Supply Chain Problems Continue…

Rocktober 13, 2021

* Currencies & metals get bought in the overnight markets

* the Stupid CPI will print today… What will it show? 

Good Day… And a Wonderful Wednesday to you! Well, that just goes to show ya, that I shouldn’t pin my colors to the mast of any team other than my Cardinals, Blues, Tigers and Billikens, because all I do is jinx them! I said yesterday that I had gotten on the White Sox bandwagon… And then they promptly blew a tire against the Astros… UGH!  Now it’s the Astros VS the Red Sox… I can’t root for the Astros, because they will forever be in my mind as cheaters… And I can’t stand the Red Sox, so… What to do, what to do…  It was a real Chamber of Commerce day here yesterday, I sat outside to read for 3 hours, until the sun became too hot…  (it wasn’t really hot, hot, just too warm for my comfort!) Our Blues have a strange and difficult schedule to start the season, they had better bring their A game… The Band: Heartsfield, greets me this morning with their song: The Wonder Of It All…

Not familiar with that one? YOUTUBE the title and I think you’ll find that you really like the song…

Ok, to start our day.. Bloomberg had this title to an article that was front and center this morning: Apple Finally Falls Victim to Never-Ending Supply Chain Crisis…   I just thought that to highlight that would give you an idea of where we’re going this morning…  Oh, and Copper is soaring these days up to $4.37… Inflation is here, and is going to stay… 

OK… Well, yesterday I thought that the crescendo of dollar buying was ending, as things were moving in the right direction early yesterday… But that didn’t hold the morning through, and by midday, the dollar was back on top, pushing the currencies downward, and taking away the thunder from Gold… The BBDXY, which started the day at 1,165.81, ended the day at 1,167.25. The euro never found a bid on Tuesday, and so it was with the other currencies, not having the title of Petrol Currency… Not that the price of Oil moved higher on the day, instead losing about 50-cents on the day.

But there are a lot of economists and analysts calling for much higher Oil prices as the year goes on and into next year, folks, and that bodes well for the Petrol Currencies.  Not so much for your wallet when you go to fill your gas tank, and not so much for the home heating season either… But when you print currency on top of more currency until the world is choking on it, you can expect that inflation begins to soar…  We are in the beginning stages of inflation rising folks… Just wait, it’s going to get a whole lot worse!

Bonds got bought yesterday, and that surprised me a bit, as I really thought that the 1.60% yield the 10-year Treasury sported on Friday, was just a stepping stone for higher yields… I still believe they will come, and Rome wasn’t built in a day, so patience, Chuck… patience…  I just had the song by the Monkees get into my head: I’m, not you’re stepping stone…  I’m, not your stepping stone…  Ok, enough of that!

I would just like to be able to put some cash to work, that yields more than what you can get 3 years out… Right now a 3 year Treasury yields 0.60%…  When the mortgage jockeys on TV quit harping about how they’ve still got mortgage rates in the 2’s, that’s when rates will be moving in the right direction!

I know it’s difficult to believe, but I consider myself a senior citizen now… I am retired, and these low rates are sickening to me… How can a person on fixed income survive with these low rates? What the Fed/ Cabal/Cartel has done to the retirees in this country is a down right shame… My good friend, Dennis Miller was dubbed “the Retirementor” for his work in giving retirees on how to retire comfortably… “It’s not as easy as it used to be”, says Dennis” We could ladder CD’s that paid over 6%, and then spend the interest and roll the principal. The principal was never touched”… 

When was the last time you  saw a 6% yield on a bank CD?  When we opened our first virtual bank, EverBank, we offered 6% on checking accounts, that was January 2000…  I would say that since that time the U.S. has gone downhill…  Think about that for a moment… Bill Bonner said this yesterday in his letter: “Since 2000, the Fed has increased its core (money supply) holdings by more than 20 times. But GDP growth has been cut in half.

From 1950-1999, real GDP growth averaged 3.6% per year. From 2000-2020, it has averaged 1.8%.

