We’ve Heard These Claims From The Fed Before…

June 30, 2021

* currencies drift on Tuesday… 

* Gold & Silver see the price manipulation again… 

Good Day… And a Wonderful Wednesday to you…  I had an awful day yesterday with the pain in my head… I’m not one to subject myself to pain medication, but… There comes a point, where there’s no other choice, and that’s where I was yesterday afternoon…  This morning is touch and go so far, so this may or may not be of regular length today… And quote frankly, I don’t think there’ll be a letter tomorrow, as I’m just not up to doing it, with all this pain in my head. That will send us into the 4th of July holiday weekend, with Sunday being the actual holiday, and Monday being the work week holiday… I have to wait until next Wednesday for my brain MRI… stupid people… And that’s all I have to say about that! REO Speedwagon greets me this morning with their top 70’s hit: Ridin’ The Storm Out… Which is what I fell like I’m doing…

So, I told you yesterday that I didn’t see the currencies doing much this week, and that they would probably result in nothing but drifting this week… And that’s exactly what we had yesterday! Get this… The BBDXY was 1,138.79, yesterday morning, and 1,138.75 at the day’s end… The Dollar Index also showed drifting as it opened yesterday morning at 92.04, and ended the day at 92.02…  So, nothing to see here, move along…

Gold & Silver however, didn’t see any drifting, and took shots to the mid-section yesterday. Gold lost $17.30 to close at $1,762.10, a multi-month low… And Silver lost 35-cents to close below $26, at $25.84…  James Rickards is back to calling a huge gain in Gold… I found this in Dave Gonigam’s 5 Minute Forecast yesterday…  And here’s what Rickards sees…

“Gold’s third bull market began on Dec. 16, 2015, with gold hitting a bottom of $1,050 per ounce at the end of the prior bear market. Since then, gold has rallied to about $1,800 per ounce as of this writing, almost an 80% gain.

“If we take a simple average of the price gains and durations of the two prior gold bull markets, we arrive at a 1,435% gain over a period of 10.7 years,” Jim says. “Applying that gain and duration to a baseline of $1,050 per ounce beginning in December 2015 leads to a projection for this bull market of $15,070 per ounce by August 2026.” – James Rickards in the 5- Minute Forecast…

Well, I sure hope I’m still around in 2026 to see that!  But, to me that’s quite a forecast… And I just can’t get my arms around $15,000 Gold… But IF it does get there, my kids and grandkids will be celebrating, I’m sure!

In the overnight markets last night… saw some dollar buying, not much but the BBDXY rose to 1,139, and the euro dropped below 1.19… Gold & Silver start the day on positive notes, with Gold up 50-cents and Silver up 13-cents to draw close to $26 once again. I really don’t see the ADP Employment report that’s due to print this morning holding a grasp over the markets, but then maybe traders are desperate for something to trade off of that it will be, today… But like I said I doubt it… 

So another day of kicking ’round the cobblestones, look at the fun in feeling groovy! 

OK… time for some silliness… Ok, I had to laugh out loud when I read this tweet by Sven Henrich, of whom I’m quoted off of Twitter before… This time he had this line that really hits home: “When will the Fed get slapped with an anti-trust suit for monopolizing the entire financial market?”   LOL!

Too bad it’s true about the Fed, and not about them being slapped with an anti-trust suit!

And back to our regular programming… And in other news… I read yesterday that some grocery stores are going to start charging 10-cents a bag for non-reusable shopping bags…  Oh, it’s starting here folks… right where it’ll be added to your grocery bill, probably without you knowing it… Until… you do!   And I know you can’t wait for digital dollars to appear, and your bank begins to charge you for who knows what, in fees… It’s all starting right here, right now with grocery stores…  a fee for this, a fee for that, and if you don’t like it, a fee for whining!

Ok.. I got to thinking the other day, in between periods, when my brain hurt so much I couldn’t think, that I’ve heard this song before… What song am I talking about? The song the Fed heads are singing about inflation, but only the words have changed…  Remember when then Fed Chairman Alan Greenspan said that there was no housing bubble?  And that real estate always went up?  And then no one except me, held his feet to the fire when the housing bubble burst and almost caused a collapse of our financial system!  Well, recently current Fed Chairman Powell, was singing from the same song sheet as Greenspan, but only this time he’s saying there’s no inflation to speak of, that’s it not real, and will be gone soon…   I’m going out on a limb here and say that he will put the Fed’s batting avg. at .000 of being correct…

A day without some talk about inflation is like a day without pain… no wait that’s just me, for everyone else it’s like a day without sunshine…  So, who else to set things straight but the best selling author, and publishing guru, Bill Bonner…   I’ll start with how Bill was showing how Paul Krugman is wrong most of the time, and let him take it from there, this is from Bill Bonner’s Diary:

“But what do we learn from Krugman?

He tells us not to worry about inflation – so, it is inflation we should be worried about.

He tells us central bankers will “step on the brakes” when inflation begins to go over the “speed limit.” Ergo, central bankers will not put on the brakes at all; they will push down on the accelerator.

He tells us not to worry about a replay of the 1970s. But wait…

In the 1970s, U.S. national debt stayed under $1 trillion. Now, it is over $28 trillion.

Total U.S. debt – households, businesses, and the government – was still under $2 trillion in 1971. Now, it’s over $85 trillion.

