February 23, 2022
* Currencies and metals rally in the overnight markets
* What’s Chuck talking about now?
Good Day… And a Wonderful Wednesday to you! A good night last night… went to dinner with friends down here for the month… one of my fave restaurants here in the Juno Beach area… I’m from S St Louis where the Italian neighborhood called The Hill has multiple excellent Italian restaurants. So I know what I’m talking about when I say the Italian restaurant here is excellent! Both our Blues and Billikens won their respective games last night… The Blues won in Philly, so that was good, and the Billikens righted the ship after a weekend loss, so that was good! Smokey Bill Robinson greets me this morning with his song: Cruisin’
Well on the markets first day back from a long holiday weekend, traders didn’t seem to have much conviction regarding whether to sell the dollar or buy it. So the dollar, while gaining a bit on the day, didn’t really show any desire by traders to own dollars…
The BBDXY closed up on the day at 1,174.95, up from the overnight low of 1,174.14 Gold lost $4.70, to close at 1,899.50 and Silver gained 16-cents on the day to close at $24.18… The price of Oil which leaped by $3 the night before, gave it all back during the day yesterday, and trades this morning with a $91 handle… Bonds seem to be stuck in the mud again, with the 10-year’s yield at 1.94, up just 1 BP on the day. The euro lost about ¼ of a cent, and the New Zealand dollar gained about ¼ of a cent, after it was announced that the Reserve Bank of New Zealand had increased their OCR (official cash rate) to 1%… That’s HUGE folks… The RBNZ isn’t pulling any punches with regards to combating inflation, while the Fed/ Cabal/ Cartel, the ECB, The Bank of England, and the Bank of Japan all sit on their hands, and keep putting of any attempt to slow down inflation in their respective countries… The Bank of Japan doesn’t really have strong inflation, but they are one of the few Central Banks that would welcome some inflation…. So, they’re a different breed altogether…
In The overnight markets last night… the strength that the dollar gained yesterday, was given away in the overnight markets. The dollar was sold to the tun of over 3 index points in the BBDXY, which this morning sits at 1,172.47… Gold is up $3 in the early trading, and Silver continues its march to higher ground gaining 11-cents this morning. Bonds got sold overnight, with the 10-year’s yield rising to 1.97%, and nothing happened in the Oil market overnight.
OK… yesterday I was a little hard on the Beaver, with the Beaver being the Fed/ Cabal/ Cartel, saying that they were either really stupid or born liars… I’m not taking it back, but just wanted to point out that I realized I was a little mean there… But do you know what a Charlatan is? I was reading my favorite writer’s newsletter, Grant Williams, Things That Make You Go Hmmm… , and he said that: “In the Age of the Charlatan, skepticism is no longer a meaningful part of the human condition and that, ladies and gentlemen, is a terribly sad state of affairs”
Grant was referring to the lady from Theranos, and Mr. Musk…
The Charlatans here that I’m referring to are the Fed/ Cabal/ Cartel heads… And for those of you who do not know the meaning of the word, or do not want to waste the time it takes to Google the word, here’s the definition: “a person falsely claiming to have a special knowledge or skill; a fraud”
The common person in the U.S. doesn’t give two hoots about whether the Charlatans in the Eccles Bldg. are either too stupid to see the rising inflation or just lying about it… They get paid, pay their bills, buy some beer, and pork ribs, and they are set for the weekend… They may have noticed that their pork ribs have doubled in price, but then so has everything else, and he’s told to not worry about it, so he doesn’t… But to figure out if the Fed/ Cabal/ Cartel is lying to them isn’t what they were put on earth for, in their opinion… So, it’s up to the rest of us to point out the Charlatans, and our skepticism of their claims…
I get carried away with all kinds of thoughts when thinking of the Charlatans at the Eccles Bldg.… I also get carried away with all kinds of thoughts when thinking about lawmakers and their tax and spend, and spend, and spend history… I’m not picking sides of the aisle here either, folks, for both have had their hands in the deficit spending cookie jar! The country has a current debt of $30 Trillion and a non-funded liabilities debt of $86 Trillion, and if you project 4 short high school years out into the future, the Debt Clock says our current debt will rise to $52 Trillion, and our unfunded Liabilities will rise to $101 Trillion…
I personally don’t see us ever getting to $52 Trillion… I truly believe that there will be a major financial event that will collapse everything, and we have to start over… But then I’ve never been a fan of a debt-based system…
There’s no way out of this mess is there? I used to say that the Gov’t would allow inflation to eat away at the debt, but now that inflation is rising, I see that there’s just no way out using this method, because if the Gov’t didn’t do anything to combat inflation’s rise, then soon the angry citizens would be storming the gates… I feel that these same citizens are gathering now…
But, there is a way out of all this debt, and debt servicing and that is… are you ready for this? Revaluing Gold… But there would need to be a floor set for the new price of Gold, so that balance sheets wouldn’t be fluctuating… So, here’s my proposal to the Gov’ts of the world… Get together and come up with a price for Gold that satisfies everyone… Let’s just throw out there a price of $10,000 oz… The Gov’t’s could then put a floor and a ceiling on Gold’s price, and be the other side of the trade if there were no buyers or sellers to offset the buyers and sellers in the market.
That would mean that owners of Gold, could, not that I would, but could, then sell their Gold at $10,000 oz and walk away with HUGE gains, that they would pay taxes on (in certain states) and fill the tax coiffures of the Gov’t… then as a part of the Gold revaluation, there would have to be a law that prohibited lawmakers from using the taxes received from Gold sales for anything other than to pay down the debt.
