Author: admin

Rocktober 15, 2020

* Gold & Silver rally on Wed. but are soft this morning

* Dollar bugs have confidence that could be short term? 

Good day… And a Tub Thumpin’ Thursday to you! All’s well with my heart and the pacemaker, according to the device specialist and the heart doc. Yesterday…  We talked baseball a bit, before getting down the brass tacks… I have to say that going to the hospital for the doctor visit, and parking far away from the door, the whole process just wore me out… I came home, had a bit to eat for lunch, and then fell asleep in my recliner, where I have to elevate my legs for 3 hours a day, and so I figure if I have to sit there for 3 hours, I might as well take a nap! I woke up in time to turn on the NLCS game 3, and watch the Dodgers go bananas on Braves pitching, it was 14-0 in the 3^rd inning!  It didn’t matter if Warren Spahn was pitching, the Dodgers were going to hit the ball with authority! WOW!  I have a treat song for the older crowd this morning, it’s Nina Simone with her song: Feeling Good….  I know Michael Buble did a retake on this song, but I prefer the original… What a sexy sultry voice!

There just wasn’t much going on in the markets yesterday folks… so this ought to be short-n-sweet, but you never know what I might ho off on a tangent on, so let’s grab that cup of coffee, and begin the day! 

Gold found a way to hold onto most of its early morning trading gain of $11, as the day went along… Of course there was some upward movement during the day that quickly had cold water thrown on it by the price manipulators…  Gold closed at $1,902.20, up $9.50 on the day, and Silver had to fight to hold onto most of its early morning trading gains too. Silver closed at $24.36, up 36-cents on the day…

But in the overnight and early trading markets, Gold & Silver look pretty soft, and have given back some gains… Gold is down $5, and Silver is down 50-cents in the early trading. And overnight, the euro was sold to bring the single unit to the brink of falling below 1.17…   I have to think that the failure to come up with another stimulus deal has given the dollar bugs a lot of confidence… But that’s to be short term right? Because another stimulus is coming… We just don’t know when… 

I really don’t see this pattern of the price manipulators taking chunks out of Gold and Silver’s prices as we head to the end of the year…  But… the other day, when I was talking to the Great Mogambo Guru, I realized that I had nothing to complain about with Gold & Silver… Gold has outperformed everything since 2000… And this past year it has put the stock market to shame…. So… It shouldn’t matter to me that Gold was above $2,000 a couple of times this year, only to see it settle in around $1,900… It’s still better than anything else!

You know, I recall back in the early 2000’s I was reading Bill Bonner’s letter one day, and he said that the trade of the decade was to sell stocks and buy Gold…  I immediately made my first buy of Gold and began telling anyone that would listen to me that they should buy Gold…  Well, his trade of decade turned out to be bang on! And while technically it ended in 2010… We could say that adding another decade still makes it bang on!

Well, the currencies didn’t see the light that Gold & Silver was shining on them yesterday, and the while the euro basically traded flat on the day, the Aussie dollar lost more ground, and the Russian ruble, which had recently gained back a big chunk of the value it lost recently, can’t stand prosperity, and lost major ground on the day.. Just because the price of Oil slid below $40?  No, there’s more at play here folks…. And maybe the recent upward move was too far too fast…  I’m just saying…

It was nice to see the U.S. Postal Service announce that they were going to reverse the recent changes they made that slowed down mail delivery, ahead of the glut of mail that will need to be delivered before the election…  Good move…

OK, I was content to get this out the door short-n-sweet this morning, but then along came a spider and sat down beside me, and whispered in my ear that I needed to include these quotes from Fed Heads… So, I guess I will do just that, and you’ll see why I the spider wanted me to include them this morning, I’m sure….   Here we go! 

Yesterday, San Fran Fed president Mary Daly made a stunning admission: just in case there was any confusion, the Fed knows that it has – and continues to blow – an asset bubble making “a few” who own stocks uber-rich, but the economy is now so reliant on the Fed liquidity fire hose that the moment the Fed threatened to pop this bubble, which some have estimated to be around $90 trillion in liquidity, would result in economic devastation and leave millions without a job.

“I am not willing to trade millions of jobs for people who need a ladder rung up in order to keep the stock market from going up for a few who have those holdings,” Daly said while answering questions following a speech on – what else – racial inequality at a virtual event Tuesday hosted by the University of California, Irvine.

Just one day after Daly admitted that the Fed is trapped, the Fed’s Vice Chair for Supervision Randal Quarles, made an even more shocking – or rather “shocking” admission, when he said that “the Treasury market is now so large that the U.S. central bank may have to continue to be involved to keep it functioning properly.”

Chuck again… I got those off an article on zerohedge.com  that Ed Steer also highlighted this morning…  So, the Cartel, I mean the Fed Heads know that they are manipulating the markets, and now are so brazen about it they talk about it in public?  In the words of my good friend, the Great Mogambo Guru… “We’re Freakin’ Doomed!” 

The U.S. Data Cupboard finally has something for us to view this morning, and right out of the starting blocks this morning we have the Weekly Initial Jobless Claims, which have already printed, and look bad… 898,000 claims were filed last week, that’s up by 53,000 from the previous week… This data set is heading the wrong way isn’t it?  of course it is… I don’t like being right when the thing I’m right about is so wrong for the country’s economy, but… I do believe that this data set pretty much tells us that there was no V recovery, and we’re in the beginning stages of a down and dirty depression… 

To recap…  Gold & Silver found a way to hold on to most of their early gains yesterday, but are back on the selling blocks this morning…  The currencies keep getting whipped by the dollar bugs, and Chuck thinks it all has to do with the confidence the dollar bugs have now that there is no stimulus deal…  And then a spider whispered in Chuck’s ear and we found out that the cartel, I mean Fed Heads are now talking about how they manipulate the markets…  UGH! 

For What It’s Worth…  Ok, you all know that I have no love for JPMorgan and Jamie Dimon their CEO, as he seems to be Teflon coated as the 5 felony counts against his firm have been filed…  So, when I read the title of this article: “If You’re Baffled as to Why JPMorgan Chase’s Board Hasn’t Sacked Jamie Dimon as the Bank Racked Up 5 Felony Counts – Here’s Your Answer”… Now doesn’t that want you to read the article too? Ok, it’s on the Wallstreetonparade.com site, but here’s the actual link to the article: https://wallstreetonparade.com/2020/10/if-youre-baffled-as-to-why-jpmorgan-chases-board-hasnt-sacked-jamie-dimon-as-the-bank-racked-up-5-felony-counts-heres-your-answer/

Or, here’s your snippet: “For years we’ve been trying to figure out why JPMorgan’s Board of Directors hasn’t sacked its Chairman and CEO, Jamie Dimon, as the bank racked up two felony counts in 2014 for its failure to alert U.S. regulators to glaring red flags in the bank account it held for Bernie Madoff’s Ponzi scheme; one felony count in 2015 for rigging foreign exchange markets; and two more felony counts just last month for rigging the precious metals and U.S. Treasury market. (The bank admitted to all five counts.) In addition, the bank came under another criminal investigation in 2012 and 2013 when it lost $6 billion of its bank depositors’ money gambling in credit derivatives in London (the London Whale scandal).

Turns out Jamie Dimon has been taking very good care of the Directors on his Board and they have been taking very good care of Dimon – turning him into a billionaire, notwithstanding the worst criminal record of any major  bank in the history of the United States.

The JPMorgan Chase Board of Directors has a stunning number of incestuous conflicts of interest, few of which have not been properly spelled out to shareholders. Others have never been mentioned to shareholders.”

Chuck again… The article goes on to describe the relationship between JPMorgan and the head of NBC Universal, which owns Comcast… it’s pretty hairy folks… And a long read to allocate enough time if you are curious about this whole incestuous set up….  I was curious and curiouser!

