- currencies & metals rally on Wednesday
- And overnight, the dollar is personal non gratis…
Good Day… And a Tub Thumpin’ Thursday to one and all… I make it a habit to watch Jeopardy daily, and the other day the song Tub Thumpin’ was the answer to a clue… I actually got that one right! My beloved Cardinals got swept by the Jays… UGH! They move on to Milwaukee now for the weekend series with the Brew Crew… R.E.M. Greets me this morning with their popular song: The One I Love…
Well, the dollar got sold yesterday as the STUPID CPI didn’t show any gains in inflation or did it show any drops… The stuck in the mud inflation, according to the BLS didn’t do the dollar any favors, because out the window went the rate cut hopes for July… The BBDXY lost 4 index points yesterday… Gold rallied on the day, and gained $32 to close at $3,356… Silver hasn’t really seen the kind of buying it saw last week, which tells me I was correct in my thought that that day’s buying was mainly short covering… Silver lost ground yesterday and finished the day at $36.28, down 28-cents on the day…
The price of Oil jumped higher again yesterday, and this time it closed the day trading with a $68 handle! Here’s Bloomberg.com with the reason for the jump in the price of Oil… “Oil surged as the US government ordered a partial evacuation of its embassy in Iraq amid rising security risks.”
Chuck again… The Fed heads must have been in keeping bond yields from getting too high again yesterday, because the 10-year’s yield fell from 4.49% yesterday morning to 4.40% at the close… Another big jump in yields that has to indicate that large buyers were in buying bonds, and I can only think of one large buyer that would want to take on more risk in Treasuries, and that is the Fed/ Cabal/ Cartel… I’m just saying…
I’ve got something for you in the FWIW section today regarding Treasuries and how the time is near that the debt in the U.S. is nearing an end… So, stay tuned, same bat channel, same bat time!
In the overnight markets last night… Uh Oh… Time for the PPT to appear because the dollar is slip sliding away (Simon) this morning… The BBDXY has lost 7 index points overnight, and even the old Dollar Index has dropped below 98… The euro is trading above 1.15 of which I had to do a double take this morning when looking at the currencies… The rest of the currencies including the Chinese renminbi have gained ground VS the dollar this morning and look much healthier.
I think this illustrates the feeling that I have the dollar is no longer a safe haven go to… Gold has replaced the dollar, euro, yen and franc as the yesteryear safe havens for currencies… In fact, the European Central Bank (ECB) issued a report over the weekend stating that Gold had replaced the euro as a reserve asset in Central Banks… I would think that it won’t be too much longer before Gold becomes the number 1 reserve asset of Central Banks globally…
Gold starts today at $3,382, up quite a bit from yesterday’s close… Silver is not receiving the same amount of love from buyers at this point this morning and is up only 4-cents.
The price of Oil continued to rise in the overnight markets and starts today trading with a $66 handle… And the buying of bonds continued overnight, with the yield on the 10-year Treasury bond falling to 4.37% to start our day today…
This selling of the dollar is really building momentum folks… I think at this point you came come out of your shelters, and celebrate that the mean old witch (the dollar) caught under the house that fell on it… And without the PPT to help the dollar, it will slowly die… I’m just saying…
The dollar even though it has fallen from 1,230 ish earlier this year, to 1,200 this morning (in the BBDXY) is still overvalued, so from my viewpoint, which is from the cheap seats, it shows to go you that the dollar has far more to drop! Are you with me?
Yesterday, I mentioned that Sly Stone had died… I still picture him raising his arms above his head in a V at Woodstock, him and his white jacket with fringe… And then yesterday I read where Brian Wilson of the Beach Boys had died… Two Rock icons back to back… i know that we all grow old and die… But this news made me sad…
The folks at Kitco.com have their ideas on what’s behind Gold’s recent ascent… so here they are: “A key driver behind gold’s ascent has been the persistent weakness in the U.S. dollar, which Morrison notes remains “overvalued by many measures.” This currency dynamic aligns with President Trump’s stated preference for a weaker dollar to enhance American export competitiveness, creating an environment where dollar-denominated gold becomes more attractive to international investors.”
Chuck again… Yes, slowly but surely, we are seeing the makings of a weak dollar trend, and that could be manna from heaven for the currencies, who have suffered a long time from the overvalued dollar… All the weak economic data prints in recent times paints a different picture than what your Gov’t economist will tell you about… But you don’t have to listen to them.. You have me and this letter that will chronicle all the weak economic data prints… And it’s all free!
And regarding a store of value… I feel and I guess most of you do too, that Gold is a better store of value / wealth than the U.S. dollar… I know that Americans are used to everything being priced in dollars… But those dollars are forever losing purchasing power. Inflation reports in this country can’t be trusted… Only John Williams at www.shadowstats.com computes inflation the right way, using the prices from goods that don’t change in a basket each month… Inflation in this country is much higher than any Gov’t reports will tell us it is… and that’s eating away at your purchasing power folks… Does your dollar buy you the same size or amount of something you regularly buy this year VS last year, or even 5 years ago?