The new money shows up first in higher stock and bond prices (because the Fed buys bonds in order to push down interest rates… and finance the government’s excess spending).

Later, it shows up in consumer prices. And by the look of things, “later” is coming soon.” – Bill Bonner in his Daily Diary 

Chuck again… Yes, since 2000, the U.S. has gone from a current debt of $5.674 Trillion… And in 20 years we had a debt of $26.945 Trillion, and one year later its $28.869 Trillion, and soon to breach $30 Trillion…  Oh, and your portion of the debt? Well, each taxpayer would owe $229,000…  So, you can write that check out to the U.S. Government… AS IF! So… if you backed me into a corner, and asked me where the U.S. Empire began to show cracks, I would say at the turn of the millennium…  Now, see you didn’t even need to back me into a corner! HA!

I can see it now… you go to your mailbox, and find a letter from the U.S. Government, and you’re very intrigued as to what this might be, so you open it to find, a letter that goes something like this:

“Dear Taxpayer

We have long sought a solution to our growing debt crisis, but with none coming to our attention, we now turn to you dear patriot. If you would be so kind to send us a check in the amount of $229,000 and make it out to the U.S. Government, we would be very appreciative of your willing to help us in this time of need.”

Then you could take the letter and hand it to your grandkids, because they’re the ones that will burdened with these debts….  I’m just saying…

In the overnight markets last night…  Well here we go again… the dollar got sold in the overnight markets and into this morning. The BBDXY has dropped from 1,167.25 yesterday to 1,165.14 this morning, and the metals are on the rally tracks again this morning. It will be interesting watching the price manipulators react to the inflation data this morning…  Gold is up $11.60 this morning and Silver is up 28-cents, to start the day… Once again, it appears that things are aligning in the right order this morning, but we’ll have to see how they trade throughout the day, eh? 

So, once again I was wrong about the dollar reaching a crescendo… Please mark that down so you can relay to my wife that I do admit when I’m wrong, as opposed to her saying that I don’t! There’s no shame in being wrong on things like that… I have no qualms about admitting it either!  But the day is coming, when the dollar crescendo is a distant memory, and then I’ll say, neener, neener, neener!

And as far as errors are concerned… Yesterday, I referred to Jamie Diamond as Mamie Diamond… Fat fingers strike again! But not to worry, I doubt he reads the Pfennig… 

I also want to apologize for the tardiness of the letter this week… I’m having a run in with the mail server, and they don’t like me any longer, so the Pfennig gets sent out later in the morning… I guess I’ll have to pull the old Chuck Charm out of the closet and see if I can get this corrected… But for now, it’s a late letter each day… UGH!

I received an email in the Pfennig Replies box yesterday, mentioning that I should add Bitcoin to the market prices roundup…  I won’t do that, period…  Because to me Bitcoin is not real… And if I included Bitcoin, then someone would want me to add another one and another one, etc.  So, I’ll talk about it every now and then, but to daily price it would be saying that I believe its real… 

Ok… The U.S. Data Cupboard today will have the stupid CPI (consumer inflation index) And Core CPI… which takes out food and energy, as if these aren’t things we use every darn day!  Yesterday’s cupboard had the Small Business Index, and it showed a drop from its August high of 100.1, to 99.1 in September, but under the hood we could find that the outlook by businesses isn’t good… Uh-Oh…

To recap… The dollar fought back on Tuesday, and regained the lost ground from the day before… UGH! Back and forth… no direction, no one saying, “This is the way it needs to go”… Because they don’t make traders like that any longer!  Gold couldn’t hold its early morning gains yesterday and only ended up with a $6.20 gain on the day…  In the overnight markets last night… The dollar got sold once again, with Gold & Silver on the rally tracks this morning… 

And before we head to the Big Finish today, I wanted to talk about this… All the cancellations of Southwest flights… Like I said on Monday, I really believed we were lucky to get home Friday night. At first S.W. told us it was weather related, but we had come from Florida and there were no weather problems there… We read the next day that it was a case of not having enough crew as they are boycotting the mandate that they receive a vaccine shot by Dec. 8th…  Now I would not like to stranded somewhere with all the flight cancellations but… I wholeheartedly support them in not accepting the mandate… Corporations should not be able to mandate something as personal as this decision. I hope it all works out for the crew members… And that’s all I have to say about that!

