Author: admin

• Currencies & metals rally on Friday last week
• Oil is waiting on OPEC…

Good Day… And a Marvelous Monday to you! How was your Thanksgiving holiday weekend? Lots of football was played, by the pros and collegians… I was in seventh heaven, as all my kids, and grandkids were here, even poor Everett with his surgically repaired ankle, that’s still in a cast… He couldn’t wrestle around with his cousin, Braden, this time, so it was quiet fun from them! Whenever the grandkids stay the night, we make them put down their phones or iPads and play board games with us, so we can all talk…  They like the board games, it’s just that they like their video games better… Well, it’s that time of year again, I’ve switched my morning listening to Pandora’s Smooth Jazz Christmas station… So, this morning, The David Ian Trio greets me with their version of the song: I Heard The Bells On Christmas Day… 

Well… Friday, black Friday, that is/ was… Saw more proof in the pudding that the U.S. economy is circling the bowl, as Durable Goods Orders for Rocktober printed negative -5.4%!  I’ll have more on the data front later today, I just wanted to use that a preface for what I’m going to talk about today…  Friday saw the dollar slide, and the call for a Fed Heads pivot begin to wane… Gold gained $10 on the day, and Silver was the shining star of the day, gaining 61-cents to close the week at $24.42… Gold closed the week at $2,003.70… Apparently, it was all about the change of heart from traders that got the dollar sold, and Gold & Silver bought…  it did NOT appear to have dampened the bond traders as the yield on the 10-year remained steady at 4.47%… 

The price of Oil slid $2 on Friday to end the week with a $75 handle… I still believe that the OPEC meeting will do something to goose the price of Oil, but I guess we’ll have to wait-n-see…  I have heard of some pre-meeting disputes about output, so that should put the meeting on edge, don’t you think? 

In the overnight markets last night… The dollar got sold a little more, as momentum for selling the dollar is being stubborn right now… The BBDXY lost 1 index point overnight. Gold is up $11 in the early trading today, while Silver has gained 30-cents to start the day… This change of heart by traders and economists (me not included, for I never fell for that snake oil they were selling!) , that now believe that the Fed Heads are not speaking with a forked tongue, when they say that rates will remain high for longer, has got the dollar on the downward run.  I look at the currencies on the screen and I see that the Euro Wanna Bes are hot right now, and that usually spells dollar weakness is deep, as dollar weakness at first is always seen in the euro rallying…  

All that dollar buying that went on while the Fed Heads were hiking rates, is now being unwound, but it will take some time to unwind it all… I’m just saying…  The price of Oil dropped below $75, to $74.95 overnight, while we wait for an announcement from the OPEC members who are still meeting…  They, the Opec Members, must be working on just how they want to word their output reduction announcement, for this is taking way toooo long for them to make the announcement… 

And the bond boys are beginning to come around to the think like the rest of the markets, as yield begin to rise again… And IF all this bond buying ends, then it will prove that what I said it was a “bear market rally”, was bang on! The yield on the 10-year this morning is 4.46%… 

You know I had this all lined up to talk about how the U.S. economy keeps showing signs of circling the bowl… And then it occurred to me that I should think about that more… Because IF the change of heart on the Fed Heads intentions are real, that would mean they given in to the “interest rates higher an longer” mantra… But… if the economy is circling the bowl, that would mean that the Fed Heads’ intentions to keep rates where they are, would have to be changed… This is a real conundrum that we’re in folks… And just shows to go ya, that no one can figure out what comes next… And in that vein, you’d have to think that Gold & Silver would blossom…  Because, as I’ve told you all dear readers for years, Traders do not like unknowns…   And to deal with an unknown is to sell stocks, and everything else that isn’t tied down, like Gold & Silver!   I’m just saying… 

The dollar keeps showing signs of wanting to go lower, but then those pesky PTTers come in and keep the dollar from going lower… The economic data in the U.S. has all been shaky, to say the least, and more and more I keep reading more observers saying that the debt problem (financing it) is getting worse, and worse… Well, when everyone finally sees what I see, and that is financing our debt is going to be the death of our financial system, that’s when Gold will finally take its place at the head of the table once again! 

And here’s another thought on Gold… It seems that a “triple topping” has taken place in Gold ($2,000), and that usually spells a breakout to the upside for an asset…  That’s my contribution to the charts… My longtime friend, and chartists, go to guy, Sean Hyman, would probably agree with me on that, so I have that going for me!  

Another metal, base metal that is, that’s been inching higher again, is Copper…  I’ve been reading alot about strikes at mines in S. America, and a shortage of the metal… This increase in the price of Copper won’t help inflation go away… As many things use Copper, and their prices will have to go higher too…  I’m just saying… 

Getting back to the question I asked last Wednesday… “Am I the only one that sees what is happening here?”   Longtime friend, # 1 author, and publishing guru, Bill Bonner, has this to say… “Interest on the federal debt is now so immense that it’s consuming 40% of all personal income taxes. The largest source of revenue for the federal government is increasingly being devoted to just servicing the debt, not even paying it down.

The problem is getting worse daily and will eventually result in even more pain for taxpayers.

The recent monthly Treasury statement from the Fiscal Service showed that the Treasury Department paid $88.9 billion in October on interest for the federal debt. That’s almost double what it paid in October of the previous year.” – Bill Bonner@  bonnerprivateresearch@substack.com 

Chuck again… Well, when I asked that question, I didn’t mean to say that folks like Bill, didn’t see the problem!  So, I did some simple math an annualizing the debt payment in Rocktober, we get $ 1.067 Trillion in debt payments in the next year…. And we’re just getting started! A lot of the low yielding bonds that we issued years ago, will be coming due, and they’ll have to be rolled into new higher yielding bonds, thus making the debt servicing costs much, much higher… And that means that you, me, and guy down the street, that puts his Christmas lights up in Rocktober, will be seeing our tax dollars go to more of the debt servicing, instead of paying for things like police and fire protection! 

Oh, you’re a bundle of good news this morning Chuck!  Hey! I wish I didn’t have to talk about stuff like this, that our leaders back in 2000, saw the direction the debt was going, and decided then to do something about it… But we all know that’s not what happened, and thus, here we are… 

The U.S. Data Cupboard late last week had the aforementioned Durable Goods Orders for Rocktober that were a negative -5.4%, and that was about it, except for the Stupid Consumer Confidence report which showed that Consumer are feeling better about what’s going on, which only goes to prove that the Gov’t’s pulling the wool over their collective eyes is working…   That, and the fact that the stock market did fare a bit better in Rocktober, but who’s to say that will continue, given the change of hear in the market’s collective minds about what the Fed  Heads are going to do… 

To recap… The PPT made an appearance late last week, but there were turned aside as we headed to the weekend, with the dollar getting sold… Gold climbed back above $2,000 for the third time in this cycle, and Chuck believes that the charts people call this a “triple topping”, which normally means the asset is ready to take off to the upside… I guess we’ll have to see, eh?  Chuck keeps pointing out how the debt servicing costs are growing, and will eventually bring our economy to its knees…  That and there’s more today, so go back and read it if you scanned over it first!

Before we head to the Big Finish today, I wanted to share with you a link to a video, that features a guy giving his forewarning about what he sees will happen in the U.S…. Well, OK… but here’s the catch… It’s from 1958!!!! So, go ahead and click on it if you care to, otherwise skip ahead: A Prediction From 1958 – The Burning Platform

For What It’s Worth…  Ok, this is quite a different viewpoint this morning… This article came to me from longtime reader, Bob… And it’s about how confident days lead to bad decisions… And it can be found here: Higher levels of financial optimism associated with lower levels of cognitive ability (phys.org)

Or, here’s your snippet:”A behavioral economist at the University of Bath in the U.K. has found evidence linking higher levels of unwarranted financial optimism with lower levels of cognitive ability. In his study, published in the journal Personality and Social Psychology Bulletin, Chris Dawson surveyed thousands of people in the U.K. about their economic outlook and compared their responses with their true financial outlook.

Prior research has found links between a sunny outlook and better health and also a higher overall quality of life, including better relationships with people. But it has also shown that being overly optimistic can lead people to make poor decisions, such as how much to save for retirement. In this new study, Dawson looked for an association between unrealistic optimism and cognitive ability regarding financial decision-making.

Suspecting that people with lower cognitive abilities tended to overestimate their financial acumen, and thus make poor financial decisions, Dawson accessed the data repository of the Understanding Society project, which conducted a longitudinal survey involving more than 40,000 households in the U.K. and Northern Ireland over the years 2009 to 2021. He also analyzed data from the British Household Panel Survey run from 1991 to 2008.

The surveys queried respondents about their financial situation along with their expectations for the future. And because respondents were queried more than once over the course of the survey, Dawson was able to compare their earlier expectations with how things had actually panned out years later. Also included in the surveys were questions designed to assess several traits associated with cognitive ability, such as memory, word recall, verbal fluency, math ability and abstract thought.”

Chuck again…  So, now I see, said the blind man as he spit into the wind… “it’s all coming back to me now”… So, all this time that laughed at those Consumer Confidence reports, they were really telling me that the respondents were making bad decisions… Who’d a thought that?  Very interesting indeed! 