Market  Prices 10/15/20: American Style: A$ .7067, kiwi .6588, C$ .7568, euro 1.1705, sterling 1.2918, Swiss $1.0940, European Style: rand 16.6876, krone 9.3750,  SEK 8.8645,  forint 311.47,  zloty 3.8890,  koruna 23.3520, RUB 77.25, yen 105.22, sing 1.3615, HKD 7.7487, INR 73.35, China 6.7300, peso 21.48,  BRL 5.5650,  Dollar Index 93.77,  Oil $39.58,  10-year .69%, Silver $23.87, Platinum $846.00, Palladium $2,370.00, and Gold… $1,897.00

That’s it for today…  Well, in the past week, I’ve had my oncologist tell me to continue what I’m doing, and my heart doctor the same, so I guess that’s what I’ll do!  No seriously, I need to lose weight, but I’ve found that that’s near impossible these days, so… I’ll just grin and bear it, I guess… The Wound Center sent me a box of supplies to change the dressings on my legs, and the box was so heavy! I was hoping that they got mixed up and instead of Silver Alginate pad, they put Silver bars in the box! HA! Now that would BE a HUGE MIX UP, eh?  The temps fell out of bed here, and it’s chilly outside once again… time to get the woolies out, as my friend in Perth Australia, Tina, used to say…  Lynyrd Skynyrd  takes us to the finish line today with their song: The Ballad of Curtis Lowe…  I hope you have a Tub Thumpin’ Thursday and Fantastico Friday tomorrow, and I ask you very seriously, to Be Good To Yourself!

Chuck Butler

 

Rocktober 14, 2020 

* Currencies, metals, Oil, stocks all get sold yesterday

* If inflation rises, how does a Central Bank Combat that? 

Good Day… And a Wonderful Wednesday to you!  We’re in our second day of warmer than usual weather today, and then the bottom falls out tomorrow… So, I’ll need to get outside today to soak up some warm sun before the cold front comes through…  I’ve always said that the Fall weather was the best weather we get here in the St. Louis area… And so far, I’ve been bang on with that thought once again!  But… even though the weather is nice now, I would rather be in a warm climate, so I can go outside each day, read a book, or listen to music, or nature, and enjoy not having to have a jacket or sweatshirt on…  But If I were away, I would miss things like my granddaughter, Evie’s first birthday! So, I tough it out here until I go to Florida for the winter…. The Guess Who greet mee this morning with their song: No Time….   I think I’ve said this before, but in case I didn’t… Burton Cummings the leasd singer of the Guess Who, is one of my all time favorite singers!

OK… I guess when I kept harping at traders to “pick a lane” I should have stipulated that I wanted them to move ahead, and not drop back, after they picked their lane… In case the coffee hasn’t tricked your mind into believing you are awake… I’m talking about the up one day, down the next, trading we saw for over two weeks, and I said that I would tell the traders to pick a lane, if reference to me commenting on drivers that can’t decide what lane to choose… 

The reason I should have stipulated which way they should go after finally choosing their lane is that yesterday should have been an up day, that is, if we were keeping with the trading trend of the last two weeks… But something not too funny, happened on the way to the forum, and the trend ended, just like that! Gold lost $30 on the day, Silver lost nearly $1 (at .98-cents), the euro dropped further downward, and stocks got sold… The price of Oil slipped downward, but…. U.S. treasuries rallied! But I have to say, that I really don’t want to seed yields go any lower…  There are over  $15 trillion of government bonds worldwide, or 25% of the market, now trading at negative yields, I don’t want to see that being the case here… But in reality, our Treasuries are trading with negative “real yields” that arrived by taking the rate and subtracting inflation…

Speaking of inflation… The stupid CPI printed yesterday, and it only showed a .2% gain in September, bringing the YTD figure for inflation to 1.4%…  Which is below where we were last year at this time, when inflation was 1.7%…   And that WAS BEFORE THE FED ANNOUNCED THAT THEY WERE TARGETING HIGHER INFLATION….   

Yesterday, I made big deal out of the increases in inflation that I’ve already seen… As always I say that you may not have experienced these same inflation increases… But overall… this is very interesting as it is the beginning of higher inflation… but is it really the case of too many dollars chasing too few goods, or… it it just a case of a lack of supply, without the spending demand?  Recall that at last check, Personal Spending was not so hot…

So… What’s it going to take to get inflation going higher the way the Fed Wants it to go?  Because if this all we get in terms of higher inflation, from all the money printing the cartel, I mean the Fed, has done, then, we need to go back to square one….  So, will the next stimulus, whenever it does get passed create greater inflation?  I doubt it…. We will see it blip higher, but it’s not sustainable, until there’s a message sent to consumers that this is not a one and done deal, that more stimulus is coming…. And to me that’s a real slippery slope folks…

Because once you get consumers primed for a regular stimulus check, bad things can happen…  And  one of them is the Universal Basic Income (UBI)….  Tax receipts are already falling very short for this year, like they did last year, which means that the difference goes to the national debt… And if our leaders, whomever they might be, decide to go with the UBI, who’s going to pay for that?  Not taxpayers because they’ve already paid…  Just more debt will be added, and added, and added, until the weight of the debt causes the financial system to collapse… 

And upon further review…  the offense was offside…  No wait! I’m going to be very serious here so don’t let that little ditty confuse you!  I was thinking yesterday, about the cartel’s, I mean the Fed’s desire to get inflation rising… But there’s a caveat here that I don’t think they’ve thought about, or maybe they have and they are just playing with fire, like little kids, and you know what they say when you play with fire, right? You get burned!   OK… so we’ve established that they want inflation rising, but… what does a Central Bank need to do to combat inflation that begins to get out of hand?  Yes, they need to raise interest rates, right?  

Well this is where it gets really ugly folks… for if the interest rates are brought higher, so does the cost of servicing the debt, paying interest on bonds, and issuing new bonds with higher rates… Uh-Oh!  I’m dead serious here folks! This is not a good scenario… And brings me back to the question of, Did they think about this before they began their campaign to increase inflation? Because, to me, it sure looks as though they didn’t…  I’m just saying… 

And readers of both the Pfennig, and Dennis Miller’s newsletter, will know that we both feel that the repeal of the Glass-Steagal Act is the root cause of the casino banks needing bail out after bail out…  Well, I received news yesterday that there’s a new book out, titled: Taming The Megabanks, and is about why we need to reinstate the Glass-Steagal laws that prohibit the Banks and Brokerage Houses to merge…  I think that this will be my Prime Day purchase! 

Boy, I’m sure full of good news for happy times ahead aren’t I? NOT!  All my education, in school and on my own has never covered what we’re doing as a country with our fiscal and monetary policies… So, we are in uncharted waters folks…  Better put your lifejackets on and hold on for dear mercy, because this is going to be rough waters ahead, and it’s not going to be clear sailing like it has been for sometime now…

OK, I’ve got to move on to something else before I blow a gasket!  So… The euro has seen better days, and worse days as a matter of fact, but for this thought we’ll just focus on recent times…  Can you believe they are still going through BREXIT negotiations?  I think that having those negotiations hanging over the Eurozone like the Sword of Damocles, is playing into the euro not being ready for prime time and move forward…  Because I know in my heart of hearts that Traders want to sell dollars right now, they know that they should be selling dollars right now, but they aren’t…. But, I believe they will eventually come around to doing so…  Economist, Stephen Roach believes that too, you may recall me highlighting a thought by Roach regarding the dollar collapsing …

In the overnight and early trading markets today, we see that Gold is up $11, and Silver is up a quarter (25-cents)…  Maybe the traders got their up, down days mixed up yesterday? HA!  The aforementioned, euro,  is inching higher this morning, but sterling has lost the 1.30 handle, and is looking peeked…   The Japanese yen, which last week looked as though currency traders had finally come back to thinking straight, and were selling yen, has returned to the 105 handle, and has fallen back in favor with traders…  I just can’t get the song by Leslie Gore out of my head…  Cause now it’s Judy’s turn to cry, cause Johnny’s come back… to me… 

Now see if you can get that little melody out of your head today! 

