here’s Bill’s latest edition of his Diary, in which he talks about the end of the Banking world as we know it, and it can be found here: A Plan to End Banking as We Know It | Rogue Economics

Or here’s your snippet: “And today, we meet a woman who intends to kill it – the exterminating angel herself – Saule Omarova.

Born in Kazakhstan, educated in Moscow, Madison, and Chicago, and now nominated by the Biden Team to head up its OCC (Office of the Comptroller of the Currency)…

…Ms. Omarova makes no effort to disguise what she is up to. She says she aims to “effectively ‘end banking’ as we know it.”

That is, she wants to replace an entire industry – one that evolved over hundreds of years, thanks to the efforts of thousands of innovating, competing bankers… who served millions of willing customers – with some monster of her own invention.

But destroying “banking” is just the beginning of her ambitions.

She has never worked for a bank, never run a business… never satisfied a customer, started a company, or “made payroll” for one…

…and never even held a job outside of academia or the law (we’re not counting her time as “special adviser” for Regulatory Policy to the Under Secretary for Domestic Finance in 2006-2007 as a real job).

And yet, she thinks she knows what is best for you, and 330 million other Americans (and perhaps the whole world)… and intends to give it to us, whether we want it or not. She explains:

My new working paper […] advocates a comprehensive reform of the structure and systemic function of the Fed’s balance sheet as the basis for redesigning the core architecture of modern finance. It offers a blueprint for transforming the Fed’s balance sheet into what it calls the People’s Ledger: the ultimate public platform for generating, modulating, and allocating sovereign credit and money in a democratic economy.

Holy moly. She thinks modern finance was “designed”… and that she has the right to redesign it, allocating money as she sees fit.

Yes, she proposes to be the decider, not just for the government, but for the private sector, too.

In particular, she proposes setting up something similar to the Gosplan in the Soviet Union, a “National Investment Authority,” (NIA) that would be responsible for “formulating, financing, and executing a coordinated strategy of sustainable and socially inclusive economic development.”

In other words, the feds have made such wonderful investments these many years… let’s give them more money to invest!”

Chuck again… This is crazy folks… it’s not like the banking system used in the old Soviet Union was a model banking system… They collapsed! in Case you forgot about that… 

Market Prices 9/27/2021: American Style: A$ .7261,  kiwi .7002, C$ .7907, euro 1.1707, sterling 1.3704, Swiss $1.0789, European Style: rand 15.0646, krone 8.5835, SEK 8.6866,forint 305.80,  zloty 3.9245,  koruna 21.7324, RUB 72.48, yen 110.96, sing 1.3533, HKD 7.7835, INR 73.75, China 6.4656, peso 20.10, BRL 5.3340, BBDXY 1,154.41, Dollar Index 93.35, Oil $74.89, 10-year 1.48%, Silver $22.68, Platinum $992.00, Palladium $2,268.00, Copper $4.21, and Gold… $1,749.20

That’s it for today… Well, after I spent most of my summer vacation in the hospital and sick, I decided that I needed to get back to my place on the beach, and so.. that’s where I am for the next two weeks….  What has happened to my beloved Missouri Tigers’ defense? They couldn’t stop a good high school team’s running game! And they hired a former NFL defense Coordinator before the season to address the defense… This is embarrassing folks…  The Pfennig might be a little later in the morning for the next two weeks depending on how things go… Other than that, I’m all yours! HAHAHAHAHA!  The late great Marvin Gaye takes us to the finish line today with his song: Mercy, Mercy Me…    I can hear his pain, and in turn I hope you can hear mine from all the price manipulation! I hope you have a Marvelous Monday, and please Be Good To Yourself!

Chuck Butler

.

September 22, 2021

* Currencies give back some gains on Tuesday…

* The House kicks the can down the road once again… 

Good Day… And a Wonder Dog Wednesday to you! Well my weather app was correct, the cold front did come through on Monday night, and I have to say that I’m just not ready for colder weather… I’m good with chilly weather, but not during the day light hours. I don’t like having to put on sweatshirts, or sweaters just to go outside in September! I dropped my iPad on the patio the other night, and cracked the screen… I thought at first I could figure out how to fix it, but then discretion became the better part of valor, and I took it to get fixed. I got it back last night, and it’s just like new! Want another sign that colder weather is coming? Our Blues are starting training camp! AYE, AYE, AYE… The late, great, Leon Russell greets me this morning with his song: Stranger In A Strange Land…  “How many days has it been since I was born, and how many days till I die?”  I’m a HUGE Leon Russell fan, folks, so forgive me for getting carried away this morning.

Well, The Drama Queen can go back to riding her broomstick, and sending the flying monkeys to get the good folks, the House voted last night to extend the Gov’t’s spending until Dec. 3, and suspended the debt ceiling through 2022…. The bill now goes to the Senate, where it will receive some resistance, but in the end, it will be passed, and we as a country, will once again, kick the can down the road…

The Spinners had a song: It’s A Shame…  I changed the words to: It’s a Shame, the way you mess around with our future, It’s a Shame the way you hurt us…  

OK, well I was wrong yesterday, and I admit it, so don’t go rubbing it in….  I said that the Bank stocks got rocked but the rest of the stocks gained on the day…  Apparently, a green number on MarketWatch doesn’t mean up on the day… I don’t really follow stocks, so it made sense to me that U.S, stock jockeys would see the Evergrande default as a non-event for us… But apparently they didn’t… So, I’ll be more careful in the future…

Speaking of being wrong… How about that trading platform for Bitcoin, that reported a 90% drop of the cryptocurrency to $5,000 and change?   Now, that type of reporting would cause some heart attacks for some, eh?

Ok, Ok, I’m getting to what the currencies did yesterday… They gave back some of their previous day and overnight trading gains yesterday… Traders are very fearful right now of what the Cartel is going to say after their FOMC meeting today…  I’ve gone out on a limb in saying that I doubt seriously that the Cartel can begin to taper… I don’t see the Cartel getting out of the bond market without causing  interest rates to move higher. And then there’s the  government debt payments which are HUGE folks, and rising interest rates on those bond payments would cause major problems with finances in the U.S.  

But why that fear would have any thing to do with their reason for buying dollars is beyond me, folks… For if interest rates rise, the house of cards which is the U.S. economy and finances, would come crashing down. Sure, interest rates would be higher, but how high? Higher than most countries around the world, except Russia… But that’s another story… But, in the end, the higher interest rates would not help, as all the King’s men and all the King’s horses couldn’t put the U.S. economy back together again… 

Gold and Silver had good days yesterday, which marks 3 days of gains for Gold, and one day for Silver… Gold gained $10.10 on the day to close at $1,774.10, and Silver gained 22-cents, to close at $22.57… Silver’s high for the day was much higher than the 22-cents it ended the day with… But the price manipulators couldn’t let that go…

In the overnight markets last night… There was little to no movement in the currencies, as traders there are in a wait-n-see frame of mind, with regards to the FOMC Meeting today.. .  I still find this whole mentality a bit strange, but then I’m not a trader any longer, and don’t talk to them any longer, which means I have no idea why they are being so bull-headed about this… 

Gold is starting the day down $1, no biggie, but in a reversal of fortunes, Silver is up this morning 24-cents, while Gold trades in yesterday’s clothes. 

