- the dollar returns to kicking tail and taking names later!
- The BRICS are turning into something that we should take notice of…
Good Day… And a Wonderful Wednesday to you! The rookie sensation, Paul Skenes made quick work of the Cardinals bats last night, and the Cardinals lost to the Pirates 2-1… Too little, too late for the redbirds… UGH! I totally have been remiss with my birthday announcements this month, and completely forgot, my friend, Mike Kettler’s birthday on Monday! UGH! Well, I hope you day was grand Mike! My second favorite Chicago song greets me this morning: Beginnings…
Well, the overnight markets on Monday night brought about some dollar buying, and that momentum carried on throughout the day on Tuesday, with the BBDXY gaining 4 index points in the past 24 hours… The currencies took a small stride backwards, and now everyone is on hold until today’s STUPID CPI And FOMC finalization of their two-day meeting…
I just don’t know what the bond boys think they are going to get out of this meeting, but whatever it is, they are going to be disappointed, I’m sure…
Gold used Tuesday as a turnaround Tuesday, and turned around the early morning loss, into a gain of $6 to close at $2,317.20, and Silver couldn’t find a bid to turn around it’s early morning loss, and ended the at down 19-cents at $29.34… Even after last week’s engineered takedown, by the short paper traders, Gold is up 18% in 2024, and Silver is still up around 30% in 2024, so far…
The price of Oil added another buck to its price and is back to trading with a $78 handle… See? I told you to get your automobile gassed up when the price of Oil was down to $75!
I mentioned the bond boys above… The reason I did that, was we saw buying in the 10-year again yesterday, marking 4 consecutive days of buying and the 10-year’s yield ended up yesterday at 4.40%… I truly believe the bond boys are thinking that the Fed Heads will surprise the markets with a rate cut today… Man, the stuff they’re smoking must be hallucinating!
In the overnight markets last night… The dollar was bought some more, with the BBDXY up 2 index points to start the day… But as I checked on the currencies they appeared to have shrugged off the dollar movement… I know, I know, very strange, but it is what it is…
Gold is down $4 to start the day today, and Silver is up 4-cents, so in reality they are both flat to start the day, and I don’t think we’ll see much movement anywhere today, until the STUPID CPI prints and then later when the FOMC convenes their 2-day meeting… Yes, they have to return the board games to the shelves…
The price of Oil has a $78 handle this morning, what just happened this week with the price of Oil, will be revealed at a later date, but for now, things are back to where they were before the price of Oil taking the Nestea Plunge, earlier this week. And the the 10-year’s remained with a 4.40% overnight, and will remain there until the fireworks start later this morning.
I guess i need to address the FOMC rate decision that will come after all the board games have been put up… I really, can’t believe that the Fed Heads will cut rates today… Not after all the economic data that came through since their last meeting 6-weeks ago, that shows that inflation has not continued to go down, and has gone higher, and that wages have increased, and there are factions of the economy that seem to be OK… So, there you have it… Chuck’s call on rates today…
Yesterday, my friend, Rich Checkin, sent out a note to his clients about Gold & Silver, and I have it for you here: Like gold, silver slipped last week on news of a stronger-than-expected U.S. jobs report (which makes it likely that the Federal Reserve will continue to delay interest rate cuts). July silver futures dropped 3.3% last week and the front-month contract lost 6.1% on Friday. But like gold, silver is now regaining ground.
This pullback should be seen as an opportunity. Silver is still highly undervalued at current prices, and arguably, investors are missing out on potential gains. Silver gained 14% in May after rising 7% in April and gaining 8.9% in March, so with a clear positive trend established, there’s no better time to buy on the dip.”
Rich can be found at Asset Strategies… Rich and his uncle Michael Checkin, are dear friends of mine, with Michael always giving me words that I’m truly appreciative of…
Ok, I think it was last week that I mentioned the “unrealized losses” that banks held ($517 Billion) in Treasuries and Mortgage Backed bonds… Well, yesterday on www.zerohedge.com it was another report on this: “According to the latest data from the FDIC, the U.S. banking system is sitting on $517 billion in unrealized losses due to deteriorating bond portfolios.
Unrealized losses triggered the collapse of Silicon Valley Bank, Signature Bank, and First Republic Bank in 2023.
According to the FDIC, unrealized losses on available-for-sale and held-to-maturity securities increased by $39 billion in the first quarter. That’s an 8.1 percent increase.
It was the ninth straight quarter of “unusually high” unrealized losses corresponding with Fed monetary tightening that started in 2022.”
Chuck again… Ok, the people that look at this with the rose colored glasses, say “unrealized is no big deal, as it’s only on paper”… But, Chuck says: “yes, they are unrealized, until they aren’t!” I’m just saying…
Circling the wagons back to a currency report, I found this on Bloomberg.com regarding the Mexican peso… “Mexico’s president-elect was set to inherit the world’s top performing currency. Instead she’s confronting a historic slump in the peso that’s casting a pall over her early days in leadership.