Market Prices 11/27/2023: American Style: A$ .6605, kiwi .6098, C$ .7335, euro 1.0955, sterling 1.2638, Swiss $1.1377, European Style: rand 18.6602, krone 10.6674, SEK 10.4220, forint 346.97, zloty 3.9762, koruna 22.2412, RUB 88.70, yen 148.86, sing 1.3371, HKD 7.7902, INR 83.37, China 7.1529, peso 17.02, BRL 4.8932, BBDXY 1,237.14, Dollar Index 103.25, Oil $74.95, 10-year 4.46%, Silver $24.72, Platinum $933.00, Palladium $1,082, Copper $3.74, and Gold… $2,014.00

That’s it for today… Just three Pfennigs this week, as on Wednesday, I’ll be seeing my oncologist early in the morning…  I think that since I recovered from that stomach bug that I had, that I’ve gained some weight back… Not much, just a few pounds… We did have Thanksgiving last week, is what I’ll say when she tells me the results… Man was a bad grandfather last week, when I said that grandson, Everett’s birthday was Thursday, only to find out that it is today! So, Happy Birthday, again Bud!  My beloved Mizzou Tigers won their final regular season game last Saturday at Arkansas, ending the season 10-2… A GREAT SEASON!  YAHOO!  I sure hope all the seniors stay with the team for the Bowl Game, whenever that will be… Our St. Louis U. Billikens won on Saturday in basketball, as did the Mizzou Tigers… And looky there our Blues beat the Blackhawks in a Sunday matinee game! The Blues have been hot-n-cold to start their season so far… UGH!  The Vince Guaraldi trio takes us to the finish line today with their version of the song: Christmas Time Is Here…  I hope you have a Marvelous Monday today, and that you will Please Be Good To Yourself! 

Chuck Butler

• currencies & metals see a dollar rally from left field!
• What’s going on in Japan?

Good Day… And a Wonderful Wednesday to you! The day before Thanksgiving, and tonight is the busiest night out of the year, as all the college students that have been gone, come home, and go out to meet up with their high school friends…  Did you remember that I would be out of pocket yesterday? NO? Well then… good! Humble Pie greets me this morning with their classic rock song: I Don’t Need No Doctor! 

Well, Pfennig tradition calls for this… here we go! 

Turkey for me, turkey for you

Let’s eat the turkey in my big brown shoe

Love to eat the turkey at the table

I once saw a movie with Betty Grable… 

courtesy of Adam Sandler! 

Ok…  here we go with a 2-day breakdown again… On Monday this week the dollar continued to get sold, and ended the day down almost 6 index points, to 1,239…  But Gold couldn’t find enough buyers to get it out of the early morning red, and ended up down $3.50 to end the day at $1,978.60… Silver never did fight back from its early morning loss and ended the day down 30-cents, for an end of day price of $23.51… 

The price of Oil remained in the $77 handle… And while the dollar didn’t get bought, bonds did, and the 10-year’s yield fell to 4.42%.

And while I was on a plane coming back home yesterday, the dollar got… sold early, but recovered to end the day at 1,240… I guess I was looking for the PPT the other day, and look who I found?  Oh well, the cows are in the barn, on this folks… I do believe we’re heading to a long period of dollar weakness…  Gold had a smash up day going, and at one point it had traded past $2,000 to $2,002 and change… But some last minute heroics by the short paper traders saw that Gold only gained $20 on the day, to end the day at $1,998… Ever sooooo, close to $2,000, once again!  Silver had about the same trading pattern as Gold did, so to save you from the theatrics of how it all went, I’ll just say that Silver gained 31-cents on the day, to close at $23.82…   The price of Oil remained in the $77 handle, and Bonds were adrift in a sea of darkness all day with the 10-year’s yield ending the day at 4.41%

In the overnight markets last night… The PPT’s foray into the currency markets yesterday, led to the overnight traders buying some more dollars. The BBDXY is up 1 index point to start the day today… The euro is hanging on to the 1.09 figure, so not all’s lost, after the rally from left field for the dollar, yesterday…  Gold is up $4 in the early trading this morning, which brings Gold back above $2,000… And Silver is up 4-cents to start the day… 

There’s some suspicious trading in Oil going on right now… I say that because our friends (NOT!) at OPEC are going to be starting a meeting today, and by all accounts that have been observing what the OPEC members have been saying, the thought here is that they will call for more production cuts, which should be a feather in the hat of the price of Oil… But, as I look at the WTI price this morning, Oil has slipped $2 and start the day, and the OPEC meeting trading with a $75 handle… 

And Bonds continue to get bought… I just don’t see what the attraction here is, but somebody does… And the 10-year’s yield has fallen to 4.37%… Well, I say I don’t see what is going on here, but I really do… You see, housing was teetering, just yesterday, it was announced that Housing Starts fell from the sky, back to 2010 levels… Well, the Gov’t can’t have that going on in the middle of an election year that’s coming…  and why is that? Because mortgage rates were getting too high, and mortgage rates are derived from the 10-year Treasury… So, here’s the solution to that bag of worms… Get the 10-year Treasury’s yield to drop…  How to do that? Buy it like there’s no tomorrow, and who’s doing the buying? Ahem… You know who… 

Ok… longtime readers know my affection for the writing of one Grant Williams, he of Things That Make You Go Hmmmm… fame…  Well, he had this bit in his latest letter, and I found it very interesting regarding Japan…  ““When  we  normalize  short-term interest  rates,  we  will have  to  be  careful about  what will  happen to  financial institutions, what will happen to borrowers of   money   in   general   and   what   will   happen   to   aggregate  demand,”  Ueda  said. “

Now Ueda is the Bank of Japan Gov. and did you catch what he said? He didn’t say “if we normalize rate”, he said “When” we normalize rates… OMG! You mean to tell me that the Bank Of Japan (BOJ) is seriously thinking about normalizing interest rates? 

What on earth would that do to the U.S.’ s plight of finding buyers for their debt / bonds? Thinking about this gives me a headache, but, I’ll carry through here… Buyers of all kinds, Gov, Corp, Personal, hedge funds, Pension funds, etc.  have all ignored Japan for decades now… And the BOJ has already said that they were dropping their Yield Curve Control… So, IF the BOJ is serious about returning to normal rates, then Japanese bonds would become something that all those buyers above might be interested in again, and that would take buyers away from U.S. debt/ bonds… Uh-Oh!    

PS… and just when the U.S. has a ton of maturities coming due, and has to roll them into new bonds, in addition to the new bonds that will finance new debt…   

I ask myself each and every day…. “Am I the only one seeing this problem?” Because the markets sure don’t see it as a problem, hedge funds don’t see it as a problem, Pension and Retirement funds don’t see it as a problem, and I could go on…  or, as has been the case with everything in my career of writing, they seem so evident to me, but they aren’t imminent at the moment… But they will, eventually… 

I know, I know, today is the day before Thanksgiving, and I need to be more upbeat, but I want to tell you this now, so maybe you’ll hear me later… I AM UPBEAT THIS MORNING!  

You should be around me when I’m down in the dumps… Like Monday, I was here by myself, and my stomach went bonkers on me… I had plans to go out to dinner for my last night here, but instead, had to settle for saltines and water…  Oh, those 3^rd world problems, eh? 

The U.S. Data Cupboard today has Durable Goods Orders for Rocktober… I suspect that they will print negative, but then that’s just me looking back at Factory Orders which were negative… On Monday, we saw the Leading Indicators for Rocktober, and they were negative once again… For the 19^th consecutive month, they have fallen… The last time that had happened was the great financial recession of 2007-2008…   I know, the powers that be still haven’t said that we’re in a recession, but lordy, does it ever feel like one with all these negative economic prints!  I’m just saying… 

To recap… The dollar got bought, to a degree, last night, after suffering through late last week’s price collapse in the dollar, the PPT has done the trick once again, and yesterday the dollar had a rally that came from left field… UGH!  What’s going on in Japan? Chuck has his finger on the pulse there… And the economic reports just keep printing negative, and the sheeple go along with the Company line, that everything is funky dory… I cringe, thinking about that, so let’s forget that I said that and go make sure our Turkeys are thawed!   

For What It’s Worth…  I found this article on Bloomberg, while looking for something else… It’s about how China and the Saudis have signed a currency swap agreement… I remember telling audiences that when this happened, we would begin to see the end of the dollar as a reserve currency… So, now it’s happened… And the article can be found here: China, Saudi Arabia Central Banks Sign Currency Swap – Bloomberg

Or, here’s your snippet: “China and Saudi Arabia have signed a local-currency swap agreement worth around $7 billion, deepening their ties as countries across the Middle East look to shift more of their non-oil trade away from the dollar.

The two countries’ central banks have agreed on a three-year deal for a maximum of 50 billion yuan or 26 billion riyals, according to their separate statements on Monday. China, which has been promoting the yuan’s use in transactions with major energy and commodity exporters, is Saudi Arabia’s biggest trade partner.

The swap arrangement will “help strengthen financial cooperation” and “facilitate more convenient trade and investment” between the two countries, the People’s Bank of China said in a statement. The Saudi central bank made similar comments.

The deal is the latest sign of strengthening relations between Beijing and Riyadh. Though Saudi Arabia has long been one of China’s main suppliers of oil, business ties have expanded in recent years, with Saudi Aramco investing billions of dollars in China’s petrochemicals sector and the kingdom trying to attract Chinese tech companies.”

