Did Traders Get A Wink & Nod?

Rocktober 6, 2021

* Currencies & metals get ambushed overnight… 

* Chuck shows off his math skills… 

Good Day… And a Wonderful Wednesday to you! A quiet night for yours truly last night, as a lot of nights recently have been late… I sat out on the deck that overlooks the beach and ocean, and had my Bose speaker turned up and sang out loud along with the songs being played…  I can do that at this time of year, because there aren’t  many people here, compared to the winter months! One Wild Card Game is done, with the Red Sox sending the Yankees home. Tonight it’s the Cardinals VS the Dodgers, which doesn’t start, Eastern Time, until after 8PM… I doubt I’ll be able to stay awake for the whole game. UGH! Simon and Garfunkel greet me this morning with their song: America…   the band, Yes, did a version of this song years later, but I prefer the original…

Well, the dollar, which was bought in the overnight markets of Monday to Tuesday, was still being bought as the U.S. session began but the buying tailed off as the day went along, and at the end of the day, the dollar had gained just a small bit… The BBBDXY, which began the day yesterday at 1,161.03, ended the day at 1,161.63. And Gold, which was down early on Tuesday morning by $15.60, ended the day at down $9.40, to close at $1,1761.50, and Silver ended the day down 5-cents, to close at $22.73.

I like the fact that Gold and Silver fought back for the second consecutive day. They didn’t totally reverse the early selling, but they did recover some of the early losses… The price manipulators are still taking their pounds of flesh from the metals, but… the physical buying is strong, and hopefully it will remain strong…  For instance, India has recently bought physical Gold by the truckload, because of 1. the cheaper price, and 2. ahead of their wedding season

I do believe that traders of all sorts, bonds, stocks, currencies, metals, cyrptos, and any others, are thinking that this weeks’ employment numbers will be the deciding factor for the Fed./Cabal/ Cartel for their decision on whether  or when to taper…  I keep thinking that if the Fed/Cabal/Cartel does decide to taper, they will be throwing the financial system under a bus…  But then they’ve done dumb stuff before… And then when, if they don’t taper as I’ve said they won’t, all this dollar buying will be reversed…  Gold will climb higher, and well… I don’t really care too much about the other asset classes…

In the overnight markets last night… there was another ambush of the currencies & metals… What on earth are the foreign traders thinking, these days? I would have thought that all traders were sitting on their hands until they get a clear picture of the employment numbers here in the U.S. but I would have been wrong in that thought, eh?  The BBDXY has moved upward to 1,167.28 this morning after closing last night at 1,161.63. Even the Petrol Currencies have given back some of their gains with the price of Oil rising to $78 yesterday.  

As I said above, the price manipulators are still present, and they appear to be a clear and present danger to the metals… Gold is down $11.70 in the early trading today, and Silver is down 39-cents…  The ADP Employment report this morning will be the first of the Employment reports this week, with the Jobs Jamboree on Friday, being the second.  It does appear to me that the price manipulators decided to get a jump on what they Might or Might not know will be the outcome of the Employment Reports… I figuring that the probably have been given a wink and nod on the reports, otherwise, why go out on a limb? 

So… have you heard the rumor going around that someone’s underground and… no wait! C’mon Chuck, get serious!  OK.. I’m sorry… Did you hear the rumor that the U.S. Treasury will issue a $1 Trillion worth Platinum coin, and sell it to reduce their deficit?  Yeah, like that would correct all the deficit spending in the past, current, and future!   That takes me back to when I used to get readers who would tell me that the U.S. could sell their Gold and that would take care of the deficit…  Ah, contraire Monfrere…..8,133 tonnes of Gold would only equal to 260,263 ounces, and at the current price of Gold, which they wouldn’t get, because once you began selling the price would go down, but for calculations here, let’s use $1,760, which would equal $458 Billion…  See, now? (there are 32,000 ounces in a ton) See my math skills at work here?  But of course the younger generation wouldn’t know how to do this, because they think 2+2 equals whatever number they think the will make them happy, because we can’t upset them!  Tsk, Tsk… 

OK… But I could see where a lot of uninformed people, or people that don’t read the Pfennig, would think that selling that $1 Trillion Coin would be the end-all to our deficit problems… Because… that’s how the spin doctors would spin this news… I’m just saying… 

I have an article for you in today’s FWIW Section that’s about how much Gold China has, so you won’t want to miss that today!