And what do we have here? Lola, aka Goldman Sachs, has issued a buy for its clients… They say buy Silver…   Well for once, I’m not going to punch holes in one of their buy signals…  And remember, what Lola wants, Lola gets….  I’m just saying… 

The U.S. Data Cupboard is still wanting economic data prints today, as only the PPI (wholesale inflation ) will print…  taking the stupid CPI into consideration, tells me that PPI will be weak…  

To recap…  The traders finally picked a lane, but it was the wrong one! As everything but Treasuries got sold yesterday… In the overnight markets Gold, Silver and euros have rallied, so we’ll see what happens the rest of the day today.. Maybe traders just got their up, down days mixed up? You think? HA! Did you know that the Eurozone and UK are still in BREXIT negotiations? No wonder the euro is tethered to the 1.18 handle!  And Chuck goes all nuclear on the cartel, I mean the Fed, regarding their desire to see inflation rising… 

For What it’s Worth…  Well, first longtime reader Bob, sent me the link for this article, and then another reader sent it to me, so apparently its something that everyone needs to see! And I believe it is! This is an article about the real unemployment numbers, and it can be found here: https://www.axios.com/unemployment-numbers-doubts-claims-backlog-california-5c9621d2-d285-4626-8657-655b43052b11.html 

Or, here’s your snippet: “More than 25.5 million people were collecting unemployment benefits as of mid-September, and nearly 1.3 million people filed first-time jobless claims last week — more than 800,000 for traditional unemployment and 464,000 for the Pandemic Unemployment Assistance program.

The state of play: That number excluded any new claims from the largest state in the country, California, which paused its program to implement fraud prevention technology and comb through a backlog of claims that had reached nearly 600,000 and was growing by 10,000 a day.

The big picture: California isn’t the only place where issues with unemployment claims are rising.

• The persistently high number of claims drive an uneasy contrast with the continued decline in the unemployment rate and improving numbers on the Job Opening and Labor Turnover Survey to the point that University of Oregon economist Tim Duy says, “We should be more skeptical about the initial claims data.  If the claims data is deeply corrupted, the conventional wisdom is just plain wrong. I keep saying the same thing: This isn’t the 2007-09 recession or the 2009-2020 recovery. It’s something different.”

Chuck again…  Ok, first things first… did you know that California’s jobless numbers weren’t included, because I didn’t until reading this article…That’s a real game changer there, folks…  But then I wouldn’t expect things to be transparent and fully explained to us by the BLS would you? 

Market  Prices 10/14/20: American Style: A$ .7175,  kiwi .6664,  C$ .7614, euro 1.1750, sterling 1.2998, Swiss $1.0941, European Style: rand 16.4996, krone 9.2090, SEK 8.8203,  forint 309.30,  zloty 3.8850,  koruna 23.2382, RUB 76.92, yen 105.29, sing 1.3570, HKD 7.7497, INR 73.20, China 6.7220, peso 21.36,  BRL 5.5428,  Dollar Index 93.46,  Oil $40.05,  10-year .71%, Silver $24.47, Platinum $879.00, Palladium $2,404.00, and Gold … $1,904.00

That’s it for today…  Well, I have another appt. today, this time it’s with my cardiologist or heart doctor is easier for me to say and type!  You know, I never in all my years prior to 2017, ever thought that I would have a “heart doctor”… The doctors would listen to my heart and tell me that my heart was not something I needed to worry about…  Now I have AFIB, and a Pacemaker, and a monitor that reads my heart numbers and transmits them to the doctor…  I still can’t believe that me… Chuck Butler, has this problem… but it is what it is…  I like my heart doc… but he is a Cubs fan, and always likes to rub their success against the Cardinals, in to me… But he’s good…  So, I’m hearing that a lot of places are cancelling Halloween… Wait, What?  That’s not right!  Don’t do that authorities!  You’ve already taken away nearly a year of their childhood social growth! Ok, Emerson , Lake and Palmer (ELP) take us to the finish line today with their song: Lucky Man…  Which is what they used to call me… “Lucky”…  HAHAHA, I hope you have a Wonderful Wednesday, and will Be Good To Yourself!

Chuck Butler

 

Rocktober 13, 2020

* Yesterday was a down day for the currencies & metals

* China puts the kyboshes on further renminbi appreciation, for now… 

Good day, and a Tom Terrific and Manfred the Wonder Dog day to you! Looky there, I remembered! Amazing things happen every day, and me remembering something from last week, is one of them! I can recall things that went on 10 years ago, but I can’t even begin to tell you what I wrote about last week! UGH!  Well, as I told you yesterday, I have lymphedema in my legs, and they’re going to send me to a lymphedema therapist… this is getting crazy folks! As I was telling my good friend, Dennis Miller last night, the deck is stacked against me once again… But the dealer doesn’t know who he’s dealing cards to! Man, have I got a treat for you today!  Yes, you’ll have to get through the letter to the FWIW article today, but trust me, you’re going to want to get there! Jack Johnson greets me this morning with his song: Drink The Water… 

Well, Friday was an up day, and Monday was a down day, what will the markets bring us today? Wait! I don’t mean to say the “markets” for they couldn’t bring us anything any longer, it’s all manipulated… Stocks, bonds, currencies, metals, have all lost their price discovery and so what we’re left with is trader sentiment, that is heavily influenced by the price manipulators…

At first glance this morning, I’m seeing some signs that the back and forth, up one day down the next trading could be coming to an end… Unfortunately for non-dollar holders that’s not going to be a good thing!  Gold which was down $8.70 to close at $1,922 is flat to down a buck or two  in the early trading today… Silver closed at $25.19, down 4-cents on the day, but is also failing to launch this morning, and is down 14-cents to $25.05…  

But these are small amount that can be reversed easily to turn out to an up day that we’re all expecting given the recent trading trend… 

The euro had clawed itself back above the 1.18 handle during the day yesterday, but in the overnight markets has fallen back below the 1.18 figure… When will traders all get the memo that inflation is coming, and it will eat away the value of the dollar, and that they should be getting rid of them as quickly as possible?

One quick note here on the euro… I read a note from Christine Lagarde the head of the ECB, where she mentions that the “ECB is seriously looking at the creation of a digital euro…  She also mentioned that the new digital euro wouldn’t replace “ever” replace the euro, just be a supplement to the the cash euro…. ”  

This has got to be another blow to the Bitcoiners of the world… Since the pandemic, we’ve had the U.S. and China both say they are developing their own respective digital currencies, and now the Eurozone has joined them…  

It’s really been so long, and I mean a long time since we saw real inflation, like we’re seeing now… And while it’s still climbing higher, people aren’t seeing it… and I’m wondering why?  How can you not see that inflation is creeping higher?  Oh, you don’t do the grocery shopping, you don’t write the checks for insurance, or tuitions, you haven’t priced a new car, or anything like that, for that’s the only way you could be oblivious to this rising inflation…

Oh, you won’t see it in the stupid CPI (Consumer inflation index) because, well, I know I’m going to sound like a broken record here, but people need to know what the gov’t is doing to pull the wool over your eyes…  This all goes back to the mid 90’s when Clinton was the president, he called then Fed Chairman, Allan Greenspan to his office and inquired as to why interest rates were so high?  Greenspan replied, because inflation is high… Clinton responded, then it’s your job to figure out how to get inflation down so that interest rates can be reduced, and housing can be afforded by all!

Greenspan hired the Boston Commission to figure out to deal with inflation…  And they came up with what I call an hedonic adjustment…. Inflation before the mid 90’s was forever and a day calculated by taking the same items in a basket and pricing them each month… the hedonic adjustment the Commission recommended was to “substitute pricy items with less pricy items, and voila! Inflation was no more, and interest rates came down, which began the root system of the Housing Crisis in 2008…

Ok, back to today….  So, did you hear what China did? The put the kyboshes on future renminbi appreciation…  Now, why did they go and do a thing like that?  Because, they can… And they don’t need to hire a PPT to do the dirty work… the renminbi’s appreciation in recent weeks, has gotten ahead of itself, and this is just a way to temper the expectations of more appreciation…

And that news will also put the kyboshes on the Sing dollar’s appreciation… Well, as long as these two maintain their current levels, that’s a good sign… 

The Euro-Wannabes, Polish zloty, Hungarian forint, and Czech Koruna have been champing at the bit to go into rally mode…  But the euro wallowing around 1.18 and not making a strong move higher, has held the euro-wannabes back for now…  Remember what I’ve always told you, that you can tell a rout on the dollar is on the docket, when these three currencies get in gear…  

Not that the price of the euro doesn’t give you that indication, it’s just another confirmation to use, that’s all…  The Dollar Index could be used if it wasn’t for the fact that it’s so heavily weighted with euros…  I know there are other “dollar indexes” out there now, but I’m an old dog, that can’t be taught new tricks, so I stick with the Dollar Index that I’ve used for nearly 30 years… 

Well, looky here! I was talking about the stupid CPI above this morning, and what do we have to see in the U.S. Data Cupboard today? That’s right! it’s the stupid CPI!  And that’s it! The Data Cupboard is a real bore early this week, as witnessed by the stupid CPI print today… 

So, don’t expect to see any sign of rising inflation today folks… Or wholesale inflation tomorrow when PPI prints… These data sets have been so mangled for so long now that they can’t, even if they wanted to, be normal…  I’m just saying! 