Remember back after the dot.com collapse, all the financial scandals that kept coming to light? Well, I was reminded of them when I saw this article from World Bank’s ‘Doing Business’ scandal is bad for globalization — Quartz (qz.com)… Here’s the skinny: “Last week, investigators from an external law firm released a report showing World Bank officials pushed the team developing the influential Doing Business index to manipulate it in several cases. Under pressure from senior leaders including then-CEO Kristalina Georgieva, employees altered scores to boost China’s and Saudi Arabia’s rankings because it was deemed politically expedient to do so. They also were told to ignore developments in Azerbaijan that would have helped improve its score.

As a result of the findings, every piece of data produced by the World Bank will now be suspected of playing to one or more favored stakeholders. Here’s why that’s bad for globalization.”

Chuck again… Here we go!

In other news…  in yesterday’s 5 Minute Forecast, which is edited by Dave Gonigam, had this to say: ““Almost one-third of all working-age men in America aren’t doing diddly-squat,” says an article at Yahoo Finance, written by the outlet’s editor-in-chief Andy Serwer (who frankly sounds a bit judgy).

[Also, we’re pretty sure there’s a double negative embedded in that sentence: If you are not doing diddly-squat, doesn’t that mean you are doing something?]

Back to our topic today, The 5 has long noted the disparity between the official unemployment numbers and the labor force participation rate — the percentage of working-age adults who are either working or actively looking for jobs. According to the St. Louis Fed, that number clocked in at 61.7% in August.

Meaning nearly 40% of American workers officially between the ages of 15 and 64 are sitting on the labor sidelines (for whatever reason). And of that percentage, about 30 million are men.

“They don’t have a job, and they aren’t looking for one either,” Serwer clarifies.”

Chuck again… The 5 goes on to describe some reasons why these men aren’t filling some of those 10.9 Million job openings…  Cash jobs seems to be the key… Hmmm… out of the Governments’ taxing authorities hands, that’s sure!

The U.S. Data Cupboard yesterday, had the Current Account Deficit, which was greater in the 2^nd QTR than the 1^st QTR…  The numbers were nearly the same, as the 1^st QTR’s Deficit was $189 Billion, and the 2^nd QTR’s Deficit was $190 Billion…  Just more debts to throw on the pile that’s now $28.8 Trillion…

Today’s Data Cupboard has the aforementioned FOMC Meeting, and some existing home sales data… That’s it for today with regards to data, and that has, in recent times, been a boon for the dollar… The FOMC Meeting today is a BIG one folks… The markets believe the Cartel will announce some kind of tightening, which tapering is in a way, and Chuck continues to believe that the Cartel has its hands tied…  I guess we’ll see later today, eh? 

To recap… The House passed a bill to extend the Gov’t’s spending through Dec. 3, and suspended the debt ceiling until 2022… The bill now goes to the Senate, where it will meet some resistance  but expect a rubber stamp in the end… No one wants the country to default…  They might want to curb our deficit spending, but not default. Of course in my mind, there will be a time for discussion of defaulting… But that comes later… The currencies game back most of the previous day’s games yesterday, but Gold gained $10, and Silver gained 22-cents…  What’s up with men not working?

And the World Bank starts the meter for financial scandals…

For What It’s Worth…  Well, now the corporate leaders in the U.S. are shouting that inflation is not “transitory”, like the Cartel Heads keep telling us it is… And that’s the gist of this article that reports on the Corporate heads meeting that took place last week, and it can be found here; “Not Transitory” – US CEOs Warn Inflation Is “Unprecedented” And Becoming “Structural” | ZeroHedge

Or, here’s your snippet:” Some of the biggest names in business virtually attended the annual Morgan Stanley Laguna conference last week and warned about the complex nature of soaring inflation.

Much of the discussion was centered around the soaring cost of raw materials, labor, and logistical nightmares. Corporate leaders from 3M Company to Trane Technologies to General Electric Co., among others, all warned about increasing inflationary pressures, according to Bloomberg.

3M’s Chief CFO Monish Patolawala shocked attendees by calling inflation “unprecedented.” He said the impact of higher commodity prices and soaring freight prices would impact its 2021 earnings.

Trane Technologies Plc’s CFO Chris Kuehn told a very similar story: “Unprecedented is the word we’d use around the inflation side.”

At the virtual event, Morgan Stanley analyst Josh Pokrzywinski joked that everyone could check the word “unprecedented” on their 2021 bingo cards.

But what has become an increasing concern, pointed out by General Electric’s CEO Larry Culp, is that inflationary pressures are “increasingly getting structural in nature.”

David Petratis, CEO of lock maker Allegion Plc, said inflationary pressures might stick around two to three years. He said his company is preparing for more persistent inflation, adding “it’s not a transitory situation.”

Diversified power management company Eaton Corporation’s CEO Craig Arnold said supply-chain bottlenecks are fueling price increase this quarter. “Much to our surprise, and to the surprise, really I think of everybody in the industry, we’ve seen that things actually got materially worse,” he said. “I’m hopeful that by the time we get to the end of this year, things have settled a bit,” he added. “But I’ll acknowledge as well — we got it wrong. I think we all got it wrong,” he said. Eaton expects revenue guidance for the current quarter to miss because of part shortages.”

Chuck again… Well, after reading this, as if I were there and listening to the Corporate Heads, I would take away that inflation pressures are here to stay, and could even get worse, folks… At least that’s what I took from the article…

Market prices 9/21/2021: American Style: A$.7247,  kiwi .7021,  C$ .7825, euro 1.1730, sterling 1.3642, Swiss $1.0843, European Style: rand 14.7736, krone 8.6402,  SEK 8.6706,  forint 302.87,  zloty 3.9496,   koruna 21.6376, RUB 73.17, yen 109.52, sing 1.3518, HKD 7.7870, INR 73.86, China 6.4654, peso 20.07,  BRL 5.3057,  BBDXY 1,153.36, Dollar Index 93.21,  Oil $71.55, 10-year 1.33%, Silver $22.81, Platinum $973.00, Palladium $2,046.00, Copper $4.20, and Gold… $1,774.10

That’s it for today… And this week… Yesterday was another of those days where I think I could sleep all day… I had a difficult time getting going all day… I think that since it was a rainy day yesterday had something to do with my sleepiness… But this morning I feel great! I wish I was going to the hospital for tests today, instead of tomorrow! The land that the hospital and my oncologist’s office is on, used to be a 9-hole golf course, that I used to play all the time! I was thinking about that the last time I was there, that I’ve spent a lot of my adult life on that land! HA! My beloved Cardinals keep winning, marking a 10-game winning streak now, and Kathy’s lucky lamp is still on! Gotta keep winning…     And AC/DC takes us to the finish line today with their song: Hells Bells…   I had a Biology teacher in High School that used to say: “Hells Bells” all the time… I hope you have a Wonder Dog Wednesday today, and please Be Good To Yourself!

