- currencies and metals get sold on Monday
- Jay Powell is a day late and a dollar short…
Good Day… And a Tom Terrific Tuesday to you! A real crappy day weather-wise here yesterday, with a cold front that came through, and temps were so abnormal to S. Florida… UGH! There’s not a lot more I can say about the BLS’s lies and videotape from last Friday. So, we’ll move along, and try to put it in our rearview mirror, and watch it get smaller and smaller as we drive away. I didn’t leave the condo yesterday… And that’s very strange for me, given I always prefer to be outside… Blood, Sweat and Tears greets me this morning with their great 60’s song: Spinning Wheel…
So, how many of you watched Fed/ Cabal/ Cartel Chairman, Jerome (Jay) Powell on 60 Minutes Sunday night? If you did, did you hear him talk out of both sides of his mouth? First he said, “the U.S. is on an unsustainable fiscal path” in a “60 Minutes” interview with Scott Pelley released Sunday.
And then had the audacity to say, ““The U.S. federal government’s on an unsustainable fiscal path. And that just means that the debt is growing faster than the economy. So, it is unsustainable. I don’t think that’s at all controversial, when he was asked if the debt was a danger to the economy… Wait, What? on one hand he said the debt was on an unsustainable path, and on the other hand, it’s no big deal… That’s Fed Speak folks… And in my years of deciphering Fed Speak, I find that Jay Powell, realized he had upset the apple cart when he said the debt was unsustainable, and then tried to water it down by saying it was no big deal… A real two-handed economist…
Then Jerome Powell followed that talk over the weekend with this ditty yesterday, “Fed’s Jerome Powell says it’s past time for an ‘adult conversation’ about unsustainable fiscal policy.”
Ahem… excuse me for butting in here Jay, but… You’re a dollar short and a day late on that comment! The time to have the adult conversation about the debt was $25 Trillion ago, when I first started pointing out how bad our debt picture was…
So, you would think that come Monday morning, that the markets would take what he said about the debt being unsustainable, to heart, and begin to ratchet back all the gains the dollar had made on Friday… But NOOOOOOOOO! The dollar continued to get bought on Monday, and bought all day long, with the BBDXY gaining 6 index points by the time the day ended. The currencies all look sick, and I mean ill-sick, not the other kind the way the kids use sick… And just when it appeared that Gold was ready to run higher once again… Friday’s engineered takedown, led to yesterday’s follow up $17 loss… That’s $32 of loss that Gold has taken on, since the BLS’s lies and videotape Friday mid-morning. And Silver has lost 55-cents the last two days… All have been brought to levels that way below any moving avg. that matters…
Higher and longer, the new way we describe interest rates here in the U.S. has really taken a toll on bonds… These guys just couldn’t get it through their thick heads that the Fed Heads were NOT going to cut rates in March… They were so all about getting ahead of the Fed/ Cabal/ Cartel… And now they’ve had their rear-ends handed to them, once again I might say, but then what else would you expect, when you don’t listen to Chuck? HA!
In the overnight markets last night… Well, I was up late last night, don’t know why, just turned out that way, and before I went to sleep land, I checked the overnight markets, and the dollar was getting sold, with the BBDXY showing a 4 index point loss at that time… So, this morning I half expected to turn on the screens and see the dollar down overnight, but NOOOOOOO! The BBDXY is up 1 index point this morning, so somewhere, someone, some institution bought dollars, and kept the pressure on the currencies.
Most of the currencies are taking defensive stances at this point… There’s one currency that is holding its own against the dollar’s strength… And it is the Mexican peso… Go figure… When all the currencies that aren’t pesos, are getting dragged through the mud, the peso shines…
Gold is up $3 in the early trading this morning, and Silver is down 15-cents… I don’t know what else to say about the metals other than to do 1 of 2 things… 1. batten down the hatches, 2. look for buying opportunities… The short paper traders even took a pound of flesh from Copper yesterday… You know, the metal that’s so short, that adding short trades, makes abundant sense… NOT!
The price of Oil is up a buck this morning… The slashing of Oil’s price that went on late last week, was something unforeseen by me ahead of time… I really thought that with the U.S. retaliating against the terrorists causing all the problems in the Red Sea, and the report I read last week that talked about Oil importing nations are now looking elsewhere for Oil that doesn’t need to go through the Red Sea gauntlet…
For all you folks out there that are digital coin fanatics, U.S. Treasury Sec. Janet Yellen, wasn’t giving you any warm and fuzzies yesterday, when she spoke before Congress… Yellen was quoted as saying that ” the crypto industry poses several potential hazards to the financial system, including the dangers of stablecoins, runs on crypto platforms and volatile prices”, according to a brief portion of her testimony posted Monday.
