December 14, 2020
*The dollar continues to weaken VS currencies
* It’s a Monday, Monday can’t trust that day for Gold…
Good day… And a Marvelous Monday to you! Well the BIG weekend for my beloved Missouri Tigers, didn’t go as hoped, but… While the football team got pummeled, the unranked Tigers basketball team upset #6 ranked Illinois, in their annual Braggin’ Rights game… My kids, and grandkids all came over to watch the basketball game with me, and a good time was had by all… Especially, watching little Evie, wolf down some dear sausage… Uncle Jerry couldn’t tear the sausage in small pieces fast enough for her! So darn cute! Kathy came home from S. Florida last night, In two more weeks she’ll be heading back! Only this time, with me! We’re heading into the home stretch to Christmas… My favorite time of year… Ray Charles greets me this morning with his soulful song: You Don’t Know Me
Well, I tried yesterday to get caught up with my reading, emails, etc. I get sent so many things to read, that sometimes I feel like they are piling up… I didn’t get through many of them, as I had other things I had to get done, but…. I did read the article I’m going to highlight in the FWIW section today. And I’m sure you will want to read it too, as it highlights something that I’ve talked about in the past… Asking the question, Does the Trust Co. for the ETF GLD actually have the physical metal to back the ETF holdings like they say they do? There was some shady business goings on there at the Trust Co. and you’ll be able to read all about it below, so stay tuned, same letter, same writer…
Well, when I left you on our Tub Thumpin’ Thursday, the Aussie dollar(A$) was within spittin’ distance of 75-cents… And shortly after signing off the A$ pushed past 75-cents and now is trading well into that75-cent handle. The New Zealand dollar/ kiwi, rallied alongside the A$, and kiwi is now within spittin’ distance of 71-cents! In September, kiwi, was trading around 66-cents… So, it’s been a slow climb, but one that has been quite Steady Eddie.
The euro has been moving higher in recent weeks, on the fact that the European Central Bank (ECB) is doing everything they can to keep the dream of a one currency, several countries coming together, going… And while that doesn’t seem to be the REAL reason for the euro’s upward move recently, it isn’t… I’ve told you before a few times, that in a true weak dollar trend, it matters not what the problems for the other currencies may be, they will rally as a result of investors, selling dollars… That includes the Japanese yen, British sterling, and so on…
Speaking of the British pound sterling… I’m suspected a real problem coming up for sterling, given the problems with agreeing on a BREXIT departure Trade agreement. There were reports a month or so ago, that the negotiators had told PM Johnson, that he should get the champagne ready to pop the corks and celebrate… But then nothing came of that, and now it appears to be a non- agreement instead… The time limit is coming up for this transition… The transition (sometimes called the implementation period) will end on 31 December 2020. It cannot be extended beyond that date.
What does it mean for the U.K. if no agreement is signed? The U.K. would have no Trade agreement with the Eurozone… And that’s going to cause major problems folks… So, watch out here…
Do you know what else expires on 12/31? The free passes on mortgage and rent payments… I don’t know what it would be like to not know whether or not you were going to have roof over your head, but I do know that can’t be good for one’s health… Stress, nerves, fears, etc. You know, it’s the government’s fault we’re in this mess… Economic lockdowns, etc. But I’m not going there today… Man did I stir up a hornet’s next last week with my opinion and well… I don’t feel like getting 100’s of emails telling me how stupid I am, again…
OK, back to the markets… Gold lost $2.90 on Thursday, and then gained it back on Friday gaining $3.50, to close at $1,839.50. Silver traded opposite of Gold, gaining 4-cents on Thursday, and losing 4.5-cents on Friday… There’s been a lot said and talked about regarding Gold’s future, with the emergence of Bitcoin… I don’t know… let’s see… I can hold a Gold coin in my hand, put it in my pocket, and push come to shove, I could spend it if I needed to. I’m just saying…
In the overnight markets… The dollar continues to weaken VS the currencies, but… Gold is down $14 in the early trading today. It is a Monday, you know Monday, Monday can’t trust that day… But I thought we were through with those Monday takedowns? I guess not… But last Monday we saw weakness in Gold in the early trading and that got turned around for a nice upward gain for the day. So… maybe… because one never knows!
The Dollar Index has fallen to 90.50, folks… The index has really taken a ride on the slippery slope in the last two months… And with every day that goes by, and we see this kind of weakness, it confirms my thought that we’ve entered a new weak dollar trend…
The Big News from Friday, was the announcement by the FDA that they had approved an emergency use for the Pfizer vaccine… And yesterday, I read where the trucks loaded with vials of vaccine were seen leaving en-masse, from their Michigan home address.. .Health workers will be the first in line to receive the vaccine, that needs to be in two shots, separated by 21 days with the Pfizer, vaccine, and 28-days with the Moderna vaccine.
So, Bully for us, our drug companies went to bat for us, and delivered… Now, I guess we’ll have to see what the side effects are, because…. These vaccines were rushed through the testing phases, and I’m skeptical as to how much testing was actually done. But then that’s just me, always skeptical of things like this… Why can’t I be more happy-go-lucky? Why can’t I just take for granted what I read and am told?