I think I have this all in order… What do you think? This could work, right? But we would have to have level headed, non greedy, folks in Washington iron out the details, and that could be quite the undertaking, finding level headed, non greedy, folks in Washington… But I digress, here… I think this is doable, and something the Central Banks of Europe, Japan, China, and anyone else at the table could get their arms around, oh, and the U.S. too…
This would eliminate the evidence that these countries need to default… And that would eliminate my call last year that these debts had grown so large and unsustainable, that default was evident, just not imminent… This isn’t the first time I’ve talked about this reset, folks… But it’s been sometime since I did, and with the debts growing even more, I thought it was time to drag it out, dust it off, and put some hot wax on it, to show it to the world!
But do I see this happening in our future? Not while I’m alive, I don’t… First of all, you would need to get everyone to agree, and just getting them to agree to meet, would be an accomplishment! Then a price would have to be agreed upon, and how the Gov’t would be the buyer or seller of last resort and that the floor and ceiling for Gold was the same… There are a lot of balls in the air and there’s no juggler to perform the act of keeping them all in the air at the same time…
The U.S. Data Cupboard is dead as a doornail today, but gets back in the data printing game tomorrow… I explained yesterday that the Fed/ Cabal/ Cartel’s preferred inflation measure the PCE will print on Friday this week… I’m betting that free undercoat that we’ll hear all kinds of calls for a larger than 25 BPS rate hike, after the PCE prints on Friday…
But again, as I’ve asked before… how does an aggressive Central Bank play in the same sandbox as a Central Bank that claims they will bring about a soft landing? I guess that and many more questions will be answered next month when the FOMC meets.
To recap… There wasn’t much movement in the dollar and currencies yesterday, until late in the day, when the dollar moved higher… The RBNZ hiked their OCR to 1%, to show inflation who’s boss! Where the other Central Banks of the world are still doing DNA testing to find who’s boss… The price of Gold went down on Tuesday, by almost the same amount it went up on Monday, while Silver gained 16-cents on the day… The price of Oil lost the $3 it had gained the night before, and bonds were stuck in the mud. Chuck in his everlasting search for a debt solution, offers up something that he’s talked about before… A Gold revaluation…
For What It’s Worth…. Well the demonstration in Canada took a turn for the worst over the weekend, and not with rioting, but with Government moves that are quite scary, and I can’t believe the people of Canada haven’t stormed the gates… It’s all here: Canada Moves To Make Asset Freezing Under Emergencies Act Permanent | ZeroHedge
Or, here’s your snippet: “In order to stop what the Trudeau regime referred to as “illegal blockades,” the government threatened to freeze the bank accounts of demonstrators and anyone who donated money to them.
Under the Emergencies Act, bank are required to freeze accounts without a court order, while all crowdfunding platforms and payment providers are mandated to provide information to FINTRAC (Financial Transactions and Reports Analysis Centre of Canada).
Deputy Prime Minister Chrystia Freeland announced that many of the measures imposed ‘temporarily’ to deal with the protesters (after they had been suitably demonized as violent extremists) will now become permanent.
“We used all the tools that we had prior to the invocation of the Emergencies Act and we determined we needed some additional tools,” Freeland announced.
“Some of those tools we will be putting forward measures to put those tools permanently in place. The authorities of FINTRAC, I believe, do need to be expanded to cover crowdsourcing platforms and payment platforms,” she added.
Ronald Reagan has been proven right again.
“Nothing lasts longer than a temporary government program.”
Meanwhile, as we previously highlighted, such measures are likely to exclude protected classes (basically anyone who isn’t a native Canadian or white), with groups such as immigrants and refugees enjoying an exemption.”
Chuck again… And just like a magician who makes a rabbit disappear by waving his wand over his hat, Canadians are seeing their freedoms disappearing very quickly… Yes, it can happen overnight apparently… And in my humble opinion, what Trudeau has done is simply started the clock on the Great Reset…. Think about that one… and if you need explanation, send me a note… That doesn’t mean I’ll respond to all notes, but send me a note and see…
Market prices 2/23/2022: American Style: A$ .7275, kiwi .6802, C$ .7882, euro 1.1343, sterling 1.3593, Swiss $1.0874, European Style: rand 15.0397, krone 8.8440, SEK 9.3126, forint 314.77, zloty 4.0071, koruna 21.5755, RUB 80.83, yen 115.12, sing 1.3445, HKD 7.8038, INR 74.54, China 6.3175, peso 20.20, BRL 5.0078, BBDXY 1,172.47, Dollar Index 95.91, Oil $91.71, 10-year 1.97%, Silver $24.29, Platinum $1,097.00, Palladium $2,506.00, Copper $4.54, and Gold… $1,903.20
That’s it for today… Man did I pig out last night… They put a bowl of pasta with chicken, mushrooms and other things in front of me and I didn’t stop until the bowl was empty! I don’t even remember the last time I ate like that! Good dinner company too… Well, still no traction in the baseball talks going on down the road here… To the players, they could care less about the fans that have made annual plans to travel to Florida or Arizona to watch spring training games, and do you know why they don’t care? Because they aren’t paid until the regular season begins… My good friend Gus, asked me yesterday if I saw any chance of games this spring, and I responded, No… But if I were in charge, I would tell the players to take the concessions that the owners have given them, and to stop being babies, and get out there and play baseball! But like everything else, no one listens to me… The Allman Brothers take us to the finish line today with their song, and one of my faves: Melissa… I hope you have a Wonderful Wednesday today, and Please Be Good To Yourself! Be Positive, Test Negative!
Chuck Butler