Category: Uncategorized

• the dollar gets sold to enter the weekend…
• India and Japan see intervention… They’ll rue the day they did it!

Good Day… And a Marvelous Monday to you! My weekend started off on Thursday evening last week, with a trip to the Budweiser Beer Garden with some friends… It was a spectacular place, and there were some old Cardinals there to talk to the crowd… A good time, for sure! My beloved Cardinals won 2 of 3 from the Cubs, which is always a treat for the fans at the stadium… And the Walker Brothers greet me this morning with their song: The Sun Ain’t Gonna Shine Any More… 

Welcome to June… Pfennig tradition calls for this: June is busting out all over… Al over the meadows and the fields, buds are busting out of bushes And the romping river pushes Every little wheel that wheels beside a mill…

See? I’m not just an old rock-n-roller… 

Ok, let’s head to the markets…  On Thursday last week the dollar started getting sold again… The BBDXY lost 5 index points and ended the day at 1,999…  On Friday, the dollar was subjected to more selling and ended the week at 1,998…  I told you that the dollar’s rally would be brief, and so here we are again with the dollar getting sold… 

Gold gained both Thursday and Friday last week and ended the week at $4,519…  You know, Gold is down about $1,000 from its Jan 26 high, but to me, Gold was moving upward too far, too fast, and a correction and consolidation of the metal was what it needed…  But now, it’s time to get moving upward again… Inflation is rising, and Gold should be too… So, did you get in when Gold hit its current low?  Well, I kept telling urging you to buy Gold, but it’s never too late… 

Silver tried to gain on Thursday last week and gained $1.01 but on Friday, Silver gave it nearly all back, falling 98-cents!  The SPTs are not going to allow Silver to gain like it did earlier this year… So, get ready for ups and downs from Silver on a daily basis… As long as the SPTs are at the door, Silver’s path will be decided by them… 

Copper ended the week at $6.38…  Copper is still in a negative supply situation, so I expect to see this industrial metal continue to be in demand, thus a stronger price… 

The price of Oil has seen the trap door pulled out of under it, and it ended the week trading with a $87 handle… All the media talks about is that Peace is right around the corner… Well, I’m all for Peace, but I’m also not going to get taken in by all the talk about Peace coming soon… That means the price of Oil will be priced according to the latest news from the Strait of Hormuz…

And the 10-year Treasury ended the week with a 4.49% yield… The Fed Head’s yield control implementation has really caused the bond boys some headaches… I’m just saying..

In the overnight markets last night… The dollar got bought a bit as we start our day with the BBDXY at 1,200… It’s Gold’s turn to see the STP’s at the doorstep this morning as Gold is off $87 to start the day, while Silver is up 19-cents… There weren’t any new developments in the Middle East to think about this morning, so… There’s that…   

The price of Oil rebounded from Friday’s selling, and starts today trading with a $90 handle… I had to stop for gas last week, the first time in over a month (I don’t go anyplace, any longer) and was not shocked by the price but had to think about the total cost to fill my tank… I don’t see how people that drive every day, are handling the cost of gas…  I see this as a good thing though…  For if enough people balk at buying gas all the time, then the demand for gas goes down, and with it so should the price…

The 10-year Treasury saw no Fed Head interference late last week, but the Fed Heads were back to implementing their yield control overnight, and we start today with the 10-year at 4.45% yield… 

And since I’ve been listing it a bit more lately, Copper is kicking tail this morning, and it is trading at 6.57 up 19-cents! 

Well, in the intervention world, Japan confirmed that they spent more than $73 billion to support the yen over the past month, representing its first intervention since 2024. Officials in Japan are concerned about a weaker currency driving up the cost of imports such as food and energy.

And going further west, the Reserve Bank of India admitted that they had intervened, buying rupees to keep it from falling even more… The RBI intervened right when the price of Oil began to drop, and those two things together helped the rupee to a stronger level… But, as I always say… The markets have deeper pockets than any Central Bank… And if the markets think that the rupee needs to be weak, weak it shall be!

I was surprised this weekend when I checked the Pfennig Replies email box… Crickets…  I was surprised because I had said that since the electricity grid in the U.S. had looked surprising strong going into summer, that in my mind meant that we would experience some blackouts… I figured that would spur some reaction from dear readers, but apparently, not… 

Well, we’re into June now, and in 15 days a two-day FOMC meeting will take place… This will be Kevin Warsh’s first meeting as Chairman… it will be interesting to see what direction he’s steering interest rates… We all know that he wants to cut them, especially after his statement that the Fed calculates inflation all wrong… But inflation, as we know it now, is soaring and that should invoke interest rate hikes… 

I got to thinking about interest rate hikes or cuts the other day, and now you get to read what I was thinking about…  I think that the FOMC rate moves are a pain in the rear… They don’t help anything, but short-term rates on Treasuries… So, in my humble opinion, there’s no excuse to have a Fed/ Cabal/Cartel…  Get rid of them, and allow the markets to determine where interest rates should be…  I’m just saying…

It was announced this past weekend that a new 60-day Peace agreement had been submitted to the POTUS for his approval… This would be in place while the negotiators hammer out the details of a Peace Agreement…  There are too many chefs in the kitchen here, and something is bound to go awry, in my opinion… The next 60 days will be like walking on eggshells…  I’m just saying…

I know I won’t make several people happy with this next part…. The Russian ruble and the Chinese renminbi are both moving higher VS the dollar… I don’t think the renminbi’s rise will hurt China much… But the rupee’s rise is detrimental to the economy vis vie exports for the Russian economy…  Of course, I’ve always said that strong currency is what a country should shoot for, as It insulates the economy from importing inflation from other countries… And besides, when a country has a strong currency, it’s a status symbol for the country and its people… 

The U.S. Data Cupboard last week had some interesting data reports for us. For example, the PCE (The Fed’s preference for inflation calculators) showed that consumer inflation rose to 3.8% in April…  then there was the Personal Income and Spending…. Income was flat with no growth in April, but Spending was up .5%, so once again, we spent more than we made…  and then there was the 2^nd revision of 1^st QTR GDP, and it was revised downward to 1.6% from 2.0%… It’s really a shame that we don’t know these things when they actually occur…  Here we are in June, and we’re finding out the economy was in the dumps in the 1^st QTR….  Of course, we Pfennig readers knew that already, but the markets need confirmation…

To recap… The dollar is back to seeing selling, and Chuck was right about its brief rally…  Gold is back to rallying, while Silver is subjected to the whims of the SPTs… The Price of Oil continues to drop on news that Peace Agreement is near… And The Bank of Japan and the Reserve Bank of India both have intervened, thus buying their respective currencies to stem their weakness… 

For What it’s Worth… This is in Ed Steer’s Saturday letter, so thanks to him for finding it… This is Doug Noland’s viewpoint on the FOMC’s rate moves, and it can be found here: Credit Bubble Bulletin : Weekly Commentary: Party Like It’s 1999, 1996 and 2007

Or, here’s your snippet: “We’ve gone and really done it this time.

Down somewhat from Wednesday’s high, the rates market still ended the week pricing 95% probability of a 25 bps Fed rate hike in the next 11 months (57% by year end). If a rate cut – or even talk of higher rates – coincides with a problematic market downturn, disregard those who will be quick to blame rate policy.

I’m reminded of the debate surrounding Federal Reserve rate policy leading up to the 1929 stock market crash. Some argued that a misguided Fed, fixated on stock market speculation, had remained excessively tight despite mounting economic vulnerability. More rigorous analysis would recognize that historic late-cycle Credit, speculative and economic “Roaring Twenties” excesses perpetuated precariously loose financial conditions. Like nowadays, responsibility for the inevitable bubble bursting lies with protracted loose money accommodation throughout the boom.

When the definitive history of this period is written, the impact of the Fed’s 175 bps of rate reduction, which commenced on September 18, 2024, cannot be overstated. The Federal Reserve slashed rates despite excessively loose financial conditions and ongoing rapid system Credit growth. The Fed moved to bolster monetary stimulus despite sticky inflation, which had remained above target for going on four years. They significantly loosened monetary policy in the face of historic speculative leverage; rampant stock market speculation; booming high-risk lending markets (i.e., private Credit and leveraged lending); out of control federal deficit spending; and a rapidly intensifying AI mania/arms race.

Since that fateful September 18, 2024, the S&P500 has returned 37.7%, with the small cap Russell 2000 returning 35.4%. But, of course, the semiconductor and technology sectors have been the epicenter of historic Bubble excess. Since the Fed began cutting, the Nasdaq100 has returned 58.7% and the MAG7 Index 64.4%.

Chuck Again… And then what happens to those gains when the FOMC wets its powder and hikes rates?  

Market Prices 6/1/2026: American Style: A$ .7174, kiwi .5952, C$ .7230, euro 1.1646, sterling 1.3464, Swiss $1.2756, European Style: rand 16.2603, krone 9.2612, SEK 9.2671, forint 304.64, zloty 3.6350, koruna 20.8538, RUB 71.70, yen 159.48, sing 1.2778, HKD 7.8370, INR 94.95, China 6.7652, peso 17.35, BRL 5.0297, BBDXY 1,200, Dollar Index 99.06, Oil $90.42, 10-year 4.45%, Silver $75.72, Platinum $1,955.00, Platinum $1,382.0, Copper $6.57, and Gold… $4,508

That’s it for today… friendly reminder, no Pfennig tomorrow, I’ll be back in your email inbox on Wednesday…  I’m going back to March and I’m sitting in my seat at Roger Dean Stadium watching my beloved Cardinals play baseball, and one play is standing out, Nelson Velasquez…  But when the team moved north, he wasn’t a part of the team and I said to myself… That’s not right, he was great in Spring Training! Well, fast forward to Friday Night, and he was called up from AAA and in his first swing, he hit a game-tying home run! I guess I was right about him!  The Cure takes us to the finish line today with their great song: Lovesong… I hope you have a Marvelous Monday today, and Please Be Good To Yourself! I talk to you again on Wednesday…

Chuck Butler

• metals get hammered yesterday and overnight
• The RBNZ left their OCR unchanged

Good Day… And a Tub Thumpin’ Thursday to one and all! My beloved Cardinals just finished a 3-game trip to Milwaukee and came home having lost all 3 games! Yesterdays game was a real heartbreaker… I’m just saying…  The U.S. sent more missiles into Iran yesterday, claiming self-defense… I doubt that goes over well with the Peace negotiators… Golden Earring greets me this morning with their song: Radar Love… 

Well, the dollar finally moved off of the 1,201 figure yesterday, it didn’t light anyone’s fire, but it did gain 2 index points to finish yesterday at 1,203… Gold & Silver just are having a very difficult time finding a strong bid these days… Yesterday was Gold lose $52 and close at $4,456 and Silver lost $2.32 to close at $74.56…  The war was back on as far as the targets that the missiles landed were concerned, and that moved traders to buy dollars, and sell Gold (Silver)…

It did not move traders of Oil as the price of Oil dipped below $90 at one point yesterday, before finally closing with a $90 handle… 

The 10-year Treasury was sold and its yield rose to 4.50%…  Remember, the 10-year is used to price just about everything financial…  

In the overnight markets last night…The Dollar saw some buying, but the BBDXY remained at 1,203 to start our day today… Gold & Silver are getting hammered again in the early trading today, This selling is giving me a rash… I must say!  The Bullion dealers remain steadfast in their opinion that Gold will reach $5,500 this year, so there’s that…   

The price of Oil remained trading with a $90 handle overnight, and the 10-year Treasury slipped a bit and trades at 4.49% to start our day today… 

Kitco.com had this story last night: “Gold remains the anchor of the new commodity cycle, and the yellow metal’s secular bull market is still intact despite the recent volatility in precious metals, according to Doug Moglia, macro and market strategist at Rockefeller Global Investment Management.  