The price of Oil has bumped higher to a $47 handle. I guess the rollout of the vaccine has Oil traders giddy… Hold on there partner… It’s going to take some time before we get the economy started up again… I think when the businesses begin to open and so on, that it’s going to be like when you let your car sit for a long time in the winter, and you go to start it, and all you hear is click, click, click… Dead battery… I’m just saying…
OH, well,, Let’s see what else? Hmmm…. This will be a very busy week with the U.S. Data Cupboard, but with nothing coming from it today… Tomorrow we’ll start off, with Industrial Production and Capacity Utilization, both for November. I believe that we’ll begin to see the rot on the economy’s vine really get exposed in these reports… And on Wednesday, we’ll see Retail Sales… I have to say that while I want to say that this data will be weak, I have to question that thought because the Butler Household Index (BHI) indicates that Retail Sales will be stronger in November than in the previous month…
To recap… The end of last week saw little to no movement in the metals, and only a handful of currencies continuing to move upward VS the dollar… Chuck thinks that from now until the end of the year, the dollar will be pushed lower and lower… BREXIT transition ends 12/31, and so far no trade agreement… This could weigh heavily on sterling… 12/31 is also the end date on the free passes on mortgage and rent payments… That could turn out to be quite ugly folks… And what place in line will you be for the vaccine shots?
For What It’s Worth… Well, I built this up above, and now it’s time to reveal the article that everyone should be fearing to read if they own GLD… This is about whether the Trust Co. for GLD has the phsical Gold to back the ETF or not…. And the shady business going on with the Trust Co., and it can be found here: GLD 10-K omits BoE gold holdings data, GLD CFO left 1 day before financial year-end (bullionstar.com)
Or, here’s your snippet: “The latest financial report and statement has recently been submitted to the U.S. Securities and Exchange Commission (SEC) by GLD Sponsor, World Gold Trust Services (WGTS), the fully-owned subsidiary of the World Gold Council.
Alarm Bells
Covering the financial year to 30 September 2020, this GLD 10-K should be raising alarm bells at the SEC given that the Principal Financial and Accounting Officer (CFO) who signed off on it, Brandon Woods, had only been in the CFO position at the GLD Sponsor for one day prior to GLD’s financial year-end. Woods was appointed on 29 September 2020.
To put it another way, the GLD Trust Sponsor’s previous Principal Financial and Accounting Officer (CFO), Laura Melman, resigned from her CFO role at WGTS on 29 September 2020, one day prior to GLD’s 30 September financial year-end.
If anyone knows of a CFO joining a high-profile listed ETF Trust one day prior to financial year-end and then signing off on the annual accounts, please let us know. Likewise, for a CFO of a high-profile listed ETF Trust leaving one day prior to financial year-end and not waiting for financial year-end. None of this, to say the least, is normal.
The World Gold Council would have you believe that everything was hunky-dory, with the 8-K (departure and appointment) form submitted by WGTS to the SEC on 29 September 2020 stating that Melman’s “departure did not arise from any disagreement on any matter relating to the operations, policies or practices of the SPDR® Gold Trust”. However, it also said that Woods’ appointment on 29 September was “effective immediately”, i.e. one day before GLD’s financial year end.
Why did the CFO resign one day before financial year end and not put her name to the annual 10-K submission to the SEC? That fact that the 8-K form was rushed out on 29 September appointing the new CFO “effective immediately” shows that the departure of Melman was abrupt, and that it triggered the rushed appointment of Woods on the same day “effective immediately”.
Perhaps in the world of fly-by-night companies, CFOs depart and appear a day before financial year-end, but this is not the norm when applied to the world’s largest gold-backed Exchange Traded Fund (ETF), a Trust which as a reminder, on 30 September 2020 claimed to hold 40.8 million ounces of gold worth US$ 77 billion with custodian HSBC Bank plc in London, and a Trust whose only asset is “allocated gold bullion”.”
Chuck again… Yes, this all sound too fishy to me, folks… Someone should be sounding an alarm to get in there and audit the Trust Co. But they won’t… I’m just staying completely away from GLD, I’ve always had my doubts about it, and now? ….
Market Prices 12/14/20: American Style: A$ .7570, kiwi .7114, C$ .7854, euro 1.2157, sterling 1.3407, Swiss $1.1285, European Style: rand 15.0026, krone 8.7043, SEK 8.3925, forint 290.70, zloty 3.6805, koruna 21.6354, RUB 73.06, yen 103.71, sing 1.3323, HKD 7.7514, INR 73.45, China 6.5457, peso 20.04, BRL 5.0645, Dollar Index 90.50, Oil $47.04, 10-year .93%, Silver $23.96, Platinum $1,028.00, Palladium $2,367.00, and Gold… $1,825.70
That’s it for today… Well the college football conference Championships will be played this Saturday, while other teams in each conference finish out their schedules… That means my Beloved Missouri Tigers will travel to Starkville Miss, to play Miss St. And the Missouri Basketball team will open its conference schedule with highly ranked Tennessee… I heard from my longtime friend, and former Big Boss, Frank Trotter last week… He’s thoroughly enjoying retirement, climbing mountains, hiking, etc. I wish I was able to me active… I’m just saying. But I’m not, and life goes on… Well, this Thursday will be a Big Day for youngest son, Alex, as he will close on his house… And former colleague, and someone I’ve known since he was quite young, Dane Moody, tied the knot this past weekend, So, congrats Dane & Loraine! ! And welcome to your new phase of Life! I have no doctor appts. this week, fingers crossed, and won’t have any until the 28th! Again fingers crossed, because with me, the wolf is always at the door! Linda Ronstadt takes us to the finish line today with her song: Blue Bayou… ( I love how she sings this song!) I hope you have a Marvelous Monday, and Please Be Good To Yourself!
Chuck Butler