August 30, 20223
* Currencies & metals rally on Tuesday…
* What’s going on in Bonds?
Good Day… And a Wonderful Wednesday to you! Well, the weather has been warm this week so far, so that’s good for me going outside to read during the day… My kids make fun of my really tanned knees… I read an entire book outside yesterday, but had to move under the umbrella after a while in sun… I had a nice call from Good Friend, Dennis Miller, and we tossed around some ideas for a letter… I know that I’ve mentioned Dennis’ letter “Miller On The Money” to you all before and many of you have signed up for his free letter, but there are still many more of my dear readers that haven’t done so, yet… Go to www.milleronthemoney.com and sign up! Iam Gomm greets me this morning with his 80’s song: Hold On…
Well, at the beginning of this month, that’s what the dollar was doing… Holding on… It was down 16% on the year, and looking like it would go on a long-term weak trend…. And then it wasn’t holding on any longer, an gained back 12% since then… Yesterday, the dollar got sold and really sold, I might add, with the BBDXY losing 5 index points on the day. What caused this turnaround on our Tuesday? Well, if you read the headlines in the financial news , you would know that a weak Consumer Confidence report yesterday, caused the dollar to get sold… I say, Mularky! Since when does the Stupid Consumer Confidence really have anything to do with the dollar trading? The dollar got sold yesterday, because it had become overbought… Now we’ll have to see if the selling continues, or if this was just a one and done, correction…
Gold took up the cue from the weak dollar, and climbed $17.40 on the day yesterday! Gold ended the day at $1,938.20, and Silver gained 50-cents to close the day at $24.81… So, it was a “Turnaround Tuesday” yesterday, and one that we hadn’t seen since the beginning the month…
The other data yesterday was the Jobs Openings, which for the longest time would come in around 10 Million each month… But in recent days, it appears that people are “finally going back to work” Because the Job Openings fell to 8.8 Million last month… And traders looked at that, and thought…. the Fed Heads won’t need to hike rates… So, that helped sell the dollar, and buy Gold yesterday…
The price of Oil bumped higher again and then time it ended the day with an $81 handle… And apparently someone was in buying bonds by the boatload, because the yield on the 10-year fell to 4.12% yesterday… What are people thinking here? Well, I guess that should be looked at differently… and wonder who’s buying that much of the bond that they could move yields like that? Well, can you say…. The Fed/ Cabal/ Cartel? I knew you could…
In the overnight markets last night… it does seem that the dollar selling will continue for now… The BBDXY has lost 2 index points overnight, and the euro has climbed back over the 1.09 figure… The Euro wannabes, (forints, zloty and koruna) are all on the rally tracks, so there’s an indication that I use to determine the strength of the dollar selling… Gold is up $7 in the early trading this morning, and Silver is up 5-cents… And get this… The 10-year’s yield has slid all the way down to 4.11%… That’s a two-day total of 11 Basis Points off the yield, which means the bond price has gone up and the only thing that moves a bond price higher is buying… Lots of buying in chunks as I go back to my bond trading days, and know that it takes a lot to move a bond’s yield…
One of these days, Alice…. To The Moon! What a great old show eh? Well, I like to use that phrase from the old TV show, with Jackie Gleason, from time to time to highlight a move in an asset that warrants it… And yesterday it was Gold… Sure it could have been an evern greater day for Golf without the daily interference, and maybe in the coming days we’ll see even better days…. But like I’ve always told you dear reader, that if you want to get rid of the short paper traders, the physical purchases of Gold by everyone and I mean everyone, would do the trick… There is still a very large percentage of people in this country that don’t own 1 ounce of Gold… Oh, they have the latest iPhones, the latest large screen TV’s, the newest automobiles, and can take extravagant holidays, but do they have any store of wealth? Tsk, Tsk, Tsk…
Good friend, Dennis Miller, sent me a picture from a Gas Station that had their sign out front that said, “Has Anyone Tried Unplugging the U.S. and then plugging it back in?” that took me back to when on our old Mark Twain Bank World Markets trading desk, we all got our own personal computer… We had a tech guy named Taru, and whenever he would walk by, and we would say, “Hey Taru, my computer isn’t working” He would reply, “Have you turned it and back on again?” So, this sign was a great memory for me… And that’s what it would take to get us all moving in the right direction again, and that is to unplug the U.S. and then pub it back in!
Ok, call off the dogs! The UAE says that their relationships with the West will be unchanged going forward… Yeah, I believe that, like I belive in the tooth fairy! This from Bloomberg.com this morning: “The UAE is looking to its membership as an opportunity to develop trade and plans to commit more capital to the New Development Bank, the lender created by BRICS that the Gulf state joined two years ago, Economy Minister Abdulla bin Touq Al Marri said in a Bloomberg Television interview.
“We are actually going to push more” and will “indeed” inject capital into the bank.”