And to further the conversation, Kitco.com also had this article: Silver will reach $100 but its stay there won’t be long… 

I just don’t understand why these guys say these things and then register them with, “And my company is very long this asset and we need to sell it”…  And one way to get people to buy it is given them lofty figures for values…  When in the long run, buying Gold & Silver isn’t about the rise in prices, it’s about reserving wealth, and hedging VS a fall in the dollar… The price gains are icing on the cake..

The Reserve Bank of New Zealand met on Tuesday night (for us) and left their OCR (official Cash Rate) unchanged at 2.25%…  New Zealand’s consumer inflation Is currently at 3.1%, which even using my old math skills is more than the RBNZ’s 2% target…  I recall when they implemented the 2% target, many moons ago, the Gov. Of the RBNZ would be fired if Inflation got above 2%…  I guess they’ve become the Fed/Cabal/Cartel of the S. Pacific… 2% is not a target, it’s a Suggestion!

Well, the fragility of the idea that a peace agreement is in the offing, is showing just how silly the idea of one being worked out now is just that… silly…  Traders, however, are still holding on to the idea of a Peace Agreement being worked out soon… Eventually, their ideas will be ruined, and they will also become jaded toward the dollar, and rebuy the Gold they sold… That’s how I see this coming together… Just my opinion, but one that’s based on reality… 

Like this brief rally by the dollar… Ok, let’s just talk about the facts that we know of… Interest rates are going to go higher, not lower, but will that help the dollar? I have an opinion on that… But I’ll save it for now…  Interest rates may be going higher later this year, but for now and the near future, they will remain where they are…The economic data has been iffy if not disappointing…  The debt servicing cost (interest rate expense) continues to rise and there’s about $9 Trillion of lower yielding bonds coming due this year and will have to be refinanced at a much higher yield that previously, thus upping the debt servicing cost..  This will put tons of pressure on the Gov’t to buy bonds and print money…  We all know what that procedure caused the last time we were in this situation…  

Yes, I’m jaded, but then a use logic and reason to make my opinions, and I think that they are far more based on truth than what Wall Street uses…  I’m just saying… 

The U.S. Data Cupboard today is chock-full-o-data after being emptied out yesterday… First up is the usual Weekly Initial Jobless Claims, then comes the second revision of 1^st QTR GDP, which should remain around 2%… Then we’ll see the color of Personal Income and Spending for April…  It’ll probably show that we spent more than we made once again…  Then we’ll have the PCE, which should show that the Fed Heads presumably favorite form of Inflation Calculation has gained in April…  

Then we’ll see the April print of Durable Goods Orders… No Capital Goods Orders again though… And finally, we’ll see the New Home Sales for April…  ( it’s nice that we don’t have to deal with past dated prints because of the Gov’t shutdown) 

To recap… The dollar finally moved off of 1,201 and gained 2 index points in the BBDXY… The U.S. fired some missiles into Iran, and that put the kyboshes on the idea that a Peace Deal was coming soon…  Chuck does his best to show that the dollar’s brief rally is a house built on Straw… and we all know what the wolf did to the pig’s house of Straw!

For What It’s Worth…  I was looking for something else on my phone yesterday when I came across this article about the economy, and thought, this is FWIW worthy! You can find the article here: Economy to See Negative Growth Shock, Sticky Inflation, JPMorgan Warns – Business Insider

Or, here’s your snippet: “Economists at JPMorgan said they’ve officially taken a “Goldilocks scenario” — an ideal situation for markets where inflation cools and the economy continues to expand — off the table. The bank says to blame the Iran war, with the latest surge in inflation likely to spark a negative growth shock.

In a note to clients on Friday, economists said they believe higher energy prices could push core inflation past 3%, which was the bank’s “long-standing forecast” for global core inflation at the start of the year.

Rising transportation and input costs stemming from higher oil prices could also help push core goods inflation past 2%, above the Fed’s long-running price target, they estimated.

The bank trimmed its global economic growth forecast by around a quarter of a percentage point. It pointed to the possible knock-on effects of higher prices, such as higher interest rates, subdued consumer spending, and consequent weakness in the job market.

“Risks are elevated that an energy price shock squeezes household purchasing power and depresses business sentiment, raising the specter of a negative growth shock raising unemployment rates,” a team led by Bruce Kasman, JPMorgan’s chief economist, wrote.”

Chuck again… So, JPMorgan believes that negative growth is in our future, and I would have to believe them… How about you?

Market Prices 5/28/2026: American Style: A$.7120, kiwi .5873, C$ .7216. euro 1.1610, sterling 1.3392, Swiss $1.2662, European Style: rand 16.3949, krone 9.2986, SEK 9.3185, forint 306.05, zloty 3.6479, koruna 20.9210, RUB 71.02, yen 159.40, sing 1.2744, HKD 7.8326, INR 95.70, China 6.7803, peso 17.33, BRL 5.0591, BBDXY 1,203, Dollar Index 99.35, Oil $90.26, 10-year 4.49%, Silver $73.67, Platinum $1,899.00, Palladium $1,385.00, Copper $6.32, and Gold… $4,401

That’s it for today and this week… Remember that next Tuesday there will be no Pfennig as I’ll be at the hospital for my oncologist appt and infusion… I’ll also be getting an infusion of iron… The doctor is still concerned that my iron is still low…  I do tire out very easily these days, so there’s that!  My beloved Cardinals now come limping home to play the Cubs… This is HUGE as the Cubs have beaten us like a rental mule the last couple of years… Now, is the time for vengeance!  Marvin Gaye takes us to the finish line today with his song: Let’s Get It On… I hope you have a Tub Thumpin’ Thursday today, and Please Be Good To Yourself!

Chuck Butler

• The metals get whacked in the early morning trade
• The electrical grid heals unexpectedly….

Good Day, and a Wonderful Wednesday to you! Well, last night marked 3 in a row for losses for my Redbirds… Pitching, which started the season unfamiliarly strong, has faulted lately…. UGH!  I don’t know what got into me yesterday, but I relaxed and fell asleep and didn’t wake up until Jeopardy time! (That’s 4;30pm CDT) That’s way too long, but I’ve always contended that your body tells you when it needs to sleep, and I’ve learned to listen to my body!! Redbone greets me this morning with their song: Come And Get Your Love…

I was feeling very melancholy yesterday for some reason and started listening to some very old Hank Williams recordings… The saddest song every recorded is: I’m So Lonesome I Could Cry…  If you don’t believe me, then look up the lyrics and bring up a YOUTUBE of Hank Willams singing it… I think you’ll be convinced… 

My dad used to go through the house singing Hank Williams Songs, and when I first learned to play the guitar, I learned a Hank Williams song so I could play along while he sung…. 

Ok, enough of all that… I beat around the bush to start today, because we’ll stuck in mud… The dollar traders won’t take a direction until something real and concrete comes along…  I feel like a broken record because for the last 3 days of Pfennig writing, I’ve said the same thing about the dollar… 

Gold was up Monday, so that meant a down day for Tuesday… Gold lost $61 on the day and ended at $4,508… Silver, too was down and yesterday it was down 86-cents to close at $77.09… 

I received this from Zerohedge.com yesterday and I’ll give it to in its entirety…  “Wall Street still believes the system is stable.

The S&P 500 remains near highs, supported by passive inflows and confidence that central banks can maintain control.

But beneath the surface, the cracks are growing:

AI-driven layoffs are accelerating.

Debt levels continue exploding.

Inflation remains sticky.

And global liquidity pressures are quietly building.

That creates an uncomfortable reality for investors:

Modern markets increasingly depend on everything continuing to work perfectly at once—stable employment, stable credit markets, stable liquidity, and stable consumer confidence.

Gold operates differently.

Gold doesn’t require central bank credibility or perpetual earnings growth. It simply helps preserve purchasing power across time.”

Chuck again… This is exactly what I’ve been thinking myself! That Wall Street just doesn’t pay attention to all the cracks in the foundation… But all those naysayers regarding owning Gold will look back and wish they had bought some one day… And that’s all I have to say about that!

The price of Oil remained trading with a $92 handle yesterday, and the 10-year Treasury’s yield remained at 4.49%

In the overnight markets last night…  Well, the dollar remained in the mud, but the SPTs have taken a few pounds of flesh from Gold & Silver already this morning… Gold is down $57 and Silver is down a whopping $2.55… Gold has lost the $4,500 level it has held for a while now, and on the technicals that means something bad for Gold is coming…  I on the other hand sill believe that Gold is getting ready to explode higher, but that’s just little old me without tons of research at my fingertips to refer to… 

The price of Oil slipped again overnight and trades this morning with a $90 handle… And the 10-year Treasury is still hanging out below 4.60%… This morning it trades at a 4.48% yield…

Well, I really went the whole 9 yards on Gold this morning… The reason? I truly believe that Gold is getting ready to go on a long upward trend again… So, I want you to be prepared for that! 

One currency that doesn’t need the dollar to weaken overall to gain VS the dollar and that is the Chinese renminbi… I don’t know if you follow the renminbi’s price in the Market Prices roundup each day, so I’ll tell you what I think is going on here… China allowed their currency to weaken while the POTUS was there, and as soon as he left, the Peoples Bank of China allowed the currency to gain again… And this morning its trading at 6.78 and change… 

And a rallying renminbi carries over to the Singapore dollar… As I’ve explained many a time in the past… These two countries compete for exports of pharmaceuticals and they can’t let one currency get out of whack with the other. So, when the renminbi rallies, the Sing dollar plays follow the leader and vice versa when the renminbi loses ground VS the dollar, so does the Sing dollar…  Ok, I promise to not repeat this again, this is the last time I’m going down this road! 