To recap today… With Friday’s up day, yesterday was a down day for the currencies and metals… Today is starting out iffy, for being a down day, but we’ll see what happens as the day goes on, eh?  China has decided to put the kyboshes on renminbi appreciation for now, and the ECB is seriously thinking about the creation of a digital euro…  Gold is down a buck or two and silver down 14-cents as we start the day today…

For What It’s Worth… OK, I gave this top billing above, and I doubt it will disappoint!  It’s my good friend, the Mogambo Guru speaking his mind and longtime readers know that when the Mogambo speaks his mind, well, you have better grab the kids and dogs and hide out in the basement! HA  Ok, you can find the whole Mogambo Guru piece in the link below, and the snippet I have for you today is pretty short compared to the article so be sure to check it out….  And I don’t like to send you to a company’s website that I don’t know about, for your safety that is… But this is OK, so click here: https://goldsilver.com/industry-news/

Or, here’s your snippet: “I could see where this was going, which was my wife grinding me into the ground, picking at me because of my many faults, real or imagined, usually about the damn kids. Usually some jibber-jabber along the lines of her sweetly saying “You know, dear, that the kids and I would love it if you _____ (insert one): paid attention to them, asked them how their stupid day went, stopped being such a jerk, remembered their stupid names, or all of the above.”

So I tried to change the subject from talking about her pet peeve, which is me, to my pet peeve, which is price inflation, the dreaded Deadly Thing That Destroys Economies, since it means that relatives will soon be knock, knock, knocking at my door, begging for a handout just because they are homeless and hungry, and who get really snotty when I tell them to either get lost or drop dead, depending on my mood.

I mean, if I don’t give cash to my own family who endlessly whine about needing to go to the doctor or the dentist or the grocery store, why in hell do they think I would give it to them and their grubby little brats?

Trying to lighten the mood, I delightfully and entertainingly went on about how the government lies to us about price inflation by adjusting actual price increases back down by using hedonic measures, meaning discounting the higher price to reflect some secret extra satisfaction you get from the product or service. For example, suppose a car costs twice as much as last year’s model, but it now comes equipped with fancy hubcaps.  Abracadabra, the government reports that because you love those snazzy hubcaps so much that you are willing to pay as much for them as the price of the car itself, inflation in car prices is not 100%, but zero! Zero inflation in price! Zounds!

By this time I am really on a roll, and I am icing the conversational cake by relating that bit of degrading government dishonesty to the ugliness of inflationary reality as reflected in the Chapwood Index showing annual price inflation running at a blistering 10% (which, by the Rule of 72, means prices will double in 7.2 years).

Or, alternatively, you can adjust your Mogambo Inflate-O-Meter (MIOM) with the calculations at ShadowStats.com, showing that price inflation is running at 6%, meaning that prices will double in 12 years (=72/6).

The fancy math is rolling off my tongue like honey, and I foolishly thought that this impressive display of raw mental power by me, an aging but still-studly “hunka-hunka burning love”,  would impress her so much that she says “Take me in your muscular arms, my irresistible manly Mogambo, my darling enemy of price inflation, with that wonderful 1,000-horsepower brain!” – The Great Mogambo Guru

Chuck again…  I truly admire this man! Years ago, I was supposed to have lunch with the Mogambo Guru when I was in St. Pete, near his home, and my cell phone rang in my hotel room as I was getting to meet him…. Now, my cell phone rarely rings, so I wondered who it was that was calling me. When I answered I heard, “Hello, Chuck, this is Mrs. Mogambo, and he’s not going to be able to meet you today, as he’s had a heart stroke, and is in the hospital..”  A couple of years later we did finally get to meet over lunch the last time I was in St. Pete…  And every now and then my phone lights up and it says that he’s calling me! I get so amped up!  I’ve got another story about the Mogambo and a fruit basket that I’ll tell you some other time…

Market  Prices 10/13/20: American Style: A$ .7187, kiwi .6655,  C$ .7629, euro 1.1789, sterling 1.3029, Swiss $1.0983, European Style: rand 16.4804, krone 9.1489, SEK 8.7734,  forint 305.65,  zloty 3.8017,  koruna 23.2025, RUB 76.88, yen 105.50, sing 1.3580, HKD 7.7498, INR 74.24, China 6.7156, peso 21.19,  BRL 5.5294,  Dollar Index 93.22,  Oil $40.38,  10-year .76%, Silver $25.05, Platinum $875.00, Palladium $2,404.00, and Gold… $1,921.60

That’s it for today… I can’t begin to express my happiness in reading the Mogambo Guru again… His writings used to be discussed on the trade desk every time he would get published. My former colleague Ty Keough and I would be in stitches laughing!  I know he’ll get a kick out the FWIW article today…  Well, I’m going to be getting a new doctor’s office to visit, as I’m now signed up for lymphedema therapy, which my son the Physical Therapy doctor tells me is a lot of messaging…  I received my new glasses in the mail on Saturday, and brother what a difference in my sight! Not that this is a promo for them, but I ordered them through Warby Parker, and everything was very enjoyable about the whole process…  OK… time to get this out…  The great Billy Squier takes us to the finish line today with his song: My Kinda Lover…  and with that, I hope you have a Tom Terrific and Manfred the Wonder Dog Day today, and Please Be Good To Yourself! 

Chuck Butler

 

Rocktober 12, 2020

* Currencies & metals rally on Friday… 

* With Friday being an up day, today must be a down day, eh? 

Good day… And a Marvelous Monday to you! What a weekend! First, my beloved Missouri Tigers beat LSU on Saturday! And then on Sunday, it was my darling granddaughter, Evie’s, first birthday… I told you about 10 days ago how she was finally taking her first steps, well, now she’s a real pro at walking and even rounded the corner inside out house at running speed!  She is growing up, already… UGH!  But it wouldn’t be right if I didn’t give a great Big Shout Out to Evie! Happy Birthday, Evie! May you have many more!  On Thursday I visited my oncologist, and she told me to keep doing what I’m doing… When I told her that means nothing… She laughed and said, Ok, keep doing nothing!   The wound center on Friday was different, and the doctor there wanted to know what I had done to have 3 spots on my legs open up…  After examination, she told me I had lymphedema in my legs…  I went home and looked up what caused lymphedema… And it’s a reaction to cancer treatments…  And I thought… I’m damned if I do take chemo, and I’m damned if I don’t take chemo!  Not a happy day for me, but, then Saturday came, and it was all seashells and balloons!  On Friday, I felt like I was being treated like the title of this song that greets me this morning… It’s the Allman Brothers and their song: Whipping Post… Because sometimes, I feel like, sometimes I feel, like I’ve been tied to the whipping post!  

Well, after a down day on Thursday, it was time for an up day in the currencies and metals on Friday… Gold rose $36, to close at $1,930.60, and Silver followed with an increase of $1.28 (which if you’ve been paying attention in class is a HUGE move in Silver)… , to close at $25.22 And the euro which started the week at 1.18, but then saw its value shrink to less than 1.18, finished the week at 1.1820…

So, let’s see, if Friday was an up day… today must be a down day, and it sure looks as if the overnight and early morning trading markets is going to keep that stupid trend going, as Gold has given back $5 in early trading and Silver is basically flat, while the euro lost the 1.18 figure again in overnight trading…   This back and forth stuff is really getting old with me folks.. As I’ve said before… Come on Traders, pick a lane! 

So what got Gold & Silver all lathered up on Friday? Well, remember when I told you that last week the President has Tweeted that there would be no stimulus until after the election, and that had taken the wind out of Gold and Silver’s sails? Well, before you could say, “what the hell is going on here?” The President changed his mind and said that he was ready to sign whatever stimulus bill had been negotiated…  And hearing those words, Gold started moving higher, and by the end of the week it was trading higher than it had the week before…  If the U.S. is going to go willy nilly on adding more debt, to the tune of over $2 Trillion dollars in one fell swoop… Then dollar traders arent’ going to stand around and look like idiots… They sold dollars so fast the dollar bugs didn’t have time to get back behind the wall boards they cam out of…

I needed some sanity on Saturday as heard that the stimulus is back on the table… And so I pulled up Bill Bonner’s  Rogue economist email to see what Bill had to say… And this is from his letter that can be found at www.rogueeconomics.com… Here’s Bill… “But on the horizon is the biggest crash of all. Like a freight train loaded with debt… the U.S. is about to get slammed by $237 trillion worth of “unfunded liabilities.”