Chuck Butler

 

September 21, 2021

* Currencies & Gold rally on Monday… 

* The overnight markets see more dollar selling… 

Good Day… And a Tom Terrific Tuesday to you! Another beautiful day here on Monday, but from what the weather app tells me, a cold front is on the way, and on Wednesday the high will be 70 degrees… Well, did you get a glimpse of the Harvest Moon last night? I don’t know why I’ve become so interested in full moons, but I guess it had to do with when we bought our beach place, and watching the full moons, especially the super moons, rise out of the ocean is a real treat!  Mike Shannon is a true St. Louis celebrity… He was recruited to play QB at Mizzou, but the Cardinals offered him a bonus and he signed, then played for the Cardinals back in the 60’s. He’s been in the broadcast booth since, and while people like to make fun of him, I love hearing his voice on the radio, and after this season concludes, he will retire…  I’ll miss your voice Mike… Crosby, Stills and Nash (CSN) greet me this morning with their 70’s classic song about the shooting and killings at Kent State University: Ohio…

For all of you youngsters out there that have no idea of what I’m talking about… Four Kent State University students were killed and nine were injured on May 4, 1970, when members of the Ohio National Guard opened fire on a crowd gathered to protest the Vietnam War.

Ok, that’s it for the history lesson today…  Well, the currencies tried to start something yesterday, with their moves against the dollar… But, I doubt, given all the dollar buying lately, that it’s about to get turned around, for now… But for yesterday, it was the currencies turn to rally… The moves were across the board in all currencies, and they were small but at least they were positive, eh?  Gold also found a bid yesterday, while Silver couldn’t find one… The price of Oil rallied and gained almost a whole dollar on the day to $70.90, and Bonds didn’t move on the day…

For those of you keeping score at home: Gold gained $10.60 on the day to close at $1,765.00, and Silver lost 11-cents to close at $22.35…  I had quite a few emails in the Pfennig Replies Box, that centered around how the price manipulators were able to move the price of Gold & Silver by large margins…  I responded to each of them, and then thought, I should do a quick explanation here too…

So, here goes… The Bullion Banks get the memo from the U.S. Gov’t. to stop Gold’s rise… These same Bullion Banks then show up at the COMEX with arms full of short Gold paper trades…  It is my understanding that they use futures contracts on the near date, with no intention of making delivery of their sell contract, and buying it back at a profit before the expiration date. 

I’ve been watching the Canadian dollar / loonie, lose ground lately, and I’ve been surprised by that downward move, as commodity prices are on the rise again, especially the price of Oil, but that hasn’t helped the loonie move higher or at least hold its ground.  The loonie had outperformed the other currencies for the first six months of 2021,  but now it’s fallen 3.2% since June 30. With the Canadian election now put to bed, maybe the loonie can get back on the rally tracks… 

In the overnight markets last night…. There’s been a little more slippage in the dollar as the currencies added to their gains yesterday. Gold is up $3.90 in the early trading, and Silver, yes, Silver is up this morning 31-cents…  Ed Steer reported this morning that 2.6 Million Troy Ounces of Silver have been Added to SLV… Which tells me that the individual investors are buying Silver’s ETF, and if it weren’t for all the price manipulation lately, that Silver would be rising and probably be close to $27, $28 in price…  

Well, the sock market collapse that was called for to happen yesterday, didn’t occur, and instead stocks rallied on Monday… I have no idea why these people keep making a BIG Deal out of their forecast for a stock market collapse on “X” date…  But not to worry, I’ll keep posting their calls as they make them, just so we can keep count of them!  I have an article from Hugo Salinas Price for the FWIW section today, you’ll not want to miss it, as it will discuss the best way to buy Gold…  (spoiler alert, it’s the same thing I’ve told you for years now!)

While the talk of stocks is still fresh… Recall I wrote about China’s Evergrande and the implications of the fallout of an imminent default of Evergrande’s $315b unserviceable debt pile… There have been plenty of articles calling Evergrande, China’s Lehman Bros…( Bank stocks didn’t fare well yesterday, but overall stocks rallied… ) Apparently they don’t know how China works… I believe the fallout from this default will be contained by the Chinese Gov’t to China, and not be the global problem the Chicken Littles were calling for…  So, yesterday’s rally in stocks here in the U.S. was telling…

OK… a week or so ago, I wrote about how U.S. Treasury Sec. Janet Yellen, was warning about the pending Debt Ceiling talks…  Well, she doubled down on her previous comments last weekend with an op ed in the Wall Street Journal. Before now, I didn’t know that Yellen was a Drama Queen…  Yellen said that “the crisis triggered by a default would compound the damage from the continuing coronavirus pandemic, roiling markets and plunging the U.S. economy back into recession at the cost of millions of jobs and a lasting hike in interest rates.”

You, me and the guy down the street, knows that the Debt Ceiling has been raised so many times in the past that it’s raising has become a rubber stamp of approval by Congress…  So, why is Yellen doing her best Gloom and Doom over this issue?  Scare tactics folks, the Gov’t has to keep rolling out the scare tactics to keep control over us…  I’m just saying…

OK… Yesterday, I talked about the lack of free speech in the U.S. these days… And that got me thinking about how I’m so lucky to have publishers like Mary Anne and Pamela Aden, who are located in Costa Rica… The cancel crowd can’t reach them there, and therefore I still get to express my free speech platform…  Did I ever tell you that I used to be called: Mr. Lucky?  Clutch was another name I was given during my youth,  But we have to keep the pressure on the state reps and senators  to not allow censorship…   just because the submission doesn’t follow their “woke” cancel culture…

I spend a lot of time watching Prager U. videos, folks… I even ordered one of their Children’s books for when Evie gets a little older and I can read to her about the formation of the U.S.  back when it was all good, and could be good again, if only… 

There’s not a lot for us to see in the U.S. Data Cupboard today folks… The Current Account Deficit is about the only real piece of data today. Tomorrow, is the FOMC Meeting… A lot is expected of the Cartel heads at this meeting, I’m afraid they are going to disappoint us, as usual…

To recap… The currencies and Gold rallied on Monday, while Silver didn’t find a bid all day, and lost 11-cents… Gold gained $10.60 on the day, and the price of Oil rebounded almost a whole dollar in value yesterday.  Chuck calls out the stock market collapse guys, and also renames the Treasury Sec. to Ms. Drama Queen… And Chuck asks you to call your state rep or Sen. And tell them that censorship is bad… The overnight markets have seen a little more dollar selling and even Silver is up this morning! 

For What It’s Worth…  Ok, I teased you a bit earlier and told you that Hugo Salinas Price was the guest in the FWIW section today… I really liked this article because it says what I’ve been saying for years now regarding buying Gold… And it can be found here: www.plata.com.mx/enUS/More/422?idioma=2

Or, here’s your snippet: “The bad news is: there are no real prices of gold and silver available in the World today.

It is useless to follow the investment recommendations put forward, all in good faith, by individuals such as Peter Schiff.

The prices presented by the Media in our world are determined by a small group of individuals in London and New York; this group decides each and every working-day, what the prices of gold and silver are to be that day.

That daily decision has nothing to do with a “Market” for these metals.

The section of Kitco.com devoted to comments regarding the markets for the precious metals is perhaps entertaining, but otherwise worthless.

Some days, the prices of these metals are allowed to rise, and the hearts of gold and silver investors go “pitty-pat”. But following that rise, comes a collapse – investors who purchased metals earlier in the day, are now losers.

