Safe Havens Are Back With A Vengence!

January 27, 2020

* Currencies have an awful day on Friday… 

* Gold is kicking tail and taking names later! 

Good Day… And a Marvelous Monday to you! As I left you last week, I said I didn’t know if I would get a letter out today, as I have an early appt. at the wound center this morning. But… I was able to get a lot of my thoughts down last night, and so, only the overnight markets are left for me to peruse and write about today… We had some real Chamber of Commerce weather here this past weekend, after the cool, rainy, dreary 3 days of winter passed. So I have that going for me! Billy Paul greets me this morning with his song: Me And Mrs. Jones… Well, she’ll go her way, and I’ll go mine, tomorrow we meet the same place the same time….

OK, time is of the essence! The currencies lost ground VS the dollar on Friday, as the week of no-to-little data in the U.S. ended up helping the dollar… Gold and Silver, however rallied with Gold gaining over $9 on Friday, and Silver gaining 33-cents… A good day for the two of them! When I last wrote to you, the European Central Bank (ECB) was meeting and just as I suspected, the ECB did little to give the markets of Europe the Idea that things are getting better, as they left their negative deposit rate unchanged… I wonder all the time just what the German Bundesbank thinks of these negative deposit rates, but then their Chancellor (Schmidt) back in the day was the one that jammed the ECB down the potential member countries, so if the Bundesbank has a problem with the ECB, they can thank their former Chancellor!

And the news of a continued negative deposit rates for the Eurozone, sent the euro-bulls home with their tails between their legs once again… With the Big Dog, euro, left to sit idly on the porch, the other little dogs had to remain there too… But for how much longer will all this dollar strength run? The strong dollar trend is in it’s 9th year… 10 years has been the longest of any of the previous trends, so like the U.S. economy which is gasping for air after spending so long in expansion, albeit soft expansion, but expansion, nonetheless.

In the overnight markets, Gold is kicking tail and taking names later… The shiny metal is up over $12 this morning…  I read this morning that the Coronavirus spreading has got traders full of fear, and therefore the safehavens are in play, like Gold…  

The price of Oil on the other hand is slip sliding away…  Oil trades with a $52 handle this morning folks…  And here the fear of the virus spreading is hurting the Oil price, as traders fear the demand for Oil will diminish, as people are made to stay home. I remember the last time that we had a deadly virus spreading a few years ago… I was traveling quite a bit for EverBank, and speaking here there and in between, and I would see people walking through airports wearing surgical masks…  

Sidebar here… I read yesterday that the CDC says that they don’t believe wearing a surgical mask prevents you from getting the virus…  FYI… 

Two other thoughts on the currencies this morning… 1. the big drop in the price of Oil has really taken its toll on the Petrol Currencies, led by the Russian ruble…  and 2. When you get down to the currency roundup and see the Chinese renminbi with a 6.93 price, you may be thinking that the renminbi has sure taken a slide down the slippery slope in recent weeks since the Phase one Trade Pact was signed… And now with the shutdown of the country due to the virus, this could very bad for the Chinese economy, folks… I’m just saying… 

I just finished reading a short book titled: Riggef, by Stuart Englent… Here’s a snippet from his book : “First Gold was coerced from American citizens and taken out of circulation. Second Silver was removed from the nation’s coinage. Next, the international link between the dollar and Gold was severed. Once that was accomplished, market were rigged to suppress precious metals, and convince the world that the U.S. dollar was a s good as Gold and Silver. The truth is, it’s not. If the dollar were as good as Gold & Silver, their prices couldn’t have to be rigged.”

If you’ve ver wondered about how or why the U.S. Gov’t manipulates the currencies and metals markets, this book will spell it out for you… I got mine at Amazon,.

And for you who still don’t believe that all markets are now manipulated, you especially, should read this book for all the documentation that’s in the book!

The U.S. Data Cupboard is still lacking today with only new home sales on the docket, but tomorrow we’ll see Durable and Capital Goods Orders… Recall that November’s Durables were negative -2.1%… I’m thinking that December’s number will remain negative, but improve a bit… On Jan 17 last week, Industrial Production for December also printed negative at -0.3%… The economic data, albeit rigged to make things look better than they actually are, continues to be weak, and weaker by the print, sooner or later, given the debt, the wars, the welfare, and the rise of Central Bank buying of Gold, the loos in confidence to the dollar will abate… You can mark my words on that one… And then no amount of currency manipulation will save the dollar from entering a weak trend….

To recap… This was a short one today, as Chuck has an early appt and it takes him 55 minutes to get there! The currencies had a bad day on Friday, but Gold gained more than $9 and Silver 33-cents on the day… And both are up in the overnight markets trading this morning. The Data Cupboard is still lacking today, and the ECB didn’t surprise anyone last week by keeping their deposit rates negative…

For What It’s Worth…  OK… my good friend, and the Retirementor, Dennis Miller wrote an excellent piece for his weekly letter last week, titled: Will The Next Bank Bailout Bankrupt America?   Those of you who have signed up for Dennis’ free letter already have read this, but there are many of you who have not, so here it is :

Or, here’s your snippet: “Can bank bailouts bankrupt America? Why would congress let it happen?

In a recent Daily Pfennig, friend Chuck Butler tells about educating his grandsons about the worst president there has ever been:

“…. I couldn’t let that one slip … I explained to them that Woodrow Wilson was the all-time worst president, … culminating with, he ushered in the Federal Reserve….”

Minnesota Congressman Charles A. Lindbergh, (father of the famous aviator) warned:

“The financial system … has been turned over to the Federal Reserve Board. That board administers the finance system by authority of … a purely profiteering group.”

Chuck again… Yes, the FWIW snippet is shorter than usual today, time is of the essence, if you need more, simply click on the link above and read it all at Dennis’ web site! 

Currencies today 1/27/20 American Style: A$.6771, kiwi .6562, C$ .7584, euro 1.1025, sterling 1.3187, Swiss $1.0318, European Style: rand 14.5446, krone 9.0985, SEK 9.5977, forint 305.57, zloty 3.8735,    koruna 22.9003, RUB 62.05, yen 108.85, sing 1.3566, HKD 7.7769, INR 71.28, China 6.9334, peso 18.94, BRL 4.1800, Dollar Index 97.84, Oil $52.25, 10-year 1.62%, Silver $18.30, Platinum $989.36, Palladium $2,378.46, and Gold… $1,584.06

That’s it for today… Man I spent a day and night in hell on Thursday… The wound center tried a new treatment, and told me it might sting a little… OMG! I was in near tears most of the day and night, and finally got to sleep around 2:30 am! So, if they come near me with that brown paste this morning, I’m going to hit the ceiling! Oh, and on Wednesday I have to go back, even earlier than this morning, so…. No Pfennig On Wednesday, but I’ll be back on Thursday… I’m so glad that January is almost over… that means there’s only 20 more days until Cardinals pitchers and catchers report to Spring Training! The Super Bowl will be this weekend on Sunday… I read the other day that a petition is going around NYC to change Super Bowl Sunday to Super Bowl Saturday…. Why on earth would we do that? If it’s too difficult to get up on Monday morning, then pass around a petition to make Monday following Super Bowl Sunday a holiday! Seems easier than the other way! But then that’s just me… The Ides of March take us to the finish line today with their song: Vehicle…. I hope you have a Marvelous Monday, and please Be Good To Yourself!

Chuck Butler