The boomer elite did not merely look out for itself in the past and the present… It promised itself pension and medical benefits, literally, from now until Kingdom Come.

There are 76 million boomers. None is eager to get to the grave. But every one of them hopes to get there before his Social Security/Obamacare benefits run out.

Many believe it’s a sure thing… They think there is a “trust fund” with money tucked away to pay for their care. But there is no “trust fund,” no savings, no pot of money anywhere.

Here’s what former Federal Reserve chairman Alan Greenspan had to say about it:

The term Social Security “Trust Fund” is nonsense… It is a mandatory outlay and there is a 0% chance that outlay will not get made. When the fund runs out, there is no chance anything will change. The U.S. has committed to pensions it cannot pay…

Greenspan is right. There is another head-on collision coming, much more serious than the Democrat-Republican game of chicken. There is zero chance that the payments won’t be made.

But there is also zero chance that the funds will be there to make them.”

Chuck again… you know I used to say, back when I was around 50, that “I didn’t expect to receive anything from Social Security…  And then I turned 65, and started receiving payments on the money I had contributed to S. S. for nearly 40 years… And thought, OK, I guess I was wrong… But was I? Well, I did actually receive something from S.S., but for how much  longer? 

Well, today used to be a holiday, for me… But I guess since they took down the Christopher Columbus statue here in St. Louis, I would think that I would be stirring up a hornet’s nest to say I was taking the day off for Columbus day…   I used to joke about how this was the day we celebrated his discovery of the West Indies…  But as time has gone on, I feel he got a raw deal… Was he not, at the time the greatest explorer of that time?  And that’s all I have to say about that!

The U.S. Data Cupboard is empty today in celebration of Columbus Day…  Late last week, we saw that the Weekly Initial Jobless Claims continued to be a very higher number… In fact it beat the estimates of 825, 000 and instead came in at 840,000, which means that for every week since March the Weekly Initial Jobless Claims have been above 800,000…   The Continuing Claims fell the prior week, but that could simply mean that the the time had passed on the claims, and they were dropped from the list… There are still 25.5 million workers collecting some form of benefits, more than half of whom fall under special benefits set up during the pandemic.

I’m got a great piece from John Mauldin, who quotes my fave economist, David Rosenberg, about all this , so I won’t spoil your appetite here… Just make sure you stay tuned in for the FWIW section today…

We won’t see much in terms of economic data prints this week, until we get to Friday when Retail Sales, Industrial Production and Capacity Utilization for Sept will print… Thursday will have the usual fare of the Weekly Initial Jobless Claims, and other than that there’s really not much…For instance, tomorrow will have the stupid CPI (consumer inflation) for last month, which is only expected to print at a gain of .2%… Bollocks!  I love that word! I got it from reading my Cormoran Strike novels, which take place in London…  I don’t think I have to explain the meaning of the word to you… So, we’ll just move along here…

To recap… Friday was an “up day” after Thursday’s “down day”… And Gold gained $36 on the day, and silver added $1.28 to its value… The euro climbed back above the 1.18 handle, and even stocks had a good day! The talk that there could, after all has been said and done, be a stimulus package…  I wouldn’t hold my breath that that would/ could happen before the election… But Traders seem to think it’s a done deal. And so the strength of the rallied on Friday…

For What It’s Worth…  Ok… I didn’t now this before I read this article, but longtime friend, John Mauldin is now contributing to Forbes, which is where this article can be found, and it’s about how David Rosenberg believes that we are in a depression…  and it can be found here: https://www.forbes.com/sites/johnmauldin/2020/10/09/rosenberg-we-are-in-a-depression/#24536c1115bf

Or, here’s your snippet; “Disney is laying off 28,000 workers. American Airlines and United Airlines plan to cut 31,000 workers. Last week’s disappointing unemployment report shows that we have a long way to go. Perhaps a lot longer than we think.

I’m going to quote at length from my friend David Rosenberg, who I believe is absolutely spot on:

“You tally up these sectors and before the crisis, they supported 32 million jobs, or about a third of the private sector workforce, and it looks to me as though half of them are not going back to their old jobs.

“And I’m not sure many people understand that amusement parks, airlines, hoteliers and restaurants cannot stay in business at 50% capacity (or even 75% in the case of restaurants).

“… As it stands, the U.S. Chamber of Commerce said that 25% of small businesses have already shut down. Another survey by Ipsos concluded that two-thirds are still nervous about leaving their homes; 59% say they intend to remain locked down on their own until signs emerge that the virus is ‘fully contained.’ A YouGov/CBS poll concludes that 85% of American households say they wouldn’t get on an airplane even if they could. That’s why the industry needs a bailout!

“A Washington Post/University of Maryland poll shows that only 56% of consumers across the nation intend to shop at the supermarket, which I suppose is a continuous bullish data point for delivery services but that’s about it. Just 33% say they are comfortable entering a retail store. And a mere 22% say they are willing to dine in a sit-in restaurant.

“All these polls say basically the same thing – it will not be ‘business as usual,’ as the bulls will try and convince you, and the best we can hope for is a partial recovery. I mean, at best. What we had on our hands was a vertical down economic decline with job losses an order of magnitude higher than anything we have witnessed since the Great Depression. So, even as the stock market is telling you it has it all figured out, I can assure you that what we face at this very moment is a very uncertain economic future. And unfortunately, most of the longer-term risks are to the downside.

“We are in a depression – not a recession, but a depression. And I think the dynamics of a depression are different than they are in a recession because depressions invoke a secular change in behavior. Classic business cycle recessions are forgotten about within a year after they end – the scars from this one will take years to heal.”

Know this: That which can’t go on, won’t. We can’t keep piling on debt at this rate forever, and we can’t repay what we have.”

Chuck Again… You tell ‘em Dave!  I love the way he pulls no punches when he talks, and he’s always spot on with this forecasts, and thoughts… I’ve told you all before how John Mauldin and I are friends from a long time ago, but I’ve never met David Rosenberg at a conference or other places, and I guess my chances at doing that are slim and none, and Slim left town! 

Market Prices  10/12/20: American Style: A$ .7212, kiwi .6647, C$ .7616, euro 1.1797, sterling 1.3033, Swiss $1.0984, European Style: rand 16.5316, krone 9.1475, SEK 8.8079,  forint 302.30,  zloty 3.7959,   koruna 23.0181, RUB 76.72, yen 105.42, sing 1.3568, HKD 7.7498, INR 73.21, China 6.0927, peso 21.26,  BRL 5.5306,  Dollar Index 93.21,  Oil $40.11,  10-year .78%, Silver $25.24, Platinum 888.00, Palladium $2,512.00, and Gold… $1,926.30

That’s it for today… What a great victory for my beloved Tigers on Saturday! The first time they’ve beaten a ranked team since 2018!  At the end the LSU team had driven to the 1 yard line with time running out, and I said, “I’ve seen my Tigers lose so many games through the years on the last play of a game, I don’t think I can watch this…” But the defense held, and the only thing missing was a rush of fans to the field, to take down the goalposts… What a rush that used to be to walk through the town after the game and see students with cut up pieces of goalposts holding them up high so everyone could see them!  So… Little Evie is walking now, I love watching her get around… She’s a fast learner too, as she was shown a couple of times how to negotiate the sunken living room that we have, and soon she was coming and going over the step down as if it was second nature!  My “other girl” Delaney Grace was here too…  My girls are so damn cute!  Triumph takes us to the finish line today with their song: Fight The Good Fight… Which is what I always try to accomplish here… And with that, I hope you have a Marvelous Monday, and please continue to Be Good To Yourself!