Then, other days, the prices of the precious metals are falling and investors rush to sell their stock of metals, to avoid further loss; the suddenly, the price turns around and goes up a bit. But the investors have now liquidated all or part of their stock, and cannot benefit from the rise.

The real purpose of the precious metals markets of today is TO CONFUSE THE PUBLIC.

This “Confusion as a Goal” of broadcasting fictitious prices of the precious metals has allowed the Dollar to survive as long as it has, as the World’s No. 1 currency.

There is one way – and ONLY ONE WAY – to profit in the precious metals markets: you buy, at whatever the price is, when you wish to buy, and take possession of the metals you have purchased.

You put your purchase away, shut up about it, and WAIT. You MAY die before the price of the metal you bought, goes up and stays up. On the other hand, if you are still breathing, and the Dollar has died and gone to Hell, what you will be able to purchase for one ounce of gold will prove to be the very great surprise of a patient life.”

Chuck again… Remember this folks… if you take possession of your physical Gold (or Silver) don’t tell people about it… Words can fall into the hands of the wrong people… And believe me there are plenty of wrong people out there these days!

Market Prices 9/21/2021: American Style: A$ .7265,  kiwi .7038, C$ .7849, euro 1.1745, sterling 1.3682, Swiss $1.0823, European Style: rand 14.8079, krone 8.6587, SEK 8.6578,  forint 300.48,  zloty 3.9379,  koruna 21.6219, RUB 73.28, yen 109.41, sing 1.3506, HKD 7.7855, INR 73.59, China 6.4657, peso 20.07, BRL 5.3105, BBDXY 1,152.12,  Dollar Index 93.07,  Oil $71.15, 10-year 1.32%, Silver $22.66, Platinum $933.00, Palladium $2,008.00, Copper $4.16, and Gold… $1,768.90

That’s it for today…  Well, my beloved Cardinals made it 9 wins in a row last night… A tight game that went to the Cardinals… I have a Cardinals neon light in my basement that my wife calls the “lucky light”… you can surely guess that it has been illuminated for the last 9 games! She wasn’t home last night but sent me a text to make sure I turned on the “lucky light”, and I did just as I was told! HA! My beloved Missouri Tigers (Mizzou) travel to Boston College this Saturday. BC is unbeaten and will be a tough row to hoe for my Tigers… I have a new item on my back bar here… My friend, and former colleague, the metals guru, Tim Smith, brought me a Ted Simmons bobblehead!   Ted is my all-time fave Cardinal… He began his career at catcher for the Cardinals at age 19!  I was still trying to figure out my life when I was 19! Hey 19… We can’t dance together, we can’t talk at all… (Steely Dan)…  Well, Jr. Walker and the All-Stars take us to the finish line today with their song: What Does It Take…. (love this song!) I hope you have a Tom Terrific Tuesday today, and please Be Good To Yourself!

 

Chuck Butler

September 20, 2021

* Currencies & metals get sold down the river last week

* What are the Cartel Heads doing with stocks? 

Good day… And a Marvelous Monday to you! My beloved Cardinals are on a roll to say the least! They have won 8 games in a row, and are looking like a completely different team than the one they made us all suffer through for 140 games… They travel now to Milwaukee, where the Brewers have already qualified for the playoffs… Cardinals gotta keep on winning! Well, it was a real Chamber of Commerce weekend, weather wise that we just went through here in the Midwest… If the weather stayed like that too long, it would cost us a fortune to live here! The Beatles greet me this morning with their song: The Long And Winding Road… 

That’s what I feel like we, as a country, are on these day… The Long and Winding Road to financial ruins… But then that’s just me, and a handful of other guys that write and keep pointing out the direction that we’re taking… Sure things “seem” to be going along smoothly, but they also say that when they’re in the eye of a hurricane… And the dollar bulls? They are taking the bait, hook, line and sinker these days, buying dollars by the bushelful…  What was their excuse for buying dollars last Friday? Oh, that’s right, August Retail Sales “surprised” with a positive print of .7%, when Retail Sales were expected to be negative -.7%…  Oh, so they were surprised by the back to school bump that Retail Sales gets every year at the end of summer?

So… on Thursday & Friday, the currencies got sold down the river, and the metals went along for the ride… A joy ride it wasn’t, as the current was very swift, and rocky… The BBDXY rose from Thursday morning’s 1,146.09, to close on Friday at 1,152.47… That’s a HUGE jump in the dollar index folks, and shows what I’m talking about when I said the currencies got sold down the river… The euro got pushed down to 1.1725, and the rest of the currencies followed the Big Dog down the river…

On Thursday last week, it was yet another engineered takedown of Gold by the price manipulators… There really was nothing, absolutely nothing, say it again, that would have garnered a selloff like we saw on Thursday… The price manipulators were so brazen with their selling, and it just gets my goat! Gold was sold down by $40.40 to close on Thursday at $1,753.70, and then on Friday, Gold was only allowed to rally by one thin dime! That put the close on Friday at 1,753.80. Silver got sold both days, with Thursday’s selling by 95-cents! And then on Friday it was sold down again by 51-cents, to close the week at $22.36…

Taper, Schmaper… There is not going to be any tapering by year end folks… And as soon as traders get it in their thick skulls that it’s not going to happen in the time frame that the Cartel has drawn out, they will stop with this pestering dollar buying!  I’m reminded of what my former colleague and good friend Ty Keough used to tell clients when the dollar was rallying… He would say, “Well, when the dollar is down, is when you should be buying more currency”…  Cheaper levels of currencies and metals are the call there, and here today…

The last two trading days of last week were very ugly folks.. .stocks got sold for the 3^rd week! Bonds got sold, as yields on the 10-year rose to 1.36%, Oil lost nearly $2 of its price, and the currencies and metals were down in the dumps… So, where was money going if all these things were getting sold? Shoot Rudy, even Bitcoin got sold late last week! These funds from all this selling had to be going somewhere, right?  Just to cash? Not when you only earn about.1% on cash… But maybe, just until the smoke clears and the all clear horn has been sounded…

That doesn’t appear to be today, as the calls for a major stock sell off are being sounded once again by the same folks that have cried wolf 3 previous times… As I said before if they keep saying it, eventually it will come true, and then they’ll be on record as saying that they called the stock selloff… Because, I know that eventually it will come true, as stocks have been in an overbought position for longer than you think… But I’m no stock jockey, and I didn’t stay at a Holiday Inn Express last night, nor do I play one on TV… I’m just pointing out facts…

In the overnight markets last night… There was more dollar buying but not to the tune of late last week’s barrage… The BBDXY is 1,153.63 this morning, so up from Friday’s close of 1,152.47… Gold and Silver are flat this morning, with Gold up $2.80 and Silver down 1-cent…  Hold on to your hats folks, this week will be a doozy!