Chuck again… See what I was talking about earlier this morning about me seeing stuff that’s going to happen, and then eventually it does? It had to be at least 10 years ago that I stood on that stage with a crowd of people all around me in chairs, on the floor, standing against the wall, and I described the currency swap agreements that China was getting other countries, mainly their trading partners to sign with them, agreeing to remove dollars from the terms of the transaction and only use each respective country’s currency instead of dollars…  At first these were small countries, but then the larger countries began to sign the agreements with China, and that’s when I told the audience that when oil is no longer priced for everyone in dollars, it would begin the dollar circling the bowl…   And now… 10 years later… 

Market Prices 11/22/2023: American Style: A$ .6561, kiwi .6035, C$ .7290, euro 1.0906, sterling 1.2534, Swiss $1.1314, European Style: rand 18.6256, krone 10.7183, SEK 10.4382, forint 349.96, zloty 4.0010, koruna 22.4963, RUB 88.35, yen 148.75, sing 1.3409, HKD 7.7959, INR 83.32, China 7.1503, peso 17.19, BRL 4.8863, BBDXY 1,241.18, Dollar Index 103.66, Oil $75.03, 10-year 4.37%, Silver $23.86, Platinum $939.00, Palladium $1,077.00, Copper $3.74, and Gold… $2002.06

That’s it for today, and this week… A short week, but… I look at this way… 16 years ago, I didn’t know if I would still be here today, and look! I am here! So, I take things as they are… roll with the punches… my favorite saying is: it is, what it is…  As Popeye used to say… “I yam what I yam, and that’s all that I yam”…  I just have one question for the airlines… Since when do you allow passengers that can walk on a plane, get on before the wheelchair people get on? I’ll hang up and listen to the answer…  I’m going to smoke a turkey this year, that’s in addition to the turkey that Kathy will roast in the oven…  The Thanksgiving clan continues to grow… I hope it’s not too cold outside tomorrow! If it is cold, then I’ll wish I hadn’t volunteered to smoke a turkey this year! I do believe that all 3 of my kids, and their families will be here tomorrow, Yahoo!  It’s that time of year, when I don’t get to see them that often… And the girls always make me smile…Dawn, Delaney, Rachel, Evie, and Grace!  The Moody Blues take us to the finish line today, with their song from the Seventh Sojourn album (one of my all-time fave Albums): Isn’t Life Strange….  I hope you have a Wonderful Wednesday today, and a truly Blessed Thanksgiving tomorrow… I’ll talk to you next on Monday next week… Please remember to Be Good To Yourself!

Chuck Butler

• Currencies & metals are rallying as dollar gets sold…
• What’s China thinking?

Good Day, and a Marvelous Monday to you!  Well, it was a long night, Wednesday night… We had water coming in from the unit above us. the wind was howling, there was a driving rain, our storm shutters were making all kinds of noises, and both Kathy and Chuck were up all-night placing buckets, wringing out towels, moving furniture, and making sure the water didn’t get to the unit below us… Now, wouldn’t it have been nice for the people above us cared about our unit like we cared about the one below us?  Anyway… I stayed behind to deal with this, while Kathy went home as planned, to deal with the construction people… UGH!  So, I didn’t write Thursday morning, because I had finally gotten back to sleep! And I’m here all by myself again! R.E.M. greets me this morning with their big 80’s song: The One I Love… 

Well, Thursday saw the dollar drift throughout the day, going up 2 index points and then back down to finally settle up 1 index point for the day… The BBDXY had lost 15 index points the day before (Wednesday, after the stupid CPI report was digested, and caused me indigestion!)  So, the selling was swift, and strong , so there was bound to be some trade adjusting done on Thursday…  

Gold kick some tail on Thursday, and took names later! Gold gained $21.60 to end the day at $1,281.80, and Silver gained 30-cents to end the day at $22.82… 

On Friday, last week, Gold continued to drive upward, until… the short paper traders showed up… Gold had moved to $1,996, but had to settle for just a 30-cent gain on the day, to end the week at $1,981.10… Silver had the same trading arc… Silver was up $24.22, when the lights went out in Georgia, and it had to settle for a flat day,  and end the week at $23.71…   For those of you keeping score at home, that’s $15 taken from Gold, and 50-cents taken from Silver!   

And the dollar continued to get sold… The BBDXY lost another 4 index points on Friday, to end the week at 1,245…

The old Dollar Index fell below 104… and the euro DID trade through 1.09!  Haven’t I always told you, well that is after the euro went through its initial baby steps, falling down quite a bit, that the euro had become the offset currency to the dollar, and therefore, whenever there was dollar selling, all you had to do was check the euro’s price, to garner just how much the dollar had fallen…  

The price of Oil fell out of bed on Thursday, and then regained what it lost on Friday, to end the week trading with a $75 handle… Strange two days for sure, as there were reports that supplies had gained on Thursday, which had Oil running for cover, but by Friday, that was all in the past… I’m still of the opinion that these are low levels that we’ll look back on in the coming months…  I’m just saying…

And bonds continued to get bought… I have something to say about all that in a minute… so stay with me here… not that you have anywhere else to go! HA!  The 10-year ended the week with a 4.43% yield…  That’s a far cry from the 5% yield we saw in Rocktober now, isn’t it? 

In the overnight markets last night…  Another 4.5 index points have been shaved from the dollar’s BBDXY index, indicating that the dollar was sold last night… I wonder what the PPT is doing? Have they left their positions, and gone out to find a fresh Turkey? Oh, good riddance to them if they have decided to throw in the towel… Gold & Silver aren’t faring well this morning either though… Gold is down $9 to start the day/ week, and Silver had given back 24-cents… Profit taking? While there may be some of that going on, this walks like, talks like, a duck, I mean short paper trading…  I’ll find out today if that was the case… 

I highlighted the euro above, but there are a couple of other currencies that are looking much better these days, and they include the pound sterling, Swiss francs, Russian rubles, and all three of the Euro Wannabes, zloty, forint, and koruna, and longtime readers will recall me talking about how when all three of those get to rallying, that a route on the dollar is on… So, we have that going for us this morning! 

And don’t look now, Hey! I told you not to look now! Ok… what I want to highlight here is that the Chinese renminbi was allowed to really take a chunk out of the price, and it trades this morning at 7.16!!!!!   WOW! Just last week it was 7.29… So, the Chinese are allowing the renminbi to rally VS the dollar, I have to think that there is some games men ship going on here, with the Chinese not buying Treasuries, and getting the Saudis to trade Oil in renminbi, and now this.. Is this all to show the world that the dollar is not the end all any longer?  I wouldn’t doubt it at all… I’m just saying… 

The price of Oil is up a buck this morning and trades with a $77 handle… While bonds…. well… the continue to get bought, I just can’t get my arms around this new bond rally… All the things that point to bonds not rallying are still in place, it’s just getting bought because of the new “the Fed Heads will cut rates by March 2024” mantra that’s getting all the air play on the radio, that has bonds getting bought… Be careful here… That’s all I have to say about that… 

I was writing out some answers to questions that were presented to me from good friend, Dennis Miller on Thursday, and in them I explained that I looked at the markets call that the Fed would be cutting rates starting next March, and that had the stocks all lathered up, that the stock rally was nothing more than a bear market rally…  after I had sent them to him, I saw this headline on MaketWatch.com “Seventh time a charm? Here are the other six times the market wrongly thought there’d be a dovish pivot.”  How about that timing!  They say you shouldn’t fight the Markets… Well, in this case, I’m going to pick a fight with them, because they’ve been like the boy who cried wolf, with their pivot calls, and what makes anyone think they got it right this time?  I sure don’t! So, be careful out there in stock jockey land…

One of the Fed Heads talked last week about additional rate hikes…  Hmmm… no sign of a pivot here, eh? 

I saw last week a report that talked about how the Fed had delivered us a soft landing…  Hmmm, isn’t that putting the cart before the horse? We haven’t gone through the whole cycle yet! And we’ve still got industrial production down, (and just printed negative!), Manufacturing still below 50, leading indicators showing negative for over 9 months, the yield curve still inverted, and a whole host of other data prints that do NOT show that we’ve experienced a soft landing…  I’m just saying!

And here are some chilling numbers and words from longtime friend, Bill Bonner from his letter last week: “The US still borrows huge amounts of money. The average interest rate on consumer credit card purchases is now over 21%. Bloomberg reports that some auto buyers are paying 29% on their car loans. Mortgage rates have come down but are still twice what they were three years ago.

Meanwhile, the largest borrower in the world – the US federal government – runs a deficit of $7 billion every day, Monday through Friday. And it has some $7.6 trillion in old loans that it must roll over in the next 12 months. Its two major lenders – China and the Fed – have both stopped buying. Shouldn’t the feds cut back…and stop borrowing so much money?”

Chuck again… yes that’s what I’ve been harping about for a couple of decades now! 

I’ve got an interview with Dennis Miller that will be hitting the inboxes of his subscribers in a couple of weeks, and I didn’t pull any punches, folks… So, if you don’t already subscribe to his newsletter, then go to: www.milleronthemoney.com and sign up… And don’t worry… It’s free! 