Claudia Sheinbaum struggled to address investor concerns Tuesday that the ruling party’s landslide election win will pave the way for measures to erode the judicial branch’s independence and allow a slate of constitutional changes to be pushed through quickly. Speaking at a news conference, she said the economy was stable and touted Mexico’s trade relationship with the US, even as the peso extended a drop. The currency is now down more than 8% since the June 2 vote, by far the world’s worst performer in that span.”
Chuck again… Who knew? Who knew that the election and change of ruling party would weaken the peso? The weaker Oil price doesn’t help the peso ward off the sellers either…
The BRICS has an economic meeting in St. Petersburg, Russia, and here are the 3 main points that were discussed at the meeting:
- Putin showed how Russia still carries the potential to launch no less than nine sweeping – global – structural changes, an all-out drive involving the federal, regional, and municipal spheres.
- That was arguably the major breakthrough in Saint Petersburg. Putin stated how the BRICS are working on their own payment infrastructure, independent from pressure/sanctions by the collective West.
- It had to be, of course, about BRICS – which everyone, Putin included, stressed will be significantly expanded.
Chuck again… Yes, there are currently plans for 59 nations to join the BRICS… What did I saw the other day, about it being an us VS BRICS?
The eventual unification of all nations that want to join the BRICS, and a single unit to represent them will eventually bring about the end of the currency regime for the dollar… It won’t be next week, or next year, but it will come… Got Gold?
Ok, want proof that the media is wrong about following the STUPID CPI report? This from CNN: The Fed is winning its battle against inflation. So why isn’t it cutting rates? | CNN Business
If the media would cover John Williams’ Shadowstats.com, they would see how wrong they are… But that would be investigative journalism wouldn’t it? And no one, does that any longer!
The U.S. Data Cupboard had the The NFIB Small Business Optimism Index yesterday, and it reached the highest reading of the year in May at 90.5, a 0.8-point increase but still the 29th month below the historical average of 98. a real non-market moving data print, but one that I truly believe should be more closely looked at by the markets.
Today’s Data Cupboard has the aforementioned STUPID CPI, and the culmination of the two-day FOMC meeting to discuss rates… I’ll be a monkey’s uncle if the Fed Heads cut rates this afternoon…
To recap… The dollar continued the buying that started in the overnight markets, and finished the day up 4 index points in the BBDXY… The new regime in Mexico after the recent elections are being blamed for the peso’s plunge… The BRICS are becoming a real problem for nations in the West… I’m just saying…
For What It’s Worth… Well, Singapore is moving upward these days, and this article tells us all about their move… And it can be found here: Singapore to lead the gold market, said the World Gold Council (cnbc.com)
Or, here’s your snippet: “Singapore is set to become a leading gold hub as trading shifts east, according to the World Gold Council.
One key reason is that gold consumption in major emerging economies is rising, and a majority of these markets are concentrated in Asia, said Shaokai Fan, head of Asia-Pacific and global head of central banks.
Singapore’s proximity to these central banks, which are actively snapping up gold, is another factor, he added.
“The center of gravity of the gold market has shifted east, with Singapore, fortuitously placed as the potential fulcrum of this new balance,” Fan said at the Asia Pacific Precious Metals Conference held in Singapore.”
Chuck again… I would like to thank the good folks at GATA for sending me that link… I’ve always been intrigued by Singapore and how they set their interest rates and keep close tabs on their spending, and currency…
On a sidebar: Singapore and Russia are the only two countries that matter, that have little to no debt… I find that admirable for a country… I’m just saying…
Market Prices 6/12/ 2024: American Style: A$.6611, kiwi .6143, C$ .7273, euro 1.0761, sterling 1.2759, Swiss $1.1161, European Style: rand 18.6631, krone 10.6641, SEK 10.4613, forint 367.16, zloty 4.0331, koruna 22.9863, RUB 89.29, yen 157.32, sing 1.3425, HKD 7.8109, INR 83.54, China 7.2536, peso 18.90, BRL 5.3660, BBDXY 1,267.31, Dollar Index 105.22, Oil $78.82, 10-year 4.40%, Silver $29.38, Platinum $952.00, Palladium $887.00, Copper $4.50, and Gold… $2,313.40
That’s it for today… Well, 48 years ago today, I married the sweetheart of my life, my beautiful bride, Kathy… My bandmates sang a song that I had written for the occasion… I’ve told this story before, but here goes again… I met Kathy on the track at our high school, I was running track, and saw this beautiful red headed young lady practicing cheerleading. I stopped, and had to know who she was… I got her phone number and the rest is history… In my eye, she’s still that beautiful bride… Eddie Money takes us to the finish line today with his song: I Think I’m In Love… Pretty appropriate song for today, eh? I hope you have a Wonderful Wednesday today, and will Be Good To Yourself!
Chuck Butler