Overnight Markets Are Without Interference…

February 9, 2023

* Currencies & metals rally in the overnight markets

* Are U.S. Consumers tapped out? 

Good Day… And a Tub Thumpin’ Thursday to one and all! The last Pfennig before the Super Bowl that will take place this coming Sunday… The game doesn’t start in the Eastern time zone until 6:30pm, and given the length of previous Super Bowls, it’ll be 11 PM before it’s over! The Super Bowl commercials have always been a highlight of sitting through the whole game…  I still laugh out loud when seeing the Budweiser commercial with the horses getting ready to play football, and shaven sheep, runs across the field, and two cowboys watching said, “streaker”…  Kansas greets me this morning with their great song, that’s 9 minutes long: Song For America

Well… the profit taking in the dollar ended yesterday, with the dollar gaining on the day. Price manipulators were back, taking the starch out of the shirts of the metals, and so, everything was back to normal…  As if!  The BBDXY gained 2 index points yesterday, no big shakes, but for most of the day it was down, but miraculously, the dollar pulled a rabbit out of its hat, and the price manipulators were the prize! Gold which was up $8 in the morning, found it difficult to eke out a gain, and only saw $3.10 added to its price. Silver wasn’t so good, and couldn’t pull the iron out of the fire, and lost 15-cents on the day. Gold ended the day at $1,876.60, and Silver ended at $22.40…

The price of Oil gained a buck on the day, and ended the day trading with a $78 handle… And bonds got bought again driving the yield on the 10-year back to 3.60%…    I know I always sound like I’m glad that the price of Oil rallies, and I am..  No, I don’t like to pay higher prices at the gas pump, but I really don’t drive that much any longer, so it is what it is, as far as I’m concerned…   The reason I’m glad with Oil rallies, is that means the demand for Oil is still strong…  And that has to totally tick off the green folks…  And anything that ticks them off is good with me!

Yesterday, I had an article in the FWIW section that talked about how U.S. Consumers are running on empty… And then I saw this on Bloomberg… “over half of Americans making over $100K living paycheck to paycheck” reads a CBS News report.”… Wait, What?  Americans making over $100,000 are living paycheck to paycheck? YIKES…  The report mentioned that the higher interest rates were playing a part in this… And that got me thinking… 20% interest rates on charge cards… making the monthly payment on those loans could really take a bite out of consumers’ disposable income…

In the overnight markets last night… It appears from the last couple of nights of trading that the foreign markets are without interference in the form of price manipulators, and therefore they sell dollars… The BBDXY lost 4 index points last night, Gold is up $6 in the early trading today, and Silver is up 7-cents… There’s not a lot in the way of data to sway the markets when they open in the U.S. this morning, so hopefully, the price manipulators are busy filling out their Super Bowl squares to participate… Besides, these bastardly guys usually like to pile on a data print that gives them cover of the night…

The price of Oil remained in the $78 handle overnight, and Bonds slipped another basis points to 3.59%, just when I thought the bond boys had thrown in the towel on the Fed Heads pivot, they start marking up bonds again…  C’mon boys, pick a lane, and stick to it!

Everything I look into these days, has something to do with or mentions, AI…   ChatGP is the current one, but Microsoft announced a new interactive Bing search, and there will be others… The thing I read yesterday, said that by the end of the year, most Americans will have tried AI…  

I’m thinking that I will be one of the few that don’t try it…   I’m so old school, I remember doing Algebra equations and answers on the blackboard! I’ll go to AI kicking and screaming, trust me on that one folks…

Speaking of ticking off the green folks… This report will really tick them off, check this out, “Recently published data from the National Oceanic and Atmospheric Administration (NOAA) shows that there has not been global warming for the past eight years. And NASA satellite data reportedly confirms that evidence, showing no global warming for eight years and five months, according to JunkScience’s Steve Milloy.”

I know, you’re saying, that you don’t know what this has to do with economies, data, dolts, finances, etc…. Oh grasshopper, but it does… Because the green folks want to spend more money than the you can shake a stick at, on their attempt to control the climate… this is money we don’t’ have to spend, and the only place the Gov’t can get money is from you & me, in taxes…   So, now tell me this doesn’t have anything to do with all those things above!

Besides, haven’t you learned by now that Chuck is always right?   OK, now that’s really funny!

Ok… For all those folks that used to call the currency and metals desk and tell us that they owned dinar, and they bought it because they heard it was going to be revalued for twice its value… Iraq finally revalued the currency, but nowhere near twice its value!  

I had a man walk up to me I Panama a few years ago now, and tell me he sold his family business, and put all his funds into dinar, and asked me what I thought about that… I said, “are you kidding me? You did what? Have you never learned anything of what I say, about diversification? Iraq is no where near being ready to revalue their currency, so are you going to hold it until they do? “ He stormed off huffing and puffing…  I guess he complained to the Sovereign Society, because they never asked me to speak at one of their conferences again…  But then the Sovereign Society’s leader at the point, was Erica Nolan, and she soon left the Sov. Soc. To do something else… So, I never blamed her for this omission of me at conferences!

The U.S. Data Cupboard yesterday, finally came out with the Consumer Credit (read debt) report for December… Proving once again what I’ve been saying….  the U.S. consumer appears to have finally hit a brick wall: the Fed published the latest, December consumer credit report, which found that in December, total U.S. consumer credit increased by just $11.565Bn, which was not only a huge, 65% drop from November’s upward revised $33.1Bn print, but also a huge, 50%+ miss relative to consensus expectations of $25BN, the biggest miss since August 2020!