Yellen is appearing before the House Financial Services Committee on Tuesday to explain the latest work of the Financial Stability Oversight Council (FSOC), a group of U.S. financial agency heads that the secretary leads. The council, which is meant to head off the next financial crisis before it happens, has paid special attention to crypto risks in recent years, putting them among the top categories of potential worry.
Chuck again… I found that perusing through Google yesterday…
The U.S. Data Cupboard yesterday had the services index that doesn’t move markets… And Consumer Credit, read debt, fell from $23 Billion to $15 Billion in January… So, it must have been a fun Christmas this year, eh?
There’s nothing in the Data Cupboard today, except for 4 different Fed Heads speaking in different cities…
To recap… Monday’s price action followed Friday’s meltdown of currencies and metals… And overnight there was more dollar buying… Jerome Powell, said the U.S. debt was unsustainable, but then followed that up with a comment about how the debt is not a big deal… Yeah, and I’ve got bridge to sell you Jay! He also said it was time to have an adult conversation about the debt… Chuck points out that the conversation about the debt should have taken place $25 Trillion ago! And Janet Yellen didn’t place any leis on the digital currencies crowd yesterday…
For What It’s Worth… Speaking of the debt… The U.S. Treasury dept, had some very disheartening news for us yesterday, and this article talks about that and the refunding problem coming for the U.S. and the article can be found here: The US has a $6 trillion problem over the next twelve months | Schiff Sovereign
Or, here’s your snippet:”Yesterday the Treasury Department announced that they expected to increase the national debt by a whopping $760 billion this quarter alone… and another $202 billion next quarter.
In short that means almost $1 trillion added to the national debt just in the first half of this year. And, again, these are the Treasury Department’s own estimates.
Obviously, that’s a pretty horrible result; even a senior Treasury official acknowledged that they have “significantly increased” their bond sales and the national debt. Not that they’re doing anything to stop the trend.
But there’s an even greater risk that the Treasury Department faces this year that is hardly being discussed anywhere.
Over the next twelve months, more than $6 trillion in existing US government debt is set to mature… and will need to be paid back somehow.
So, to give you an example, back in 2014, the federal government issued $264 billion in 10-year Treasury notes.
Well, it’s now 2024, i.e. ten years later. Meaning that $264 billion worth of 10-year notes issued in 2014 will become due and payable this year.
In 2017, they issued $368.8 billion worth of 7-year notes. And those 7-year notes issued in 2017 are due and payable this year.
You get the idea. The point is that the total sum of Treasury Bonds, Notes, and Bills outstanding that will become due and payable this year exceeds $6 trillion.”
Chuck again… Well, add the $6 Trillion to what will probably be $2.5 Trillion in new debt this year, and then add in the fact that the buyers of our debt that were around 10 years ago, probably don’t have the same appetite for U.S. debt now… What will we do? Stay bat tuned, same bat time, same bat channel, for more in the future…
Market Prices 2/6/2024: American Style: A$ .6491, kiwi .6050, C$ .7384, euro 1.0724, sterling 1.2542, Swiss $1.1450, European Style: rand 18.9893, krone 10.7039, SEK 10.6307, forint 361.37, zloty 4.0593, koruna 23.2620, RUB 90.91, yen 148.78, sing 1.3459, HKD 7.8230, INR 83.05, China 7.1896, peso 17.10, BRL 4.9741, BBDXY 1,240.24, Dollar Index 104.55, Oil $73.19, 10-year 4.16%, Silver $22.35, Platinum $904.00, Palladium $962.00, Copper $3.78, and Gold… $2,026.90
That’s it for today… Well, I’m not sure that today’s weather will be much better than yesterday’s… But it will get warmer soon, and then I’ll forget about all the gray skies, wind and rain! I guess I shouldn’t have complained about yesterday’s weather here, given the way the state of California is getting hammered by the Pineapple Express, a river of rain that has fallen and caused major flooding… I read this morning that my beloved Cardinals were packing up the gear to head to Spring Training yesterday… That was always a sign for me that baseball wasn’t far away… And today, there’s only 8 more days until pitchers and catchers report to Spring Training! And this is the first reminder for you that next week is Valentine’s Day… hint, hint… The Beatles takes us to the finish line today with their song: And I Love Her… a pretty song… and one of my faves… I hope you have a Tom Terrific Tuesday today, and will Be Good To Yourself…
Chuck Butler