U.S. Jobs Jamboree Disappoints, But The Markets Don’t Care….

Rocktober 7, 2019

* Currencies try to rally but it gets stalled out!

* Chuck takes issue with elected officials, so what else is new? 

Good Day… And a Marvelous Monday to you! A good weekend for yours truly, event wise, unfortunately though, not so good for my beloved Cardinals, who are down to the cheese that binds this afternoon in their playoff series. If they lose, it was good morning, good afternoon, and good night. If they somehow figure out how to hit the ball, and win, then they’ll play a winner take the series 5th game on Wednesday… My Missouri Tigers won, but their quarterback took a very cheap hit and had to leave the game… I sure hope he’s going to be OK… But that player that committed that cheap hit should have been ejected from the game and the season! The New Radicals greet me this morning with their song: You Get What You Give….

Well, I really blew that call on last Wednesday didn’t I? I had so many emails telling me I was wrong, etc. about the NL Wild Card Game ending… I made a big mistake and didn’t check the score that morning as I was rushed to get out the door, early… I thought that once the Brewers’ big time reliever, Hader came in it was like when Bruce Sutter used to pitch for the Cardinals, the other team would start packing up their bats! For the game was about to be over… But that’s wasn’t the case, so all I had said about the game was wrong…. I apologize for that if I got anyone’s dander up!

The Jobs Jamboree on Friday was a real disappointment, but only to me, I guess… As the markets just shrugged it off once again…. Only 136,000 jobs were created in September, and… believe it or don’t, but the BLS took away 71,000 jobs… How’d that happen? Beats me… But for once in blue moon, the BLS too jobs away instead of adding them…. So… maybe that’s why the markets didn’t get all loopy when the jobs number came out, but if that’s the case, then every month when the BLS adds numbers they should be taking issue with that too! So, I’m doubting that the BLS’s hedonic adjustments had anything to do with the markets… The markets are so much like being able to count the cards at a 21 table in Vegas, without anyone noticing, you just keep winning…

So, the currencies tried to rally, but they were stalled… Gold tried to rally, but it too stalled out… The Bond boys kept the pressure on yields though, and the price of Oil spent another day getting marked down. I have a real issue with the currency traders… Don’t they see that the economy is grinding to a halt? Or, maybe they won’t allow themselves to think that way, for this so-called expansion just keeps going like the Energizer Bunny…So, to them, why would that all end?  Dolts, all of them, eh? 

In the overnight markets, Gold is getting sold and is back below $1,500 …  Wait! What? You mean to tell me that the U.S. economy is grinding to a halt, and Gold is getting sold?  That makes about as much sense as… Well, fill in whatever is stupid to you there…  Because if I say something it won’t be nice! Gold getting sold with the U.S. economy grinding to a halt, while all other countries, sans Russia, seem to be already have grinded to a halt…

But why on earth am I getting all worked up over this selling of Gold this morning?  Wasn’t it me that said that $1,500 was the new $1,300 a month or so ago? So, listen to yourself Chuck!  And not that devilish guy on your left shoulder, who tells you all the time that you need to rail about price manipulators…  OK, so in essence this is just normal trading right now, because we are set to watch Gold go past $1,500 and then slide back below it until…. drum roll please…..  until it doesn’t any  longer!  See, what a genius I am? HAHAHAHAHAHA!  

Well, today, I’m going to take issue with our elected officials… This is not a political hack at them, just strictly, a “what in the hell are you thinking question to them”…. OK, this all stems from an email I received from the GATA folks, who quoted Russ and Pam Martens saying, “Yesterday the House Financial Services Committee released its hearing schedule for October. There is not a peep about holding a hearing on the unprecedented hundreds of billions of dollars that the Federal Reserve Bank of New York is pumping into unnamed banks on Wall Street at a time when there is no public acknowledgement of any kind of financial crisis taking place.” – Russ and Pam Martens from wall street on parade

Wait! What? You mean to tell me that no one except the Fed, and the banks receiving the cash flows, know who is getting it? And the politicians, who we voted for, and put into office to make sure they protected us against this kind of thing, are going to do nothing? OMG! That’s it! I’m giving up on these boys and girls… I used to have that Polly Anna viewpoint that by contacting your representative you could effect change… But that idea has been shot down… Like the April Wine song of the 70’s…. Shot Down!

Now, you can tell me that this kind of stuff doesn’t bother you, because you no longer allow things you have no control over to bother you… And that’s fine… I wish I could accept that idea for myself, but I can’t! I can’t because that’s not who I am! So, in the “it doesn’t bother me world”, You’re ok that the Fed is pumping newly created money, which in essence should debase the current stock of money, and you’re OK with that, because you still have your pocket full of dead presidents and they still buy you gas, groceries and giggles… Geez, I wish I could take that kind of laisse fair attitude…

Just the other day, I heard a young woman say, that she got back her DNA test, and that she’s 10% this and that and so on, and I just had to speak to it… I said, “ OK, but now the government knows more about you than you do.” And she replied, “So, I haven’t done anything wrong”… To which I replied, “Well, when your civil liberties have all been taken away, don’t come crying to me”…. See? I can’t keep my mouth shut!

