Riksbank Changes To Bond Buying-lite…

Chuck Butler’s: A Pfennig For Your Thoughts 

December 20, 2017 

* Currencies & metals trade in tight ranges

* krona is best performer overnight!

* A special treat awaits you in the letter today… 

Good Day… And a Wonderful Wednesday to you! Tomorrow I start my traditional winter vacation, albeit a shortened version of it, as I plan to be back, writing again next Wednesday. It’s Christmas time and no one wants to be working, I can tell you that from years of being in an office, before I had the seniority to take vacation at this time of year. This is going to be a short-n-sweet Pfennig today too, as I’m busy as a bee today with appointments, etc.  So, since it’s going to be a short one, I had better get to the meat of the letter, eh? Jimmy Cliff greets me this morning with his song: Hello Sunshine… Which is exactly what I would like to see today, instead of these steel gray skies…   

The action in the currencies and metals are allowing me to print a short-n-sweet letter today, as there’s just nothing going on, and the movements are so small it’s as if they are playing a part in the new movie: Downsizing…  The Big mover overnight is the Swedish krona, as krona traders and investors took the notice by the Riksbank (Sweden’s Central Bank) that they were ending their bond buying that began 3 years ago, as an indication that they needed to buy krona. And buy it they did! 

But, I think calmer heads will enter the picture soon, and some profit taking  will begin, as the Riksbank didn’t exactly go “all-in” on ending their bond buying program, saying that they would reinvest maturities all next year, and probably into 2019…  So, just like we did here in the U.S. for a couple of years, when we did a bond buying ending-lite…  

Trading ranges in the other currencies are very tight… Yesterday, for instance the euro was 1.1820, and today it’s 1.1845, and the same can be said for the metals, as Gold lost a whopping 60-cents, and Silver lost 1-cent! And then the Dollar Index yesterday was 93.58, and this morning it’s 93.44…  And to take one day further back, on our Marvelous Monday the Dollar Index was 93.69…   I told you on Monday that this week could yield some volatility with the senior traders heading home for some homemade pumpkin pie, but that volatility just hasn’t materialized, but we still have 3 trading days, including today, this week, so don’t write off that scenario just yet…   

And besides, I’ll be “gone” Thursday and Friday this week, and as they used to say on the trading desk, “When Chuck is away, the currencies rally”..   Longtime readers know that I like to send out a Christmas poem on Christmas Eve, so look for that in your mailbox this Sunday… I’ve working on the poem this year, and I have to say that it gets more difficult every year to come up with something different…  I had a dear reader send me her own version of a Christmas poem mimicking T’was The Night Before Christmas last year that was just AWESOME!   And she already sent me this year’s effort, which is just as good as last year’s…  She’s allowed me to share it with you all, so that’s how I’m going to finish the Pfennig today… 

I was putting together my weekly letter for the Dow Theory Letters that goes out on Thursdays, yesterday, and tried like hell to keep the letter from getting down and dirty, given what’s going on, and that it’s Christmas time…  And I’m going to do that here too… No beating on the twits and dolts that keep spending money we don’t have. Or anything else like that… in fact, I think I’ll go to my dear reader’s Christmas poem right now, and then sign off for the week…  here you go, I hope you enjoy it like I did! 

On the night before Christmas

As I sat in my chair

I was thinking of memories of this past year.

Changes were many

That opened new doors.

Should I step through them

Or should I ignore?

One story was ending

Leaving some true friends behind.

They’d carry on working

The work I’d defined.

The future was pending

Oh what should I do?

My readers would miss me

And I sat in a stew.

Along came some sisters

That were quite the gurus.

Financial advisors

For many, not few.

I considered my options

And now was my time.

To semi-retire

And write things on my mind.

My schedule is flexible

The Adens are great.

The currencies are slow

Not quick on the take.

The children are older

All grown and a blast.

My wife is as beautiful

As she was in the past.

I love my music

My guitar and my songs.

BBQ cookouts

Are where I belong.

I’m as feisty as ever

And I feel mentally strong.

My readers and friends

Keep me moving along.

So as I sit here

And reflect on this year.

I know that I’m blessed

And I’ll keep my good cheer. 

To Recap… The currencies and metals are in very tight trading ranges and the volatility that I told you might come to fruition this week, is nowhere to be seen. Sweden’s Riksbank announced a semi-end to their bond buying program and the krona soared.  Gold lost 60-cents on the day, but is up $4 in the early trading today, and Chuck gave us his kinder, gentler self for the Christmas week today…    There will be no FWIW today, as the dear reader’s poem will act as the FWIW for today! 

Currencies today 12/20/17… American Style: A$ .7679, kiwi .6980, C$ .7785, euro 1.1845, sterling 1.3410, Swiss $ 1.0124, … European Style: rand 12.6705, krone 8.3272, SEK 8.3635, forint 263.90, zloty 3.5480, koruna 21.6725, RUB 58.66, yen 113.23, sing 1.3455, HKD 7.8242, INR 63.94, China 6.6068, peso 19.24, BRL 3.2914, Dollar Index 93.44, Oil $57.78, 10-year 2.48%, Silver $16.25, Platinum $919.98, Palladium $1,035.38, and Gold… $1,268.50    

That’s it for today… and this week… I hope you have a blessed Christmas, and hope that you’re not offended by me using the Merry Christmas saying instead of Happy Holidays…  My beloved Missouri Tigers eked out a win last night in basketball.. And Kathy came home last night, after being gone for 10 days… And the house is all lit up again! YAHOO! I’m listening to Pandora’s smooth Jazz Christmas station, and their playing a guitar solo version of It Came Upon A Midnight Clear… I wish I would have learned to play guitar like that! Oh well, too late to teach an old dog new tricks, right?  So, Merry Christmas to everyone, I hope you get to spend time with family and friends, and that the spirit of the season fills you up… Now go out and make this a Wonderful Wednesday, and Be Good To Yourself!  

Chuck Butler