Is This All We Get From All That Stimulus?

July 17, 2018

* A nothing day for currencies & metals on Monday

* Cut the pork, will you Lawmakers?

Good Day… And a Tom Terrific Tuesday to you! Well, my busy day yesterday, got to me about mid afternoon, and I was wiped out, took a long nap, and was then ready to watch the Home Run Derby… I’m reminded of a HRD of years ago, when I was recovering from my two major cancer surgeries, and my colleagues, Chris, Mike, and Christine, came to visit with me… Good memories…  One of my doctors told me yesterday, that I’m his best patient, and that he loved it when I came in! WOW! My grandson, Braden is coming to spend the day with me… Just me and Braden, I wonder how this turns out! HA!  Seals & Crofts greet me this morning with their song: Summer Breeze…  

Well, yesterday’s trading was a lot of nothing.. No major movements anywhere, the Dollar Index at the end of the day stood at 94.55, and it began the day at 94.53…  Gold lost 80-cents on the day!  Have the Dog Days of Summer come upon us already? 

The U.S. Data Cupboard had the June Retail Sales print for us yesterday… Recall that I call this print a piece of real economic data, so paying attention to it is called for. And like I told you yesterday, the BHI indicated that June’s report would good, not great, but good, and that it was, gaining 0.5% for the month.  When I looked at that yesterday I got this feeling of being let down…  I asked myself, “is this all we get for all we did as a country to spur consumption?” 

Do I think consumers have finally figured it out that sooner or later the bill comes in the mail for their purchases, and if they don’t have the money they won’t buy? I doubt it one second! We’re a country of consumers, we buy, buy, buy…  But as a country of consumers we do catch our collective breaths every now and then, and when we do, the numbers begin to look ugly…  But the point I’m getting to eventually, is this… The U.S. Gov’t and Fed went a long way toward ruining our financial system to get us to this point, and it’s just not what we paid for! 

This past weekend, President Trump said some things about NATO that had a lot of people up in arms… But if you go back to the Chuck’s Debt Solutions from many years ago, I was the first to call for the closing of military bases around the world, especially in countries where the citizens don’t’ want us there to begin with! Now, if that was my call then, I was sure happy to hear the President call NATO to the red carpet… and then tell them they’re obsolete, and that the European countries need to buck up and pay more of their share of the costs of NATO… You tell ‘em!

I spoke about the Federal Budget Deficit yesterday, and good friend, Dennis Miller, sent me a note that he too had written about it in his letter published last Thursday (the day that I was whacked out!). So, I thought I would share with you one of his thoughts on the Federal Debt… Here’s Dennis Miller (

“Today you spoke about government debt. This was last weeks article and I realize you were fogged over. What I found amazing was the budget deficit and the government grants were almost identical.

Congress gives us the BS that there is nowhere to cut the budget. What crap! If they all stopped their pork giveaways, we would have a balanced budget.

This explains to me why Reagan said no matter how much you take in… congress will spend more. They look at revenue as their personal piggy bank.” – Dennis Miller

Chuck again… Thanks Dennis… Yes, I was “fogged over” last Thursday… But I’m back now, and I bet you all are happy as larks that I’m back! HA!

I mentioned above that Gold lost 80-cents yesterday… And that move contributed to my thought that it was a nothing day in the currencies and metals… Have you noticed how the price of Oil has been taken back down so swiftly? I’m going to have to call foul on this move…  The fingers are all pointing at Saudi Arabia’s call to increase production… And while that could have caused some slippage, I’m not buying what they’re selling here, as the reason for this huge drop in the price of Oil… There’s something else in the works here folks… That’s all I’m saying… 

I did let the cat out of the bag last week, when I said that all markets are manipulated… OOOPS, did I say that out loud? I guess I did! No one wants to hear those words, but they’ve got to be said, and if their said enough and loud enough then maybe some regulator will do something about it, but I’m dreaming folks… And before I go deeper into that rabbit hole, I’m going to climb out, and live another day! 

Fed Chairman, Jerome Powell, will be speaking today and tomorrow, so this must be the semi-annual trip to give the Fed Chairman’s testimony on the economy to both houses of the Gov’t. It used to be called the Humphrey-Hawkins Bill, but that bill expired long ago, and Fed chairmen and woman have continued to make the trip up to the “hill”…  I could say that the markets are awaiting Powell’s speech to give them some direction, but deep down I don’t believe that to be the case…  Why?

