I’m Baaaaacccckkkk!

  • Currencies have gained VS the dollar while Chuck was gone!
  • Gold continues to climb higher, while Silver lags…

Good Day… And a Wonderful Wednesday to you! Whew! I’m worn out from all the hub-bub of the holiday weekend, and a birthday to boot! I hope everyone had a very Blessed Christmas, and you were able to share the warmth of love with family and friends… I know, I did!  It was not a White Christmas here in the MidWest, as we had abnormal weather, albeit rainy, but not as cold… Over the weekend, Our Blues beat the Blackhawks, which is always a highlight of the hockey season… I reached out to a former H.S. classmate last week, and she responded to me, and we have renewed out acquaintance, I told her that “life is too short to forget friends”… There was lots of movement in the dollar and Gold last week, so we have lots to talk about today, and I might as well get started on it, eh?  Tim Janis plays his version of the song: Silent Night to greet me this morning… 

The trading last week was not of the volumes we normally see, since it was the week before Christmas, and so each day that went by, there was some story as to why the markets did what they did… I won’t bore you with each day’s chatter, but I will say that at the end of the week, the BBDXY has lost 7 index points, that put the index at 1,219 to end the week. That’s the lowest it’s been since the last week of this past July… It was then that I had said that it appeared that the dollar had exhausted its gains, and was ready for a long-term weak trend, only to have the PPT prove me wrong, once again… The PPT has a bad habit of doing that, in my opinion, for why can’t assets trade on their own merits without intervention? 

Gold has inched higher daily in the past week, and at the end of the week it was $2,052, which was $26 higher than it was on 12/18, the last day I wrote to you (other than the Christmas Pfennig) Now that was a great Santa Claus rally for Gold, eh? Silver has lagged but still ended the week at $24.18, which was 22-cents higher than when I left you on 12/18… There have been several articles written in the past 10 days, about the Industrial demand for physical Silver, and how that should increase the shortage of Silver, and how that should drive the price of Silver much higher… have these writers not noticed that supply and demand doesn’t dictate price in Silver any longer, instead its ruled by the short paper traders?  Oh well… it’s a good story to tell, about the shortage, and maybe we can get some buying out of it, but who knows? 

The price of Oil has really moved higher on the news that the Red Sea is being shut down to shipping, and that ships are having to go all the way around the Cape of Horn (Africa) to get to their destination, which incurs more shipping costs, and a higher price of Oil… Oil ended the week with a $74 handle… And the bond boys are still holding on to their thought that the Fed Heads will cut rates as soon as March 2024, and the yield on the 10-year Treasury remains below 4%… 

In yesterday’s trading, we saw a little more volume, but not much more… The dollar got sold once again, with the BBDXY showing a loss of 4 index points, and Gold gained $14.90 on the day to close at $2,067.50. Silver gained 5-cents on the day to close at $24.23… There was not a lot of activity in the markets yesterday, but more than there was last week… I would think that things might be muted through this week, with most of the senior traders still on the slopes or sipping pina coladas on the beach.  That kind of volume can lead to wild swings though… And through the years, I’ve seen some real wild ones this last week of the year, so be prepared…. 

On a side bar… Have you ever wondered why they word the sign ” Be Prepared To Stop”… that way?   I mean when you’re driving shouldn’t you always be prepared to stop?  These are the things in life that bug me… 

In the overnight markets last night… The dollar got sold a little more and has dropped another index point in the BBDXY, while Gold inches higher by $2 in the early trading, and Silver gets old by 13-cents to start the day today… The price of Oil trades with a $75 handle this morning, while the 10-year’s yield is 3.86%… Those bond boys just are like a big ship that’s difficult to change directions quickly… 

With the price of Oil perking higher these days, the Petrol Currencies are frolicking in the sun… That is most of the Petrol Currencies, as the Russian ruble isn’t participating at this time… But the Mexican peso is at a level it hasn’t seen in a year of Sundays! Yes, it’s been that long!  The Brazilian real is rallying as is the Norwegian krone, so the rise in the price of Oil isn’t being ignored by most of the Petrol Currencies! 

Last week, I had a conversation with a guy who questioned my stating that the high U.S. debt was becoming unsustainable… (See? I still talk about this stuff when on vacation!)  He said that he saw no reason why the U.S. couldn’t just add as much debt as they wanted to…  I then went all ape on him and described what I’ve described for you dear readers for years, but will do so again… Having excessive Gov’t dept reduces economic activity by crowding out private capital formation and by requiring future tax increases or spending cuts to accommodate future interest payments. And those tax increases take away from consumer spending, which drives the car of GDP… AND furthermore, now that interest rates are higher, the debt is issued with higher yields, which means the servicing costs of those debts increases, and causes other items that the Gov’t deficit spends on, to go away, for they have to service the bond costs, and not their jackass spending programs…. 

And having the Gov’t overspend all the time, leads to consumers thinking that what’s good for the goose is good for the gander, and they overspend too… This was the headline on a story on CNBC.com this past weekend, “Couple has $520,000 in debt—and wife had no idea: ‘We’ve been living a life maybe we shouldn’t be living’   

t’s not uncommon for people to keep financial secrets from their partners. Nearly 1 in 4 Americans in relationships admit to keeping a money-related secret from their significant other, according to a 2023 Bankrate survey.