We should have known that this would happen, not to the extent that it fell, but given what we already knew about December Consumer spending, I was expecting a fall in debt… higher interest rates also are probably to blame for this, no more easy, and cheap credit…  Oh-No, what are we to do?

Today’s Data Cupboard just has the weekly initial jobless claims… Along with that we’ll see the continuing claims.. Given all the layoffs that I’ve been reading about lately, I suspect this number to begin rising once again…

In this lack of data this week, here’s something that I doubt was talked about in the State of the Union the other night… “The world has just a few major shipping companies, and one of the ones we track is A.P. Moller-Maersk A/S, which expects global containerized shipping volumes to slide by as much as 2.5% this year amid “muted” economic growth worldwide. We’ve been seeing demand falling from both the U.S. and Europe, and it’s a pretty sharp correction,” Maersk Chief Executive Vincent Clerc told Bloomberg in an interview.”  Just another sign on the road to ruins… These signs are akin to the Burma Shave Cream signs that used to be along side the road… One after another telling a story… Remember those?  I know the youngsters won’t have a clue as to what I’m talking about here… Their loss…

To recap… The dollar profit taking ended yesterday, with the dollar being bought, by a small amount, but bought nonetheless… And the price manipulators were back attempting to keep Gold from taking off, and keeping Silver down… Americans making $100,000 per year are living paycheck to paycheck… Well, not all Americans making that amount, but a large percentage!  Chuck talks about ticking off the green folks this morning, that seems to be a favorite thing for him to do! The price of Oil keeps inching higher, and bonds got bought yesterday…  In the overnight markets the dollar

For What It’s Worth…  I’ve said this before, and I’ll say it again, whenever Matthew Piepenburg writes something I read it and search for FWIW worthy articles! So, this is a good article by Matthew, as he talk about how Gold has performed, and his thoughts on the dollar…And this article can be found in its entirety, here: No Matter How You Turn It, The Global System is Already Doomed: Got Gold? – Matterhorn – GoldSwitzerland

Or, here’s your snippet: “Below we look at the interplay of embarrassing debt, dying currencies and failed monetary fantasies masquerading as policies to confirm that no matter how one turns or spins the inflation/deflation, QT/QE or recession/no-recession narratives, the global financial system is already doomed.

Recession: The Elephant in the Room

As I’ve been arguing in report after report, my view has been that the US, with its 125% debt-to-GDP and 7% deficit-to-GDP ratios, was, and already is, in a recession heading into 2023, despite official efforts in DC to re-define the very definition of a recession.

But a recession is still a recession, and an elephant is still an elephant, and both are fairly easy to see at a distance.

As of now, however, the recession has officially been avoided.

How comforting.

As with the inflation data, it’s nice when the folks in Washington can exercise their magical powers to move the goal-posts in mid-game whenever a little “cheating” helps their odds and fictional narrative.

For me, an elephantiac recession is now in the room.

The Empire Manufacturing data in my latest report, for example, supported this recessionary outlook.

In case, however, we still need more recessionary evidence, the dramatic 6 month decline in the Conference Board’s index of leading indicators serves as yet another neon-flashing warning that the recession—if not under our bow—is certainly right off our bow.

Furthermore, and despite Powell’s belief that his office can manage a recession with the precision of a home thermostat, his faith in what he lately described as a “softish landing” is almost as farcical as his prior attempt to describe inflation as “transitory.”

Without wishing to appear “sensational,” as many of us blunt and math-based observers (from Burry to Middelkoop) of late are described, I will stick my tin-foil-covered head out and say candidly that I see nothing “softish” ahead.

Instead, I see either: 1) a financial crisis which will dwarf 2008 and/or, 2) an absolute tanking of the USD, whose unsustainable strength throughout 2022 was indeed “transitory,” as I argued numerous times.

Gold was a far more loyal asset than stocks and bonds in the turbulent times of 2022; and given that 2023 portends to be even worse, we can expect better loyalty from this so-called “barbarous relic” of the past.”

Chuck again… a long snippet, yes, but an even longer article, should you want to read everything that Matthew wrote, and I strongly recommend you doing so, by clicking on the link above!

Market Prices 2/8/2023: American Style:  A$ .6977, kiwi .6366, C$ .7458, euro 1.0759, sterling 1.2137,  Swiss $1.0870, European Style: rand 17.6810, krone 10.1611, SEK 10.4127, forint 358.78, zloty 4.4090, koruna 22.0226, RUB 72.92, yen 130.90, sing 132.25, HKD 7.8499, INR 82.51, China 6.7785, peso 18.89, BRL 5.2009,  BBDXY 1,2333.22, Dollar Index 103.48, Oil $78.61, 10-year 3.59%, Silver $22.47, Platinum $974.00, Palladium $1,653.00, Copper $4.08, and Gold… $1,882.81

That’s it for today…! Just last year, we had to install a new A/C unit, and already this year the evaporator coil had gone bad… it was a warranty item, so no money out of my pocket, but I was thinking that’s too darn fast for that coil to go bad… good thing it was a warranty item!  But we carry on…   Good thing it didn’t conk out in the summer time!  Yes, I thank my lucky stars all the time!   I’ll be rooting for the K.C. Chiefs in the Super Bowl… Hey, they ARE a Missouri Team! And since we don’t have a team in St. Louis, we have all adopted the Chiefs! Only 4 more days till pitchers and catchers report…  The great Percy Sledge takes us to the finish line today with his song: When A Man Loves A Woman… I saw Percy Sledge on TV last year, and at his age, his voice was still great as he sang that song!   I hope you have a Tub Thumpin’ Thursday today, and a Fantastico Friday tomorrow… And please, please, please, Be Good To Yourself!

Chuck Butler