Is It Finally Japan’s Time?

  • currencies & metals drift through the day ahead of CPI
  • Silver to outperform Gold this year?

Good Day… And a Tom Terrific Tuesday to you! Well, my trip to the ballpark did not yield a win yesterday, although when the “regulars” were in the game the Cardinals were winning… The team did hit the ball better when they were in there yesterday, so they had that going for them!  Last night we went to one of our fave restaurants down here, : The Dune Dog… The Cure greets me this morning with their song: Close To You… 

I have to admit to something front and center this morning… I apologize for the late Pfennig yesterday… I was such a dolt! I wrote it, and then completely walked away thinking that I had sent it, for it has been a routine of mine for years now, but this time I hadn’t, and didn’t realize that I hadn’t until good friend Dennis Miller kept telling he didn’t see it… UGH! See? I’m a dolt too at times! 

Well, the markets seemed to have taken a pause for the cause yesterday with the dollar not losing ground, and Gold & Silver not gaining any ground. The moves were very small, and led me to believe that the markets are waiting for the STUPID CPI to print before they go any further with the task at hand. There was no movement in Oil or the 10-year yesterday, so I guess we’re all waiting for the print… 

You know me, I think that John Williams has the best, and trues inflation reading… Not the one the BLS uses with all their hedonic adjustments… But, the markets still put a lot of stock in the BLS STUPID CPI print, and so I guess we should too! With the only difference for us being that we know in our heart of hearts that the STUPID CPI is all a bunch of baloney! 

Gold lost 60-cents yesterday, and Silver lost 4-cents… Gold closed at $2,182.20, and Silver closed at $24.34…  The BBDXY lost the 1 index point it had lost overnight, and that was it. Oil remained in its current range ($77-$78), while bonds were unchanged on the day…

In the overnight markets last night… There was little-to-no movement in the dollar, currencies, metals and bonds… The BBDXY starts today at 1,229, Oil with a $78 handle, and the 10-year at 4.08%… Gold is down $6 to start today, nervous nillies ahead of the STUPID CPI… Silver is up 11-cents to start the day… I’ve got something on Silver for you in the FWIW section today, so don’t change that bat channel! 

Well, all the usual suspects that come out when Gold starts a run like this and talk about where they think it will end up… or go to… better yet…  I read that James Rickards is calling for $3,200 for Gold… I say, as long as there are no engineered takedowns here with Gold, then Gold could stay where it is for all I care… It won’t, but you get what I’m saying… right? 

As you know, dear reader, I’ve been quite critical of the Bank of Japan (BOJ) and their negative rate policy (nirp), and I’ve talked about how there’s a lot of talk that the BOJ could leave the NIRP soon, and that has really fueled a rally in yen VS dollars…  I pulled this from;

 “Markets are reckoning with the very real chance that the Bank of Japan will exit the world’s last remaining negative-rate regime and increase borrowing costs as soon as this month.

It’s a pivotal moment for global funds that have been pouring money into Japanese assets on bets of an economic renaissance, and for domestic investors who have been chasing better returns abroad after decades of disappointment at home.

The yen has surged more than 2% this week, its best run since the start of the year, amid signs that the Bank of Japan sees a sustainable cycle of rising prices and wages taking hold. “

Now, if you’re a betting person, than you would be looking to buy yen, and go with the momentum that would build with a rate hike this month…  But if you’re still of the opinion, like me, that Japan is still a basket case, with their debt and demographics, and would prefer to not touch this currency… 

But if you get past the debt and demographics of Japan, and think strictly about how the BOJ would be the only Central Bank in the World that’s hiking rates right now, as all the other central banks have reached the top of their respective rate cycles…  Then you could rationalize buying yen… 

Last week, a ship going through the gauntlet of the Red Sea was hit and sank… That made me stop and think about why shippers are still attempting to go through this gauntlet, when there are alternative routes that can be taken… I know, I know, stay in my lane here… But it doesn’t stop me from thinking! 