Chuck again, ok, so you’re telling me that you’re going to push for more in the BRICS, and inject more capital in the BRICS bank and that won’t move you to do more trade with BRICS members? Words… It’s a battle of words, and most of them are lies… (Pink Floyd)
The U.S. Data Cupboard yesterday had the aforementioned stupid Consumer Confidence data yesterday… The index fell from 114.8 to 106.1… That’s quite a fall, and while I poopooed it above, it did fall quite a bit… But like I said yesterday, this report is nothing more than a pulse of the stock market… So, apparently, the folks asked their opinion, weren’t happy with the stock market’s performance… So what?
I forgot to mention that previously that the Dallas Fed Survey, which is a pulse taken on their Manufacturing Sector, fell to a level (not counting the Covid year) not seen since May 2016… The quote from zerohedge.com had someone saying that “our sector is in recession”…
To Recap… The dollar got sold on Turnaround Tuesday yesterday, and now we need to see if there’s follow-up in selling or if it was just a one and done correction because the dollar was very overbought… Gold had a great day, but not as good as it could have been without interference… The Texas manufacturing sector is in recession, but you didn’t hear about that on the TV news, did you? No, you only heard about it here!
For What It’s Worth… Well, I’ve been holding this one for a few days, waiting for the time I needed a FWIW article, and that day is today…. This is Paul Craig Roberts, and his thoughts on the fall of our Empire… And it can be found here: PaulCraigRoberts.org » Realistically, How Strong Is America? » Print
Or, here’s your snippet: “America’s weakness is overlooked by investment analysts. Having offshored manufacturing, the US is import-dependent, and having weaponized the dollar Washington is causing foreign central banks to stop holding dollars as reserves. The consequence is that the US has a rising issuance of debt to finance trade and budget deficits, but a declining supply of customers for that debt. Either the Federal Reserve has to monetize the debt or interest rates will rise.
Note also that it appears there will be in about 4 months a large expansion of BRICS. Argentina, Egypt, Iran, Saudi Arabia, and the United Arab Emirates have been invited to join. I assume the Russians have the diplomatic sense not to invite someone unless they know they will accept. Otherwise, Russia will have set herself up for the Western media headline, “Country X refuses Russia’s invitation.”
In a slap down of Washington signifying the termination of the petrodollar, Saudi Foreign Minister Prince Faisal bin Farhan said, “the special, strategic relations with the BRICS nations promotes common principles, most importantly the firm belief in the principle of respect for sovereignty, independence and non-interference in internal affairs.”
BRICS expansion will make the two largest South American countries members, and with the Saudis, Iranians, and UAE almost the entirety of Middle East oil goes into the Russian organization, which with Russia’s oil is essentially the world’s oil supply, and Egypt sits on the Suez Canal. China and India, the largest part of Asia, are already members. This suggests to me that the US dollar is headed for trouble and will need interest rate support. If the dollar loses exchange value, the cost of imports will drive US inflation considerably higher. The worst inflations are always caused by currency decline. Gold investments make a lot of sense for Americans assuming that the criminals in Washington who are ruling us don’t confiscate them.
Keep in mind also that the indictments of Trump are completely phony. If white-hating black Democrat prosecutors and white-hating black Democrat juries convict Trump of these phony charges, political upheaval could result. If the Americans simply accept the false conviction of an American president, they will fall into tyranny and no asset will be safe.
The real American situation could be very different from what Wall Street thinks. Dollar problems could make the US an unsafe investment climate.”
Chuck again…. This article is long, and ventures into the problems for white Americans, for which I wasn’t going to use that part for I don’t like talking about stuff like that…
Market Prices 8/30/2023: American Style: A$ .6495, kiwi .5985, C$ .7382, euro 1.0912, sterling 1.2693, Swiss $1.1390, European Style: rand 18.5340, krone 10.5692, SEK 10.8265, forint 347.47, zloty 4.0958, koruna 22.0896, RUB 96.14, yen 146.02, sing 1.3509, HKD 7.8473, INR 82.73, China 7.2866, peso 16.73, BRL 4.8486, BBDXY 1,235.48, Dollar Index 103.24, Oil $81.50, 10-year 4.11%, Silver $24.86, Platinum $990.00, Palladium $1,268.00, Copper $3.81, and Gold… $1,944.60
That’s it for today… Well, looky there! The Cardinals finally won a game last night! A walk off 10th inning win to boot! I’m keyed up for the soccer game tonight… our StL City team plays Dallas here at City Park! And don’t forget, no Pfennig tomorrow, and then I’ll see you… In September… See you, when the summer’s through… (The Happenings) Betcha you didn’t know who sang that song! I put out a challenge on a song to my local watering hole buddies a week ago, and only one of them replied, and he was wrong.. Man, I thought, that was a lame response! Oh well, I’m looking forward to the next few days of warm weather and not a return of the heat… A hurricane has its sights on Florida, but right now, it’s thought to go way north of my place in S. Florida… I hope everyone takes this seriously, and prepares for the hurricane… The Moody Blues take us to the finish line today with a great song from their Seventh Sojourn album” New Horizons” I hope you have a Wonderful Wednesday today, and rest of the week… Please Be Good To Yourself!
Chuck Butler