April 21, 2022
* currencies & metals rally on Wednesday
* What’s China up to?
Good Day… And a Tub Thumpin’ Thursday to one and all! Now that was an old fashioned baseball game last night, a pitcher’s duel, that resulted in a Cardinals 2-0 win, on a 9th inning home run! The Miami pitcher, used to be a Cardinal, but we traded him 3 years ago, while he was still developing, and now he’s one of the best pitchers in the League! I go to see the eye prosthesis doctor later this morning, should be a lube and Oil job, in and out! David Crosby & Graham Nash greet me this morning with their song: Wind On The Water… It’s sad that Nash won’t speak to Crosby these days… I saw them perform at the Mississippi River Festival, many years ago…
Well, when I left you yesterday, the dollar was getting sold, and the BBDXY dollar index has lost 6 index points. It didn’t stop there though… The index lost another point on the way to closing at 1,212… So, it was nice to see that the currency traders could do something other than buy dollars! Gold & Silver floundered most of the day yesterday, with Gold finally eking out a $7.16 gain on the day to close at $1,958.70. Silver gained one red cent yesterday, and therefore closed the day at $25.28
Bonds lost a bit of ground, but not much, and the price of Oil lost a buck, to finish the day trading with a $102 handle…
In the overnight markets last night… the dollar got sold a little more and appears to be starting a losing streak, after two weeks of daily increases… Like I said before, the dollar was extremely overbought… And these things always seem to correct themselves, eventually. Gold & Silver are getting off on the wrong foot this morning, with Gold down $11, and Silver down 37-cents… Oil had bumped higher to trade with a $103 handle this morning, and Bonds are stuck in the mud, and not moving… I think the bond markets are letting it be known that earlier this week’s rise in yield to 2.95%, was too much, too fast… Yields will get there, in time.. just not at this time… is what I believe the bond boys are telling us.
Regarding the price of Oil, I read this morning that supplies are getting quite low, which could be the fuel that pushed the price of Oil higher into the weekend.
Ok, well, good friend, Dennis Miller, of www.milleronthemoney.com sent me a link to an article yesterday, that made my head spin with anger when reading it! The article had a guy saying that he thinks inflation has peaked and will be on its way back down now… I replied to Dennis the following: Apparently this guy hasn’t heard about the ports in China being locked down because of the Covid outbreak in China… that means shortages and higher prices…
What a dolt!
Food shortages, now that’s just what this country needs, eh? NOT! But don’t that thought get in the way of a rainbow and butterflies outlook for this country, and its finances, economy, and overall outlook!
Remember about 15 years ago, when it was the “in thing to do”, and that was moving your operations over to China so you could produce your goods at cheaper rates, with cheaper labor? Well, that won’t do you too much good, when there are no shipments of goods coming out of China right now… I’m just saying…
Built in America used to mean something, but now… Because of all the bad mouthing that Corporations here get from the woke crowd, the climate change crowd, the current administration, and so on… I still buy whatever I can that’s made in America… I don’t want a parade for doing that, It’s just who I am… And as Popeye used to say, “I ams what I ams, and that’s all that I ams”…
Ok… lets move on… I also saw that the Fed’s Beige Book, which is a pulse of what’s going on in each Fed Region, said in their last entries that they don’t see inflation backing off any time soon… I’m still seething mad at that guy who claims that inflation has peaked! It’s all seashells and balloons for this guy, and like I said: “What A Dolt!”
In Ed Steer’s letter yesterday he had a quote from one of my fave founding fathers, Thomas Jefferson… Check this out… ““The end of democracy and the defeat of the American Revolution will occur when government falls into the hands of lending institutions and moneyed incorporations. –Thomas Jefferson
Uh-Oh… I do believe that we are at the crossing point of what the great Thomas Jefferson described for us all those years ago…. If you recall your American history, Thomas Jefferson had his battles with Alexander Hamilton…
So, in case you don’t recall this battle, here is one of the main points: Hamilton believed in the establishment of a central bank(this is why he favored the creation of the Bank of North America). Jefferson strongly disagreed and did not advocate the issuing of debt which Hamilton deemed as ” a national blessing ” if ” not excessive “.
I’m not a fan of Hamilton…. Never have been… Speaking of Hamilton, my wife was thrilled to attend the performance of Hamilton at the Fabulous Fox on Tuesday night…
OK… enough of that… In New Zealand last night, they printed their latest inflation report, and it was New Zealand’s annual consumer price index (CPI) hit a three-decade high in the first quarter, underlining the central bank’s hawkish stance to contain price pressures bubbling in the economy.
Annual inflation rose 6.9% from 5.9% in the previous quarter, the fastest rate since a 7.6% annual increase in the year to the June quarter of 1990,
The RBNZ (Reserve Bank of New Zealand) will have to rethink their approach to hiking rates, and get more aggressive.. .At least they are 3 rate hikes ahead of the Fed/ Cabal/ Cartel!