Remember all the hope we had that Fed/ Cabal/ Cartel nominee, July Shelton, would be approved to join the Board of the Federal Reserve/ Cabal. Cartel?  She of the dissenting vote that is much needed on a board that hasn’t seen a dissenting vote in a number of years?  And then just like that, her nomination was defeated…  What happened?  Well, the Sun has an article that helps explain why they believe her nomination was defeated, and I’ll pick up the conversation in the Sun (Did Chairman Powell Seek To Sabotage Trump’s Nomination of Judy Shelton to the Federal Reserve Board? (nysun.com),  here:

“If President Biden nominates Jerome Powell for a second term as chairman of the Federal Reserve, the question for which we’ll be waiting is whether Mr. Powell tried to derail the nomination to the Fed’s board of Judy Shelton. President Trump had signaled his plan to nominate Ms. Shelton in July 2019. In a razor-thin vote in late 2020, though, Ms. Shelton was defeated when two Republicans voted “no” and one failed to show up at all.

It turns out that just before that vote, one of the most dramatic in the history of the Federal Reserve, Chairman Powell got on an extraordinary string of telephone calls with senators who could be key. We don’t yet know what was said on those calls (hence this editorial). The calls, though, were logged on the Fed Website. All the more reason that if Mr. Powell is renominated, at least one senator should ask what he was doing.

Mr. Powell himself has suggested that it would be out of place for him to take sides on a nomination. Right after President Trump tweeted his plan to nominate Ms. Shelton, Congresswoman Jennifer Wexton, at a hearing, asked Mr. Powell about the gold standard. The chairman immediately noted that this could be considered commenting on a particular nominee and “of course I would not do that.”

Chuck again… Yeah Right! I believe he didn’t have anything to do with dissing July Shelton’s nomination like I believe the inflation numbers and employment numbers each month! I don’t! Don’t like someone questioning your monetary policy decision, Jay? Well, it’s a good thing I’m not that board!

The U.S. Data Cupboard today has the ADP Employment Report for September, and the forecast is for 425,000  newly employed… I’ll believe that when I see it… And then  all we’ll see tomorrow is the Weekly Initial Jobless Claims, that will lead to Friday’s Jobs Jamboree, which has the forecast at 500,000 jobs created in September… Again, I don’t see that as a viable number, given the recent increases in Jobless claims… But that’s just me, looking at it logically, but… you have to take into hand the BLS and their birth/ death model adding jobs out of thin air..

To recap… The currencies & metals continued to get sold yesterday after the big sell off overnight, but during the day the selling tailed off, and at the end of the day, the upward move of the dollar was tiny…  Did you hear about the $1 Trillion platinum coin the treasury is rumored to be creating to sell to reduce the deficit?  What a bunch of smoke and mirrors folks… And Chuck points out that Jay Powell may have had something to do with Judy Shelton’s failed nomination to the Fed/ Cabal/ Cartel… 

And in the overnight markets there was yet another ambush of the currencies and metals… Chuck questions what Traders are thinking ahead of the Employment reports, and thinks that the Traders got a wink and nod on what the reports will contain… 

For What It’s Worth…  Remember when I used to tell you not to believe what the Chinese said about the total of their Gold holdings? Well, I came across this article after the good folks at GATA highlighted the link… This is an article that does the math on Gold holdings in China and it can be found here: China owns a lot more gold than it’s letting on – and here’s why | MoneyWeek

Or, here’s your snippet: “China’s officially declared holdings of 1,948 tonnes make up just 3% of its $3.2trn in foreign exchange holdings, but the real number is much larger than that. China has been the world’s largest gold producer since 2007 –this past decade it has produced about 15% of all the gold mined in the world; last year it produced 380 tonnes – that’s 20% more than the world’s second-largest producer, Australia.

