August 15, 2023
* Gold & Silver get their daily beating…
* Russian Central Banks hikes rates 350 Basis Points!
Good Day… And a Tom Terrific Tuesday to you! Well, my beloved Cardinals played to the level of their competition last night having to come from behind to beat the A’s… A win is a win, right? Never mind the blown save, and the need to come from behind… UGH! I’ve been having major problems with the new chemo, and now my oncologist has taken me off of it, while she tweaks the dosage… I have to go have blood drawn this aftenoon, so I need to drink plenty of water this morning! And don’t forget, no Pfennig tomorrow, as I will be getting scanned… Alice in Chains greets me this morning with their unplugged song: Down In A Hole…
Well, the buying of the dollar in the overnight markets (Sunday to Monday) ended yesterday, in the U.S. session, there was no more dollar buying, nor was there any dollar selling, and the BBDXY ended the day at 1,237… The short paper traders just won’t let go of thier choke hold on Gold & Silver… Hulk Hogan would be proud… Or for the old timers out there like me, Gene O’Connel would be proud… Ahhh, Saturday nights, and “Wrestling At The Chase” aired in the St. Louis region… That was a very long time ago!
Gold, as I just mentioned was subjected to the short paper trades once again, and lost another $6.30 yesterday, while Silver lost 7-cents… Gold closed at $1,907.80, and Silver closed at $22.69… The price of Oil lost another buck during the day yesterday, and ended the day trading with an $81 handle… Bonds are seeing mucho selling these days, with all the issuance of new bonds coming down the pike, the 10-year’s yield had risen to 4.20% to end yesterday…
The price manipulators, or short paper traders have become so brazen with their attacks on the metals… Take yesterday for example… Gold was down early in the day, but rallied back by noon, an was even on the day, and that’s when the boys in the band showed up at the COMEX with arms full of short paper traders… They don’t even need an excuse to bring the metals down an longer, they just go our and get it done!
Yesterday, I talked about how the Russian ruble had dropped like a rock off a cliff, and had gone past 100 in price VS the dollar… Well, the prompting by the Foreign Ministry guy who called out “loose monetary policy” on the Russian Central Bank, may have hit a nerve, because the Russian Central Bank called an “emergency meeting” yesterday, where they hiked rate 350 Basis Points to 12%! The Central Bank pointed to how the weak ruble was allowing inflaiton to rise in the Russian, and therefore they needed to hike rates… Inflation is running about 7% in Russia, so their positive interest rate is 5%… And the ruble responded appropriately…
In the overnight markets last night… There was little to no movement in the dollar overnight… The BBDXY is still trading in the same clothes as yesterday at 1,237…. Gold is getting sold again this morning, and is down $5 as I write, with Silver down 29-cents… More of the same-o, same-o, for the metals… When is this going to stop? I know, I know the dog days of summer are never kind to metals, but this is preposterous!
The price of Oil remains in the $81 handle, after reaching $86 briefly last week, Oil has slid downward, but still, to me looks like it will want to move to $90… I’m just saying… And the 10-year’s yield, has risen some more overnight to trade at 4.22% this morning… It’s not like I didn’t warn you about this rise in yields… The debt issuance has been unreal, causing yields to rise to attact buyers for all the issuances…
Well, did you hear about the latest U.S. Bank to fail? Probably not, because, the media has a hush-hush on bad news in the economy… OK, I made that up, but it wouldn’t surprise me one bit if the media did have a hush-hush on bad news in the economy! Seriously though, the latest bank of fail was the Heartland Tri-State Bank in Kansas… Remember when I told you that the end of the banking crisis was not nearly at an end? This bank wasn’t on the list of Big Banks, but still it’s another one bites the dust… And the economy is moving along just fine, eh, Janet? As if!
I really went all postal on the short traders and their scheme yesterday, eh? Well, they deserve it, every inch of it! And probably more! I saw a line from a writer that quoted a hedge fund guy, who told him that the HUGE breakout for Gold & Silver is coming… Well… count me in on those that are waiting!
Well, the folks, Russ & Pam Martens at www.wallstreetonparade.com had this to say yesterday, and I like the sound of it, here it is: “In the Federal Reserve’s most recent “Supervision and Regulation Report” on the big bank holding companies it “supervises,” the Fed continued its attempts to perpetuate the narrative that “The banking industry came into 2020 in a healthy financial position” and has simply unraveled as a result of the COVID-19 pandemic. That narrative is built on the same flimsy house of cards that the New York Times and Andrew Ross-Sorkin built the narrative that the mega banks on Wall Street were not responsible for the 2008 financial collapse.
The Fed is desperate to promote this narrative to stop a new Congress next year from holding hearings on why the Fed, for the second time in 12 years, had to engage in trillions of dollars in Wall Street bank bailouts after reassuring Congress for years that the financial system was fine as the Fed loosened or rolled back reforms like the Volcker Rule. The Fed needs this narrative to prevail in order to cover up its own negligent supervision of the behemoth banks.