Ok… I read this past weekend that Andrew Maguire, who watches Gold like a hawk, believes that Central Banks will require a Gold revaluation in 2024… Whoa there partner! What kind of revaluation?  Well, Maguire believes that that gold increasingly is viewed as a better risk-free asset and market hedge than U.S. Treasury bonds, that  “the exchange-traded gold fund GLD is under an attack seeking to convert its shares into real metal for delivery to Russia and China, and that the “trade at settlement” mechanism for trading gold futures contracts on the New York Commodities Exchange is the only device still available to the U.S. government and its agent banks for price suppression.”

I thank the good folks at Gata for sending me that note, along with a link to a video of Maguire talking about this revaluation…  Ok, we’ve heard rumors of a pending revaluation of Gold for years now… But if he’s right, and Central Bank will require it, then that’s a different story, with a different ending… I’m just saying…  Oh, and.. Got Gold? 

The U.S. Data Cupboard had some damaging economic reports last week… Let’s go through them quickly here: Retail Sales for Rocktober were negative… Industrial Production was negative… Durable Goods Orders lacked any Oomph! And Initial Jobless Claims were 10,000 more than expected, and trending the wrong way… And all the Gov’t had to hand its hat on was the STUPID CPI!  You know the report that even with all the hedonic adjustments, still shows consumer inflation way over the 2% target the Fed Heads have for inflation…  

With this being a work shortened week with the Holiday, there’s not a lot of data to look at this week… We do start the week with the Leading Indicators, which have been negative for months now, and will continue to be, as long as the Gov’t doesn’t get a hold of the data!  Tomorrow we’ll see the latest Durable Goods Orders, and judging from what I’ve seen so far, the data should go negative in Rocktober…    So… the dollar is on its own this week ahead of Thanksgiving… And so far, it appears that the dollar will not get any stuffing…  HA!  

To recap… The dollar got whacked late last week… Gold & Silver rebounded… Bonds continued to rally on some very shaky trade thoughts… Chuck throws cold water on the folks saying that the Fed Heads had delivered us a soft landing… And Andrew Maguire is calling for a Central Bank originated Gold revaluation… Hmmm… 

For What It’s Worth…  I’ve talked about a Silver shortage for a long time now, and it’s never materialized, but Ted Butler, no relation that I know of, asked a simple question to the SEC and the CFTC (regulators)  last week, and I’ve got his question detailed for you here… This was sent to me by the good folks at GATA, and it can be found here: An Answer Long-Overdue | SilverSeek

Or, here’s your snippet: “Butler writes: “The issue revolves around the 103 million ounces listed as being held for the I-Shares silver trust (SLV) by the trust’s custodian, JPMorgan, in New York and the 134 million ounces held in the JPMorgan Comex warehouse.

“This creates the unanswered question of whether the 103 million ounces held on behalf of SLV are also a big part of the 134 million ounces held in the JPM Comex warehouse or if the 103 million ounces are separate and distinct from the 134 million ounces in JPM’s Comex warehouse.

“This is a rather simple question that could be of significance.”

For if the inventories overlap, it would be more evidence of a silver shortage, as well as evidence of the official deception that long has surrounded the monetary metals.

So Butler has put the question to the chairmen of the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission. His report is headlined “An Answer Long Overdue”

I also know that the answer can be uncovered within a few minutes and a few phone calls, so this is not some heavy-duty investigation, involving a drain on S.E.C. or CFTC resources. I’ve also enlisted the aid of my local congressman, so an answer is just about guaranteed. Again, I’m not suggesting any type of deliberate under-handed activity here, just an issue that fell through regulatory jurisdictional cracks that needs to be clarified.”

Chuck again… Could this email that Ted Butler sent have anything to do with Silver’s big advance late last week?  I guess we’ll have to wait-n-see… But there’s smoke here folks… and when there’s smoke, there’s fire… At least that’s what I’ve been taught! 

Market Prices 11/20/2023: American Style: A$ .6551, kiwi .6025, C$ .7291, euro 1.0923, sterling 1.2466, Swiss $ 1.1314, European Style: rand 18.3961, krone 10.7393, SEK 10.4700, forint 347.40, zloty 3.9976, koruna 22.4610, RUB 88.46, yen 148.23, sing 1.3400, HKD 7.7942, INR 83.34, China 7.1675, peso 17.17, BRL 4.9094, BBDXY 1,241.25, Dollar Index 103.59, Oil $77.01, 10-year 4.47%, Silver $23.46, Platinum $901.00, Palladium $1,058.00, Copper $3.70, and Gold… $1,972.75

That’s it for today… This will be a very short week for Pfennigs! Tomorrow, I travel back home, so no Pfennig, and then Thursday is Thanksgiving, so definitely no Pfennig that day! So just today and Wednesday… So, what’s the deal with all the water problems we’ve had this year, first at our house, and now down here? Are we on the bad list? It sure feels that way, like if we didn’t have bad luck we wouldn’t have any luck at all!  (Junior Sample)  I kid, but it sure feels that way…  How about my beloved Mizzou Tigers!!!  They pulled a game out of the fire on Saturday, which was Senior Day at Mizzou… I was on the edge of my seat, and could hardly look to see if the winning field goal went through the uprights… My Tigers are now 9-2… And play their final regulars season game this weekend VS Arkansas, their border rival… Hopefully the team still has some hunger in them to win their 10^th game!  And our Blues got taken to the woodshed Saturday night… UGH!  The Ozark Mountain Daredevils take us to the finish line today with their song: If You Wanna Get To Heaven…  I hope you have a Marvelous Monday today, and please oh please, Be Good To Yourself!

Chuck Butler

• currencies & metals have strong rallied on Tuesday…
• The House agrees to kick the can down the road again…

Good Day… And a Wonderful Wednesday to you! Real Quick here, this is just a reminder that there will be no Pfennig tomorrow! Ok, now that that’s out of the way, my beloved Mizzou Tigers were named the # 9 team in the College Playoffs Rankings!  That’s a long way from where they started the season, non ranked! YAHOO! I went to lunch in Port Salerno yesterday with some friends from down here… It was a fairly long drive, but well worth it to see everyone again! 3 years ago, I used to make that drive and even further to Port St. Lucie, 2 times a week, to visit the wound center there… I’m sure glad that’s all behind me now! The late, great, Leon Russell greets me this morning with his song: Back To The Island… 

Well, you can’t say that I didn’t tell you! On Monday this week, I told you that IF the STUPID CPI came in weaker, as it was expected to do, that it would be bad for the dollar, and good for Gold…  Well, rewind to yesterday, and the STUPID CPI came in weaker, and the dollar got sold like funnel cakes at a State Fair, and Gold & Silver rallied big time. on Tuesday…  The BBDXY lost 15 index points yesterday, and most likely has the PPT tuning up their horns to blow some intervention toward the markets today… Gold gained $16.90, and at one point yesterday it was much higher, but settled to close at $1,963.70… Silver gained 76-cents, and after flirting with falling below 22-cents, earlier this week, Silver closed yesterday at $23.16… 

The euro rallied BIG TIME on Tuesday, and ended the day at 1.0875!, all the other currencies followed the lead of the euro, with the star performers including the: pound sterling, Swiss franc, and even the Japanese yen saw some love for the fist time in a while…  These gains by the currencies were all a result of the dollar getting sold… It’s all about the dollar, and has been for some time now… 

The price of Oil remained in the $78 handle, and Bonds got bought in bunches on Tuesday…  So, here’s the skinny, on the bond buying… The markets are all saying that the “Fed is finished hiking rates”…  And that was celebrated by the bond boys, by marking up bond prices… The 10-year’s yield fell from 4.62% to 4.43%, which in bond moves is considered to be collossal!  And normally I would say that the only thing that moves bonds by that much is some bulk buying by the Fed/ Cabal/ Cartel… But with all this euphoria in the markets about how the Fed Heads are finished hiking rates, I’m going to leave this move all to the markets… 

In the overnight markets last night…  The dollar got sold a little, cetainly not with the umph that it was sold during the day… The BBDXY has lost another index point overnight, with the euro pushing toward 1.09, this has got the inklings of a major PPT intervention to save the dollar… But as long as they remain on the sidelines, the currencies will contiue to gain VS the dollar…  Gold is up $9 to start the day today, and Silver is up 30-cents… So, some good gains from the metals to start the day today… I love it when a plan comes together! I just knew in my heart of hearts that 1. the BLS would show that inflation weakened, 2. that the markets would take that as a Fed isn’t hiking rates any more stance, 3. that the dollar would get punished for this stance, and 4. that Gold (& Silver) would rally strongly…    So, as Hannibal Smith of the A-Team used to say… “I love it when a plan comes together!” 

Speaking of a currency rally… The Chinese renminbi really rallied, overnight!  The Peoples Bank of China (PBOC) was probably looking the other way, when the markets took the renminbi to a 7.24 handle… That move prompted the Singapore dollar to a higher level too… And the currencies in the rest of the Asian region all rallied… And that includes the Pan-Asian Aussie and kiwi dollars… 

The price of Oil slipped about 50-cents overnight and trades this morning with a $77 handle.  And thinking that the drop in yields was overdone, the bond boys adjusted the yields a bit higher in bonds, with the 10-year’s yield at 4.47% this morning… 

I thought I would stop here and give you the skinny on the STUPID CPI yesterday… First of all… On a monthly basis, prices increased were unchanged following a 0.4% rise the previous month.  The euphoria came from the result of annualized CPI, which fell to 3.2%…  So, the drop in the STUPID CPI was due to lower gas prices… And apparently they were so low that they more than made up for the gains in inflation from: Food, Insurance, and Health Costs…  So, here’s my take on the whole shootin’ match… According to www.shadowstats.com  if we calculate inflation without the hedonic adjustments, like we did before 1990, CPI would be 7.9%…  More than double the 3.2%, the BS, I mean the BLS would have you believe is real inflation…  As if! I didn’t just fall off of a turnip truck last night! I don’t believe the BLS’s CPI, and the markets should know better, but they apparently don’t! 