The price of Oil has fallen out of bed, and trades with a $70 handle this morning, having been as high as $73 early last week!  Bonds are getting bought this morning, and Bloomberg forecasts that the 10-year’s Treasury yield will be 1.69% by year end…  Hmmm…. Interesting, very interesting… 

Well, well, well, what have we here? Could this be the final straw of Fed Credibility? I’m talking about the news articles this past weekend regarding the Fed Heads buying stocks ahead of monitary policy decisions were made public… This is HUGE folks, because it’s not only a few Fed Heads, but it includes the Fed Chairman, Jerome Powell, and Robert Kaplan Dallas Fed President, who sits on the Federal Open Market Committee…  A few years ago, Martha Steward when to jail for “insider trading” But I doubt seriously that these guys will ever see the inside of a cell, because…. The Elite, take care of the Elite… They don’t throw people under busses… And they don’t go to jail… 

But this makes me sick to my stomach folks… And if everyone knew what these guys were doing they would be calling for their heads… But this will get swept under a rug, and if you asked a random person on the street what they thought about this, they wouldn’t have the faintest idea…  And that’s a sad state of affairs, folks… I’m just saying…

Just in case you think I’m spreading non factual news here… You can find the info here: Fed Chief Powell owned same type of assets bank bought during Covid (cnbc.com)

And here’s another: Dallas Fed President Traded S&P 500 Futures. Dallas Fed Will Not Say If He Shorted the Market During Pandemic Crisis in 2020. (wallstreetonparade.com)

OK… what else is on my mind this morning?  Free speech… That’s what! Or the lack of free speech would be a better lead in to what I’m going to say here…  If you don’t like the sound of this next diatribe then skip ahead, you won’t hurt my feelings…

But I’ve remained pretty quiet about all this cancelling of people’s free speech by the Social Media Platforms, and YouTube, etc.  If whatever the person has to say that doesn’t jibe with the new “woke” mentality of the platform, they cancel the submission, and in some cases close the account of the person… Shoot Rudy, they cancelled the account of the President of the United States!  All, I’m saying here is that this is not the free country that I grew up in… I knew in my heart of hearts that all that PC Policing that was being done a few years ago, was going to lead to this…  The pendulum has swung folks, and it has swung too far to the other side, could we please just come back to the middle?

Moving on to other thing… My good friend Rick S. sent me this and I thought it did a great job of bringing the debt in this country to the forefront and allowing people to think about it differently and not allow all the zeroes to boggle the mind…  here we go!

Lesson # 1:

* U.S. Tax revenue: $2,170,000,000,000

* Fed budget: $3,820,000,000,000

* New debt: $ 1,650,000,000,000

* National debt: $19,271,000,000,000

* Recent budget cuts: $ 38,500,000,000

Let’s now remove 8 zeros and pretend it’s a household budget:

* Annual family income: $21,700

* Money the family spent: $38,200

* New debt on credit cards: $16,500

* Outstanding balance on credit cards: $192,710

* Total budget cuts so far: $385

Chuck again… See what I mean?  What would happen if you or me tried to get along with $192,710 in credit card debt? Someone with an ounce of brains would finally decide that we had been given too much credit, and would begin to call the debt payments to be made…

The U.S. Data Cupboard last week had the aforementioned Retail Sales… But another data print that we saw on Thursday was the Weekly Initial Jobless Claims, and unlike previous weeks, the number of ,Claims didn’t go down, they went up! And I’m going out on a limb here to say that I think given the COVID virus variants that are present today, that we could very well see these Claims continue to go upward each week. Certainly not like in the spring in 2020, but move higher each week and take the euphoria out of the folks that continue to say the economy has recovered…  Well, that’s not true and we know it’s not true, otherwise we wouldn’t have 10.9 Million job openings and 8.4 Million people unemployed…

This week’s Data Cupboard has a FOMC Meeting on Wednesday… Some pundits think that this will be the meeting that the Cartel heads begin to pull back the reins on stimulus…  I don’t think that to be the case, but then I could be wrong… But it just seems to me that the Cartel knows the real facts about the economy and unemployment, and while they may want to begin to remove stimulus, their collective hands are tied… 

To recap… it was a very ugly end of the week last week, as Thursday and Friday brought about major dollar buying and currencies and metals getting sold down the river. Chuck is besides himself this morning at the brazen way the price manipulators implemented yet another engineered takedown of Gold & Silver… What are the Fed Heads up to these days? Chuck talks about their stock trading ahead of monetary policy decisions… He also touches on the lack of Free Speech, and… gives us a breakdown of expenses that take out all the zeroes so that it’s more easicly understoon…

For What It’s Worth…  Well, folks, this is something that screams FWIW if anything does! This is an article about a new proposal that the President proposed that would require banks to report any transactions of $600 or more… Wait! What? And it can be found here: Biden proposal mandates banks to track and report all transactions over $600    :   Opinion: – (informationclearinghouse.info)

Or, here’s your snippet: “ Opposition is mounting to a Biden administration plan to require financial institutions to report customers’ account flow data to the Internal Revenue Service, with banks, credit unions and some consumer advocates warning it would be a massive invasion of consumer privacy.

The Treasury Department outlined a proposal in its recent budget request for a regime requiring banks and other financial institutions to report inflows and outflows in consumer accounts with more than $600. The goal is to crack down on tax evasion by high earners and narrow the so-called tax gap between what Americans pay and what they owe.

Financial institutions sounded the alarm over the new plan — meant to help the administration pay for the American Rescue Plan and infrastructure overhaul — before it was formally unveiled on May 20, noting the potential regulatory burden. But criticism has intensified from a broader array of stakeholders over concerns that consumers’ private information could be compromised.

“It’s not a targeted program,” said Ed Mierzwinski, senior director of the federal consumer program at the U.S. Public Interest Research Group, who warned lower-income Americans could be targeted by the reporting regime. “They are collecting information about everybody and I don’t know why it is necessary to collect information about everybody.”

The top 1% of taxpayers fail to report as much as 20% of their income, and the projected tax gap could reach roughly $7.5 trillion, according to estimates. The IRS cannot always identify more obscure income sources in parnerships, LLCs and S-corporations. The administration has also called for more resources at the IRS to conduct tax audits, which plummeted between 2010 and 2018.

The proposed financial reporting regime is seen as helping the government gain insight on wealthy earners. But financial trade associations and others warn that will be a costly undertaking for the industry to implement it, and it could expose private account data. Many say that would be a significant expansion of what banks report to the government about their customers, on top of the suspicious activity reports they submit to the Financial Crimes Enforcement Network.”