But Gold would… You see, when Gold rises in price, the dollar loses ground, maybe not seen in the price but in the things that get priced in the dark… Gold is much better at pricing anything… I’m just saying…
And you don’t have to take my word for it… “The potential issuance of more than $1 trillion in new government debt could make commodities a smarter defensive plays than bonds, according to “The Bear Traps Report” founder Larry McDonald.”
OK, let’s talk about something else, I’m beginning to break out with a rash!
But before we move on from Gold, I saw this and it made me chuckle: “Ironic: Dollar-enforcer IMF wants to put Zimbabwe on a de-facto gold standard”
Makes no sense to me that the IMF wants to do that… I’m just saying…
Longtime reader, Bob, sent me this article that I’ve clipped out a snippet for your that will give you the gist of what the rest of the article is about: “A draft law submitted to the State Duma at the end of May will permit the federal government to use the digital ruble to pay for a limited list of budget expenditures starting October 1. The full-scale use of the central bank-controlled digital currency for all types of budget payments will begin on January 1, 2026.”
I’m shocked that the U.S. allowed the Russians to beat us to the punch here.. .Aren’t you? Oh, well, I don’t want to see a digital dollar but that’s not going to stop one from being issued here…
The U.S. Data Cupboard yesterday had the STIPID CPI and the annual consumer inflation remained at 2.4% for May, according to the Gov’t reporters… Today’s Data Cupboard has the Weekly Initial Jobless Claims, which have been edging upward recently, And May’s print of PPI (wholesale inflation)…
To recap.. The dollar got sold yesterday, and some say it was because the monthly inflation data was softer by .1% I guess the dollar bugs still think there’s a chance of a rate cut in July… Chuck says he doesn’t think it will happen in July…
For What It’s Worth… Here’s an article I talked about above, and its Jeffrey Gundlach a bond guru, talking and I thought we needed to listen, and you can do that by clicking here: Jeffrey Gundlach Warns US Deficit Adds Risk to Treasuries – Bloomberg
Or, here’s your snippet: “America’s debt burden and interest expense have become “untenable,” a situation that may lead investors to move out of dollar-based assets, according to DoubleLine Capital’s Jeffrey Gundlach.
“There’s an awareness now that the long-term Treasury bond is not a legitimate flight-to-quality asset,” the veteran bond manager said Wednesday in an interview at the Bloomberg Global Credit Forum in Los Angeles. A “reckoning is coming.”
In a wide-ranging discussion that also touched on gold’s attractiveness, stretched market valuations, the state of private credit, artificial intelligence and long-term investment opportunities in India, Gundlach said investors should consider increasing their non-dollar-based holdings, adding that his firm was starting to introduce foreign currencies into its funds.
DoubleLine Capital CEO and CIO Jeffrey Gundlach says a “reckoning is coming” for US Treasuries. “You should be thinking about increasing your allocations to non-dollar investments,” he said at the Bloomberg Global Credit Forum.
Gundlach, 65, likened today’s market to the environment in 1999, just before the dotcom bust, as well as 2006 and 2007 before the global financial crisis. Going further, he said the booming private credit sector is analogous to the market for collateralized debt obligations, or CDOs, in the mid-2000s, “where there’s just tremendous issuance, there’s tremendous acceptance.”
The investor noted that public credit markets have outperformed their private counterparts in recent months, and sees “overinvestment” — and a risk of forced selling — in the latter.
“I just don’t think the excess reward is anything close to what it used to be,”
Chuck again… all things that I’ve talked about, but when guys like Gundlach talk about them people should listen!
Market Prices 6/12/2025: American Style: A$ .6516, kiwi .6064, C$ .7335, euro 1.1505, sterling 1.3685, Swiss $1.2307, European Style: rand 17.8057, krone 9.9801, SEK 9.4312, forint 345.64, zloty 3.7564, koruna 21.3765, RUB 80.04, yen 143.74, sing 1.2795, HKD 7.8483, INR 85.84, China 7.1753, peso 18.89, BRL 5.5613, BBDXY 1,200, Dollar Index 97.89, Oil $66.91, 10-year 4.37%, Silver $36.28, Platinum $1,273.00, Palladium $1,080.00, Copper $4.80, and Gold… $3,382
That’s it for today… Well, today is the 49th anniversary of Chuck and Kathy… I’ll have to celebrate it by myself as Kathy is in Florida right now… Next year it will be the BIG 50, Golden Anniversary… I think a big party ought to take place! I know where 2 of my groomsmen are, but the other 2 are AWOL! So, I’ve got a year to find them! And Sunday is Father’s Day… My son Andrew called me last night to tell me he and his brother, Alex, will be coming over to celebrate the day with me… Last Sunday, all 4 grandkids were here in the pool… I watched them full of pride… All four can swim like fish.. And I can’t swim a lick! Oh well too late to start now… Paul McCartney and Wings take us to the finish line today with their song: Band On The Run… I hope you have a Tub Thumpin’ Thursday today, and all the Dads out there have a great day on Sunday… Please Be Good To Yourself!
Chuck Butler