In a quick trip around the world, I see that there’s not much in data or events this week that would help the currencies gain a bid.  On Wednesday, we’ll see a whole truck load of data prints from Japan…  But Japan is a basket case, and I don’t care about their data any longer!  Thursday, will bring a European Central Bank (ECB) meeting… This will be ECB President, Mario Draghi’s, last meeting…  Look for him to leave with both guns blazin’…   which won’t be good for the euro, of course…  And then the rest of the week has some prints from various places, that we’ll talk about when we get there… 

The U.S. Data Cupboard last week had a bad week, what with the ISM falling below 50, and Factory Orders for August printing negative at -0.1%, and the rally in wages, seeing a real hit to the solarplexes, as they were flat in September, and then the icing on the cake was the very disappointing Jobs number for September…

This week’s Cupboard gets a reprieve of sorts, as there’s not a whole heck of a lot to speak of on the docket… There is Consumer Credit (read debt) for August that prints this morning. And then on Wednesday the Fed’s FOMC Meeting Minutes will print from their last meeting when they cut rates… And then there are a bunch of non-market-moving prints to fill in the rest of the week.

And finally, the Trade War negotiations will begin again this week, as a high ranking Chinese diplomat will arrive in the U.S.  I would look for two things this week here…. 1. that the Chinese renminbi would drift stronger as the week goes on, just as window dressing if you will, and 2. that the negotiators get nowhere… 

To recap…  The jobs Jamboree last Friday was very dissapointing, but the markets shrugged it off and went about their daily chores… The dollar didn’t get sold, Gold was flat, Oil got sold, and Bond gave away more yield, which means they were rallying…  Chuck has an issue with the elected officials, what else is new?  

For What It’s Worth… I’ve been telling you all for some time now that Russia and China are trying to rid themselves of dollars and to do this, they’ll stop trading in dollars… this article from the Russia Times, talks about how Russia’s largest Oil Company is doing just that… And it can be found here: https://www.rt.com/business/470192-russia-dumps-dollar-oil/amp/
Or, here’s your snippet: “Russia’s largest oil company Rosneft has set the euro as the default currency for all new exports of crude oil and refined products.

As of September, Rosneft is seeking euros as the default option of payment for its crude oil and products, Reuters reported on Thursday, quoting tender documents the Russian firm has published.

“Rosneft has recently adjusted all the new contracts for export supplies to euros,” a trader at a company that regularly procures oil from Rosneft told Reuters, adding that buyers have already been notified of the change.

The United States has not ruled out imposing sanctions on Rosneft over its involvement in trading oil from Venezuela. Rosneft has been reselling the oil from the Latin American country to buyers in China and India and thus helping buyers hesitant to approach Venezuela and its state oil firm PDVSA because of the U.S. sanctions on Caracas, and, at the same time, helping Venezuela to continue selling its oil despite stricter U.S. sanctions.

Rosneft’s move was seen by traders and analysts as a future hedge against potential new U.S. sanctions on Russia and/or its oil industry.”

Chuck Again…. I always told my audiences after 2010, that with China adding country after country to their roster of countries that do currency swap agreements with them, that it wouldn’t take that much to add the Oil producing countries and when they took the dollar away from Oil trading, it would be bye bye dollar… Well, this is not the Chinese swap agreement, but it’s the same thing. Now, we just sit and watch as oil producing country after oil producing country drops settling in dollars…. I’m just saying…. Oh, and Got Gold?

Currencies today 10/7/19 American Style: A$.6738, kiwi .6290, C$ .7511, euro 1.0981, sterling 1.2328, Swiss $1.0052, European Style: rand 15.1430, krone 9.1355, SEK 9.9152, forint 303.77, zloty 3.9439,  koruna 23.4745, RUB 64.62, yen 106.85, sing 1.3805, HKD 7.8443, INR 70.83, China 7.1475, peso 19.57, BRL 4.0537, Dollar Index 98.84, Oil $53.37, 10-year 1.54%, Silver $17.45, Platinum $877.26, Palladium $1,662.07, and Gold…. $1,499.10

That’s it for today…  Ok, since last Wednesday, I went to see the wound center and they went crazy over the looks of the wound on my leg… I spent over 2 hours there, and they think they have the magic potions to heal it… I hope so….  On Saturday, a group of friends got togher for a bite to eat and then go enjoy the music and fireworks of our City’s celebration…  Fun times for sure, and our Blues won on Saturday night!  So, let’s hope the Cardinals find their bats today, and that there is a game 5 on Wednesday, eh?  Stevie, guitar, Miller, and the Steve Miller band takes us to the finish line today with their song: Serenade…    A great chords riff to start that song….  I hope you have a Marvelous Monday, and please Be Good To Yourself! 

Chuck Butler