The other thing that I read from the markets, is that they don’t believe the Fed Heads will be cutting rates any time soon… But you can see the gears in their heads grinding right now… if the the Fed Heads are finished hiking rates, then their next move will be down… And that’s what the markets are hanging their hats on right now…  I won’t complain too much as long as Gold continues to get some love becuase rates are going higher! 

Here’s Dave Gonigam from his 5 Bullet Points newsletter yesterday: “Some of the internals of the report are laughable. Food at home up only 2.1% year-over-year? Yeah, maybe if you cut back on meat and got more of your protein from lentils. (Believe it or not, the statisticians monkey with the numbers exactly this way; they call it “the substitution effect”)  

Chuck again, see? even Dave sees the STUPID CPI print for what it is… worthless! 

Well the news this morning is that the House agreed on a spending bill that would be an exension, to avert a Gov’t shutdown… We all knew this would happen, with the only surprise here is that it was done a day early, and not at the 11^th hour…  This extension will now go to the Senate, and then to the POTUS for his signature… So, mark your calendars, for February 2nd… That’ll be our next day of default…  Kicking the can down the road… I need to write a song with that title… I’ll get working on that when I get home… 

I was looking at the components of the BBDXY Index the other day, and noticed a change in the makeup… The Singapore dollar was added to the list of currencies that make up the index… That brings the total of currencies that make up the BBDXY index to 12…  do you want to know what they are? I’m sure you do! … Ok, here’s the list: euro, sterling, yen, C$, peso, renminbi, francs, A$’s, S.K. won, rupee, sing, and Taiwan dollar…  I’m sure you’ve been wondering what those were for a long time, since I began using the index instead of the dollar index, since the dollar index is so heavily weighted with euros… So, congrats Singapore dollar, you make the club! 

The U.S. Data Cupboard yesterday was the spring board to the dollar selling with the Stupid CPI… and today we get the wholesale inflation index, PPI… Should show that the pipeline inflation isn’t going away… We’ll also see Retail Sales for Rocktober…  I have something for you in the FWIW section today, with regards to Retail Sales…  It’ll be interesting to see just how disappointing the report will be…  I’m just saying…

To recap… The STUPID CPI sent the markets reeling yesterday, as it showed that the propeller heads at BS, I mean BLS, showed inflation, on an annual basis, had weakened, never mind that on a month to month basis it remained the same, and that was with a revision higher in September’s number!   Nevertheless, the dollar got sold on a new markets stance that the Fed is finished with rate hikes, Gold & Silver romped on the day, and the euro traded well into the 1.08 figure!   The House agreed on a spending extension to avert a government shutdown… Whoopee! As if we didn’t think they would!   

For What It’s Worth… Well there’s a new sheriff in town, so where’s bad Bart?  That’s what I wanted to think when I read this article in Ed Steer’s letter www.edsteergoldsilver.com  And it’s about a new system that will track consumer spending, and it can be found here: Consumer spending fell in October, according to new CNBC/NRF Retail Monitor tracking card transactions

Or, here’s your snippet: “The consumer took a spending break ahead of the holiday season, with October retail sales, excluding autos and gas, falling by 0.08%, and core retail, which also removes restaurants, declining by 0.03%, according to the new CNBC/NRF Retail Monitor.

The new Retail Monitor, debuting Monday, is a joint product of CNBC and the National Retail Federation based on data from Affinity Solutions, a leading consumer purchase insights company. The data is sourced from more than 9 billion annual credit and debit card transactions collected and anonymized by Affinity and accounting for more than $500 billion in sales. The cards are issued by more than 1,400 financial institutions.

The data differs from the Census Bureau’s retail sales report as it is the result of actual consumer purchases, while the Census relies on survey data. The government data is frequently revised as additional survey data becomes available. The CNBC/NRF Retail Monitor is not revised as it’s calculated from actual transactions during the month. It is, however, seasonally adjusted, using the same program employed by Census.

“Our audience, investors and executives alike, will now be armed with dynamic insights that go beyond headline numbers to show emerging trends and critical detail,” CNBC Senior Vice President of Business News Dan Colarusso said.

Chuck again… Well, I’m all for technology that brings us data faster and correctly… And this report said that consumers took a break in spending in Rocktober…  I guess we’ll see if it plays out like that when Retail Sales will print this morning for Rocktober…  As I said on Monday, the BHI tells me that this report should be disappointing… 

Market Prices 11/15/2023: American Style: A$.6527, kiwi .6047, C$ .7309, euro 1.0862, sterling 1.2473, Swiss $1.1277, European Style: rand 18.1395, krone 10.8228, SEK 10.5422, forint 346.70, zloty 4.0460, koruna 22.5582, RUB 89.26, yen 150.32, sing 1.3415, HKD 7.8013, INR 83.14, China 7.2418, peso 17.30, BRL 4.8637, BBDXY 1,248.06, Dollar Index 104.13, Oil $77.82, 10-year 4.47%, Silver $23.46, Platinum $895.00, Palladium $1,041.00, Copper $3.67, and Gold… $1,972.41

That’s it for today, and this week… There are storms that moved through the area yesterday, and the ocean is really angry! The surf is up BIG TIME, and probably causing beach erosion… I guess we’ll find out when the storms clear out which won’t be until Friday! My wife and I keep the local TV station app on our phones, so we can check out what’s going on here while we’re back home… I think when I get back home tomorrow, I’ll have one more day of hammering and sawing to get through, and then our house will be back together!  Just in time for Thanksgiving, which will be at our house next week… When I left St. Louis it was chilly, then it warmed up while I was gone, and now it’s going back to being chilly… UGH!  I would stay here, except there’s Thanksgiving next week…  My beloved Mizzou Tigers take on the Florida Gators on Saturday… I’m worried about this game… After Mizzou’s big win last Saturday, I hope they still have the killer instinct in them! The Cure takes us to the finish line today with their song: Just Like Heaven…  I hope you have a Wonderful Wednesday today… And please, oh please remember to: Be Good To Yourself!

Chuck Butler

• currencies & metals try to rally on Monday
• Germany’s economy appears to have bottomed out…

Good Day… And a Tom Terrific Tuesday to you! Well, the rain has moved into S. Florida… It rained off and on all day yesterday, and the forecast for the next 3 days are nothing but rain filled…  Usually, that means the trip gets very expensive for me, for when it rains, my wife goes shopping!   So, I guess we’ll see… I can’t, and won’t complain, as the first 8 days I was down here, it was absolutely beautiful!  Well, how’s your NFL team doing at the half-way mark of the season? We no longer have a team in St. Louis, so I’ve adopted the K.C. Chiefs, since K.C. is in the state of Missouri!  And the Chiefs were on bye this last week… UGH!  Our Blues get back on the ice tonight VS Tampa Bay… There’s not a lot to talk about today, so I’ll get going on that… Little Feat greets me this morning with their rock classic song: Dixie Chicken…   

Well, Yesterday, we started the week in the morning, with Gold & Silver down, and the dollar flat… We ended the day with the dollar down 2 index points in the BBDXY index, the euro trading withing spittin’ distance of 1.07, at 1.0698, and Gold having rallied with some short covering to show a $7.10 gain on the day, and end up at $1,946.80… Silver was the star of the day, but you wouldn’t know it if you just looked at their closing price, which showed a 3-cent gain, to $22.40… At one point yesterday, Silver was dow 61-cents! So, it took a major rally to get them back to positive territory for the day! 

The price of Oil gained another buck yesterday to add to its $2 gain overnight, and so it ended the day trading with a $78 handle…  And bond traders are waiting for the STUPID CPI to get a read on the direction of the Fed heads with regards to interest rates. The 10-year’s yield remained at 4.64% yesterday… 

Here’s how Kitco.com described yesterday’s price action in Gold: ” Gold prices are moderately higher near midday Monday, on some short covering by the shorter-term futures traders and some perceived bargain hunting after recent selling pressure.” – Kitco.com

I didn’t read anything about why the dollar got sold yesterday, but since the selling only represented 2 index points in the BBDXY, I understand why… It just wasn’t a big deal…  I do think that the dollar traders were also on wait… Just like the bond boys… But what if the STUPID CPI is a non-event? Nah, that can’t happen Chuck, because that wouldn’t show what a great trumped-up job the Fed Heads are doing, and the Gov’t can’t have that! 

