- Not much movement in the dollar yesterday or last night
- Gold & Silver continue their assault on prices
Good Day… And a Tub Thumpin’ Thursday to one and all, especially for my good friend, Dewey, who celebrates his birthday today! And knowing Dewey like I do, he will indeed be having a Tub Thumpin’ Thursday today! So, Happy Birthday my good friend… Is that an age! HA! (inside joke) Well, yesterday, I hit send on the Pfennig, and then right back to sleep for a few more hours and then awoke ready to take on the day! Marty Balin greets me this morning with his song: Hearts…
Well, front and center this morning, I wanted to pound on the Fed/ Cabal/ Cartel for telling more lies… Or better yet, not coming out with the real truth… You see the St. Louis Fed sends me an email of their findings from time to time and yesterday’s letter made me seethe… The Fed Heads claimed that the soaring inflation of 2022-23, was caused by the pandemic… Not a word about all the money supply that they had added for over a decade, or the zero interest rates they held for a decade… Not a single word, for shoot it couldn’t have been their fault that inflation soared! See why I wanted to get this off my chest first thing out of the starter’s blocks this morning?
OK… The dollar gained 1 index point yesterday, after a “hot STUPID CPI” printed… The euro moved past the 1.0
4 figure, and the other currencies at least sat up and noticed… I’ll get to the STUPID CPI in a minute, but first… Bonds had their largest one day upward move this year, so far.. The 10-year Treasury’s yield climbed to end the day trading with a 4.61% yield… I guess the Fed Heads had more important things to worry about to bother themselves with keeping a lid on bond yields…
Gold rallied in the face of several attempts by the short paper traders to see Gold gain $7, and that was after starting the day down $2… And Silver gained 39-cents to end the day at $32.25, while Gold ended the day at $2.905.
Not seeing their efforts succeed elsewhere, the short paper traders turned to Oil contracts, and the price of Oil dropped $2 to end the day trading with a $72 handle.
Inflation, as measured by the STUPID CPI saw an upward move, that moved the mom inflation rate to 3.0%… This is the highest the monthly STUPID CPI has been in 7 months! So, in my humble opinion the Fed Heads previous rate cuts are filtering throughout the economy, as rate movements tend to take some time to work themselves through… So, it was a good thing that Jerome and boys & girls at the Eccles Bldg. Decided to leave rates unchanged at their last meeting… You may recall me saying then that the next rate move may very well not be a rate cut, but a rate hike… And I believe that thought has been on the minds of the bond boys for several months now.
The other STUPID CPI numbers were: Core yoy CPI 3.3%… And the monthly increase was .5%… Hey, Psst! Fed Heads! Are you seeing this rising inflation trend? I know that usually you have to be hit over the head with a 2X4 to see the problem before acting on it!
In the overnight markets last night… The dollar inched higher by 1 index point to 1,301… The euro fell back below the 1.04 figure… There are so many analysts out in the cold world, that believe that the euro is going to parity with the dollar this year… I find it difficult to believe when the euro does rally, with all that negativity toward it… Gold starts the day today, up $9, and Silver up 3-cents…I think the markets are still trying to digest the PPI # this morning… But when they realize that this means consumer inflation is going to rise, they’ll finally come around…
The price of Oil starts today trading with a $70 handle, and the 10-year’s yield is 4.61% to start our Thursday…
The Edleman Trust Index printed recently, and it showed that the 33,000 U.S. residents rated trust in the U.S. Gov’t very low… This Index measures the trust in : Gov’t, Business, and media… And all three were very low rated… Go figure… If they had surveyed me, I would have put them at the bottom!
I’ll only watch the local news shows, no cable new, no national news… Because? I don’t trust those other guys!