Chuck Butler

Rocktober 7, 2020

* The up one day down the next trend continues… 

* Chuck goes through his thoughts on the Credit Markets… 

Good Day… And a Wonderful Wednesday to you! I said yesterday that an “Indian Summer” would be very welcome here in the Midwest, where quite chilly temps had ruled for the last week. And much to my surprise it warmed up yesterday, and now we’re set to have temps in the mid 80’s for the next week… I know that technically, it’s too early for an Indian Summer, but I’m going to call this week that, because…. I want to! We are in the U.S. right? Freedom of Speech and all that!  Sad news last night that cancer had taken the life of guitar great, Eddie Van Halen, at age 65… he had throat cancer, which is different from my cancer, but this one still hit home… RIP Eddie….   The Cure greets me this morning with their song: Friday, I’m In Love…  I do believe that this was one of my former colleague Jenn’s fave songs! HA!

I don’t know what I was thinking yesterday, thinking that maybe, just maybe the recent trend of one day up the next day down for the currencies and metals had come to an end… The day began on a good note, but that soon turned sour… And the currencies and metals took one on the chin all day long… The euro was 1.1802 yesterday morning, and by the end of the day here in the U.S. the single unit was 1.1735…. And Gold was up $4 in the early trading yesterday, only to see the dollar gain back $36.80 to see Gold close at $1,877.30. Silver too got the stuffing knocked out of it during the day, and the dollar gained back $1.12 to see Silver close at $23.12….  A whole $1 move in Silver is HUGE folks, and showed that the price manipulators weren’t fazed by the findings that their ringleader (JPMorgan) had gotten its wrists slapped once again… 

In the overnight markets… Well, let’s see yesterday was a down day, today should be an up day… And if the overnight markets are any indication, it will be… Gold is up $10 in early trading, and the euro is moving higher once again… 

I know this up one day and down the next day is pretty silly as it actually tells investors when to buy and when to sell… Sorta like those computer programs that light up green when it’s time to buy, and light up red when it’s time to sell…  For years, at the Money Shows our booth was near the booth where those programs were sold… I had their sales schtick down at one point I had heard it so much… 

Well, there was all this talk over the weekend that a new stimulus bill was nearing the end of negotiations, and that had Gold pushing higher on Monday, but then yesterday, they let the air out of the stimulus bill’s balloon, when it was Tweeted  that there would be no stimulus until after the election…   You should have seen everyone run to the exits after that Tweet…. Stocks, bonds, currencies, metals, there were no safe harbors….

And that put the idea in the price manipulator’s minds that Gold would see some selling, and they decided to pile on… And pile on they did… In fact if they played in the NFL, they would have gotten a flag for Unnecessary Roughness….   I told you all before about my football playing days, and about the time I ended up on the other team’s sideline, after driving a runner out of bounds. I feared for my life and a steered away from that sideline the rest of the game.  I was piled on, out of bounds mind you by, the opposing team, and the refs had to come and pull the opposing team off me… I was a tough sonofagun in those days, but even that made me think twice about going into another team’s sideline!

So… what’s the lack of another stimulus check in consumer’s mailbox or direct deposit into their bank account going to do to the election?  Better than that question is what will it do to the economy that can’t get started after being neglected for 5 month?    I see the economy as being akin to when you haven’t driven your car for months… What happens? The Batter dies. (unless you’re smart like me and have a solar battery tender)

You know, I’ve talked to you before about all these moratoriums and what they will eventually do to the bond holder… But… I thought it best to talk about it again…  We currently have moratoriums on eviction and foreclosures, because people can’t or wont’ pay their rent or home loan…

While that’s a nice thing to do for these people it does nothing for the bond servicing…  You may be renting, but there’s a home owner with a loan, and if you don’t pay your rent, he can’t make his home loan payment. And all those home loans get packaged into bonds, folks… Now Banks do cherry pick some of the home loans to have on their books and not present them for packaging, but those cherry picked loans are small compared to the size of the mortgage backed bond market…

Eventually, these bonds don’t pay P&I to the bond holder, and now the bond holder has a non-performing asset… And the bond’s value is going down the tubes, so he can’t sell the bond without taking a huge loss… Pretty soon the bond defaults, and one default, begets another one, and pretty soon the credit market as a whole collapses… Uh-Oh, did I just say that out loud?  Oh well it has to be explained and said so that investors can take appropriate measures before all hell breaks loose… .I’m just saying…

The Whole financial system is built around the credit markets, and without proper running credit markets the financial system that we all know and love will collapse…  And let me tell you something that you won’t hear anywhere else… The Credit Markets began to collapse last September, when the repo market had to be  bailed out by the Fed…. Remember me telling you that this was going to be a bid deal?   Well, in my opinion, it’s still a problem, but… The Pandemic slowed the process…. You see if people aren’t getting loans, banks don’t have a need to for extra capital and the place they would get that is the repo market…  And so the need for the Fed to keep bailing out the repo market slowed to a snail’s pace, but it still needs to be bailed out, and to me, that was the beginning of the end of the credit markets….

And no one is talking about this…. Crickets….  Makes you wonder if the powers in charge want to spring the whole collapse on you in one fell swoop…  I’m just asking….

Well, the U.S. Data Cupboard still is in need of a restocking, but for today, we will see the minutes of the Fed’s last FOMC meeting…  And Consumer Credit (read debt) for August… We just saw late last week that August Personal Spending, while not huge, was larger than expected, and out paced Personal Income… So, put two and two together and you get…. A larger Consumer debt number for August…  Yes, grasshopper… you figured it out… Credit Card purchases… 

OK, yesterday, I told you I didn’t know how to get a cartoon on the email server and so I wrote out the verbiage for you…  But my  associate at Adenresearch saw what I wrote, and said, I can do that for you! And so, Here it is for those of you who read the email, it won’t be here on the website version…. 

Before we head to the Big Finish today I wanted to tell you about this bit of news that showed up yesterday… “U.S. commercial bankruptcy filings are up 33% so far this year with new cases in September surging by 78% from a year earlier as the recession triggered by the COVID-19 pandemic hits small businesses, data released on Monday showed.

Filings by individuals, however, are lower so far this year courtesy of government relief efforts.

Chapter 11 bankruptcy filings totaled 747 last month, up from 420 a year earlier and from 525 in August, legal services firm Epiq said in a monthly report. Year-to-date filings total 5,529, a third higher than in the first three quarters of 2019.”   I found that on Reuters…  w

To recap… Everything was going along smoothly yesterday, and then a Tweet from the White House that said , “no stimulus until after the election” and you should have seen the players run for the exits… There were no safe harbors as, stocks, bonds, currencies, Oil, and metals all took a shot to the midsection… . The overnight markets show a rebound is building, but we’ll have to see what the NY traders have to say about that! 

For What It’s Worth…  Well, I was up all night last night, couldn’t sleep, don’t know why, but an hour here and an hour there was it.. .So, I got up and went to my writing desk, opened my email and there was Ed Steer’s letter, so there I was a 4 in the morning reading his letter and found this article that he highlighted about how the Fed keeps asking Congress for another stimulus package, and it can be found here: https://www.zerohedge.com/markets/watch-fed-chair-powell-ask-congress-more-fiscal-stimulus

Or, here’s your snippet: “Fed chair Powell is holding a virtual conference with National Association for Business Economics. As previewed earlier, there were  no notable surprises in his prepared remarks in which he emphasizes that the outlook remains highly uncertain, the expansion is far from complete, and in keeping with the Fed’s recent appeals to Congress, Powell asks Congress to quickly vote through more fiscal stimulus, assuring lawmakers that providing too much stimulus wouldn’t be a problem.

Powell’s remarks come amid continued gridlock in Congress and Republican opposition to a larger relief package that’s kept talks with Democrats at a stalemate in Congress since aid to jobless Americans and small businesses expired in July and August.

“Too little support would lead to a weak recovery, creating unnecessary hardship for households and businesses,” Powell said in the text of a speech for a virtual conference hosted by the National Association for Business Economics. “By contrast, the risks of overdoing it seem, for now, to be smaller. Even if policy actions ultimately prove to be greater than needed, they will not go to waste.”

While Powell didn’t explicitly reference either party’s position in his prepared remarks, he said that the “recovery will be stronger and move faster if monetary policy and fiscal policy continue to work side by side to provide support to the economy until it is clearly out of the woods.”