In the overnight markets last night…  There was little to no movement in the dollar once again… These traders sure have been spooked by the STUPID CPI that will pint about the same time you get this letter this morning…  I read this morning that yen traders are bracing for more rot on the vine for yen, as they are expected a stronger than expected CPI… Just shows to go ya that these yen traders are whacky dudes!   Ok, getting back to the overnight markets… Gold is flat to down a buck this morning, and Silver is down a plug nickel… So, even the precious metals traders are waiting on the STUPID CPI!  I find this to be a real shame that the markets are so enchanted with the STUPID CPI… How could these highly educated people fall for that hedonically adjusted piece of you know what?  This is where I scratch my bald head and wonder what the answer to that question is… I don’t think I’ll come up with an answer to that any time soon… 

The price of Oil remains trading with a $78 handle this morning, and the 10-year’s yield dipped to 4.62% overnight…  I wonder what the stock jockeys will do IF, the STUPID CPI does come in higher, and the threat of more rate hikes comes back?  Might be a good time to sit on the sidelines, eh? 

Well, I have some BIG NEWS that I’ll be sharing with you dear Pfennig Readers in the near future… I can’t say any more about it at this time, but when I do, I think you’ll be quite happy, as I know I will be! 

So… with that out of the way… Let’s get to some of the stories going around about the dollar, Gold, bonds, economies, etc. OK?  

Here’s some more info on Treasuries that should get you out to buy more Gold… This is from Dan Denning’s Twitter account, “You hear that sound?

Brrrrrrrp.

It’s the sound of the Fed’s money printer warming up. $15 trillion in US debt matures and must be refinanced in the next four years. It’s $20 trillion over the next ten.” -Dan Denning on Twitter

Again, and I don’t mean to beat a dead horse (there were no animals hurt here!) but who’s going to buy those bonds, and if they do step up to buy them at what yield will the be issued at?   First, I really don’t think the U.S. has the allies to buy all that debt…. That means the Primary Banks will have to take up the slack, but what if they tell the Fed heads and Treasury, “no mas!”  Well, that means the the Fed/ Cabal/ Cartel will have to print dollars and buy the bonds for their balance sheet, which was supposed to be drained by then….  So, when at the end of Dan Denning’s Twitter feed he says: “out to buy more Gold”… He’s got the answer to all this dollar printing… and bond buying… and self-dealing… demonetizing debt…  and it’s all about having enough Gold! 

Well, you know what happens this coming Friday, right? Well, that’s out next day of default, that won’t happen… At least for now… 1440 reports that: “House Speaker Mike Johnson (R, LA-4) unveils plan to avoid government shutdown ahead of Friday night deadline; proposal would split federal agencies into two groups, provide separate short-term extensions for each.”

Chuck again… see? I told you last week that this is what it would come to… extensions, just keep kicking the can down the road… What else would you expect from these knuckleheads? That’s all they’ve done (kick the can down the road) for decades now… And quite frankly, they’ve gotten good at it… And that’s a bad thing! 

And overseas this morning, it was reported that the ZEW (think tank) investor confidence report in Germany bet the expectations by a wide margin (5 was expected, reported at 9), which could mean that the German economy has bottomed out, and is on the way to mending… That could be why the euro has popped up over 1.07 this morning… These think tank reports used to really move the euro when they printed, so it is nice to see something coming back… I’m just saying… 

The U.S. data Cupboard started the week yesterday with nothing to show us… But today’s Cupboard will have the STUPID CPI print for Rocktober… The forecast for the data which is hedonically adjusted, is for it to remain at 4.1%…  now you and I know that that our personal inflation is higher than 4.1%, so why try and pass this fraudulent number off on the masses? Because the “masses” don’t read the Pfennig, although they should, and don’t know about how the BLS massages, cooks, and adjusts the CPI data each month… 

The markets are wishin’ and hopin’ and thinkin’ and prayin’ (Dusty Springfield) that CPI shows weaker inflation, so they can get back on their “the fed will pivot soon horse” That would be good for stocks… And… it would be good for Gold… but then that’s just a small effect, that won’t be noticeable if the markets get their wish… 

To recap… The dollar was sold a little yesterday, but too much, as no one wants to make a call on the STUPID CPI that will print this morning… Gold gained a bit on Monday, and Silver make a comeback rally for the ages!  Lots and lots, which really doesn’t describe the amount of debt that is coming due in the next few years, and will have to be rolled at higher yields, and there’s also the question of who will buy the bonds?  Oh brother!  I just keep thinking about Dick Cheney saying, “Deficits don’t matter”…  Well, in a way, if the deficit is paid off the following year, then they don’t matter, but that’s not what was happening and look where we are now! 

For What It’s Worth… I found this article yesterday, and while it doesn’t spell gloom, despair or agony, it does point to something if, it continues would be very bad for banks… And it can be found here: $174,303,000,000 in Deposit Flight Hits US Banks in Three Months As S&P Global Declares Banking Industry Is ‘Gradually Shrinking’ – The Daily Hodl

Or, here’s your snippet: “New numbers are shedding light on the multi billion-dollar flow of capital out of the US banking system.

In a new report, S&P Global says total non-brokered deposits, or funds coming mostly from retail customers, recorded their sixth consecutive quarterly decline in Q3 of this year.

The market intelligence firm says non-brokered deposits dropped from $17.430 trillion in Q2 to $17.256 trillion in Q3, representing a decrease of $174.303 billion. Specifically, S&P Global says Citibank, Bank of America, Wells Fargo and JPMorgan Chase saw at least a 2% quarterly decline.

Deposits across the commercial banking industry are down about $947 billion dollars from an all-time high of $18.203 trillion set in April of 2022.

To make up for the deposit outflows, the data intelligence firm says the industry is beginning to rely more on wholesale funding, which involves brokered deposits from large financial institutions.

Banks are also depending on loans and leases to shore up their balance sheet.

The shift in strategy comes as the total assets held across the industry continue to drop.

“That transformation is taking place as the industry gradually shrinks. Total assets for US commercial banks, savings banks and savings and loan associations were $23.406 trillion at Sept. 30, representing a 0.2% decline from June 30 and a 2.4% decrease since the all-time peak at March 31, 2022.”

Chuck again… if I may suggest another reason for this drop in deposits at banks… And that is that all the stimmie Checks that were deposited have been spent, and then some…  I’m just saying… 

Market Prices 11/14/2023: American Style: A$.6370, kiwi .5868, C$ .7228, euro 1.0719, sterling 1.2285, Swiss $1.1084, European Style: rand 18.7378, krone 11.1593, SEK 10.8414, forint 351.70, zloty 4.1260, koruna 22.9068, RUB 90.84, yen 151.73, sing 1.3613, HKD 7.8101, INR 83.33, China 7.2894, peso 17.57, BRL 4.9103, BBDXY 1,264.63, Dollar Index 105.55, Oil $78.36, 10-year 4.62%, Silver $22.35, Platinum $870.00, Palladium $975.00, Copper $3.65, and Gold… $1,945.57

That’s it for today… I tried to remain awake to watch the Monday Night Football game last night but didn’t make it even to half time! Man do I recall the 70’s when MNF was HUGE! We went to bars to watch the games and stayed until the end! There were BIG parties surrounding MNF back in the day…  Now? I can’t even make it to half time! UGH!  My beloved Mizzou Tigers played a basketball game last night that for that too, I couldn’t stay awake for! double UGH! So, I checked this morning, and they won! Just 3 more days down here, and then I go home UGH! Got an update on grandson Everett’s recovery… His surgery went well, and he’s on the road to recovery… Tough little guy!  The Guess Who takes us to the finish line today with their song: No Time…  (a great song!) I hope you have a Tom Terrific Tuesday today, and Please Be Good To Yourself!

Chuck Butler

• currencies and metals get sold on Friday…
• Jerome Powell says, “not so fast there!”

Good Day… And a Marvelous Monday to you! What a Wonderful Weekend was had by St. Louis sports fans! First and foremost, my beloved Mizzou Tigers stomped on Tennesee, then our Blues stomped on the Avs, And finally our Billikens won too! I was dressed all in black like the team on Saturday, what a great victory! There’s all kinds of things I would like to say at this point, but… that would make this a sports only letter, and that can’t happen!  I’m on a roll this morning, so the dolts had beter beware, as I’m coming for you!  That sounded like I’m a real bad @#X, and I’m not… But as they say the pen is mightier than the sword…  In this case I hope the typewriter keys are mightier than the sword!  The great Rev. Al Green greets us this morning with his song: Love & Happiness… 

Well, the dollar was on a roll to end the week…  Jerome Powell, backed tracked and talked about how the Fed Heads are not closing the book on rate hikes, and that scared the bejeebers out of the markets, but not the dollar bugs, and the BBDXY rose 5 index points on Friday…  The euro dropped below 1.07 again, and the Japanese yen fell to 151.52 to end the week…  And the sharp long knives were out again for Gold & Silver… Gold lost $19.50 on Friday, and Silver lost 34-cents… Gold ended the week at $1,939.50, and Silver at $22.37…  There have been days when Gold has been whacked like it was on Friday, in the past, but this one felt different… This one had the Jerome Powell words hanging over Gold like the Sword of Damocles…  And then there were the short paper traders piling on… which in football is a penalty, but not so, in the markets… UGH!  