My friend and editor of the 5 Bullets newsletter, David Gonigam, had a recent survey of the electrical grid in the U.S. yesterday, he said that the grid showed that there were only a few places that were in trouble going into the summer… he mentioned that this report had reported a ton of problems in the past, so there apparently was some upgrade to the grids across the nation…  I say, well, in other years, there were problems showing up on the survey, but none came to fruition, so that means that this year with a few problems shown, there’ll be blackouts…  I’m just jaded that way… 

The U.S. Data Cupboard yesterday had the Case/Shiller Home Price Index (HPI) for March and it was up .7%… A couple report ago there was a feeling that Home Prices would be sinking with the thought of rate hikes… But since then, home prices have gone back to rising…  We also saw the stupid Consumer Confidence that sunk even with the stock market rising to new heights. 

Today’s Cupboard is empty and we only have 3 Fed Heads out speaking today so nothing on the docket to view… 

To recap… The dollar continued to wallow in the mud (I’m using that phrase because the dollar is a pig) but did gain 1 index point to close the day at 1,201… 

For What It’s Worth… This came to me from long time reader, Bob… (thanks!) and it’s about how the bond market is gearing up for inflation… and it can be found here: The bond market is restless

Or, here’s your snippet: “The bond market is in a state of unrest. For now, policymakers in Washington are shrugging it off.

Yields on 30-year Treasury bonds — a government bond that underpins long-term borrowing — climbed to 5.10% on Friday. Earlier, they had surged to 5.2%, the highest level since 2007, when the financial crisis started taking root. It’s an identical story for 10-year bonds, which are connected to credit card debt, mortgages, and car loans. The yield on 10-year bonds are near 4.6%, their highest level in a year. These aren’t inconsequential movements: Even these small yield increases can add up to $2 trillion to the federal debt over 10 years.

Now bond traders are surrendering to the fear that inflation is here to stay, elevating the stakes for Washington policymakers steering an economy under mounting strain. Consumer confidence is plummeting to new lows as Americans struggle to pay more for gas, groceries, and other goods due to the fallout of rising energy prices from the Iran war. Any prolonged climb in yields will amplify the financial pain Americans are experiencing since consumer lending costs increase in tandem.

The bond market has acted as a brake on Trump before. In April of last year, the president acknowledged the bond markets had turned “yippy.” It became part of the reason he backed down from instituting global tariffs — at least for another few months. During this stretch, it hasn’t packed the same firepower that it did last year.”

Chuck again… nothing new, as I’ve talked about all this stuff previously, but wanted you to hear it from someone else! 

Market Prices 5/27/2023: American Style: A$ .7133, kiwi .5881, C$ .7228, euro 1.1640, sterling 1.3439, Swiss $1.2721, European Style: rand 16.3582, krone 9.2738, SEK 9.2537, forint 304.87, zloty 3.6386, koruna 20.8612, RUB 71.01, yen 159.40, sing 1.2775, HKD 7.8336, INR 95.75, China 6.7813, peso 17.30, BRL 5.0337, BBDXY 1,201, Dollar Index 99.13, Oil $90.40, 10-year 4.48%, Silver $74.54, Platinum $1,934.00, Palladium $1,400.00 Copper $6.35, and Gold… $4,451

That’s it for today… Oh, Woe are the Cardinals… at the beginning of the year, I would have expected a losing streak, but after they surprised everyone with winning, a losing streak sticks out like a sore thumb! Day game today, so if it’s not raining I’ll be outside to watch the game… We got some torrential rain pours yesterday, so hopefully mother nature has gotten that out of her system! The Moody Blues take us to the finish line today with their song: Ride My See Saw… I hope you have a Wonderful Wednesday today, and Please Be Good To Yourself!

Chuck Butler

• the SPTs had their way with the metals on Friday
• There’s lots of talk of “pleace”…

Good Day… And a Tom Terrific Tuesday to you! I don’t like the Reds one bit, not since the big brawl from probably 10 years ago…  Their pitcher had his back against the backstop, and he started high kicking Cardinals players. One player suffered a concussion and had to hang his cleats up because of his recurring headaches…  I’ll always remember that Reds player… Early warning… No Pfennig next Tuesday, Oncologist appt and infusion on tap…  Johnny Rivers greets me this morning with his song: the Poor Side of Town… 

Well, last week ended with a whimper for the dollar, and the BBDXY headed into the weekend at 1,202…  Down just a smidgen… from Thursday’s 1,203… What I said last week about dollar traders not having a clue as to which way this war in Iran is going to go. So, for now, they’ll just sit on their hands until reliable news breaks one way or the other…

Gold ended the week with the SPTs in control of the metals… Gold was down $34 and Silver was down $1.16 Gold closed at $4.508 and Silver at $ 75.64…

And since I’ve been talking a lot about Copper lately, Copper finished the week up 85-cents to $6.37…

The price of Oil saw its traders take the bait, hook, line and sinker on all the people talking about Peace…  I think, they’ll rue the day that they figure out that when an Iranian minister is quoted as say that the two sides are far apart and there are “deep divides” between words…  So, who are you going to believe? 

And the Fed Heads were back at their “yield control” buying of the 10-year on Friday, and so, the 10-year Treasury went into the weekend with its yield at 4.56%

Yesterday, while we were sitting outside remember those fallen soldiers for our country, Gold saw that there were no SPTs out and about, and Gold gained $60 on the day, and Silver gained $2.55… it was a banner day for the two and Gold closed at $4,569 and Silver at $77.95

In the overnight markets last night… The dollar wallowed and stayed in the 1,200 handle throughout the night… Same old reason for no movement, in my opinion… The SPTs are back and Gold is down $60 and Silver is down $1.75…. So, up one day and down the next continues for these two…

The price of Oil is getting sold as the “peace thought” is out there and really putting pressure on the price of Oil… Oil starts our day/ week trading with a $92 handle… 

And the 10-year saw a ton of Fed Head Yield Control late last week and that carried over to this morning and the 10-year trades with a 4.49% yield. 

I was very happy to see a copy of “In Gold We Trust” in my inbox on Thursday last week… This is the Bible as far as I’m concerned regarding information on Gold… the future, the past and the current…  In the report they talked about how the word “Trust” is key in our world…  and they said, “. Trust, in our view, is
currently being repriced – and the market is rendering its verdict in ounces.”  

True, very true as the price of Gold goes from $600 in 2007, to its current price… The trust in our Governments, Treasuries, Central Banks has gone to hell in a handbasket… I’m just saying… 

And here’s another very poignant view from their letter: “„You have to choose between trusting in the natural stability of gold and the natural stability of the honesty and intelligence of the members of the government.

And, with all due respect to these gentlemen, I advise you, as long as the capitalist system lasts, to vote for gold.”—- George Bernard Shaw

They also go on to explain that when Gold gets sold it’s used to pay for margin calls or other losses, and not just sold to get cash… 

Chuck Again… All I’ll add to all of that is: Got Gold?

That was some piece on Gold today, eh? If you don’t own any right now, this is the time to buy it… Alasdair Macleod believes that Gold is getting ready for an “explosion” and that’s to the upside I might add! 

Well, the markets are buying the words from the POTUS that he’ll announce a negotiated deal soon…  And that means that for the time being the Risk On assets are back… But wait! Iran says no deal ‘imminent’ despite progress in talks with U.S… This is the same back and forth of words that we’ve been seeing, but the markets only believe one side of the words…  And that’s too bad… In my humble opinion that is…

I truly believe that Gold’s selling it tied to investors that need liquid money now… Well, that and the SPT’s and their armfuls of short trades… 

I saw a video over the weekend of an explanation of what Keven Warsh, the new Fed/ Cabal/ Cartel chairman is talking bout, so that he can push for a rate cut… He’s got this plan to change the way the Fed Heads look at inflation… he says they are currently doing it all wrong, and he’s going to change that… Well, he’s going to use what’s called  “Trimmed inflation”… I’ll have more on this as we go along these days, because this is going to really cause a ripple effect of confusion…

The U.S. Data Cupboard from late last week had the Weekly Initial Jobless Claims, which were 209,000… And April Leading Indicators, which were negative -.3….  and from Thursday, we saw the S&P print of the manufacturing index, and it did stay above 50 this month, but not by much at 50.9…. 

Today’s Data Cupboard has the Case/Shiller Home Price Index (HPI) from March… and we’ll also see the color of the stupid Consumer Confidence report… I won’t believe for one minute IF the stupid Consumer Confidence report is strong… But, most of the real economic data is back loaded this week…  For instance, the 2^nd revision of 1^st QTR GDP will print, along with Personal Income and Spending for April, and finally the presumably favorite inflation calc of the Fed Heads, PCE will print for April… Now, that’s enough data, eh?

For What It’s Worth… Last week I featured an article about how foreign Central Banks are reducing their Treasury holdings… And now this article is about the message that the bond boys are sending to Washington and it’s getting ugly, folks… And it can be found here: Is The Bond Market About To Break Washington | ZeroHedge

Or, here is your snippet: “The bond market is beginning to force reality onto Washington, and it may ultimately force an end to the Iran war long before politicians or diplomats are willing to admit it.

And now, beneath all the geopolitical noise, a much more serious, harder to ignore crisis is unfolding. As Cypher says in The Matrix: “Fasten your seat belt Dorothy, ’cause Kansas is going bye-bye.”

This crisis is in the Treasury market. Bond yields are moving sharply higher, and they are sending a message that policymakers can no longer afford to ignore: the financial system is becoming unstable under the weight of war spending, massive deficits, persistent inflation, and a debt load that was already unsustainable before this conflict began.

The bond market does not give a flying f**k about political narratives, gamma squeezes, meme stocks, retail investors or any other ticky tacky end-around style loopholes that continue to push stocks higher. It cares about math, fiscal policy and monetary policy. And the math is getting ugly very quickly.

The 10-year Treasury yield is arguably the single most important price in global finance because virtually every major asset class is built on top of it. Mortgage rates, commercial real estate valuations, private equity models, corporate borrowing costs, equity multiples, venture capital, and government financing itself all depend on stable Treasury markets. When yields rise too quickly, everything starts repricing at once. That is why this matters so much more than the daily moves in the stock market.

Washington understands this, even if it refuses to say it publicly.

The United States can survive political embarrassment overseas, but it simply cannot survive a disorderly Treasury market.