Meanwhile, the Fed chair confirmed what we said last week, namely that U.S. consumer are rapidly burning through their savings, something which has so far allowed U.S. consumption to remain stable, however at the current rate of spending, savings would will likely return to pre-covid levels in 2-3 months”

Chuck again…  Well, you know why Powell is so hell bent and whiskey bound to get Congress to pass another stimulus don’t you?  The stock market…The Fed’s baby…  It’s losing ground every day it seems that a new stimulus doesn’t get passed, and now with the Tweet yesterday… We won’t be seeing on any time soon…. 

Market  Prices 10/7/20: American Style: A$ .7123, kiwi .6586,  C$ .7515, euro 1.1757, sterling 1.2867, Swiss $1.0893, European Style: rand 16.6978, krone 9.3305, SEK 8.9367,  forint 305.93,  zloty 3.8170,    koruna 23.0574, RUB 78.16, yen 106.08, sing 1.3590, HKD 7.7498, INR 73.24, China 6.7882, peso 21.56, BRL 5.5659,  Dollar Index 93.81,  Oil $39.54,   10-year .78%, Silver $23.66, Platinum $864.00, Palladium $2,411.00, and Gold… $1,887.50

That’s it for today, and this week… recall that I have my monthly oncologist appt tomorrow bright and early…  And Friday will not be a sleep in day, as I have a bright and early appt at the Wound Center… yes, I have to go back to them…. UGH!  Monday morning at this time it was 36 degrees outside, and this morning it’s 56 degrees… I told my wife that she did a good job bringing back the warmer weather from Florida!  Now that my beloved Cardinals have been ousted from the playoffs, I try to watch the remaining teams play, but they can’t hold my interest very long…  The Allman Brothers take us to the finish line today with their song: Statesboro Blues…   “I woke up this morning, I had them Statesboro Blues”…  I hope you have a Wonderful Wednesday and rest of the week, and please Be Good To Yourself!

Chuck Butler

Rocktober 6, 2020

* Currencies & metals both rally on Monday

* Big Ben Bernanke & Paul Krugman explain GDP… 

Good Day… And a Tom Terrific Tuesday to you! I had a reader last week request that I include Tom Terrific’s dog, Mighty Manfred the wonder dog, on Tuesdays…  Well, I don’t know If I’ll remember to do it each week, but there it is! How many of you recall Tom Terrific cartoons? I loved the name of his foe: Crabby Appleton, whose saying was, “I’m rotten to the core”!  They don’t make cartoons like that these days! Well, tonight I’ll pick up my wife from the airport, which means, with kudos to Barbara Mandell, I won’t be sleeping single in a king size bed any longer! Well, for about 6 weeks that is, when she’ll return to our Florida home for a couple of weeks… I’m not a fan of country music, per se, but I am a fan of all the old recordings my Hank Williams…  My dad used to sing these song all the time, and so I learned how to play them on my guitar, and surprised him one day, many years ago… OK INXS greets me this morning with their song: Listen Like Thieves…  (were they talking about the price manipulators? HA!)

 

Well… I told you yesterday morning, that we were in store for an up day in the currencies and metals, and that’s what we got!   Gold held on to its early $6 gain, and added another $8 to close at $1,914.30, and Silver added another 33-cents to its 30-cent early morning gain to close at $24.42… The euro continued to ratchet higher through the 1.17 handle and was within’ spittin’ distance to the 1.18 handle, and the Aussie dollar (A$) was also close to hitting the 72-cent handle again…  But that was yesterday… And if recent trends hold true, it would mean that today will be a down day…. It’s turn down day… (The Cirkle)  Let’s hope the trend ends!

 

In the overnight markets… The euro did reach 1.18 and has held it so far, as the U.S. traders arrive at their desks… no wait!  Manhattan is a ghost town now, so traders are arriving at their laptops in their pjs…  The Aussie dollar (A$) found the sledding a little rough around 72-cents and it backed off of the figure..  The currencies I see that have gained VS the dollar since yesterday besides the euro would include: the krone, the sing dollar, the koruna, the renminbi, and real.  There could be others but these currencies have gained enough to make it noticeable…  

In the early trading in Gold & Silver, Gold has picked up another $4 this morning, but Silver has remained unchanged. 

So, maybe, the PPT will stay away, and the price manipulators are still licking their self inflicted wounds from last week’s news that their ring leader, JPMorgan had 2 more felony counts of price manipulation thrown on them by the DOJ….

The news that the Congressional folks in charge of negotiating a new stimulus bill are getting closer to announcing one… One side wants to pull out all the stops and have the bill larger than $2.2 Trillion, but they’re torn between two lovers… They want to spend, spend, spend, but if the stimulus bill helps reinvigorate the stock market, they don’t want that to happen before the election….  The other side wants the bill to be $2 Trillion and no more, but doesn’t want the public to see that they are working with the other side…   This isn’t politics, folks, this is fact!  And we all know that politics have no facts! HA!

So.. where was I before I went all truthful about the stimulus package… Oh!… The news of a new stimulus bill getting closer to realization, put the pedal to the metal for the metals, because even though we crossed $27 Trillion in current debt, it would mean another jump in the debt numbers… And while there are some that say they don’t matter, and that contrary to what my mom used to say to me and my siblings, that “money doesn’t grow on Trees”,  the Monetary Money Tree (MMT) folks don’t care… They’re hanging out the car window with their hands in the air, screaming, More Money, More Money, the debt is soaring and we don’t care!”

People that own Gold get it… People that don’t own Gold, don’t get it…. They call it barbaric, non interest earning, glob of metal, and they try and try to rationalize why they haven’t bought Gold by now….  When Gold wasn’t “that pricey” I used to give a Gold coin to my kids each year at Christmas… A Gold coin for those that don’t know it, says $50 on it…  And my darling daughter said, “looks kids it’s a $50 Gold coin”…. I then explained to her that if she read more of the Pfennig than the first and last paragraph, she would know that the price of Gold was at that time $1,000….   Well, I had to stop giving Gold coins, and substituted Silver Coins for the grandkids… I asked my kids (3 of them) if they still had their Gold Coins, and all said yes… So, at least I taught them something through the years!

But here’s a little talked about fact regarding Gold that needs to be said more…. Gold is not issued by a Central Bank… Therefore it can’t be debased,  sent to the printers for copies, and there is a finite amount of Gold in the world….  I heard this yesterday, that the Pension companies, the one’s I’ve been telling you are in deep dookie for a long time now, are saying that they will change their bylaws and start buying and holding Gold…   Do you know the size of these potential  transactions? If the Pensions made a 1% allocation to Gold, it would put such pressure on supply that it would probably eat the supply away, thus leaving everyone else to scramble for physical Gold…  So… if you’ve been waiting, and waiting, and waiting, to buy Gold… I would certainly think about doing it before the Pensions Plans fire up the buying machines!

OK… enough… I mentioned above that the current debt is now $27 Trillion…  It wasn’t that long ago that we passed $26 Trillion… And with another stimulus coming, We, as a country will be very close to my estimate from months ago that our current debt would be $30 Trillion by year end…  And it’s not just the Gov’t debt, which doesn’t include Unfunded Liabilities ($155 Trillion),  but you have to include Corporate debt, which is 48% of out GDP right now at $10 Trillion, and State and local Gov’t debt, and then the topping on the debt cake, Consumer debt… How does all of this debt ever even think about getting paid down, much less paid off? 

And this is why…. I still believe that the U.S. along with other countries are going to have to default on their respective debts…  And this is why I continue to think that countries like Russia, Singapore, Germany, Ireland, Netherlands, Oh, wait, those last three, you can’t buy their currencies because they belong to the European Union, and use the euro…  But Isn’t it nice to know that not every country in the world is up to their eyeballs with debt?