Depending on the composition of Congress next year, those hearings might bring about not only a restoration of the Glass-Steagall Act (which bans trading houses on Wall Street from combining with federally-insured, deposit-taking banks) but might also put an end to the Fed’s ability to negligently supervise the big banks with one hand, while bailing them out with the other hand, using money it creates out of thin air. (The Fed will report its latest balance sheet tally today at 4:30. It is expected to be close to $7 trillion from the $6.7 trillion it reported last week – which is $2.8 trillion more than it was exactly one year ago. The growth in the Fed’s balance sheet has come as a result of efforts to prop up Wall Street banks.)”
Chuck Again… wouldn’t that be nice if we could wake up, in the morning when the day is new, and find that Glass-Stegal has been reinstated, we could then party the whole day through!
The Fed Heads have used that excuse of the Plandemic causing them problems for far too long… If you recall, in September of 2019, I was writing about all the repos the Fed Heads were doing for the Big Banks, and pointed out that this can’t be a good thing going forward…
The U.S. Data Cupboard has the July Retail Sales for us to see this morning… The BHI (Butler Household Index) indicates to me that July deliveries to our house were plenty, so that’s a good sign for Retail Sales, but then in July, we had the beginning of “Back To School” buying… And the lastest Consumer Credit (read debt) told us that credit card purchases were a plenty in July… So, it all comes together, eh?
To recap… the dollar buying in the overnight session ended in the U.S. session yesterday, no dollar buying was done, and by the same token, no dollar selling went on either! Gold & Silver got sold once again, by the short paper traders, And we have a big session in Congress coming up…
For What It’s Worth… I mentioned Fitch and its credit rating downgrade and then I was just minding my own business and this article popped up about Fitch… And it’s about further rate cuts that could be coming from the ratings Agency and it can be found here; Fitch warns it may be forced to downgrade dozens of banks (cnbc.com)
Or, here’s your snippet:”A Fitch Ratings analyst warned that the U.S. banking industry has inched closer to another source of turbulence — the risk of sweeping rating downgrades on dozens of U.S. banks that could even include the likes of JPMorgan Chase
.
The ratings agency cut its assessment of the industry’s health in June, a move that analyst Chris Wolfe said went largely unnoticed because it didn’t trigger downgrades on banks.
But another one-notch downgrade of the industry’s score, to A+ from AA-, would force Fitch to reevaluate ratings on each of the more than 70 U.S. banks it covers, Wolfe told CNBC in an exclusive interview at the firm’s New York headquarters.
“If we were to move it to A+, then that would recalibrate all our financial measures and would probably translate into negative rating actions,” Wolfe said.
The credit rating firms relied upon by bond investors have roiled markets lately with their actions. Last week, Moody’s downgraded 10 small and midsized banks and warned that cuts could come for another 17 lenders, including larger institutions like Truist
and U.S. Bank
. Earlier this month, Fitch downgraded the U.S. long-term credit rating because of political dysfunction and growing debt loads, a move that was derided by business leaders including JPMorgan CEO
Chuck again…. Well, you can certainly expect to hear more whining and crying from Janet Yellen about these credit rate cuts, because in her mind, one that looks through rose colored glasses, the U.S. economy, and banking system is just fine, and that these cuts are unwarranted… I think you all know what I think of Janet Yellen’s viewpoint, eh?
Market Prices 8/15/2023: American Style: A$ .6474, kiwi .5971, C$ .7411, euro 1.0935. sterling 1.2707, Swiss $1.1402, European Style: rand 19.2033, krone 10.4789, SEK 10.8372, forint 354.48, zloty 4.1042, koruna 22.0647, RUB 98.77, yen 145.48, sing 1.3569, HKD 7.8257, INR 82.94, China 7.2865, peso 17.11, BRL 4.9635, BBDXY 1,237.92, Dollar Index 103.29, Oil $81.70, 10-year 4.22%, Silver $22.41, Platinum $893.00, Palladium $1,243.00, Copper $3.70, and Gold… $1,902.55
That’s it for today… well, this day August 15th will always be burned on my brain, for that was the day each year when we began summer football practice… Some years, we did 3-a-days and some 2-a-days… It was grueling, hot, and I loved every minute of it! I’ve been stuck at home this week, as I’m afraid to go out in public with my stomach problems right now… UGH! Well, it’s not like you go many places anyway, Chuck! Ok, so I’m complaining, can you let me get away with that for once? Ok, I’ve got a treat for my song to send us off today… The great Stan Getz, plays his 1964 hit of year, The Girl From Impanema… The girl that sang that song, died the other day… She was the wife of one of the musicians and was not a trained singer… There, a little trivia for you! I hope you have a Tom Terrific Tuesday today, and please Be Good To Yourself!!
Chuck Butler