Chuck again… This is just the beginning folks…  IF they get this passed, then the next thing will be to have banks report on your spending in any amount. Of course in my mind that will mean when we are on a digital currency basis…  I shake my head at the direction this country is going folks… I feel so badly for my kids and grandkids…

Market Prices 9/20/2021: American Style: A$ .7234,  kiwi .7020, C$ .7788, euro 1.1707, sterling 1.3684, Swiss $1.0742 ,Eu0ropean Style: rand 14.7775, krone 8.7484, SEK 8.7279,  forint 301.89,  zloty 3.9283,  koruna 21.7006, RUB 72.84, yen 109.54, sing 1.3522, HKD 7.7864, INR 73.58, China 6.4652, peso 20.13,  BRL 5.2872,  BBDXY 1,153.63, Dollar Index 93.36,  Oil $70.55, 10-year 1.33%, Silver $22.45, Platinum $926.00, Palladium $2,046.00, Copper $4.20, and Gold… $1,757.60

That’s it for today… Back to normal today..  But on Thursday this week, I’ll not be writing as I’ll need to report to the hospital bright and early Thursday morning…  Just normal stuff folks, no need to be concerned, as my breathing is much, much better, my strength is almost all back, and I’ve put the double dose of Covid and pneumonia behind me… I know, some of you are saying, well, it’s about time! Well, give me a break here, I’m 66 years old, have had cancer for 14 years, along with taking daily chemo for many of those 14 years, and I’m over weight…  I tend to think that I’ve done quite well in my recovery! Grandkids, Braden and Evie came to stay with us Saturday night… Braden is 10 now, and pretty much does his thing, but Evie has to be entertained all the time, and she wears me out! But she’s so darn cute, that I don’t care! I got her to sit still for about 10 minutes and watch the baseball game with me on Saturday night. That was quite the accomplishment on my part I thought!  The Ides of March take us to the finish line today with their great 70’s song: Vehicle…  I hope you have a Marvelous Monday, and please Be Good To Yourself!

Chuck Butler

 

 

September 16, 2021

* yesterday’s moves were small in the currencies

* But the overnight markets have taken down the currencies & metals

Good Day… And a Tub Thumpin’ Thursday to one and all! Well, my beloved Cardinals took my suggestion that they continue to win into last night’s game VS the Mets, and scored 5 runs in the first inning to cruise to a victory, and sweep of the Mets…. They come home now to play a weekend series against a team that’s chasing them, The Padres… Gotta keep winning…  Well, yesterday was one of those days for me, when I can’t seem to wake up, and didn’t do so until 11:30 am. Sat outside to watch the game last night, with neighbor Paul.. It got a little chilly by game’s end, but that’s what it’s supposed to do in the fall! Early last week I was convinced the Cardinals were not going to make the playoffs, and now they’ve got a punchers chance! The great Al Stewart greets me this morning with this song: On The Border…

Well, yesterday was a slow day for the currencies, and they didn’t really gain or lose much throughout the trading day…  The euro was 1.1829 yesterday morning and at the close yesterday it was 1.1820, so as you can see, not much movement at all…  The Bloomberg Dollar Index (BBDXY)  lost a little ground to show what I’m talking about… the BBDXY yesterday morning was 1,144.04, and ended the day at 1,143.78. Gold on the other hand saw selling throughout the day, and ended up down $10.50 to close at $1,795.10… Gold was up $11 on Tuesday, and down $10 on Wednesday… Strange goings on here folks… I’m just saying…  Silver lost a whopping 2-cents on the day and closed at $23.93…

In the overnight markets last night… It’s been another ambush of the currencies and metals overnight folks…  They took the euro back below 1.18, and Gold is down $20 in the early trading today… What gives?  What on earth are the overnight markets thinking? Well, this is quite the takedown, folks… The BBDXY this morning is 1,146.09, so up over 2 whole figures.  Silver is down 46-cents.

The Petrol Currencies are the only ones with a fighting chance this morning, as they hold their recent upward moves VS the dollar, and add some as the price of Oil is trading with a $72 handle this morning, and doesn’t seem to be pausing for the cause…  The Russian ruble leads the Petrol Currencies… 

So to be clear, John Williams showed that consumer inflation did slip lower in August from July, but his slippage had inflation slipping to 13.2%…  And to me this is more representative of what I’ve been experiencing, and I’m sure you will agree… When I chastised the BLS yesterday I was chastising them for saying inflation was only 5.3%…  That’s a far cry from 13.2%… And you would think the BLS would be embarrassed to print such a low number… But NOOOOOOOOO! They don’t have a conscience folks, other wise they wouldn’t throw out such stupid numbers that everyone knows are wrong…  Reminder here that the BLS is also responsible for the jobs data each month…  And the Good Lord knows all too well that I do not believe the BLS’s jobs data…

OK… Well, Global Debt has reached $300 Trillion…  The U.S.’s portion of that is $28.7 Trillion or 135% of GDP… China, Japan, the U.K. along with the U.S. are the major contributors, and one country that’s a super power that has not run up large debts, is Russia… And on a lessor scale, Singapore…  And still investors are worried and scared stiff to invest in Russian rubles… And with the price of Oil now trading with a $71 handle, the smart money is looking to the ruble… And the ruble is still one of the few currencies that pays interest… 

How will these countries ever pay off their debts? Well, they either need to inflation or die, or begin to cut their deficit spending and try to get to Budget surpluses to pay down some debt…  So, like I said they need to inflate or die… So, take the U.S. because that’s where most of live (I do have readers all over the world!) The Gov’t can’t allow the inflation reports to show real inflation numbers or else the people would revolt, but the Gov’t needs for inflation to run hot for an extended period of time just to get their heads above water…

Circling back to Gold… Did you hear this news, that someone bought 40,000 contracts of Gold? Here’s the skinny: Whales moving the markets are more common in crypto, but since 10 August, a new major player has appeared on the long side of the gold futures contracts market. Raw data shows a large non-commercial trader has amassed as many as 40,000 COMEX gold contracts, the equivalent of 4 million ounces of gold – a cool $AU9.85bn.  WOW! That’s a HUGE position especially for a non-commercial trader… 

So, now the question is: Will this “whale” take delivery of this Gold at the end of his contract? I sure hope they would because it would break the COMEX…  Oh, and if you check the prices of Gold around August 10, you’ll see that this investor bought at cheap levels…

It was a very slow news and markets day yesterday… I searched and searched for something to talk about, but my search ended up much like, oh never mind, no need to bring that up here…   But I did find something later in the day, in Dave Gonigam’s 5 Minute Forecast… So, take it away Dave!

“California’s $470 billion CalPERS — for the benefit of the state’s government employees — has been without a CIO for more than a year now after former CIO Ben Meng’s investment acumen missed the mark. Namely, under Meng’s management, CalPERS’ investments earned just 4.7%, well shy of its 7% target.

[Apropos of nothing, we found this nugget on Mr. Meng’s CV: He was a risk manager. At Lehman Bros. Oy.]

If the absence of a competent CIO isn’t alarming enough, according to CalPERS 2020 annual report, the fund invested $3 billion in Chinese companies — including businesses heavily involved in China’s neo-Silk Road venture.”,

Chuck again… Thanks to Dave Gonigam and his 5 Minute Forecast…   Now, think about that how the world’s largest pension fund, in the world’s 5^th largest economy, is investing in China… I don’t see how that will be a problem do you?  I kid here… I do believe these investments will prove to be very risky, and cause tears…  Just my 2-cents…

And then I came across this on Bloomberg.com this morning: “In order to retire and enjoy decades of financial security, two in five American investors figure that it will take:

a) $300,000  
b) $750,000 
c) $1.7 million
d) a miracle

The answer, according to the 2021 Natixis Global Retirement Index released Tuesday, is choice d — a miracle. That’s what 46% of Millennials, 45% of Gen X and 30% of Baby Boomers said in the annual survey.

The firm surveyed people with at least $100,000 in investable assets. Half of respondents with a net worth of $1 million or more said they were resigned to the fact of having to work longer than they’d anticipated. In the U.S., the 750 survey respondents had a median net worth of $450,000 and had saved on average more than 16% of their salary.”