That is why I believe the bond market is eventually going to force a few things. First, a de-escalation of the Iran conflict. The priority now is no longer “victory” or even geopolitical strategy. The priority is restoring stability before bond yields spiral completely out of control. A prolonged war that keeps oil prices elevated while deficits explode higher is simply incompatible with a heavily indebted financial system already struggling under the burden of high interest rates.”

Chuck again… sorry about the language above, I just copied and pasted the article as is… But the bond boys are back! They’ve been like 

Rumpelstiltskin for 20 years, but now they are back and demanding that Washington see them!

Market Prices 5/26/2026: American Style: A$ .7165, kiwi .5842, C$ .7239, euro 1.1635, sterling 1.3470, Swiss $1.2735, European Style: rand 16.3590, krone 9.2542, SEK 9.3008, forint 305.45, zloty 3.6367, koruna 20.8491, RUB 71.50, yen 159.20, sing 1.2778, HKD 7.8356, INR 95.68, China 6.7846, peso 17.29, BRL 5.0221, BBDXY 1,200, Dollar Index 98.97, Oil $ 92.80, 10-year 4.49%, Silver $76.11, Platinum $1,951.00, Palladium $1,403.00, Copper 6.37, and Gold… $4,509

That’s it for today… Well, did you have a good Memorial Day Weekend? The rain did leave us for a couple days, but it’ll be back later this week… My beloved Cardinals played those dreadful Reds between the raindrops… Next week we’ll be into June! Can you believe that we’re here already? I know time goes by faster as you age, but this speed is throwing me off! I smoked two Pork Butts on my Big Green Egg on Sunday (to eat Monday) so, I was outside almost all day… Oh, and the pulled pork was YUMMY!  Eddie Money takes us to the finish line today with his song: Two Tickets To Paradise… I hope you have a Tom Terrific Tuesday today and Please Be Good To Yourself!

• The dollar remains stuck at 1,203…
• The SPT’s were asleep at the wheel yesterday for Gold & Silver

Good Day, and a Tub Thumpin’ Thursday to one and all! A rainy day yesterday here, and from the weather app that I use, we may as well get used to rainy days for the next week… But first, a no-rain day today, as The Cardinals play the rubber match in a day game at Busch! R.E.M. Greets me this morning with their great song: Losing My Religion…

Well, the dollar didn’t move one iota yesterday…. traders too a pause for the cause, and tried to figure out if the U.S. is going to attack Iran again, or are they going to pick up their guns and come home… 

I read where the pundits think that the only way to get Iran to rid themselves of Nuclear Capabilities is to go on an all-out attack with ground troops… I sure don’t want to see that happen, call me a big sissy if you want, but I don’t see any good coming from that…  I’m just saying!

Gold found a way to rally on the day and yesterday it gained $61, while Silver also followed Gold’s lead and gained $2.09…  Gold & Silver have followed this day up and the next day down for some time now… with the down days coming more harshly… 

The bond boys are really sending a message to the Fed Heads… Get serious about rising inflation and start hiking rates ASAP!  The 10-year saw Fed interference yesterday with their yield control and the 10-year lost some yield… The 10-year ended the day yesterday with a 4.58% yield… 

And the price of Oil gained $3 yesterday to close the day with a $107 handle… I read where some takers filled with Oil were allowed to pass through the Strait of Hormuz yesterday… Does that mean more will be on the way? I would certainly hope so, but then we never know, do we? 

In the overnight markets last night…  the dollar remained trading in the BBDXY at 1,203… The dollar hasn’t moved off the 1,203 figure at the closing for 2 days now…  Up one day, down the next, holds true for Gold & Silver this morning… Gold is down $16, and Silver is down 94-cents to start the day today… The SPT’s must have asleep at the wheel again yesterday… I’m Just saying…

The price of Oil remained trading in the $107 handle overnight, while the 10-year Treasury’s yield saw the Fed Heads and their “yield control” leave and the yield bounced back to 4.61% overnight… 

Gold & Silver have been sold recently on the thought that interest rates are going higher… And well, they should, but like I said last week, I don’t see higher interest rates as a long term down for Gold… 

But I just can’t get my arms around the fact that traders haven’t picked up on the fact that the U.S. is going to have major problems financing their debt in the near future… Yesterday, CNB.com reported that Japan and China had led Global Banks in reducing their Treasury reserves to help defend their currencies that were being sold by the markets because of their newfound expense… Oil…  Here’s the skinny: China reduced its holdings to $652.3 billion, down roughly 6% from February to the lowest level since September 2008, according to U.S. Treasury data released late Monday stateside.

Japan, the single largest foreign holder of U.S. government debt, shed approximately $47 billion to $1.191 trillion.  This is getting serious, folks… 

Well, the POTUS claimed, yesterday, that “a peace deal is close”…  Well, I’m from Missouri, and they are going to have to show me that Iran has signed such a deal…  But it would be good if done, for a lot of reasons, including that the risk assets like Gold, wouldn’t be on the chopping block any longer… 

I’ve been mentioning Copper a bunch lately, and when it rallied to 6.60 last week I was leery of this move because Copper had gone past the overbought level on the RSI… (Relative Strength Index) which measures the strength of an asset… And when an asset goes past the “overbought” level in the index, it’s time to reorganize one’s thoughts about taking the asset even higher… 

Copper is still in a negative supply situation, and that alone gives Copper backing to move higher, let alone the fact that Copper is an industrial metal that used in just about everything! 

The U.S. Data Cupboard had the FOMC Meeting Minutes for us from their last meeting… And in them the Fed Heads discussed that the War in Iran had pushed commodities like Gold,  to the forefront of investor’s needs… Remember, this meeting was a month ago, and that was before Gold got hammered daily…  They also mentioned that Fed Fund Futures only showed that there’s a 30% chance of a rate hike this year…  Now, that should help Gold recover a bit, since the thoughts of a rate hike have diminished…  

But what are they waiting for? Inflation is rising NOW! I tell you, these Fed heads are economists and have never been in the real working economy… So, that tells you that they have no idea how normal people are coping with higher inflation…  

Today’s Data Cupboard has the usual Tub Thumpin’ Thursday fare of the Weekly Initial Jobless Claims…  the Data Cupboard has been basically empty all week, but tomorrow we will see the Leading Indicators for April, which have been negative for so long now that I look at the Data Calendar and think that Leading Indicators will be negative without even checking… 

For What It’s Worth… Well, I talked above about the price of Oil being a real pain the side for consumers, and this article says, “you haven’t seen anything yet: and it can be found here: “Goldman Says Global Oil Stockpiles Falling at Record Pace on War – Bloomberg

Or, here’s your snippet: “Global stockpiles of crude oil and products are being drawn down at a record pace this month as the war in the Middle East drags on, curtailing supplies, according to Goldman Sachs Group Inc.

Visible inventories contracted by a record 8.7 million barrels a day so far in May, almost double the average pace since the conflict began, analysts including Yulia Zhestkova Grigsby and Daan Struyven said in a note dated May 20.

“Physical markets continue to tighten, as estimated oil exports through the strait remain at a very low 5% of normal,” they said, referring to the Hormuz waterway that’s subject to a double blockade by both Iran and the US.

Global energy markets have been upended by the conflict, which has led to an unprecedented supply shock. That’s spurred the rapid drawdown of holdings accumulated before the crisis, while governments have also coordinated releases from strategic reserves in a bid to rein in price gains.

International Energy Agency Executive Director Fatih Birol warned last week that commercial oil inventories were shrinking at an accelerated pace. The agency has also estimated that the market would remain “severely undersupplied” until October even if the conflict were to end soon.

About two-thirds of the draws in May were driven by a drop in so-called oil on water, with declines in exports outpacing a decrease in imports, the Goldman analysts said. The import slump was now “spreading from Asia to Europe,” they said, noting jet-fuel imports into Europe were 60% below 2025 averages.”

Chuck again… using up their respective reserves Is using them the way they were stored for.. For energy crises… Not to get the price of Oil down like the previous POTUS did…  But by doing this, when the reserves run out, then what do the respective countries do? 

Market Prices 5/21/2026: American Style: A$ .7124, kiwi .5854, C$ .7294, euro 1.1606, sterling 1.3424, Swiss $1.2691, European Style: rand 16.5594, krone 9.2424, SEK 9.3714, forint 310.40, zloty 3.6600, koruna 20.9410, RUB 70.71, yen 159.13, sing 1.2801, HKD 7.8349, INR 96.19, China 6.8026, peso 17.35, BRL 5.0000, BBDXY 1,203, Dollar Index 99.28, Oil $107.77, 10-year 4.61%, Silver $75.06, Platinum $1,935.00, Palladium $1,376.00, Copper $6.26 and Gold… $4,517

That’s it for today… My beloved Cardinals couldn’t find their bats last night and lost to the Pirates, thus setting up the rubber match game today…. Betcha don’t know where the ter “rubber match” came from? Well, it’s tied to lawn bowling (bocce ball, today) and when a bowler got his ball to run against the scoring ball it was a “rubber match”… And that carried over to baseball when there’s a 3-game series and the 3^rd game will break the tie in wins between the teams… Clear? Yea, I know, clear as mud… Oh well I tried… Mungo Jerry takes us to the finish line today with his song: In The Summertime… I hope you have a Tub Thumpin’ Thursday today and Please Be Good To Yourself!

Chuck Butler

• The dollar continues to benefit from POTUS talk
• The short sellers rule the metals these days…

Good Day… And a Wonderful Wednesday to you! What an ordeal coming back home last night… We were the last to aboard our connecting flight from BNA to STL and had to hustle to get there!  Everyone on the plane already, had eyes on me as I got down the aisle to my seat. I know what they were thinking… “What took you so long to get here?”  Well, if one of them had the intestinal fortitude to ask me, I would have said… “The airport that didn’t have a gate for us when we landed and sat out on the tarmac for 20 minutes”  Eddie Floyd greets me this morning with his 60’s classic: Knock On Wood…

Well, the rally that the dollar is currently in continued to keep the lights on as the POTUS keeps mentioning that Iran is running out of time… And that keeps the risk off mode for the markets, and that means that the dollar gets bought, and Gold gets sold….  The BBDXY ended yesterday at 1,203. The dollar isn’t running away but it’s still getting bought by pieces… 

Gold got sold yesterday, by the SPT’s and the naysayers, short-timers, and the folks that just don’t get the real reason to own Gold…. Silver also lost ground yesterday and ended the day below $74… OUCH, now that’s going to leave a mark!   Gold ended the day down $84 and close at $4,482… 

The price of Oil continues to be strong, with Oil closing yesterday with a $104 handle, (it was up to $106 during the day, but closed at $104).