I don’t know if you follow this or not, but after months of the Chinese renminbi trading around 6.36 VS the dollar, the renminbi has had a turn for the worse, with it first dropping to 6.41 yesterday, and then to 6.44 today… The lockdowns in China probably have something to with this, but my spider sense is tingling and telling me that there’s something much more sinister going on here… Could it be the Chinese are back to their old tricks of allowing their currency to weaken VS the dollar to make U.S. exports to China even more expensive?
When I was a young man I asked my dad about China, and he responded, “Chuck, China is a sleeping giant, and we as a country would do best to leave them be, don’t go poking the big bear”… Well, we didn’t heed my dad’s warnings and we went and poked the big bear… And kept poking it until we woke up the sleeping giant, and now we have them to deal with…
The U.S. Data Cupboard finally has something besides housing data for us today… First of all we will see the usual Tub Thumpin’ Thursday fare of Weekly Initial Jobless Claims, and then we’ll see the color of the March Leading Indicators… I’ve said this before, so I’ll try to be brief… Capacity Utilization, and Leading Indicators are the only two forward looking pieces of data that we receive… I expect the Leading Indicators index to drop in March… Shoot Rudy, everything else did!
For instance, GDP in the 1st QTR of this year will have dropped by a significant amount when it finally gets massaged, and cooked… The Fed Atlanta’s GDP NOW shows 1st QTR GDP to be just above 1%… They had some forecasts that were greater than 2%, so that means with the average being just above 1%, that there had to be some forecasts at zero and below…
To recap… The dollar finally got removed from the turn table yesterday, and lost ground on the day. It had to have caused by an extremely overbought position in the dollar… Gold gained $7 and Silver gain 1-cents yesterday, To me, these two are just biding their time, waiting for the right moment to strike higher… New Zealand saw their 1st QTR inflation grow faster than at any time in the past 3 decades! Chuck thinks the RBNZ will act appropriately…
For What It’s Worth… Well, I made a BIG Point of telling you yesterday that a shortage of Silver could be in the cards, and then I came across this article that sort of explains why the shortage is happening, and it can be found here: Global Silver Demand Surged in 2021 (yahoo.com)
Or, here’s your snippet: “The global silver market realized growth in every demand category in 2021, marking the first time all key sectors rose in tandem since 1997. Surpassing pre-pandemic volumes, total global silver demand achieved its highest level since 2015, surging 19 percent to 1.05 billion ounces (Boz) last year. Leading the way was an all-time high for silver’s use in industrial applications, rising 9 percent to 508.2 million ounces (Moz).
Physical silver investment (sales of silver coins and bars) leaped by 36 percent to 278.7 Moz, its highest level since 2015, as retail investors in North America and Europe, motivated by safe-haven and inflationary concerns, took advantage of periodically lower silver prices to purchase coins and bars.
Of note, last year, the silver market experienced its first deficit since 2015, at 51.8 Moz, its most significant shortage since 2010.
These developments, along with other important segments of the global silver market, are discussed in World Silver Survey 2022, released today by the Silver Institute. In addition to reviewing the main factors influencing the 2021 silver market, the Survey provides insights and an outlook for 2022. The Survey was researched and produced for the Silver Institute by Metals Focus, the London-based independent precious metals consultancy.
All categories of silver demand strengthened last year, taking the annual total to 1.05 Boz, an impressive 19 percent gain over 2020. Industrial fabrication rose by 9 percent to 508.2 Moz despite global logistical challenges.”
Chuck again…. As I’ve said for many years now, physical demand will eventually crash the price manipulators, and this is a good sign that physical demand is get there… I’m just saying…
Market Prices 4/21/2022: American Style: A$ .7447, kiwi .6797, C$ .8018, euro 1.0922, sterling 1.3081, Swiss $1.0535, European Style: rand 15.2258, krone 8.7669, SEK 9.3855, forint 339.76, zloty 4.2550, koruna 22.3196, RUB 80.10, yen 128.07, sing 1.3612, HKD 7.8442, INR 75.95, China 6.4467, peso 20.06, BRL 4.622, BBDXY 1,210.34, Dollar Index 99.94, Oil $103.24, 10-year 2.87%, Silver $24.94, Platinum $979.00, Palladium $2,470.00, Copper $4.65, and Gold… $1,946.00
That’s it for today… I’m really tired today, don’t know why, just am… I do believe though that it’s a case of my daily chemo dragging me down… But I won’t let it get to me! Had a nice lunch with good friend, Duane yesterday. We went to Carl’s Drive In, for smashed burgers… The people at Carl’s are so used to working people coming in to grab a quick lunch, and they accommodate them, but we were two old retired guys, and the whole experience lasted less than 30 minutes! Too Fast! We had all afternoon! Oh, well, the burgers were great, and I even splurged and got a Root Beer, the first sugar I’ve tasted in 2 years! I said to Duane, I had better not check my blood sugar tomorrow morning! Well, next week is the last week of April… The month seems to be going by very quickly! My May Calendar is packed with events and appointments! The Moody Blues take us to the finish line today with a song from their best album, Seventh Sojourn titled: New Horizons… don’t know that song? YOUTUBE it, and it’ll be stuck in your head all day! I hope you have a Tum Thumpin’ Thursday today, and please remember to Be Good To Yourself!
Chuck Butler