Since 2000, China has mined roughly 6,500 tonnes. More than half of Chinese gold production is state-owned; the China National Gold Group Corporation alone accounts for 20%. Already that official 1,948 figure looks doubtful. Crucially, China keeps the gold it mines –exporting of domestic mine production is not allowed.

With reserves in decline at home, Chinese mining companies have also been buying assets abroad, across Africa, South America and Asia. International production exceeded domestic production by about 15 tonnes last year. As well as being the world’s biggest producer, China is the world’s biggest importer. It is hard to get precise import figures, but we do know that, for example, via Hong Kong alone, over 6,000 tonnes has entered the country since 2000. Add that to cumulative gold production since 2000 and you get a figure of 13,200 tonnes.

Whether imported, mined or recycled, most of the gold that enters China goes through the Shanghai Gold Exchange (SGE), including the gold imported from Hong Kong. So SGE withdrawals – for which we do have numbers – can act as something of an approximation for demand. And it is possible to get numbers for SGE withdrawals: since 2008, roughly 20,000 tonnes have been withdrawn from the SGE.

Then we have to add in gold held in China, whether as bullion or jewelry, prior to 2000. The World Gold Council estimates a figure of 2,500 tonnes in privately-held jewelry. If you add domestic mining and official reserves, you get a figure of around 4,000 tonnes.

Nick Laird of goldchartsrus.com, perhaps the world’s leading gold data expert, has cobbled it all together to produce this chart, showing cumulative gold held in China to be around 28,911 tonnes. I’ve spoken to numerous analysts – Ross Norman, Bron Suchecki and Koos Jansen – and they all arrive at similar estimates.”

Chuck again.. And once again I’ll repeat why this is so important…  Remember the old saying that “he who owns the Gold, makes the rules”?  That will come into play when the financial system that we currently use collapses, and the leaders of the world get together to discuss the new financial system, and China will come to the table with the most Gold of any country… So… guess who’ll get to make the rules?

Market Prices 10/6/2021: American Style: A$ .7237,  kiwi .6888, C$ .7909, euro 1.1538, sterling 1.3563, Swiss $1.0757, European Style: rand 15.1435, krone 8.6174, SEK 8.8184,  forint 311.66,  zloty 3.9831,  koruna 22.0357, RUB 72.44, yen 111.45, sing 1.3618, HKD 7.7864, INR 75.00, China 6.4457, peso 20.82, BRL 5.4598, BBDXY 1,167.28,  Dollar Index 94.38,  Oil $78.51, 10-year 1.54%, Silver $22.34, Platinum $953.00, Palladium $1,962.00, Copper $4.10, and Gold… $1,749.80

That’s it for today…  Another beautiful data here… I’m going to really be sad to go home at the end of this week… I sit outside to eat my lunch, to read my books, and to meet with friends, and discuss the problems of the world! HA!  I love it here! Big Game tonight for my beloved Cardinals… I sure hope Adam Wainwright is on his game… I’ve been bad down here with regards to watching my carbs… and my blood sugar numbers are elevated, so I’ll have to correct that once I get home.. .This was my vacation that I missed two months ago, when I had to spend time in the isolation room at the hospital down here… So, I was eating things on my vacation redo, that I normally don’t eat…  I think a gained a couple of pounds too… So, a redo of my eating habits are in store upon my return home… The late great, Dan Fogelberg takes us to the finish line today with his song: As The Raven Flies… I hope you have a Wonderful Wednesday today, and please Be Good To Yourself!

Chuck Butler