And the 10-year Treasury closed yesterday at 4.67% yield…  Remember bond yields up=bond prices down… The bond boys waited a bit before reacting to Moodys announcement last Friday, that they were reducing the U.S.’s credit rating from AAA to AA1…  

This means, and it’s the first time ever to happen, that all three rating agencies have reduced the U.S.’s credit rating… S&P, Fitch, and Moodys are all singing from the same song sheet…  This is HUGE folks… I think that it this new overall rating for the U.S. will affect foreign buying of Treasuries… And do you know what the main reason for Moodys to cut their credit rating for the U.S.?  Well, if you said, “The interest payments on our debt is growing too fast” then you win the stuffed Teddy Bear!  No, wait! I don’t have a stuffed Teddy Bear to give away… No worries, I just issue a “TBD” to be delivered…  

In the overnight markets last night… not much movement in the dollar overnight… The BBDXY starts where it ended yesterday at 1,203… Gold is up to start the day $17 and Silver is up $2.27… So, far so good… But the wolf is always at the door… And that’s the SPT’s…   Copper rebounded from yesterday’s 12-cent sell off by the SPT’s, and Copper’s rebound is good for Silver…  

The price of Oil has slipped overnight to trade this morning with a $102 handle, and the 10-year also saw some slippage in its yield overnight as it starts today with a 4.64% yield…  Bonds are really on the selling blocks these days… I’m just saying… 

Where’s the beef? Remember those two ladies asking the question, Where’s the Beef?  Well, I can tell you that the Beef isn’t on the table for many Americans as the price continues to rise for Beef…

This from Wolf Richter: “Ground beef: The average price of ground beef, 100% beef (excluding round, chuck, sirloin, and preformed patties) spiked by 3.0% in April from March, and by 18.9% year-over-year to a record $6.90 per pound, according to the detailed CPI data from the BLS. Since January 2020, the price has shot up 78%.”

OMG! 78% in the last 26 years? That’s crazy folks! No wonder my favorite ¼ pounder with cheese is so darn expensive these days! 

Well, here’s something that scary…  And I used to run a margin dept in a regional brokerage so I know a thing or two about margin….. But that’s not the scary thing… The scary thing is that margin debt keeps rising and is now more than 5% of the GDP…   That’s HUGE folks…  And when all the major hedge funds, pension funds, insurance funds, mutual funds, etc. figure out that rising yields normally bring about a shift in allocations from stock to bonds, all that margin debt will be getting what they call “margin calls” and if they can’t pay cash or deposit more stocks to increase their market value, they will face stocks getting sold to meet the “call”…  More selling will beget more selling, etc.   I’m just saying…

Well, life as they knew it for farmers is changing, yet again…  This from Reuters.com; “Soaring costs of fuel and commercial fertilizer, opens new tab in ‌the wake of the Iran war are making hard times worse for farmers across the U.S. Plains states of Texas, Kansas, Oklahoma, South Dakota and Nebraska.

Even before the war, farmers were struggling with a resurgent drought, high input costs, and the fallout from President Donald Trump’s trade policies, which hobbled export markets and drove down prices for their crops.

Since the closure of the Strait of Hormuz in late February, the cost of farm diesel has climbed 72%, the Kentucky Farm Bureau wrote in prepared testimony to a U.S. Senate agriculture committee hearing this month. Prices for ​urea, one of the major fertilizers produced in the Gulf region, were up 55%, while prices for another nitrogen-based fertilizer rose 33%, the farmers’ group said.

And yet, because of the drought, farmers are looking at the prospect of ​smaller harvests to pay for it all.”

Chuck Again… Consequences… That’s the bugaboo that no one thinks about before they partake in an activity… 

The Bank of Japan, as I reported in a previous Pfennig, intervened with tons of their dollar reserves to defend the yen the last time that yen looked ready to become a lemming and jump off a cliff…  But, as I’ve always contended, that intervention is a short-term aid for a currency, but as soon as the bloom Is off the rose, the currency goes right back to where the markets feel it should be… I’ve used this line plenty of times in the past, and that is that: The Markets have deeper pockets than any Central Bank…  And yen is right back at 159 and looking strangely like a lemming once more…

The Petrol currencies are hanging in there VS the dollar… Led by the Russian ruble trading with a 71 handle, and the Norwegian krone trading with a 9.27 figure… it’s good to “be known for something”, and the Petrol Currencies have their association to the price of Oil as their “something”…  And in the case of the Norwegian krone, they are also known as the richest country in the world… I would suggest that being known for that is a very good thing!

The U.S. Data Cupboard has the minutes of the FOMC’s last meeting for the markets to review… I guess we’ll see for sure just how many Fed Heads balked at keeping rates unchanged…. The next FOMC meeting will be run by new Fed/ Cabal/ Cartel chairman, Kevin Warsh… We’ll see how popular he is the POTUS after he had to hike rates, maybe not at his first meeting but by his second meeting, inflation will be soaring, and once again the Fed Heads will be behind the inflation 8-ball… and trying to play catchup, but I’ll be singing to them: too much, too little, too late…. 

To recap… yesterday saw lots of sellers of all kinds in Gold & Silver…  it was an ugly day for the metals, as the POTUS keeps the hopers and dreamers out there satisfied with his comments that Iran is running out of time… That keeps the risk off trading on the table and that means the dollar gets bought and Gold gets sold… And Chuck is questioning the intestinal fortitude of the masses… 

For What It’s Worth… What to do about Gold? I hear some of you saying that it has run its course… but I wouldn’t be too fast to unload it because of this article on Bloomberg.com; Goldman Says Central Banks Want More Gold for Their Reserves – Bloomberg

Or, here’s your snippet: “Central banks are expected to step up gold-buying, helping prices to recover by year-end, according to Goldman Sachs Group Inc.

Purchases are expected to pick up to average 60 tons a month over 2026, analysts Lina Thomas and Daan Struyven said in a note dated May 15. Under a revised framework for estimated accumulation, the 12-month moving average of purchases was 50 tons in March, up from a prior figure of 29.

For central banks, there’s “strong underlying interest in gold, and recent geopolitical developments are likely to reinforce diversification,” the analysts said, citing an in-house survey, without giving details.

Gold has struggled since the outbreak of the war in the Middle East, as higher energy costs have raised worldwide inflationary pressures, making central banks less likely to ease policy. With no end to the conflict in sight, global bond markets have sold off, putting pressure on non-yielding gold..

Still, Goldman was cautious near term. Gold is “a natural source of cash if private investors face liquidity needs — for example, if equity markets sell off amid higher rates and weaker growth expectations,” the analysts said.

Goldman’s methodology for estimating central-bank buying had rested in part on assumptions based on flows seen in UK trade data. It was updated as the figures may “no longer fully reflect” shifts, the analysts said.

Among central banks, the People’s Bank of China bought the most gold in over a year in April, boosting holdings by 260,000 troy ounces. That was the 18th month of additions, matching a streak that began in late 2022.”

Chuck Again… Remember… What Lola Wants… Lola gets…  and for longtime readers of the Pfennig they well know that I call Goldman Sachs… Lola… 

Market Prices 5/20/2026: American Style: A$ .7127, kiwi .5846, C$ .7268, euro 1.1602, sterling 1.3462, Swiss $1.2642, European Style: rand 165934, krone 9.2781, SEK 9.3850, forint 311.20, zloty 3.6664, koruna 20.9560 RUB 71.14, yen 159.60, sing 1.2803, HKD 7.8330, INR 96.82, China 6.8037, peso 17.36, BRL 5.0482, BBDXY 1,203, Dollar Index 98.35, Oil $102.10, 10-year 4.64%, Silver $75.09, Platinum $1,951.00, Palladium $1,398.00, Copper 6.24, and Gold… $4,499

That’s it for today… Geez, I looked at the calendar yesterday and noticed that this coming weekend will be Memoria Day weekend, with Monday being Memorial Day… Unbelievable that time is going by so fast! And then we’ll be heading to June!  June is a good and bad month for me… Chuck & Kathy got married in June… this will mark 50 years this year…. God that’s a long time! And the middle of June will mark 19-years since by good friend, and Doctor Jeff, showed up at the front door looking as white as a ghost, and told me I had cancer…. So, good and bad, and I’ll let you decide which is which… HA!  Chicago takes us to the finish line today with their great song: Does Anybody Really Know What Time It Is?… I hope you have a Wonderful Wednesday today and Please Be Good To Yourself!

Chuck Butler

• The dollar goes on the warpath…
• Bonds get routed…

Good day… And a Marvelous Monday to you! How was your weekend? Mine was pretty low-key, but we tried a new restaurant, and it was good! My beloved Cardinals had an OK weekend VS the Royals, winning  2 of 3 games… I will travel back to Missouri tomorrow, so no Pfennig… I’ll be back in the saddle at home on Wednesday, so look for me then! The Allman Brothers greet me this morning with their song: Blue Sky… 

Well, the dollar had a banner day on Friday with the BBDXY gaining over 5 index points and ending the week at 1,202… I have to think that the markets were trying to think ahead at what might happen in Iran on Friday… You see, the POTUS was on his way back to the states, and the peace Accord had ended… So, the markets thought that on Friday night the U.S. would resume the war, as to not shift the markets one way or the other…  Well, that didn’t happen, and now it we will wait and see if the markets put the dollar back in its underlying weak trend, or not…  So, much for their attempt to read the tea leaves!

Gold and Silver got whacked! It was an ugly day for the metals, as all the metals, including Platinum, Palladium and Copper all saw major short selling… Gold lost $111  on the day to finish the week at $4,539; Silver lost $7.52 on the day to finish the week at $75.84… Copper lost 32-cents on the day to finish the week at $6.30…  The short sellers made sure that I had to eat my words regarding Copper, didn’t they?   Yes, they did… 

The price of Oil saw its trader trade like the dollar traders did, in fear of another attack in Iran, and so they marked up the price of Oil to end the week at the $105 handle…  The 10-year Treasury saw its yield climb to 4.61% before settling at 4.59% yield to end the week… 

In the overnight markets last night… There wasn’t much movement in the asset classes… The dollar got sold a bit and the BBDXY starts today at 1,201… Gold is flat to up a buck in the early trading , and so is Silver, so far no SPT’s, but it’s early… The price of Oil bumped higher to trade with a $106 handle this morning, and the 10-year’s yield bumped higher too and starts today with a 4.60% yield… 

I think the rout in bonds is putting pressure on the POTUS to get a deal done, soon… I have more on bonds in just  bit… 

Well, the next item to mark off the list of things seeing their prices and availability is motor Oil… Yes, you know the stuff you put in your engine. I immediately asked Kathy if her car back in Fenton was nearing an oil change… You see, Oil that’s used for base oil is seeing refiners capable of producing base oil prioritizing diesel output. ( I got that from Dave Gonigam’s 5 Bullets)  

So, is your car nearing an Oil change? Well, I would suggest that you get it into the shop and get it done, right away, for the price of motor Oil is going to go sky high, and availability is going to be a problem in the near future…  This public service announcement is brought to you by the Pfennig, and Battle Bank!