And in the 1970s, central bankers – as well as leading economists – still feared inflation and believed they had a duty to keep it under control. Now, they are under Krugman’s spell.

Inflation is no problem, they believe. And more government spending is the cure for every problem – from global warming to inequality.” – Bill Bonner’s Diary

In case you didn’t notice, I’m using a lot of quotes from other people today, as I really don’t have much else to add to the market movements… The currencies are drifting with no economic data, and Gold & Silver got manipulated downward once again yesterday.

The U.S. Data Cupboard yesterday has the Case/Shiller Home Price Index, which showed an increase in home prices for April… Wait until next month’s report, that’ll really show an increase, in my humble opinion… But there’s not a new housing bubble forming, here… according to the Fed…   Of course as I told you earlier, they’ve sung from that song sheet before, and were so wrong, they were almost right…

Today’s Data Cupboard as the ADP Employment Report for June…  And Friday we’ll see the color of the BLS’s Jobs report at the Jobs Jamboree…  But as I’ve told you before, I don’t care what the BLS prints any longer, it’s all lies and doubletalk… UGH

To recap… The currencies drifted yesterday, and Gold & Silver got manipulated downward once again… Chuck gives us the thoughts of James Rickards and Bill Bonner today, now that’s a 1-2 punch that carries some umph!  And that’s that!

For What It’s Worth…  Long ago, I used to quote the guys at Bullion Star.com a lot… But then they kind of when separate ways, and I lost track of them. Then yesterday, I found this on Ed Steer’s letter, that highlighted a story on BullionStar.com, and I knew then I just had to use it, because, after reading it, I had already planned some snide remarks, not about the article. So that’s the FWIW article today, about Central Banks buying physical Gold, and it can be found here: Thai central bank leads pack, buying 90 tonnes of gold over April and May (bullionstar.com)

Or, here’s your snippet: “In early April this year, the Hungarian central bank stunned gold markets with the surprise that it had purchased a massive 63 tonnes of gold during March, and in doing so tripled its gold reserves from 31.5 tonnes to 94.5 tonnes.

At the time, this 63.5 tonnes purchase (the details of which we covered ) was the largest year-to-date gold purchase by a central bank during 2021.

Fast forward to June and that record has now been broken, as Thailand’s central bank has now made public that over the two months of April and May inclusive, it purchased a total of 90 tonnes of gold, thereby putting the Bank of Thailand in the pole position of the global central bank gold purchases during the first half of 2021.

In fact, with China and Russia now ‘officially’ out of the market for buying gold since 2019 and early 2020, respectively, this Bank of Thailand gold buying is the largest short-term gold accumulation operation by any central bank sovereign since the Polish central bank bought 100 tonnes of gold in London during the first half of 2019 and promptly to Warsaw.

Thailand’s 90 tonnes addition in its gold reserves over April and May comprised a 43.5 tonnes increase in during April, and another 46.5 tonnes increase during May, taking its total gold reserves from 154 tonnes to 244 tonnes, a 58.4% increase.”

Chuck again… Ok, we’ve got these Central Banks loading the boat with physical Gold that they have bought, and the price of Gold goes down?  Thanks a lot you dastardly price manipulators, for nothing, absolutely nothing, say it again!

Market Prices 6/30/2021: American Style: A$ .7506,  kiwi .6990, C$ .8075, euro 1.1888, sterling 1.3866, Swiss $1.0866, European Style: rand 14.2973, krone 8.5468, SEK 5.070,  forint 295.53,  zloty 3.7992,  koruna 21.4176, RUB 72.53, yen 110.53, sing 1.3440, HKD 7.7659, INR 74.24, China 6.4605, peso 19.82, BRL 4.9340, BBDXY 1,139.10, Dollar Index 92.10,  Oil $73.87, 10-year 1.45%, Silver $25.98, Platinum $1,064.00, Palladium $2,780.00, Copper $4.21, and Gold… $1,762.60

That’s it for today, this week and until next Tuesday… And by then hopefully I’ve weathered the storm and gotten some relief for the pain… I’m really surprised I made it this long this morning, as I was ready to throw in the towel at the onset this morning! But I soldiered through… There’s really nothing I can do to help this situation except take the pain medicine… Don’t worry, I hate taking it so much, I would never be tempted to get addicted to it… As I always tell the nurse after she goes over my medicines… “Better living through Chemistry”…   So, what will you do for the 4th of July 3-day Holiday Weekend?  I used to be a big fireworks guy… But not so much any more…  Instead, I’ll put some huge chunk of meat on the Big Green Egg, smoke it till the sun doesn’t shine, and have a great Bar-b-que, even if it is just me and Kathy!  You know what, after dealing with the hospital yesterday, I’m tired of dealing with stupid people! People that take no pride in their work, people that don’t care that the customer is who they need to take care of!  And not the other way around! I’m tired of it… And from now on I’m going to be a real pain in the rear to people who treat me like that… So watch out America! Grand Funk Railroad takes us to the finish line today with a very apropos song: We’re An American Band…  “We’re coming to your town, we’ll help you party it down, we’re an American Band” I hope you have a Wonderful Wednesday, and big 4th of July holiday, and please remember to Be Good To Yourself!

Chuck Butler