Chuck again…  I found that very interesting that so many investors think it will take a miracle for them to retire…  The  masses are beginning to see what I’m seeing, and that is with so much debt, there’s no way the country will be able to keep all their promises…  That’s a sticky wicket folks… 

The U.S. Data Cupboard yesterday, had the August Industrial Production, and much like many of the data prints in recent times, it failed to meet expectations, only gaining .4%, VS .5% expected, and the .8% gain in July…  Capacity Utilization remained unchanged in August from July, so nothing to look at here, move along…  

Today’s Data Cupboard has the usual Thursday fare of Weekly Initial Jobless Claims, and then a real piece of economic data: Retail Sales for August. You may recall that July’s Retail Sales were negative -1.1%, and I don’t expect August, even though there was still some back to school buying, to come out of negative territory…   How can Retail Sales be strong, when all the money is gone?  No new stimmy checks in the mail, all the credit cards are maxed, and now… The rent is due… Uh-Oh…

To recap… The currencies didn’t move much yesterday… But Gold got sold by $10.50, to offset its $11 gain on Tuesday…  Industrial Production failed to meet expectations, falling in line with most data prints in recent times. And Chuck points out that the Global debt has reached $300 Trillion… Now go try on that hat for size!  But in the overnight markets there was another ambush and takedown of the currencies and metals… It’s an ugly day to start today… 

For What It’s Worth…  A few weeks ago I highlighted an article that quoted Jeffrey Gundlach, and how he thought the Fed’s policies were not in keeping with a reserve currency… Well, he’s doubled down now and today’s FWIW is another rant by Mr. Gundlach, and it can be found here: Jeff Gundlach Warns “History Books Won’t Say Inflation Was Transitory”, Remains Long-Term Dollar Bear | ZeroHedge

Or, here’s your snippet: “Building on his thoughts from earlier in the year that the dollar “is doomed,” DoubleLine Founder Jeffrey Gundlach reiterated in tonight’s webcast that any “economic growth we’re seeing isn’t really economic growth,” it’s just spending funded by “massive amounts of tools and devices The Fed has used.”

As he noted previously, consumption is not really the economy. The economy is about production. And when you buy goods produced in Asia with stimulus money, it shows up as GDP, but it’s really Asian GDP. It’s consumption in the United States. “So the economy isn’t really that strong with five million fewer jobs.”

“The Fed decided to go big early,” Gundlach said and warns that policy makers going big with stimulus will be a “recurring theme” going forward, building on his previous thoughts that: “We’re running our economy in a way that is almost like we’re not interested in maintaining global reserve currency status.”

CPI would be at 12% year-over-year if inflation statistics used actual home prices rather than owners’ equivalent rent, Gundlach says.

The copper-gold ratio is saying that the yield on the 10-year Treasury “makes no sense,” Gundlach says. The ratio shows it should be at 3%. The copper-gold ratio is telling the message of Fed and Treasury manipulation, Gundlach says.

Chuck again… Here’s a guy who thinks like I do, folks, and he runs a HUGE Bond Fund!

Market Prices 9/16/2021: American Style: A$ .7320,  kiwi .7112,  C$ .7915, euro 1.1772, sterling 1.3824, Swiss $1.0939, European Style: rand 14.4550, krone 8.5934, SEK 8.6166,  forint 296.83,  zloty 3.8857,  koruna 21.4676, RUB 72.60, yen 109.39, sing .13429, HKD 7.7843, INR 73.39, China 6.4343, peso 19.86, BRL 5.2405,  BBDXY 1,146.09, Dollar Index 92.73,  Oil $72.53, 10-year 1.30%, Silver $23.40, Platinum $945.00, Palladium $2,166.00, Copper $4.25, and Gold… $1,772.20

That’s it for today… Well, we’re putting the finishing touches on the 2^nd week of September, I really can’t tell you where the year has gone!  It seems to me that just a couple of weeks ago I was sitting in Roger Dean Stadium watching day baseball, spring training games… My beloved Missouri Tigers try to forget about their game last week at Kentucky, on Saturday… Go Tigers!  It’s been a great week weather-wise, and it appears to be continuing right through the weekend. YAHOO!  I’m not as tired this morning, so maybe I caught up on my needed sleep yesterday…  Edwin Starr takes us to the finish line today with his song: War…  I’ve used his words more times than you can shake a stick at through the years… War, what’s it good for, Absolutely nothing, Say it again! I hope you have a Tub Thumpin’ Thursday, and please Be Good To Yourself!

 

Chuck Butler

 

September 15, 2021

* Currencies & metals inch higher VS the dollar

* Spin Doctors attempt to tell us inflation is going away… 

Good day… And Wonderful Wednesday to you! I almost didn’t answer the bell this morning…  Man, am I draggin’ the line this morning! Crazy game last night, for my beloved Cardinals, who won and that’s all that matters at this time of year! When there are games like last night, I can’t turn it off and go to bed… So, I was up late last night, so forgive me if misstate something this morning, I have an excuse!  The sun was in my eye, I tripped on a rock, the other guy called for it first… you know that kind of excuse that a young ball player gives for not catching the ball…  Steely Dan greets me this morning with their song: Aja…  Aja, when all my dime dancing is through, I run to you….

Ok… what a crock! The headlines yesterday were all about how inflation had “slowed” in August from July…  So, my initial reaction to those headlines was, “What a Crock!”  The bean counters that deal with all the hedonic adjustments of the Consumer Price Index (CPI) said that inflation had dropped from 5.4% in July to 5.3% in August… They are so wrong, they’re almost right…  But they are wrong, and they know it, but they can’t say it, because they work for the Gov’t.  And the Gov’t doesn’t want you to know what the real inflation rate is, for if you knew, you would rush out and start buying things before their prices got out of hand, and that would beget more inflation, and before we knew it, well… it would be ugly…

But… if we did know what the real inflation rate was, and we do know from John Williams’ Shadow Stats website, the markets would know and would be hammering on the Cartel to hike rates to slow the inflation… Now, wouldn’t you rather have a Central Bank that fought inflation than one that ignores it?  I’m just saying…

The currencies didn’t rally yesterday as the spin doctors did a great job of selling the population snake oil… I’m talking about the media response to the fake inflation number…  Oh, I can hear all those that said that it wasn’t inflation we were seeing, and if it was it wouldn’t last, crowing to the full moon… But, as I always say, one report doesn’t make a trend… And just because the BLS comes up with an inflation report that’s hedonically adjusted, and it’s lower than the previous month, doesn’t mean it’s all clear on the inflation front.