The currencies are getting hammered by the dollar right now, so batten down the hatches or crawl under a rock and forget about the dollar strength right now, as it’s not really strong… Just a brief rally, in my opinion, which I could be wrong, but I doubt it…  The underlying weak trend is in waiting for the dollar to return…  

I say, batten down the hatches, but… if you see something you like, this is the time to go out and buy it, because it’s cheap right now… So, if, for instance you see the Norwegian krone at 9.30 ish, and it was just at 9.10 a couple of days ago, then you see this as an opportunity to pick up some more krone and average price it is with your other krone… That’s what I could call “prudent buying”…  

Ok, enough of that! Well, rising yields in bonds have really done a number on Gold & Silver…. Along with the SPT’s, rising yields have always been a bugaboo for Gold… And this time is no different, however, without the SPT’s piling on, the losses for Gold would be much more watered down from where they are now…  I’m just saying…

Whenever I use the words “piling on” it sends chills down my back… I’ve told you this before, but here goes… Back when I was playing football in H.S. I went to tackle a punt returner near the other team’s sideline, and when I did, our momentum carried me into the bench, where it seemed the whole team piled on top of me, and started kicking me and I was smothering… That only lasted about 30 seconds, but it seemed like an eternity to me! And has stuck with me, all these years… 

Rising yields are vogue right now, and I think they will continue to rise as long as inflation continues to rise, and it will rise in my humble opinion… PPI told us as much last week, but if you don’t believe that PPI is a harbinger for higher consumer inflation, then check out our bills for groceries, gas, and giggles… They will tell you that higher inflation is already baked into the goods… 

Beyond  these rising yields, I drift back to the mid 70’s (and yes, I was in the business then, smart Alec!) inflation was soaring like it is now, and then stagflation set it, which is the scenario of high inflation combined with high unemployment and stagnant demand in a country’s economy, and Gold rallied in the face of higher interest rates fighting inflation… So, it’s not out of the question if Gold can rally during higher interest rates… The problem here and now is that I’m probably one of the few that are still in the business that was around back then… They have no reference to compare today with yesteryear…  But they’ll figure it out, sooner or later, hopefully sooner, but they will figure it out, once inflation is soaring to new levels… 

The war in Iran isn’t doing Gold any favors right now either… I read this past weekend that Wall Street is seeing this as a rising yield and dollar story to fight Gold’s rise… What do they think about the U.S.’s situation regarding debt servicing? I mean I really do think we are heading to a recession and with our $39 Trillion national debt, it leaves government worse prepared for recession than ever, in my humble opinion… 

And the U.S. isn’t exactly cutting deficit spending, are they? I read this past weekend that the U.S. has already on the books, a deficit for 2026 of $954 Billion… They still have 5 months to go until their fiscal year ends, and don’t forget that the war deficits haven’t hit the books yet…  if the U.S. was a company, or individual they would have to declare bankruptcy or default by now…   

And the bond boys took to marking up the yield in the 30-year last week… Treasury long bond (30yr) yields jumped 18 bps this week to 5.12%, surpassing the October 2023 gilt crisis spike to the highest yield all the way back to (“still dancing”) July 2007. 

2007? Man, I had hair back then… I was smaller in size… I was just establishing myself as the “currency guru” (I was the only writer out there writing about currencies and Gold ) and the Great Recession was beginning…  I did a quick look at the songs in 2007, and it reminded me that I didn’t listen to new music then… I didn’t recognize any of the songs!  The Red Sox won in baseball and the Colts were the Super Bown Champions…  Man, that was a long time ago!

This dollar rally takes its toll on the usual subjects… The euro is first to succumb to the dollar pressure, and then the rest of the currencies follow the euro’s lead… Even with the price of Oil so high, the Petrol Currencies are seeing their respective currencies get sold…  But don’t lose faith in your diversification… This dollar rally will be brief, in my humble opinion, and then we’ll see unicorns fly across the sky, the beach will be full of shells, and the sun will be warm…  In other words, all will be right in the world again… 

The U.S. Data Cupboard had the April Industrial Production and Capacity Utilization to print on Friday and IP gained 0.7% for the month and CapU moved up to 76.1% from 75.5%…  I really think these were cooked books reports… I guess we’ll see later this summer when The Federal Reserve Board plans to issue its annual revision to the indexes of industrial production (IP) and the related measures of capacity utilization in the autumn of 2026. So, they get to romp and rollick until August… I’m just saying… 

The other thing to think about with data reports is that they are all inflated… Take Retail Sales for instance: Everything that goes into calculating Retail Sales has seen HUGE upward price movements, so wonder Retail Sales looked strong…  Keep this in mind when you review data prints… 

To recap… It was an UGLY day for the metals on Friday, as Gold lost $111 and Silver lost $7.52  Usually when you see the metals go through a wash, rinse and spin cycle, the selling comes to an end and then the buying can begin again… So, the question is: has the SPT’s gone through their wash cycle yet? The dollar is getting bought because of the higher yields in bonds, but I think dollar traders will rue the day they bought dollars now… at a later date that is…

For What It’s Worth… Well, I’m a true believer that foreign buyers are demanding higher yields at the Treasury auctions, and eventually they will get them… This is an article about the latest Treasury Auction and how things are going and can be found here: US Government Sold $691 Billion of Treasury Securities this Week, 10-Year Yield Spikes to 4.6%, 30-Year Yield to 5.12% as 2nd Wave of Inflation Takes Off | Wolf Street

Or, here’s your snippet: “Longer-term Treasury yields spiked late this week as the second wave of inflation took on more substance with back-to-back inflation reports: CPI inflation soared by 3.8% year-over-year, driven by core services, gasoline, electricity, and food; and the measure that tracks inflation in prices companies pay each other, the Producer Price Index soared by 6.0% year-over-year as the services PPI blew out. Inflation in services is the biggie. Services account for over 60% of the economy, and inflation took off in services.

The 30-year Treasury bond sold at the auction on Wednesday at a yield of 5.046%. In the secondary market, the 30-year bond has traded over 5% from time to time in recent years, but this was the first time since 2007 that the 30-year bond actually sold at auction with a yield above 5%. And in the secondary market, the yield rose following the auction and ended on Friday at 5.12%, the highest since June 2007, having edged past the October 2023 high.

The long end of the Treasury market completely blew off the Fed’s rate cuts, as indicated by the widening gap, now 149 basis points, between the 30-year yield (5.12%) and the Effective Federal Funds Rate (EFFR, blue line) of 3.63%, which the Fed targets with its policy rates.

Higher bond yields in the market mean lower bond prices for existing holders.

The bond market is now fretting about a lax Fed that would “look through” the surge of this second wave of inflation for too long and, instead of getting serious about it, would proffer more excuses why no rate hikes were needed at this point. And the bond market is cutting the market price of those securities, which causes yields to rise.

The 10-year Treasury note sold at the auction on Tuesday at a yield of 4.468%. The yield then continued to rise in the secondary market, including by 11 basis points on Friday, to 4.60%, the highest since January 2025.

Longer-term yields reflect the bond market’s views of the future – especially the path of inflation as the second wave takes shape, amid the tsunami of supply of Treasuries to fund the ballooning deficits.”

Chuck Again… yes, the ballooning deficits of the U.S. will require greater Treasury issuances, and everyone will hold their collective breath until the whole auction is sold…  I’m just saying 

Market Prices 5/18/2026: American Style: A$ .7153, kiwi .5858, C$ .7267, euro 1.1634, sterling 1.3356, Swiss $1.2730, European Style: rand 16.6746, krone 9.2955, SEK 9.4348, forint 310.69, zloty 3.6615, koruna 20.9146, RUB 72.51, yen 158.92, sing 1.2799, HKD 7.8308, INR 96.35, China 6.8009, peso 17.32, BRL 5.0556, BBDXY 1,201, Dollar Index 99.18, Oil $106.45, 10-year 4.60%, Silver $75.99, Platinum $1,972.00, Palladium $1.472.00, Copper $6.25, and Gold… $4,540

That’s it for today and until Wednesday… I don’t care for short trips to my winter home, I just get settled into the flow here, and it’s time to go home… UGH! But I do like the different restaurants we have down here, like we tried a new one the other night and it was delightful! I think the Pfennig was quite long today, so you’ll have a lot to take in while I’m gone tomorrow! The Friends of Distinction take us to the finish line today with their great 60’s song: Grazing In The Grass… I hope you have a Marvelous Monday today and Please Be Good To Yourself… 

Chuck Butler

• The dollar drifts on Tuesday
• But rallied overnight on the rise in the STUPID CPI!

Good Day… And a Wonderful Wednesday to you! Well, my beloved Cardinals moved their traveling baseball show to Sacramento, Calif, for last night’s game, which started way too late for me, so when I woke up in the middle of the night, as I always do, I checked to see the outcome of the game, and saw that the Cardinals won 6-4… I did see the first 2 innings before retiring and the Cardinals posted a 4 spot on the A’s in the 1^st innning! Van Morrison greets me this morning with his song: And It Stoned Me… 

The dollar tried to go higher in the BBDXY yesterday, but by the end of the day it was back to 1,1192, its beginning price… and Gold & Silver continued the “getting sold short” day that began with Gold down $45 and Silver down $1.94… They ended the day at $4,717 and Silver at $86.44… So, the SPT’s tried to take the two down on the day, but the physical buying overwhelmed the SPT’s and put them in their place!

The price of Oil gained another buck and ended the day at $1.02, and the 10-year saw its yield rise to 4.45%…  No Fed/ Cabal/Cartel yield control in operation yesterday…

In the overnight markets last night… the STUPID CPI rising yesterday caused the dollar to gain a bit overnight, with the BBDXY starting the day at 1,194…  More on the STUPID CPI in a minute… The dollar is a creature of habit with traders buying it on the stupidest ideas!  But, there you go!  