Because they’ve and we’ve heard it all before… The economy is robust, unemployment is down, yadda, yadda, yadda…  Pink Floyd said it best when they wrote in their song: It’s a battle of words, and most of them are lies… 

The U.S. Data Cupboard has two pieces of real economic data for us today… Industrial Production and Capacity Utilization will print the June’s results today. As I said yesterday, I suspect that the Industrial Production data will reverse May’s negative print, but in all for the year, this data is still underwhelming…   I read a report the other day, about how Capital expenditures are falling, and plans to spend are also showing signs of backing off…  Capital expenditures, or CAPEX, are what makes the economy go around folks… This is an easy thing to check out folks… Check around your place of business, are they planning on making equipment purchases, expand space, etc.? 

It’s all about the U.S. Data and Powell speech today folks, there’s just not much going on overseas today… China did print their latest GDP figure and called it weak at 6.7%…  Sure, it’s not the go-go years of 10% clips and above for Chinese GDP, but weak?  If we saw GDP of 6.7% here in the U.S. we would be dancing in the streets!  We did see that Russian Industrial Production for June printed this morning, and it was not a strong number, only gaining 2.2% VS 3.7% in the previous print… 

The Russian ruble has had to deal with sudden drop in the price of Oil, and now this weaker IP data… Hang on ruble, times will be better…  reminds me of a great 60’s song: Hang on Sloopy, Sloopy hang on… 

I’ve been pleasantly surprised by the resiliency of the Canadian dollar / loonie…  The loonie saw weakness late last month after they picked a fight with the bully, and lost, but has regained its mojo, and has withstood the test of a price drop in Oil. 

To recap… It was a nothing day in the currencies and metals, as there was little movement if any in both asset classes. The Dollar Index dropped 3 ticks from yesterday morning’s figure, and Gold lost 80-cents on the day…  nothing…  Fed Chairman Powell heads to Capitol Hill today for the first of his two speeches to lawmakers, and Chuck believes it will be more of the same yadda, yadda, yadda…  

For What It’s Worth…  OK… I’ve said this quite a few times previously, but when I saw this article, it reminded me that Debt Is Everywhere!  And this article breaks that down and can be found here:  

Or, here’s your snippet: ” You may well have seen in the news the last couple of days that global debt has reached another all time high. After climbing to astonishing $247 trillion when combining public debt of around $60 trillion and non-financial sector debt of about $186 trillion.

This eye-watering figure also means that for the first time ever there is now officially 3 times more debt in the world than money.
It has been reported that this astounding level of debt is causing major cause by investors on top of ongoing concerns about the Federal Reserve’s monetary policy.

Chuck again… 3 times more debt in the world than actual money… Now how’s that going to work out? Badly, if you ask me, but then I’ve said that all along, but who listens to me? 

Currencies today 7/17/18… American Style: A$ .7407, kiwi .6815, C$ .7572, euro 1.1715, sterling 1.3208, Swiss $1.0052, …European style: rand 13.2720, krone 8.0960, SEK 8.7880, forint 275.80, zloty 3.6720, koruna 22.0735, RUB 62.31, yen 112.55, sing 1.3612, HKD 7.8486, INR 68.28, China 6.6847, peso 18.93, BRL 3.8546, Dollar Index 94.50, Oil $68.13, 10-year 2.85%, Silver $15.76, Platinum $822.71, Palladium $916.56, and Gold… $1,241.31

That’s it for today… Well, I had better get ready for the arrival of Braden today… I had a pretty good day with my stomach yesterday, so hopefully that can continue today… I cringe when I load up the meds in the morning and at night, and realize they are the reason I have stomach problems… of course if I just didn’t eat I wouldn’t have any problems either!  HA!  I used to tell people that I was trying to grow to 6’4″ because I had reached the perfect weight for someone that tall, and I had more of a chance of growing taller at my age, then I did losing the weight! HA! So, here’s to growing to 6’4″!  A Big Thanks to my good friend, Terri, who helped me get something done yesterday, and she went out of her way to get it done for me! Thank YOU!  Ok, Uriah Heep takes us to the finish line today with their song: Sweet Lorraine…  I hope you have a Tom Terrific Tuesday, and remember to Be Good To Yourself!

Chuck Butler