A $520,000 secret is a pretty big one, though.”

Chuck again… I would have to agree with the writer on that one…  But see, that’s just one example of overspending, and then realizing that you have overspent to the tune of over $500,000 or whatever amount! 

Changing gears… I found this on Wolf Street.com  “But overall and “core” PCE price indexes decelerated, on plunging gasoline prices, a dip in food prices, and a continued big drop in durable goods prices.

The fly in the ointment in today’s PCE Price Index by the Bureau of Economic Analysis was rent inflation, which accelerated in November from October, and has gotten stuck since March for the ninth month in a row with month-to-month increases that annualized were in the 6%-plus range.”

Ok, so from all that I read, the young folks are finding that owning a home is out of the question, because of 1. the house is too expensive, 2. the cost of a mortgage is preposterous, and 3. they probably have student debts up to their eyeballs, and their balance sheet is a mess…. So… they HAVE to rent… And from the looks of it rent inflation is not coming down… And it’s the same in prices of lots of things… food, health insurance, medicines, new cars, etc. the prices won’t be coming down any time soon… They have risen and will remain at those lofty levels for some time, because…. inflation is sticky… And once prices rise, they rarely come back down…  I’m just saying… 

The U.S. Data Cupboard this week is very lacking… The only piece of data that is worth its weight is the Weekly Initial Jobless Claims, which will be printed tomorrow… I think what we’ll see most of this week, the last trading week of the year, is book squaring trades, and last-minute tax situation trades… 

To recap… It was a weak trading, volume-wise, week leading up to Christmas, but through it all the dollar lost ground, and Gold moved significantly higher… If any thing, the short paper traders have been just topping off Gold & Silver’s daily rises… There are lost of things for Chuck to talk about today, so if you skipped again, be sure to go back and read them! He didn’t write them for his health, you know! 

For What It’s worth… In keeping with the thought that consumers overspend, I have this article for you this morning, that talks about how consumers are spent!  And it can be found here:America’s Debt Crisis: People Are Maxed Out – LewRockwell

Or, here’s your snippet: “Americans are largely maxed out when it comes to the amount of debt they have accumulated. Americans had surpassed a combined total of over $1 trillion in credit card debt back in August. Three months later, the balance had already gone up an additional $48 billion.

The August data came from the Federal Reserve Bank of New York released its Household Debt and Credit Report for the second quarter of 2023 and it continues to worsen as Americans struggle under the weight of an oppressive ruling class and central bankers. According to CNET, what’s more alarming is that the cost of carrying this debt has also increased. Credit card APRs have gone up 30% in the last year and a half, eating away at consumers’ budgets more than ever before.

Credit card debt is just one type of debt we face in our lifetimes, along with mortgages, car loans, student loans, and medical debt. But the credit card is uniquely powerful. It’s comparatively easy to obtain. It’s aggressively marketed. It also heavily influences your credit score, the financial reputation marker that determines if and how you fund future milestone purchases.

Credit can be a lifeline for many in hard times, but it can also be quietly destructive. As the pace of inflation surpasses wage growth, it’s gotten harder to afford rent, utilities and groceries, forcing us to rely more on credit cards for everyday goods. –CNET

Americans Falling Behind on Credit Card and Loan Payments as Inflation Persists

People are being pushed to the brink of financial ruin as the ruling class continues to print more fiat currency to fund wars on the other side of the globe. All this is happening as consumerism and consumption rates rise in the United States.”

Chuck again… I agree with all of that, and have seen what this has done to some families… Please don’t let it happen to you! 

Market Prices 12/27/ 2023: American Style: A$ .6838, kiwi .6329, C$ .7574, euro 1.1082, sterling 1.2739, 

Swiss $1.1727, European Style: rand 18.5024, krone 10.1440, SEK 10.0014, forint 344.94, zloty 3.9193. 

koruna 22.2962, RUB 91.85, Yen 142.60, sing 1.3220, HKD 7.8094, INR 83.35, China 7.1474, peso 16.94, 

BRL 4.8169, BBDXY 1,214.67, Dollar Index 101.37, Oil $75.20, 10-year 3.86%, Silver $24.10, Platinum $976.00, Palladium $1,192, Copper $3.91, and Gold…. $2,069.11

That’s it for today… Yesterday was Kathy’s birthday… I think she had a grand day… I sang Happy Birthday to her, which I don’t think she enjoyed… But oh well… I tried!  Now, no mentions to Kathy that I talked about her this morning!  That means you Lisa and Lynn!  it’s time to tear down all the decorations we had put up in the house and outside the house… I do not like that whole process, for I love seeing out house all decorated…  I used to be a stickler about leaving the lights on the house until the Epiphany, Jan 6… but now I’m no longer here on that day, so they have to be taken down before… UGH!  I have Catholic training in me, from my days of youth, and I retain some of the stories, like the Epiphany… Somebody different is playing this morning, his name is Rick Gallagher and he’s playing his version of: Having A Wonderful Christmas Time as he takes us to the finish line today… I hope you have a Wonderful Wednesday, and will Be Good To Yourself!

Chuck Butler