But… the currencies didn’t exactly get sold by the bushelful like they were in the overnight markets of Sunday to Monday.  The BBDXY started yesterday at 1,145.84, and ended the day at 1,146.29… That’s some small change folks…  Gold however did rally on the day, gaining $11.10, to close the day at $!,805.60, and Silver gained 13-cents to close at $23.94…  

In the overnight Markets last night… there has been a little dollar selling, with the currencies inching higher VS the dollar, and the metals are basically flat in the early trading today, with Gold adding just $1.60, and Silver flat as a pancake (Head East)…  The BBDXY which closed yesterday at 1,146.20, is trading this morning at 1,144.04, So the general feeling this morning is sell dollars… We’ll see how long that lasts… 

So… what’s on the agenda today?  The U.S. Federal Budget was printed on Monday, and it showed that with just one more month in the fiscal year, that the Budget deficit is $2.7 Trillion dollars…  Last year at this same time with a month to go, the Budget Deficit was $3 Trillion…  So, while better than last year, it’s really a mess folks… $2.7 Trillion to be added to the current debt…   Extending this to the start of the covid pandemic in March 2020, the U.S. government deficit for the past 17 months is a stunning $5.1 trillion!!!   There’s no two ways about it folks… We as a country are turning into a Banana Republic…  Oh, I know that’s pretty harsh, but I recall my days doing presentations with my former Boss and long time friend, Frank Trotter, who would describe the U.S. finances a those of a Banana Republic… I wonder what he would think of them now?

The headline story on the Federal Budget print on MarketWatch was touting the prospects of lower Budget Deficits with the implementation of higher Corporate taxes….  I laughed out loud when I rea that… What on earth on these people thinking?  For either the Corporations will find loopholes and ways to not pay more taxes, or… Congress will see new tax receipts and think that they need to be spent…  You can mark my words on that one folks…

And then seeing that they didn’t get the bang for their buck, they’ll go back to the drawing board, and you know who will be next in line to make up their tax receipts don’t you?  You and me… It’s coming folks, if not already upon us, hidden in the new tax plan the House came up with…

The U.S. Data Cupboard today will have a couple of real economic data prints for us… Industrial Production and Capacity Utilization both for August… These two aren’t normally market movers but… They are important to keep track of… Capacity Utilization is one of the few data prints that is forward looking…  And I’ve explained this before, but will again just for good measure…  Capital expenditures are key to a strong economy, without them, the economy just muddles along, which is what we saw going on for the last decade… 

To recap…  The stupid CPI dominated the media and markets yesterday, and the media couldn’t help from celebrating big time because the annualized inflation rate fell to 5.3% from 5.4%…  You would have thought that the drop was 5 full percentage points or something the way they carried on… As Chuck always says one report doesn’t make a trend…  All I know is that everything is more expensive these days…   The currencies didn’t move much yesterday, but Gold rallied, and in the overnight markets

For What It’s Worth…  I read a long article yesterday that I’ll give you the link for, and it’s very well written, with great thoughts, and viewpoints. The article is written by Matthew ,Piepenburg of Matterhorn Investments, a Swiss firm, that is headed by Egon Von Greyerz, of whom I’ve featured in the FWIW section before… This article talks about how investing and the economy and Fed Policy is not real…  So, if you don’t have the time to read it all save the link and go back to it when you do have time… The article can be found here: Nothing is Real: A Visual Journey Through Market Absurdity – Matterhorn – GoldSwitzerland

Or, here’s your snippet: “From where I sit in terms of both history and economics (at least until these subjects are equally “canceled” from the modern curriculum), falling GDP as indicated above effects all our lives far more than falling statues or controversial children’s books.

 

But as we’ve written so many times, the powers-that-be are clever little foxes, and even crashing GDP and skyrocketing debt, which are objectively time-proven cancers for society, can be a boon for their false narrative of governmental or central bank “guidance,” which is nothing more than increasing social control hiding behind a Covid mask.

Debt to GDP: The New Distortion

After all, one way to address the appalling 135% debt to GDP ratio in the U.S.  is to simply reduce the productivity component rather than debt component of the ratio, akin to telling a man with only one arm that his shirts will fit better if we remove the remaining arm.

A “bad” debt to GDP figure is just veiled anchoring for more QE “stimulus” and more ludicrous fiscal spending of money which governments don’t in fact have but which a mouse-click at the Eccles Building can produce in seconds.

 

In simple speak, this latest GDP “bad news” looks like an open as well as carefully planned piece of “good news” for a QE-addicted, fully Fed-supported and ultimately rigged to fail stock bubble.

The Pointless Taper Debate

As for Fed tapering, even the hawks at that same Atlanta Fed can’t keep their message or ethics straight for more than a week.

Nothing at all shocking or new there…

Another Fed Two-Step

Back in August (8/27), for example, Atlanta Fed President, Raphael Bostic, bravely declared: “Let’s start the taper and let’s do it quickly.”

But fast forward just a few days to September 2, and that same Fed President, like so many other fork-tongued masters of doublespeak within the FOMC, back peddled with fabulous elan, declaring instead that “we’re going to let the economy continue to run until we see signs of inflation.”

The amount of “duplicitous dumb” within this single sentence defies both belief and this report’s word count, but for simplicity’s sake, and despite “signs of inflation” literally everywhere, Bostic’s latest semantic two-step translates to this: Don’t expect a “taper” of the free money spigot anytime soon.

Besides, and as we wrote last week, even if a “taper” in Fed QE were to occur, such hawkish optics won’t stop the Fed from dumping ever-more dovish liquidity into the system via clever little tricks up the sleeves of its Reverse Repo Program.

In short, the Standing Repo Facility (or SRF) is just QE by another clever acronym, so please: Don’t let the headlines or double-speak from above fool you.

Taper or no taper, the dollar in your wallet is about to drown under even more currency-killing liquidity from on high.

In short, nothing is real.”

Chuck again… nothing else to add here, just make sure you get the time to read the article in its entirety…

Market Prices 9/15/2021: American Style: A$ .7323,  kiwi .7094,  C$ .7879, euro 1.1829, sterling 1.3824, Swiss $1.0907, European Style: rand 14.3080, krone 8.5791, SEK 8.5720,  forint 294.79,  zloty 3.8440,  koruna 21.3980, RUB 72.78, yen 110.13, sing 1.3431, HKD 7.7823, INR 73.36, China 6.4423, peso 19.87, BRL 5.2240, BBDXY 1,144.04,  Dollar Index 92.44,  Oil $71.48, 10-year 1.26%, Silver $23.94, Platinum $945.00, Palladium $2,096.00, Copper $4.32, and Gold… $1.807.20

That’s it for today… What a game last night in NY…. My beloved Cardinals had to come from behind, then took the lead, only to give it up, and go extra innings where they finally broke through and won the game, and now are all alone in the second wild card position for the playoffs this morning… Got to keep winning….  I had a run in with a squirrel late last week, that I’m still hobbling around in pain from… To make a long story short: I tried to get a squirrel out of my gas grill only to find it had nested there and had two baby squirrels… When I opened the lid, the squirrel jumped out at me, I backed up and tripped and fell… Thankfully the squirrel ran away leaving the babies, but I fell on my right side, and the patio is quite hard! OUGH!  The mom squirrel eventually came back and got her babies out of the grill…  Now I have to watch the grill for any signs of nesting coming back… UGH!  Ok… I was up late last night with the game, and so I’m tired, so let’s get this out the door! The Byrds takes us to the finish line today with their song: Eight Miles High…  3 of the original members of the Byrds went on to become rock legends… David Crosby, Chris Hillman, Jim McGuinn… I hope you have a Wonderful Wednesday and please Be Good To Yourself!

Chuck Butler