The price of Gold saw more short selling overnight, and is down $19 to start our day today, while Silver, which had reached its 50-day moving avg with yesterday’s gains, is also seeing some selling but is up 19-cents to start the day…  I would have thought that Gold would react to the rise in the STUPID CPI, but then so did the SPT’s so they made sure Gold stayed down below its 50-day avg… 

Open Interest in the two metals are vapors right now, and when Gold and Silver were running to their recent highs, I said that the Open Interest falling wasn’t a problem… But now, that the two metals are looking for any gains they can muster, having a strong Open Interest would certainly help…  I’m just saying… 

The price of Oil dipped back to a $101 handle overnight, and the 10-year saw it’s yield rise by 1 bp to 4.46%

Well, yesterday the STUPID CPI for April printed… And even with their hedonic adjustments the year on year consumer inflation was 3.8%…  and that rise in the STUPID CPI was responsible for the markets, once again, reviewing their outlooks for rate movements from the Fed/ Cabal/ Cartel…I really can’t believe that the markets still go for this STUPID CPI… But they do, and so therefore I have to… UGH!

The POTUS is in China now, and hopefully he can get the Chinese to use their influence in Iran to get them to honestly come to the negotiating table… and maybe, just maybe, he’ll allow the Chinese to sell their automobiles here in the U.S.    I doubt it, but we can wish that a cheaper option to car buying is available. 

I’m at wits end trying to figure out why the dollar gets bought when it appears that the war is going to continue… But I have to say, it is, what it is..  And that’s that!

I know, I know the old safe haven talk plays here, but not in my mind, the dollar should be sold down the river for this incursion… And the fact that the U.S. has a major debt problem, that’s not going away… And they have a debt servicing nut that’s not going to get turned in their favor…  But don’t let these two problems get in the way of a dollar rally…  I shake my head in disbelief…

Well, inflation here in the U.S. has reached a 3-year high, and it’s not going to get any lower in the near future… I truly feel that consumer inflation is not 3.8% but more like 8-9%…  With everything under the sun and moon seeing price increases…

The real culprit is money supply… as money supply grows so does inflation, and dont’ be of the belief that this is inflation is something that can’t be avoided… Inflation is a Government phenomenon brought on by increased money supply… I found this on money supply: Money Supply M2 in the United States increased to 22442.10 USD Billion in January from 22366.20 USD Billion in December of 2025. Money Supply M2 in the United States averaged 5745.38 USD Billion from 1959 until 2026, reaching an all-time high of 22686.00 USD Billion in March of 2026 and a record low of 286.60 USD Billion in January of 1959. 

So, you see the hard facts that Money Supply has reached an all-time high in March of this year, and it’s not going to get any smaller going forward, with a war going on…. I’m just saying…

I’ve got to talk about something other than money supply and inflation.. Well, the Chinese renminbi continues to be allowed to gaining VS the dollar and yesterday it reached a 6.79 handle which it hadn’t been since Feb of 2023…  I recall when I first talked the people at EverBank to allow us to offer Chinese renminbi deposits, back in the mid 90’s, the renminbi to the dollar was around 8.5…  So, we’ve come a long way baby! And there’s more to go! 

One of these days, China will gain a very wide distribution of their currency and then they can overtake the euro as the offset currrency to the dollar… This is just one of my thoughts, I don’t claim to know more than anyone else about this, just a thought that I have regarding where the world is leaning these days…

The U.S. Data Cupboard has the STUPID CPI yesterday, that I talked about above.. Today’s Data Cupboard has PPI (wholesale inflation ) for April and that’s usually a good indicator of what we will see in the future with the STUPID CPI…  Tomorrow’s Cupboard will have the Retail Sales from April, and the BHI (Butler Household Index) tells us that with even with Easter Sales, we should see a weaker Retail Sales figure…

For What It’s Worth…Well, my friends Rich and Michael Checkan over at Asset Strategies do what they call an information line, and Rich does the writing… And his information line last Thursday was a keeper and I have it for you here: Information Line – May 2026

Or, here’s your snippet: n 2022, central banks started buying gold in a meaningful way. They purchased over 1,000 metric tons that year. They did it again in 2023. They did it again in 2024. Last year, they purchased 860 metric tons.

Prior to 2022, and going back fifty years, the annual high-water mark for central bank gold buying was 500 to 600 metric tons.

All that buying had an impact on the gold price… $1,700… $2,400… $3,000… and earlier this year… $5,500.

The buying started when interest rates were near zero. The buying continued as governments around the world raised interest rates in order to subdue inflation. (The peak for the United States was 5.25%.) The buying continued as interest rates were cut, starting in late 2024.

The buying continues now with U.S. interest rates at 3.5% to 3.75%.

Yet, over the past four years, every time I hear a discussion about the gold price, I hear the following phrase uttered in some form or fashion…

“Higher interest rates are typically bearish for gold, making the yellow metal a less attractive alternate investment than other assets.”

The suggestion is basically that gold simply cannot move higher in price unless the Federal Reserve lowers interest rates.

I could not disagree more.

All FED Up

I believe we give the Federal Reserve way too much credit.

I am not doubting the Federal Reserve is made up of brilliant economists who mean well. However, I do doubt that they have the understanding and the tools to drive inflation down to their target of 2%.

We may cover that at another time.

Today, I want to address my biggest frustration with all this hype about what the Federal Reserve will or will not do with interest rates. That is, at these levels, it should have no impact on the price of gold whatsoever.

The current Fed Funds Rate is 3.5% to 3.75%.

The current Consumer Price Index (CPI) is 3.01%.

That means, if you could get your bank to pay you the effective funds rate of 3.5% – which you probably cannot – your Real Rate of Return on your term deposit would be one half of one percent.

That is it… a rounding error!”

Chuck again… yes, the article is longer than the snippet, so if you have the time, please check out the article in its entirety at the link above…

Market prices 5/13/2026: American Style: A$ .7245, kiwi .5929, C$ .7304, euro 1.1709, sterling 1.3503, Swiss $1.2709, European Style: rand 16.3449, krone 9.1745, SEK 9.3815, forint 307.01, zloty 3.6307, koruna 20.7942, RUB 73.32, yen 157.83, sing 1.2725, HKD 7.8313, INR 95.19, China 6.7914, peso 17.23, BRL 4.8926, BBDXY 1,194, Dollar Index 98.53, Oil $101.92, 10-year 4.46%, Silver $87.01, Platinum $2,136.00, Palladium $1,515.00, Copper $6.49, and Gold… $4,697

That’s it for today… I watched the Cubs play the Braves for a while yesterday, and found that if the Cardinals aren’t playing these games can’t hold my attention very long… Now, if I was there at the ballpark watching live baseball, I would be all over it! Yesterday was a non-event day for yours truly, as I didn’t even make it out to the deck to read! Everything just seemed to work out slower for me yesterday…  time to get on the run… The Amboy Dukes takes us to the finish line today with their song: Journey To The Center Of Your Mind…  I hope you have a Wonderful Wednesday today, and Please Be Good To Yourself!

Chuck Butler

• Gold & Silver have banner days on Friday…
• But the STPS were back on Monday…

Good Day… And a Tom Terrific Tuesday to you! Well, did you get a kick out of my Friday Pfennig featuring Frank Trotter? Well, if you got ½ of the kick that I got from his writing, then you were a happy camper! Did all the mothers have a grand Mother’s Day?   I certainly hope so… I really found that I missed my mom on Sunday, and had to do something to get me out of the funk I was in…  And having the kids over did the trick! The Cranberries greet me this morning with their song: Linger…  (I love the singer, Dolores O’Riordan, and its sad that she’s no longer with us) 

Before I get on the markets, economies and dolts this morning, I wanted to share this with you…  When I was a young man I dreamed of flying cars… hey! The Jetsons had them! I always thought that by now we would have flying cars. So, it warmed my heart to see this on 1440: 

“Morgan Stanley estimates the flying car market could reach $9 trillion by 2050. What’s changing now is that governments are beginning to invest in the infrastructure to support it.

Florida has officially launched state funding for vertiports, creating real infrastructure for electric aircraft to operate. As a Florida-based company, Doroni is positioned directly within one of the first regions actively building toward this new transportation layer.”

Chuck again… Wahoo! I can’t wait to see the first flying car in action!

OK, Ed Steer had such a great explanation as to what happened to the Metals on Thursday, so let’s listen in: “It was patently obvious that the collusive commercial traders of whatever stripe/’da boyz’ intervened in the gold & silver space starting at the 11:00 a.m. EDT London close — and then didn’t let up for the rest of the day.

That was all aided and abetted by that phony baloney DXY ‘rally’ that began at the same moment…so this was obviously a well-coordinated assault on these two precious metals, plus their associated equities.

Not only did they close gold back below $4,700 spot…they stopped silver 2 cents shy of $82 spot — and then closed it well below $79 by the time they were done with it.”

Chuck again… So, we had a day where the SPT’s were nonexistent on Wednesday, but came back with a vengeance on Thursday… I just shake my head in disgust at these guys…  BTW you can find Ed Steer Here: www.edsteergoldsilver.com

So, Gold ended the week at $4716 and Silver at $80.47… They were both up on Friday, so at least they had a positive week… 

The dollar ended the week down for the week at 1,187… As the war continued with shot fired back and forth in the Strait of Hormuz…  The price of Oil ended the week with a $94 handle, and the 10-year ended the week with a 4.36% yield… 

On Monday, while I was traveling, the dollar the STP’s must have been asleep at the wheel, as Gold and Silver rallied without governors… Gold gained $20 on the day, and Silver was the BIG Winner, gaining $5.75… For Silver it looked like a short squeeze…  Gold ended Monday at $4,734 and Silver at $85.95… 

The dollar didn’t react to the no Peace Agreement and ended the day with the BBDXY at 1,189… 

The price of Oil gained a buck and ended the day at $101, and the 10-year saw its yield climb higher to 4.43%

In the overnight markets last night… the no Peace Agreement meant the war was back on and the dollar got bought… I read a piece this weekend where the writer was scratching his head over the fact that the dollar rallies on war and gets sold on peace… Same thing I’ve been scratching my bald head over for weeks now! So, the BBDXY starts today up to 1,192… and Gold and Silver is seeing the SPTS’s wake up and begin selling short the two metals to make up for being asleep at the wheel yesterday…  Gold is down $45 and Silver is down $2.94…  Up one day and down the next… UGH!

The price of Oil remained in the $101 handle overnight and the 10-year saw a bit of buying but not enough to move the yield from 4.43%..