You know… the funny thing (not funny ha-ha) is that for the most part of Gold’s rise the U.S. investors are still ignoring the impressive upward growth of Gold…
And here’s a headline from Bloomberg.com this morning: “Eggs Soar 15% in a Month With US Grocery Shelves Empty” And that, alone is being blamed for the rise in the STUPID CPI… I find that to be questionable because, in the past the BLS would simply substitute an item when the item in the basket of goods use to price Inflation became too expensive… So, why not a substitution for eggs, BLS? Oh, that’s right, I almost forgot, the BLS has no reason any longer to make data look good, for the new POTUS…
Well, today we’ll see what new rabbits the POTUS pulls from his hat, as he will announce reciprocal tariffs, as the Eurozone begins to huff and puff about putting tariffs on U.S. imports… This is becoming akin to a hand of poker, I’ll see your raise, and raise you further… And then I read an article on the FXSTREET.com that talked about tariffs would most likely produce inflation this time, as 2018’s tariffs were at a different time and space, and situation…
The U.S. Data Cupboard already printed PPI (wholesale inflation) this morning for Jan… And PPI last month and grew to 3% for the month, and 3.5% YOY… So, don’t look now but that’s inflation that’s in the pipework, working its way to consumer inflation… We also saw the usual Thursday fare of Weekly Initial Jobless Claims… And they remained above 200,000… When will all the axing of Gov’t employees begin to get counted?
To recap… The corrupt media called the STUPID CPI a “hot CPI”… Brother! Give me a break! I mean the STUPID CPI did rise last month but hot? And Chuck questions why the BLS didn’t do one of their hedonic adjustments to the cost of eggs, which have soared and was blamed for the increase in the STUPID CPI.. Gold gained a little yesterday, the dollar gained a little, Silver gained a little more, Bonds yields soared, and Oil got whacked…
For What It’s Worth… Well, I talked a lot this morning about inflation an wholesale inflation, and then ran across this article on MarketWatch.com and well, here it is: “Wholesale prices pop and point to persistent inflation pressures in guts of the U.S. economy – MarketWatch
Or, here’s your snippet: “The numbers: Wholesale prices rose sharply in January in another sign that lingering inflationary pressures in the economy will keep high U.S. interest rates from falling much anytime soon.
The producer-price index increased 0.4% last month, the government said Thursday. Economists polled by The Wall Street Journal had forecast a 0.3% gain.
The increase in wholesale inflation in the past 12 months rose to 3.5% from 3.3%. That’s the highest rate in almost two years.
The PPI report follows a sharp uptick in consumer prices in January, which rattled financial markets and raised the possibility of the Federal Reserve not cutting interest rates this year.
High borrowing costs have punished home buyers and made it more expensive for people to buy cars. The cost of borrowing has also discouraged business investment.
High rates tend to slow the economy over time, however, and reduce the rate of inflation. The Fed has paused further rate cuts until it sees more evidence that inflation is decelerating again.”
Chuck again, you’ve heard it all before, but it’s always worth it to circle the wagons and revisit…
Market Price 2/13/2025: American Style: A$ .6281, kiwi .5629, C$ .7006, euro 1.0389, sterling 1.2469, Swiss $1.1016, European Style: rand 18.6211, krone 11.2711, SEK 10.8625, forint 386.89, zloty 4.0141, koruna 24.1262, RUB 91.20, yen 153.82, sing 1.3572, HKD 7.7866, INR 86.90, China 7.2978, peso 20.64, BRL 5.7878, BBDXY 1,301, Dollar Index 107.83, Oil $70.64, 10-year 4.61%, Silver $32.26, Platinum $1,001.00, Palladium $993.00, Copper $4.73, and Gold… $2,914.77
That’s it for today, and now the sad part… Today would have been my oldest sister’s birthday, Brenda was very young when she was take from us with ovarian Cancer… Brenda taught me slow dance, to tie my shoe, she took me to my very first day of school and stayed by my side until I had stopped crying… Miss you, Brenda… Ok, enough! I don’t need to end the week on a sad note! There was a friend of ours that used to come to Spring Training with us, his name was Jay, and he was a mountain of a man: 6’8”… And he had a twin brother! But what I’m getting at is that he used to say each day when we met for breakfast.. “Sunny and 80 again today”… Well, for the next 5 days he would be bang on again! Oh! Tomorrow is Valentine’s Day! Happy Valentine’s Day to all your sweethearts out there! Little Feat take us to the finish line today with their song: Fat Man In A Bathtub… I hope you have a Tub Thumpin’ Thursday today, and please Be Good To Yourself!
Chuck Butler