Alasdair MacCleod sent something to the good folks at GATA , when then sent it to me, and it was about how Silver could be the next nickel…  You may recall that in 2022 there was a big kerfuffle when the London Metals Exchange cancelled orders for $12 Billion on March 8, 2022… This caused a $728 Million loss… On the other side of the trade was a HUGE short position by a Chinese nickel producer, that the LME wasn’t aware of… this causing the short positions to be wiped out…  And now Alasdair thinks the same situation could be coming in Silver…  That would be stupendous! To wipe out the short positions and the traders that put them on, would just be peachy in my book!…  I’m just saying… 

The U.S. Data Cupboard this morning has the aforementioned STUPID CPI on the docket to print… I’ll be checking with John Williams after the STUPID CPI prints to see what difference he shows and will report it to you here tomorrow…  Besides the STUPID CPI there’s nothing else today, and tomorrow, and then we’ll pick up the data prints again on Thursday when Feb Retail Sales will print… January’s negative 0.8% print hangs over this month’s print like the Sword of Damocles… But since Consumers running up more debt in Feb has already been reported by me, I would suspect the Retail Sales for Feb will also rebound… 

To recap… It was a day of recovery from all the selling of the dollar  yesterday, and all the buying of Gold & Silver, and bonds were put on hold for the day.  Chuck discusses the Bank of Japan, yen, and its chances of rallying VS the dollar. 

For What It’s Worth… This report on Silver is interesting simply from the fact that it came from an unusual source… The report is about how Silver will outperform Gold this year, and can be found here: Gold vs. silver prices: Analysts expect XAG to outperform XAU in 2024 (

Or, here’s your snippet: “Spot gold prices on Monday edged higher to $2,178 per ounce, after settling at their highest since 1979 on Thursday last week.

Spot silver prices, meanwhile, were last seen up 0.2% at $24.36 per ounce at 6:24 a.m. London time (1:24 a.m. ET). The contract, which rose over 5% last week, on Thursday settled at its highest level since late December.

Precious metal prices have pushed higher in recent weeks amid growing expectations of U.S. interest rate cuts. Federal Reserve Chair Jerome Powell on Thursday said that inflation is “not far” from where it needs to be for the central bank to start cutting rates.

The last thing I might add on silver though, as a dual precious and industrial metal, if we start to see global growth pick up a bit more over the course of this year — which is very much our base case — then I would expect silver to go from a relative underperformer to gold to being a relative outperformer to gold over really the third and fourth quarter of this year.”

Earlier in the year, the Silver Institute said in a report that global silver demand was expected to reach 1.2 billion ounces in 2024, hitting its second-highest level on record.

The institute, a non-profit international association composed of various members across the silver industry, told CNBC last month that it expects silver to have a “terrific year,” particularly in terms of demand.”

Chuck again… I mentioned that this report was from an unusual source, and that source being CNBC… It’s very rare when a major media outlet talks the talk with metals…. I’m just saying…

Market Prices 3/12/2024: American Style: A$ .6615, kiwi .6163, C$ .7424, euro 1.0833, sterling 1.2796, Swiss $1.1428, European Style: rand 18.5882, krone 10.4506, SEK 10.2085, forint 362.79, zloty 3.9180, koruna 23.1253, RUB 91.12, yen 147.35, sing 1.3308, HKD 7.8238, INR 82.77, China 7.1705, peso 16.79, BRL 4.9782, BBDXY 1,229.18, Dollar Index 102.80, Oil $78.34, 10-year 4.08%, Silver $24.45, Platinum $929.00, Palladium $1,023.00, Copper $3.93, and Gold…. $2,176.80

That’s it for today… no game for me today… I have 6 more games down here before the team moves out… The Cardinals start the year playing the vaunted Dodgers, and Shohei Otani… a Tough row to hoe out of the starter’s gates, for sure! Cards open at home on April 4… And no team does opening day like the Cardinals! I’ll admit that I fell asleep during the 2nd half of the City STL game Saturday night, and didn’t see the tying goal… But sure have watched in several times since! Cornelius Brothers & Sister Rose take us to the finish line today with their song: It’s Too Late, To Turn Back Now… I hope you have a Tom Terrific Tuesday today, and also I hope that you will Be Good To Yourself! 

Chuck Butler