The price of Oil remained trading with a $75 handle to end the week… And the 10-year’s yield rose to 4.64%, after Powell’s words… The 2-year Treasury note saw its yield rise above 5%!   So, yes, the yield curve is still inverted… It’s only the money that the Gov’t keeps spending that’s keeping the U.S. economy so resilient, and not subjecting it to a recession… Which I’ll remind you is actually needed to wipe out the excesses of the previous boom… That’s how “real economies” work, and not ones that are manipulated by a Central Bank… But I digress… 

In the overnight markets last night…  there’s been little to no movement in the dollar, so we start the week with the BBDXY at 1.266… The metal whackers are still hanging around, with Gold down $2 to star the day/ week, and Silver down 31-cents… When is this going to stop? I’ve explained their method for making money in this short paper trading before, so I won’t go into it again, but only to point out that when the selling does stop, that’s when the boys in the band will go back to buying again to drive the price up from their shorted price… And then it starts all over again…  

The price of Oil rallied and trades this morning with a $77 handle!  And the 10-year didn’t move overnight, and therefore it starts the day/ week with a 4.64% yield… I’m looking at the yield curve right now… and have some thoughts I’m going to get into in a minute, so keep reading, for that! 

Well, it was bound to happen eventually, and now… well, the news on Friday, was that the ratings agency Moodys, had downgraded U.S. Debt to negative… Moodys pointing to rising risks to the nation’s fiscal strength, as their main reason for the downgrade to negative from stable… Moody’s move to cut its outlook arrives as Congress faces the looming threat of a government shutdown once more. The government is funded through next Friday. Remember? The extension that was put into place 6 weeks ago? Well, time has elapsed, and it’s here again… the “deadline”… to fund the Government…  

This is Huge folks, and of course, Treasury dolt, I mean Secretary, Janet Yellen disagreed with Moodys… Just like she did when Fitch downgraded U.S. debt… And on top of this, last week the Treasury held an auction of Treasuries, and  bidders showed their lowest interest in the long-term 30-Year Treasury Bond since December 2021, as evidenced by primary dealers buying nearly 18.2% of debt. Primary dealers are required to take the debt not purchased by other bidders. The highest yield accepted came in at 4.837%, the highest level since 2007…  See? 

Haven’t I warned you that interest in our debt is lagging? And we have much more debt that has to be issued… In fact, we have A whopping $7.6 trillion in interest-bearing US public debt will mature within a year, which represents 31% of all outstanding US government debt… And guess what will happen when all that debt needs to rolled into new bonds? Yes, they will all be at higher rates than the maturing issues… 

And just last week it was announced that the U.S. debt servicing total at the end of Rocktober, was over $1 Trillion!  YIKES!  This from www.lewrockwell.com  ” Debt literally takes down empires. The U.S. government was never meant to be a militarized empire, since freedom and empire are mutually exclusive. But alas, the decisions to become an empire were made before any of us were born. In typical fashion, the U.S. government has overextended itself militarily around the world, engaging in endless wars. Those wars come at a severe cost, as our standard of living at home deteriorates. Debts cannot be endless. Ultimately, the interest payments will overwhelm. The U.S. government is now paying $1 Trillion in interest payments alone.”

Chuck again… couldn’t have said it better myself!  it’s all too much like the fall of the Roman Empire that it’s scary…. I’m just saying… 

And what would you think would be the results that the dollar faces with all this bad stuff going on in refinancing out debt?  Well, I know what should happen… And that is, it gets hammered…  But that’s working under the assumption that the PPT doesn’t have a Treasure Chest of funds to spend to keep the dollar’s head above water…  And we all know that the PPT does have a Treasure Chest of funds…  So, this will be a classic case of the markets’ will VS the PPT’s will…  It used to be said that the markets have deeper pockets than any Central Bank… I would think of the PPT and their Treasure Chest of funds, as a Central Bank…  Hopefully that old adage doesn’t go the way of the dodo bird… 

OK… well the U.S. Data Cupboard last week was a waste of time… But this week is cock-full-o-data for us to see! Starting with Retail Sales that will print on Wednesday… The BHI indicates that it will disappointing… Then the STUPID CPI will print for Rocktober… This is the most useless piece of data that gets printed, and that’s saying something considering how useless the BLS’s Jobs data is each month!   The Gov’t likes you to feel comfortable with them and their economy, so they lie to you about what inflation is really doing… But C’Mon Gov’t! Do you really think we’re that stupid that we don’t know that prices haven’t come back down, and we’re running out of savings? 

To Recap… The dollar bugs were dancing in the streets on Friday, when Fed/ Cabal/ Cartel Chairman, Powell, back tracked and talked about how the Fed Heads are not finished hiking rates… The BBDXY Gained 5 index points on Friday, and Gold got whacked once again, along with Silver. Chuck spends a lot of time this morning talking about our financing problems, as a country that is…  What on earth will we do, when the well runs dry? … 

For What It’s Worth… Here’s another article about Silver, and the supply and demand that just isn’t used to price Silver correctly any longer…  And it can be found here: Silver Demand in Three Key Sectors Expected to Nearly Double in the Next Decade | SchiffGold

Or, here’s your snippet: “Silver demand set records in every category in 2022. Meanwhile, supply was flat with mine output dropping by 0.6% to 822.4 million ounces.

Record global silver demand and a lack of supply upside contributed to last year’s 237.7 million ounce market deficit. It was the second consecutive annual deficit in a row. The Silver Institute called it “possibly the most significant deficit on record.” It also noted that “the combined shortfalls of the previous two years comfortably offset the cumulative surpluses of the last 11 years.”

The price of silver does not reflect the current supply and demand dynamics. In fact, silver is significantly undervalued right now. One analyst called the current price in the $22 an ounce range “inexcusably low.”

At some point, investors will have to reckon with the shrinking supply of silver coupled with rising demand, along with the Fed’s inability to bring inflation back to its 2% target. When that happens, the price of silver will likely take off.

Given the supply and demand dynamics, the skewed silver-gold ratio and the likelihood that the Fed will not beat price inflation, $22 to $23 silver looks like a great buying opportunity.”

Chuck again… This is the same old story with Silver… the demand is greater than the supply, but the supply/ demand rules doesn’t exist for Silver, it should, but it doesn’t, because according to Ed Steer there’s about 150 day’s of Silver production that’s needed to cover the short positions that exist…  Yes, that’s down from what it was a year or so ago, at 180 days, but still 150 is just a ridiculous amount of shorts… One of these days, Alice… To the Moon! 

Market Prices 11/13/2003: American Style: A$ .6374, kiwi .5883, C$ .7242, euro 1.0682, sterling 1.2244, Swiss $1.1071, European Style: rand 18.7532, krone 11.1252, SEK 10.8739, forint 353.02, zloty 4.1471, koruna 23.0275, RUB 91.91, yen 151.74, sing 1.3598, HKD 7.8082, INR 83.33, China 7.2909, peso 17.68, BRL 4.9120, BBDXY 1,266.95, Dollar Index 105.71, Oil $77.30, 10-year 4.64%, Silver $22.06, Platinum $856.00, Palladium $974.00, Copper $3.63, and Gold… $1,937.51

That’s it for today… Well… I need to tell you that there will be no Pfennig this Thursday… It’s a travel day for me to go back home… My time here is coming to an end, but it won’t be long before I’m back for the winter! But first I need to go home for Thankgiving, and then Christmas!   My Tigers don’t get to celebrate their win last Saturday too long, as Florida comes to Columbia Mo. this coming Saturday… If the Tigers play like they did last Saturday, I like their chances…  My house is nearing completion… the rebuild of the interior is almost completed, just some vanity tops, and mirrors and other little things still to do… I really was happy to not have hammers hammering, saws not sawing, etc. while down here… I actually got in some naps!  The Ozark Mountain Daredevils take us to the finish line today with their song: Jackie Blue…  I hope you have a Marvelous Monday today, and Please Be Good To Yourself! 

Chuck Butler

• Currencies & metals get sold on Wednesday
• Short paper traders rule the roost!

Good Day… And a Tub Thumpin’ Thursday to one and all! Man what a beautiful day yesterday down here in S. Florida! Warm, plenty of sunshine, and a beautiful ocean with multi colors coming to shore!  As I said the other day, the college basketball season has begun, but the early games are for the blood donors… That’s what they used to call the teams that play the big boys, and know they can’t win, but they do it for the revenue they received…  So, that means very uninteresting games to watch, at this point… The free agent and trading players is open for business in baseball… C’Mon Cardinals what are you waiting for?  The late, great, George Harrison greets me this morning with his song: What Is Life? 

