Currencies & Metals Get Ambushed Overnight!

September 28, 2021

* Two Cartel Heads resign over trading activity

* China bans trading in cryptocurrencies… 

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


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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Chuck Butler