For What It’s Worth…  Well, I spilled the beans on this article yesterday, when  I told you I had two articles for you and one was former CFTC Chairman, and new SEC Chairman,  Gary Gensler saying how tough he was going to be with regards to regulation… And I kept it on the shelf in case I needed it today, and I did, I did, I did see a putty tat! So, that’s today’s FWIW and the article can be found here: Gensler To Wall Street: Prepare For The “Everything” Crackdown | ZeroHedge

Or, here’s Your snippet: “Regardless of what one thinks of SEC Chair Gary Gensler, he certainly seems to be bringing more to the table in terms of regulations than his predecessor, Jay Clayton.

In fact, Gensler is readying an “everything crackdown”, according to a new report from Bloomberg.

Gensler has already proposed 49 separate changes for his staff to consider implementing, the report says, calling it “one of the most ambitious agendas in the SEC’s 87-year history”. At the same time, he has kept an aggressive stance on ongoing enforcement actions.

Gensler even said in a recent interview that he thinks about a famous Martin Luther King, Jr. speech about the “fierce urgency of now”.

He has set up about 50 teams involving about 200 people just to write rule proposals. Each team has staff from the general counsel’s office and economists to help examine costs and benefits of new proposals.

Everyone from SEC veterans to hedge funds – and even some supporters of Gensler’s agenda – are worried that the pace he is setting could wind up being counterintuitive.

Frank Kelly, a former agency official who now runs Fulcrum Macro Advisors, told Bloomberg: “You have to think it will be quite a challenge for the SEC staff to achieve.”

Gensler has been urged to lighten his load on account of policies he is advocating for potentially taking years to finalize.

For Gensler, it appears that all of his proposals share a spot at the top of his list.”

Chuck again… Sure they want him to slow down, nothing to see here, move along…  Look Gensler was the head of the CFTC and claims he looked into price manipulation with Silver, and never found anything… So, either he wasn’t looking and lied to us, or… he was paid under the table to look the other way…  And now he’s the SEC head?  Move along now, for these are not the droids we’re looking for… But I do believe that he has the cryptocurrencies in his sights for regulation, folks… 

Market Prices 10/13, 2021: American Style: A$ .7354, kiwi .6947, C$ .8040, euro 1.1560, sterling 1.3627, Swiss 1.0780, European Style: rand 14.8629, krone 8.5280, SEK 8.7548, forint 311.66, zloty 3.9591, koruna 21.9516, RUB 71.83, yen 113.60, sing 1.3528, HKD 7.7800, INR 75.32, China 6.4492, peso 20.70, BRL 5.5337,  BBDXY 1,165.14, Dollar Index 94.29, Oil $80.16,10-year 1.57%, Silver $22.91, Platinum $1,016.00, Palladium $2,176.00, Copper $4.37,  and Gold $1,772.60

That’s it for today, and tomorrow, as I explained on Monday, I’ll be at the hospital tomorrow bright and early for scans… I used to get all hyped up about going in for scans, because once you’ve gone in and they’ve found cancer, you always have that in the back of your mind… But now 14 years later, I figure that I would know if something was awry… And so I go to the scans with confidence of not finding anything… Well, Congrats to the Braves, Red Sox, Astros for moving along in the playoffs… Well, our Chamber of Commerce day yesterday was a one and done, as we’re expected to have rain for the next 3 days! While I was away on vacation, we learned of the death of a very good friend… She was the wife of my friend Gus, the ice cream guy… Kathy and I had gone to visit them a couple of years ago… The news of her death, was sad and heartbreaking for me… RIP Vivi….   The Gin Blossoms take us to the finish line today with their song: Found Out About You…  I hope you have a Wonderful Wednesday and please Be Good To Yourself!

Chuck Butler