- Dollar stops gaining ground on Monday
- Gold takes off for higher ground this morning!
Good Day… And a Tom Terrific Tuesday to you! Well, it’s been a nice time, but it’s time to go, was the statement yesterday… I leave for home tomorrow, it’s been 3-months since I was last at home, so it’ll be a reunion of sorts… I will get a couple of days of quiet when I get home, and then it’ll be Easter, and family will gather… The Babys greet me this morning with their song: Back On My Feet Again…
When that song began to play, this morning, I thought, well, that’s what the dollar bugs must be singing these days… As the dollar has rebounded and brought with it a lot of pain and suffering in the currencies. Yesterday, there was a chink in the dollar’s armor, albeit a little one… The BBDXY lost 1 index point on the day. Gold gained $3 on the day, to close at $2,171, and Silver was basically flat on the day, and closed at $24.73.
Gold hasn’t really benefitted, yet, that is, from all the talk of rate cuts… I do believe the benefit will come, sometimes it takes a bit for the ship to change course, and that describes Gold to a T! And the other thing that should be weighing on the dollar, and benefitting Gold, is all this debt in the world, especially in the U.S.! You know, I head it said once by a trader, that knew the score, he said:” The markets can ignore things (read debt in this case) far longer than anyone can suspect, util one day they don’t ignore them any longer”
His gist was, “don’t fight the markets”… You see, I’ve not followed that advice very often in my days in the markets…
In the overnight markets last night… The dollar saw 2 more index points fall off of its value… Could this be the beginning of an extended trend in selling dollars? I mean the absolute onset of this trend, if it exists, is where we are now! Gold is up BIG this morning, so maybe the Gold bugs finally saw the light? Gold is up $29 this morning! The tide is turning, folks… People all over the world, join in, get on the Love Train, Love Train… Silver is up 8-cents to start the day today…
The price of Oil remained in the $81 handle overnight, and bonds didn’t move an inch! The 10-year’s yield this morning is 4.23%…
Well, have I got a doozy for you in the FWIW this morning… It’s former Treasury Sec. Larry Summers, taking a verbal shot at Jerome Powell’s Fed Heads… You won’t want to have missed that one!
But don’t go there yet… I’ve got other things to talk about first… Like once again the markets got hype up over a Bank of Japan rate hike, and forgot about the other problems in Japan… Like Debt and demographics… The yen has actually lost ground since the BOJ hiked rates! YIKES!
And on the other end of the spectrum we find the Swiss franc, floundering and losing ground to the dollar and euro ever since the Bank of Switzerland (BOS) decided to be the first Central Bank to dip its toe in rate cuts… After cutting their official rate the franc has dropped from lofty levels VS the dollar and euro… And with all these geopolitical problems in the world!
Ahem, Fed Heads… I sure hope you’re watching this goings on in Switzerland, since you seem to be ready and willing to go down the road of rate cuts too…
And dat Ole digital currency is rounding the corner and heading for home! I found this on theconservativetreehouse.com regarding the digital currency, “”The same way the Patriot Act was not designed to stop terrorism but rather to create a domestic surveillance system. So too were the “Russian Sanctions” not designed to sanction Russia, but rather to create the financial control system that will lead to a USA digital currency. The Western sanctions created a financial wall around the USA (dollar-based west), not to keep Russia out, but to keep us in. The Western sanction regime, the financial mechanisms they created and authorized, created the control gate that leads to a U.S. digital currency.”
Well, you can’t say that I didn’t warn you that this was coming… But did you do anything about it? I sure hope so…
The U.S. Data Cupboard has the Feb Durable Goods Orders for our review… You may recall that the Jan Durable Goods Orders were a negative 4.2%… So, you would expect in this election year, that the data was massaged and cooked to show a positive number in Feb… I’m just saying…
To recap… The dollar has seen it’s run up halted, but only in small amounts so far, which Chuck asks if this is a the onset of an extended weaker dollar? Gold was up a bit yesterday, but is soaring this morning in the early trading… Chuck talks about the yen, and francs this morning, and the coming digital currency…
For What It’s Worth… well, I prebilled this article, and now I hope it lives up to the hype! This is Larry Summers, former Treasury Sec. taking verbal shot at Jerome Powell’s Fed Heads, and it ca be found here: Ex-Treasury Chief Larry Summers Questions Fed’s ‘Hurry’ to Cut Interest Rates – Bloomberg
Or, here’s your snippet: “Former Treasury Secretary Lawrence Summers criticized the Federal Reserve for continuing to signal that it’s prepared to lower interest rates in coming months, despite a strong economy that’s giving off projections of still-too-high inflation.
“My sense is still that the Fed is itchy fingers to start cutting rates and I don’t fully get it,” Summers said on Bloomberg Television’s Wall Street Week with David Westin. Given how the economy and financial markets are performing, “I don’t know why we’re in such a hurry to be talking about moving towards the accelerator,” he said.
Summers: Fed Still Has ‘Itchy Fingers’ to Start Cutting Rates
Summers spoke a day after policymakers updated their forecasts for the central bank’s benchmark interest rate, with the median estimate continuing to show three reductions for this year. Fed Chair Jerome Powell said while “we don’t want to be dismissive” of the faster-than-expected inflation readings for January and February, they “haven’t really changed the overall story” of price pressures gradually diminishing.
A key issue remains that the Fed’s estimate of the neutral policy rate — the setting where it’s neither stoking or slowing the economy — is too low, said Summers, a Harvard University professor and paid contributor to Bloomberg TV. That distortion means that policymakers believe their current setting is more restrictive than it really is, he said.
“If you don’t know what’s neutral, you don’t know how expansionary or restrictive you’re being,” Summers said.”
Chuck again… That’s right Larry! You tell ’em! But like I said wen Jerome Powell mentioned 3 rate cuts… The Gold Bugs love him for that!
Market Prices 3/26/2024: American Style: A$ .6551, kiwi .6028, C$ .7372, euro 1.0858, sterling 1.2659, Swiss $1.1102, European Style: rand 18.9236, krone 10.7146, SEK 10.5429, forint 365.08, zloty 3.9716, koruna 23.7450, RUB 92.65, yen 151.27, sing 1.3438, HKD 7.8233, INR 83.29, China 7.2183, peso 16.67, BRL 4.9754, BBDXY 1,241.92, Dollar Index 104.01, Oil $81.64, 10-year 4.23%, Silver $24.81, Platinum $909.00, Palladium $1,021.00, Copper $4.02, and Gold… $2,200.20
That’s it for today, and tomorrow… no Pfennig tomorrow… just a friendly spiderman reminder… Our Blues had a chance to get closer to a playoff position last night, and fell on their face.. They did get 1 point for a tie, but lost in overtime. My beloved Cardinals went Arizona to play the Cubs, and actually played a good game in beating their rivals to the North… It’s still spring training, so it really doesn’t mean much… Sniff “n” the Tears take us to the finish line today with their song: Driver’s Seat… if you want I’ll take you on a sidebar here and tell you about the band… Quite a few years ago, I wrote about Driver’s Seat being the song of the day, and I received an email from the bass player of the band! Pretty cool I must say! Ok, I hope you have a Tom Terrific Tuesday today, and will Be Good To Yourself!
Chuck Butler