Well, the major media outlets are finally getting the picture… This from Fortune.com: “The $39 trillion debt is set to surpass its postwar peak—and the math says Washington can’t simply cut its way out”

The debts of WW2 had grown to 106% of GDP in 1946… By the time that Truman left office in 1953, Congress had cut enough to get the debt in order…   The Debt was such a number so large that policymakers spent a generation treating it as the high-water mark of what the country could survive. But they did it, and notice that the cuts didn’t have debt added to them like they do these days… 

I bring this up because the debt has gone past our GDP again…  And it (the debt) will continue to grow larger as the interest on our debt takes up most of the tax receipts…  I just keep warning about this growth of our debt, and I’ve been doing just that since the mid 90’s…  But has anyone from Congress done anything about it? The Fed/Cabal/Cartel, Treasury and Congress are in this together with each one responsible for parts of the debt growth…  I say, end the Fed/Cabal/Cartel, throw all the representatives out, and put governors on the Treasury!  

Boy, for being in one of my favorite places to be, I’m sure in a feisty mood this morning… Well, you haven’t seen nothin’ yet! Just kidding… Frank Trotter was busy last week as he wrote the piece on diversification for the Pfennig, and then he turned around and wrote a piece on Gold for the Asset Strategies web site…  here’s a piece of his writing on Gold: “There is the old saying that gold cannot be printed. Supply constraints are not an artifact of sentiment; they are geological fact. When fiat currency expands at will, a fixed-supply asset does not merely hold value — it appears to appreciate relative to the currency that is being diluted. In reality of course the value of gold holds relatively steady while the value of US dollar has declined.”

You can find the entire piece he wrote, which I might say that you should, but I don’t want to be bossy, at Asset Strategies International’s web site: Asset Strategies International. Precious Metals and Rare Tangible Assets

At Battle Bank, Frank had a devised a way for you to margin your Gold… In other words, get a loan with Gold as your collateral… It’s genius and I wonder where this type of margin wasn’t thought of before now…  So, Kudos to my good friend, and former Big Boss , Frank Trotter…  

The U.S. Data Cupboard on Friday last week had the Jobs Jamboree and it was surprisingly greater in jobs created than the forecasters had forecast… But… And that’s a Big But, (but don’t tell that person!)  The BLS was up to their old tricks as they added 394,000 jobs to the surveys (They’ll have to erase those at a later date, but for now, the markets have swallowed the bait, hook, line and sinker… 

I thought that by removing the old head of the BLS and replacing him with someone new that these shenanigans would stop, but the BLS is the same old book cooking, back massaging, and creator of jobs out of air that they have always been…  I shake my head in disgust!

Yesterday’s Data Cupboard had Existing Home Sales, and they were awful… I’ll just say that and point to a previous Pfennig when I asked the question about another housing problem….  I’m just saying… 

To recap… The SPT’s were asleep at the wheel yesterday and the metals all kicked tail and took names later… But today, they have been awakened and the SPT’s are back to selling the metals short…  The dollar is getting bought this morning on the news that the war is still going on… 

For What It’s Worth… Well, after all that tough stuff in this letter today, I have a brief note here on the Gold at Fort Knox and what the POTUS thinks about it, and it can be found here: Trump still wants to crack open Fort Knox to personally confirm $700B gold cache has not been stolen

Or, here’s your snippet: “The president revealed that he’s still eager to crack open Fort Knox and personally ensure that the nation’s gold reserve — valued at nearly $700 billion — is still in the highly secure bullion depository following an uproar about it last year.

“We wanted to go and knock on the door of Fort Knox — a very thick door — and to see whether or not we have any gold in there,” Trump told “Full Measure with Sharyl Attkisson” in an interview that dropped Sunday.

The gold stash in the uber-secure Kentucky facility accounts for half of the government’s gold supply.

It’s not fully clear when the facility last went through a comprehensive audit.

“It’s a very interesting question. We played with that. I wonder if they left the gold in Fort Knox, because they steal a lot,” the president mused. “I do want to go to Fort Knox sometime.”

“I want to see if the gold is there, which I’m sure it will be.”

Access to its vaults has been heavily restricted for decades.”

Chuck again… this is crazy folks…. I personally think that instead of all the Gold bars that supposed to be there, in their place will be slips of paper that tells us who the Gold was swapped with… But that’s just me, and I’m a bit of a conspiracy person… 

Market Prices 5/12/2026: American Style: A$ .7225, kiwi .5950, C$ .7295, euro 1.1745, sterling 1.3619, Swiss $1.2805, European Style: rand 16.5364, krone 9.1490, SEK 9.2749, forint 303.59, zloty 3.6159, koruna 20.7135, RUB 73.80, yen 157.55, sing 1.2728, HKD 7.8293, INR 95.63, China 6.7935, peso 17.24, BRL 4.8914, BBDXY 1,192, Dollar Index 98.25, Oil $101.56, 10-year 4.43%, Silver $83.29, Platinum $2,073.00, Palladium $1,496.00, Copper $6.49, and Gold… $4,591

That’s if for today… Well, I hope all the moms out there had a wonderful Mother’s Day… At the Butler House all the kids were there minus Alex, but Grace was there in his place!  We sat outside and enjoyed the day.. (except the Cardinals blowing the game in the bottom of the 9th! UGH!) Well, I’m back in my winter home for the week, it was great to not feel cold when I got off the plane!  I did get so see Alex at the airport as he and his friends were getting ready to get on the plane we just got off of! Jethro Tull takes us to the finish line today with his song: Locomotive Breath… I hope you have a Tom Terrific Tuesday today and Please Be Good To Yourself!

Chuck Butler

Good Day… And a Fantastico Friday to one and all! I know, I know it’s Friday and there’s normally no Pfennig today, but… I have a special treat for you today! And I couldn’t wait until next Tuesday, for Monday, I’m traveling to my winter home for a week…  As you all are aware, Battle Bank is my new home for the Pfennig… 

And Frank Trotter is the President of Battle Bank and the man responsible for moving me over to his Bank! So, the team is back together again!  Well, Frank wrote a piece for the Pfennig, and I decided that it will be a special Friday edition of the pfennig… So, here’s Frank;

Way back in 1995 Chuck and I were on the International Markets Trading Desk at Mark Twain Banks.  Chuck was the head of Trading, and I made mostly unsuccessful attempts to herd the cats.

It was a sophisticated bond shop.  Over on the domestic side they were trading complex mortgage-backed issues and providing advise to firms well above our mid-size bank.

On our International Markets desk we were certainly the only firm we knew of focused on providing retail investors the opportunity to diversify outside the US dollar in WorldCurrency™ deposits and bonds.

Back then, the US 10-Year Treasury wasn’t just a benchmark—it was the undisputed king of the world. 👑

Best credit.  Pretty much the lowest borrowing rates.  “Risk-Free Rate”

If you wanted to buy debt in Australia, Canada, or the UK, you weren’t just looking at the coupon and currency; you were looking at the spread to the US 10-year.

In 1995, the US 10Y yielded around 6.57%. But look at some of the alternatives:

Australia was paying a massive +249 bps premium

The UK’s 10-year was 1.69% higher than the US.

Italy? They were paying a staggering 560, 5.60% higher than the US.

In those days, the US was the ultimate “Safe Haven.” Our fiscal house was perceived as the sturdiest on the block, and the rest of the world had to offer significantly higher yields just to compete for capital.

The US budget was headed for a surplus.

For those of you unfamiliar with the term “surplus” that means that the US would collect more revenue than it spent.  Of course, there were still off-income statement obligations but just imagine.

Fast forward 30 years to 2026.

The script has flipped in a way few of us on that 1995 desk would have believed. Many, maybe most “major” economies now have lower borrowing rates than the US.

What changed?

One administration after another piled on the debt and ran increasingly larger deficits.  Social programs, the military-industrial complex that Eisenhauer was so correct about, and now the interest payments are about to become the largest budget item.

Naturally I was delighted with the various tax cuts – the chance for smaller government and all that.  But each tax cut came with a spending increase.  Not the right way to run a business, and especially a national treasury.

The bond market just trades value as they see it.  What does relative inflation look like in the country?  What’s the fiscal situation?  What are the prospects for growth?  How much does the country need to borrow?

The traders add it all up and there’s a number in their head.  Millions of participants voting with a buy or a sell.  

With a ballooning national debt and a shifting global landscape, the US Treasury is no longer the benchmark it once was. We aren’t the ones demanding a premium anymore; we are the ones paying it to keep the lights on. 📉

When you look at the 1995 spreads compared to 2026, you don’t just see numbers—you see the story of a deteriorating financial lead. The “Risk-Free Rate” is feeling a lot more “Risk” than it used to.

Today of course this has all changed.  Pulling 10-year Treasury yields from Thursday (check for an update in today’s financial press):

US                             4.34%

Canada               3.49%

Germany             2.99%

Italy                         3.71% – seriously, Italy

Switzerland      0.32%

Of course there are a few with higher rates.

UK 4.92%, Australia 4.92%, and places like Brazil, Mexico, India and others where investors need serious incentive to provide a loan.

It’s our viewpoint that over the next decade it’s likely that the US dollar will decline.  I didn’t say crash.  I didn’t say become irrelevant.  Just decline.

Last year overall it fell about 10%.

These days people are apparently uninterested in double digit returns and it appears the market is overlooking the impact of currency moves.  After all there’s the stock market that seems to be headed to the moon.  Precious metals, which I suspect most of you reading the Pfennig hold, are skyrocketing.

But a word to the wise.  Double digit returns ,if they were to continue, can compound nicely to double in just over 7 years.  Sounds like a nice compartment in a diversified portfolio.

Obviously, I should disclose that each of these items can decline and these investments aren’t suitable for everyone.  Maybe the rest of the world falls apart.  Maybe something like the current war in Iran becomes World War III – who knows?  Also, precious metals are not FDIC insured and both foreign currencies and precious metals can lose value due to market price adjustments.

If you are interested in exploring alternatives for your portfolio, along with learning about the risks head over to Battle Bank where we give you can explore the opportunity to invest in precious metals and over 20 foreign currencies.  Of course there’s a downside to all these investments so consider that carefully before taking action.  I’m just a guy that works at Battle Bank and these aren’t necessarily the opinion of the bank.

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Chuck Again… Thank you, thank you, thank you (in my best Gomer Pyle voice ) Frank for this piece… I had extended an offer to Frank some months ago that any time he felt like writing; to just fire it off to me and I’ll use it!

That’s it for today… make sure you are on Battle Bank’s waitlist…  They will take care of you! I personally know several of the employees at Battle Bank, and they are great!Little Feat take us to the finish line today with their song: Dixie Chicken… (the live version!)  Now, go out and have a Fantastico Friday today, and Please Be Good To Yourself!

Chuck Butler (With Frank Trotter)