Well… the last two days, the dollar got sold during the day, and bought back at night in the overnight session… Yesterday, the dollar got sold again this time with the BBDXY giving up 2 index points… The euro climbed back above the 1.07 handle, and the rest of the currencies all fell in line behind the Big Dog, euro…  Gold got whacked again yesterday, by the short Gold paper traders, and it lost $18.90 on the day to close at $1,950.80… And Silver, had a nice rally at the end of the day, but couldn’t climb out of the hole it had dug by the short paper traders… Silver lost 9-cents yesterday to close at $22.60.91

Bonds are really getting a lot of love these days, after people shunning them since the Plandemic… The 10-year’s yield fell more yesterday and closed trading with a 4.49% yield…  And on the opposite side of the spectrum, the price of Oil fell another buck yesterday to trade with a $75 handle… There’s no love coming Oil’s way these days, but… if you listen to James Rickards, you would be sitting here waiting for the shoe to drop, and Oil to turn things around quickly…  I read yesterday, in Dave Gonigam’s 5 Bullet Points (formerly known as the 5-minute forecast), that Rickards believes that Oil flowing through the strait of Hormuz will get shut down by the Iranians, and even Saudi Oil won’t get through, and that will lead to Oil rising quickly back to $100 and beyond…   I see his point, and like I said yesterday, I truly believe that these are excellent buying prices for Oil… 

In the overnight markets last night…  Well the recent pattern played out once again, with the dollar getting bought in the overnight markets to the tune of seeing the BBDXY gain 3 index points… When will the short paper traders take a rest? They were at it again yesterday, and that has spilled over to the early trading this morning. Gold is down $2 to start the day, and Silver is down 5-cents… These are small amounts and could very well be turned around easily today, so what do you say? Get going Gold!  Oil remains in the $75 handle, and the 10-year’s yield is 4.52% this morning… 

Well, the markets were all waiting for Fed/ Cabal/ Cartel Chairman, Jerome Powell, to speak yesterday, and give the markets some fodder on Interest Rates and so on…   But Powell stuck to his script, and only talked about how the Fed Heads need to be willing to think beyond the complex mathematical simulations it traditionally uses to forecast the economy…  OK, that’s Fed speak for “put away the abacus and your Texas Instrument calculator, and get up to date with the changing economy”….  

Well, those nasty sanctions on Russia, have seem to run out of steam… Reuters reported last night that :” Russian banks could make record profits of 2.9 to 3 trillion roubles this year, Deputy Central Bank Governor Olga Polyakova said on Wednesday.

Polyakova said the central bank expects banks to add to their reserves in the fourth quarter.

On Tuesday Russia’s biggest bank, Sberbank (SBER.MM) said it expected to make record profits this year, bouncing back after a 75% drop last year when Western sanctions hammered the financial sector.”

Chuck again… Just like the trade war with China that I told you when it was announced that it wouldn’t do anything to help the trade balance of the U.S., which incidentally printed the other day at $61 Billion in Rocktober… That’s up from the previous month… The sanctions on Russia, are proving to be a non-event… I’m just saying… 

Okbee… Let’s see what else is in the news this morning…  Well, if you want news on the war, elections, or Taylor Swift, you won’t find it here!  And that’s about all that’s in the news headlines this morning… No data, to talk about, and no commentaries… There’s a void in market news today, so I’ll just zip this up and head out for the weekend! 

The U.S. Data Cupboard has been a non-event all week, and will continue to be today, with only the weekly Initial Jobless Claims to report… This data surprised observers last week coming in higher than the forecast…  I suspect this week will be the same… 

To recap… The dollar gets sold during the day, and bought overnight… Interesting pattern that I hope goes away soon! Jerome Powell, left his audience “wanting” yesterday, refusing to talk about interest rates and the economy, other than it was time to put away the abacusses and Texas Instrument calculators and get into the new math of changing economies… You all probably know that at one time in my young life I was a musician… and played in a band that toured the country! I was told by a representative at the Dick Clark studios that there was one thing I needed to learn in show business, and that is “leave the crowd wanting”….  So, back then that was a good thing, for Jerome Powell, not so much… 

Do you feel that there’s something wrong with today’s finances/ economy, but you just can’t put your finger on it? I’m feeling that way, as there are so many things out there that could cause the economy to collapse, but they aren’t imminent… Which means they could happen at any time, and Whoosh!  One person that I follow, Stephanie Pomboy, had this to day recently on Twitter: “Stephanie Pomboy: “We Are on the Brink of a 2008-Style Financial Crisis — And I’m Not Trying to Be Hyperbolic”  Well, I’m glad that there are people out there that explain this stuff to the masses… 

Before we head to the Big Finish today, I wanted to note that tomorrow is Veteran’s Day… This is a big day as far as I’m concerned… Our fathers and grandfathers fought in wars, and that alone deserves a salute on Veteran’s Day… As I’ve explained before, my dad was a veteran of WWII… He was the biggest patriot I’ve ever known… he loved this country, and would have fought again in Vietnam, but he was too old…  So, if you know a Vet, tell them you appreciate their service, or at least give them a salute! 

For What It’s Worth… Ok, long ago in another time warp, I wrote a Sunday Pfennig, that was titled: Chuck’s Debt Solutions… It was hailed as THE write up to end all write ups on the debt!  Of course, nobody of importance, in the gov’t read it, and so here we are years later, with $33.5 Trillion in debt, and the world famous Doug Casey, now talking about his Debt Solutions, so let’s listen in, and this can be found here; International Man – How to Open an Offshore Bank Account, Get a Second Passport & How to Save Tax

Or, here’s your snippet: “1. Allow the collapse of all bankrupt entities. No bailouts, subsidies, or guarantees for banks, insurers, corporations, or anything. 

There will be plenty in the coming years. Bailout money is always wasted. Most of the real wealth now owned by the bankrupt entities will still exist.

It will simply change ownership. But that’s not nearly enough. At this point, it would be a half-measure, a 3-foot rope over a 12-foot gap. If you allow the collapse of unprofitable enterprises without changing the conditions that created the problem, recovery is going to be even harder. So…

2. Deregulate. Contrary to what almost everyone thinks, the main purpose of regulation is not to protect consumers but to entrench the current order. Regulation prevents new institutions from arising quickly and cheaply.

Does the Department of Agriculture really need 100,000 employees to regulate fewer than two million farms in the US? Abolish it.

Has the Department of Energy, created in 1977 to somehow solve a temporary crisis, done anything of value with its 110,000 employees and contractors and $32 billion annual budget? Abolish it.

How about the terminally corrupt Bureau of Indian Affairs, which has outlived whatever usefulness it might have had by 100 years. Abolish it.

The FTC, SEC, FCC, FAA, DOT, HHS, HUD, Labor, Commerce, and many more, serve little or no useful public purpose. Eliminate them, and the entire economy would blossom – except for the parasitical lobbying and legal trades. There are hundreds of agencies like these. Most aren’t just useless. They’re actively destructive.

3. Abolish the Fed. This is the actual engine of inflation. Money is just a medium of exchange and a store of value; you don’t need a central bank to have money. In fact, central banks are always destructive. They benefit only the cronies who get their money first..

4. Cut taxes by 50%… to start. The economy would boom. The money won’t be needed with all the agencies gone. Certainly not if the next two points are followed.

5. Default on the national debt. I realize this is a shocker unless you recall that the debt will never be paid anyway. Why should the next several generations have to pay for the stupidity of their parents?

A default sounds dishonorable—and it is in civil society. But government is different. It hasn’t been “We the People” for a long time; it’s now a self-dealing behemoth run by cronies. It’s like a building with a rotten foundation—better to bring it down with a controlled demolition than wait for it fall unpredictably.

Governments default all the time, though most defaults are subtle, through inflation. In an outright default, however, the only people who get hurt are those who lent money to an institution that can only repay them by stealing money from others. They should be punished.

6. Disentangle and disengage. The entanglements the US needs to escape prominently include the UN and NATO. Spending could easily be cut 50%. The US combat troops now in over 100 foreign countries can come home. They’re not “defending” anything but local collaborators while picking up bad habits and antagonizing the locals. Spending on the military and its sport wars significantly adds to the economy’s problems.”

Chuck again… I know, if you recall my Sunday Pfennig, you may be saying to yourself, those all sound familiar, where did I hear them before? Oh! That’s right, they sound eerily like Chuck’s Debt Solutions!  only in a different way of saying them… 

Market Prices 11/9/2023: American Style: A$.6398, kiwi .5927, C$ .7250, euro 1.0689, sterling 1.2261, 

Swiss $1.1107, European Style: rand 18.6187, krone 11.1707, SEK 10.8738, forint 354.85, zloty 4.1643, 

koruna 22.9810, RUB 92.16, yen 151.50, sing 1.3582, HKD 7.8078, INR 83.28, China 7.2856, peso 17.59, 

BRL 4.9099, BBDXY 1,263.62, Dollar Index 105.70, Oil $75.81, 10-year 4.52%, Silver $22.57, Platinum $867.00, Palladium $1,039.00, Copper $3.65, and Gold… $1,948.58

That’s it for today… Well, today, seems like it has been a very long week for yours truly… And maybe it has!  Kathy arrived in S. Florida last night, so I’m not all by myself any longer! I’m worried about my Mizzou Tigers game this weekend, VS Tenneessee… They need to win this game… so Go Tigers! I wore my black and gold on the airplane coming down here last Saturday, and one of the flight attendants, said, MIZ! And I returned a ZOU! And then she began to tell me how she graduated from Mizzou!  She asked me when did I graduate from Mizzou… I said, I wish! I would have given my left arm to be able to play for the Tigers!  I was brought up a Tigers fan, taught my kids to be Tigers fans, and anyone else that’s around me during football season! The Easybeats takes us to the finish line today with their 60’s song: Friday On My Mind…. I hope you have a Tub Thumpin’ Thursday today, and Fantastico Friday tomorrow, and I’ll talk to you again next week!  Don’t forget that tomorrow is Veteran’s Day!  Please…. Be Good To Yourself!

Chuck Butler

November 8, 2023

* Currencies rally a bit on Tuesday…

* Another Bank closes its doors… 

November 7, 2023

*Currencies & metals get sold on Monday

* RBA hikes rates! 

November 6, 2023

* Currencies & metals rally on Friday

* Our next day of default is Nov. 17…