All this talk about debt is giving me the willies…. Let’s move on…

I don’t know if you’ve noticed this or not, but the yield on the 10-year Treasury has been very stealth-like in its move higher this past week…  On 9/28/20 the 10-year’s yield was .66%, and today it sits at .78%…  In the “old day” that would be a big move…  Are the bond boys telling us something that we need to pay attention to?  Like inflation is rising? Or, is this upward move in the yield a result of a lot of absentees at the bond auction?  Hmmm… These ARE things that may you go Hmmm…  

The U.S. Data Cupboard  today doesn’t have much for us, just like yesterday’s offerings. Tomorrow we will get the Minutes of the last FOMC meeting by the Cartel, I mean the Fed…  We did see the color of the monthly Trade Deficit this morning… And it was larger than then expected and the August Trade Deficit came in at $67.1 Billion…  You know… it wasn’t that long ago, well it was before Covid (BC) , that the Trade Deficit was around $40 Billion, and then in July it jumped to $63 Billion, and now $67 Billion…  

I once read a paper written by an economist that said, “the Trade Deficit isn’t a concern”…  I said, “What?!@*%^(O  you’ve got to be kidding me! Oh me, oh my, what’s a guy like me supposed to do with a guy like that? I just hoped that my dear Pfennig readers didn’t read this guy’s essay… 

The other day I mentioned that GDP for the 2nd QTR was negative -33%, but I got to thinking that a lot of people don’t know what that means in dollar terms….  Well, that negative 33% was equal to $2.07 trillion, in the second quarter to a level of $19.49 trillion.  And all that thought about GDP got me thinking of this great cartoon that circulated during the Big Bernanke era… 

I have no idea how to get a picture on this set up, so…  Big Ben and Paul Krugman are walking down a country road, and Paul says to Ben.. I’ll pay you $20,000 to eat that pile of bull crap. Ben says, “Deal”!  Then Ben says to Paul, I’ll pay you $20,000 to eat the pile of bull Crap, and Paul says, “deal”! Ben then says, “I’m feeling pretty sick, we both ate a pile of crap and neither of us is any richer”… To which Paul Krugman says, “You’re missing the big picture, Ben, we ‘ve increased GDP by $40,000, and created two jobs”!   

And that pretty much explains how GDP is created….  pretty funny, eh? 

OK, To recap…  The currencies and metals had an up day yesterday, thus continuing the back and forth, up and down days in trading… But in the overnight markets and early trading the currencies have added to their gains from yesterday, and Gold is up another $4 this morning, so maybe, just maybe because you never know, the back and forth trend has ended! Chuck talks about the talk going around that the Pension funds are contemplating buying Gold, and what that would do to supply… 

For What It’s Worth…  Well, this is quite an interesting article that’s about the ending of the Dollar’s hold on the reserve status, and so on… Longtime readers know that I’ve said this for a long time now, but it’s good to get a refresher, eh?  This article can be found here: https://www.zerohedge.com/geopolitical/crash-looming-yale-senior-fellow-warns-end-dollars-exorbitant-privilege

Or, here’s your snippet: “The riddle once posed in the 1960s by former French finance minister (eventually president) Valéry Giscard d’Estaing is about to be solved. Giscard bemoaned a U.S. that took advantage of its privileged position as the world’s dominant reserve currency and drew freely on the rest of the world to support its over-extended standard of living. That privilege is about to be withdrawn. A crash in the dollar is likely and it could fall by as much as 35 per cent by the end of 2021.

The reason: a lethal interplay between a collapse in domestic saving and a gaping current account deficit. In the second quarter of 2020, net domestic saving – depreciation-adjusted saving of households, businesses and the government sector – plunged back into negative territory for the first time since the global financial crisis. At -1.2 per cent in the second quarter, net domestic saving as a share of national income was fully 4.1 percentage points below the first quarter, the steepest quarterly plunge in records that go back to 1947.

Unsurprisingly, the current account deficit followed suit. Lacking in saving and wanting to grow, the U.S. levered its exorbitant privilege to borrow surplus saving from abroad. That pushed the current account deficit to -3.5 per cent of gross domestic product in the second quarter – 1.4 percentage points below that in the first period and also the sharpest quarterly erosion on record.   

While a Covid-related explosion in the federal government deficit is the immediate source of the problem, this was an accident waiting to happen. Going into the pandemic, the net domestic saving rate averaged just 2.9 per cent of gross national income from 2011 to 2019, less than half the 7 per cent average from 1960 to 2005. This thin cushion left the US vulnerable to any shock, let alone Covid.

As budget deficits pile up in the years ahead, further downward pressure on domestic saving and the current account will intensify. The latest estimates of the Congressional Budget Office put the federal deficit at 16 per cent of gross domestic product in 2020 before receding to “just” 8.6 per cent in 2021. Assuming the US Congress eventually agrees to another round of fiscal relief, a much larger deficit for 2021 is likely.”

Chuck again…  Yes, like I’ve tried to explain numerous times previously, the pandemic just hurried along the rot that was on the economy’s vine, folks… And it’s nice to see someone else express this point! 

Market  Prices 10/6/20: American Style: A$ .7167,  kiwi .6656, C$ .7546, euro 1.1802, sterling 1.2956, Swiss $1.0945, European Style: rand 16.4645, krone 9.1919,  SEK 8.9012, forint 304.40,  zloty 3.7990,   koruna 22.8985, RUB 78.21, yen 105.63, sing 1.3588, HKD 7.7499, INR 73.28, China 6.7893, peso 21.25,  BRL 5.6388,  Dollar Index 93.36,  Oil $40.32,  10-year .78%, Silver $24.42, Platinum $887.00, Palladium $2,417.00, and Gold… $1,918.22

That’s it for today…  Well, it was quite chilly here yesterday morning, and today things are a bit warmer, good thing! I was thinking the other day that we are in need of an “Indian Summer”…  Which usually follows a cold spell in the fall… I saw the other day that for Halloween we’ll have another full moon, which would be a Blue Moon… Pretty cool…  Sorry for the tardiness of the letter, I had to stop and go put the trash and recycle bins out, I forgot to do that last night, and I had to wave down the truck to see my bins… the joys of owning a home! HA!  Ok…  Red Rider takes us to the finish line today with their song: Lunatic Fringe…  a 1980’s song, that my good friend Rick will enjoy!  I hope you have a Tom Terrific and Mighty Manfred the wonder dog day, and will Be Good To Yourself!

Chuck Butler

 

Rocktober 5, 2020

* Back & forth, up then down trading continues

* Oil slides downward again… 

Good Day… And a Marvelous Monday to you! Well, it was a bad weekend, sports wise, for me this past weekend, as both my beloved teams lost… My Cardinals forgot how to hit a baseball again on Friday night, and they were ushered out of the playoffs, after such a promising Game 1 victory… UGH! And then on Saturday, my Missouri Tigers forgot how to play defense in their loss at Tennessee, so I sat a sulked all day on Sunday! I’m only on page 600 of a 965 page book, so I did some reading, not making much of a dent in those remaining 365 pages!  I hope you have a relaxing, fun, whatever weekend, for mine was a bust! Big Head Todd & The Monsters greet me this morning with their song: Bittersweet…

Well, On Thursday last week, I talked about how the back and forth in markets were really giving me a rash… But Friday was more of the same…. On Thursday Gold closed up $21 to $1,906, and Silver was up 79-cents to $23.79, but on Friday, Gold gave back $7.60 to close $1,898.80 and Silver gave back 10-cents to close $23.69…  In the currencies, the traded stronger on Thursday, only to see about ¼ of a cent was taken from its value on Friday… The Aussie dollar (A$) also gave back ¼ of a cent, on Friday…

OK, it’s a new day, and since Friday was a down day for Gold & Silver, that must mean that today will be an up day… And as I look at the early morning trading in those two metals I see that’s exactly what’s going on, as Gold is up $6, and Silver is up 30-cents… 

And in the overnight markets the euro has regained its mojo, and is pushing higher in the 1.17 handle. The price of Oil has slipped downward again, as it is trading this morning with a $38 handle…  Which can’t be a good thing for the Petrol Currencies….  However, there is one Petrol Currency that has not gotten caught up in the Oil price slide… And that currency is…. drum roll please…. The Canadian dollar/ loonie…  Must be from all that tourism…. HAHAHAHA! As if! 

While I was sulking, yesterday, I got caught up on email.. And that includes watching some videos from Prager U…  And then I thought… why don’t I read some articles that have been sent to me from readers that want my opinion on them…  One of them was about Bitcoin… The reader wanted me to include the price of Bitcoin in the Market Prices roundup…. And…. Talk about Bitcoin on a regular basis….  Basically, I’m going to say the same thing I’ve said before about Bitcoin….  And I’m saying this knowing that many people have made beau-coup bucks in the cryptocurrency… I believe that Bitcoin is a scam…. There’s nothing there folks… I fear about computer hacking, and the thing I think about the most is that Gov’t is going to develop their own digital currency, and when they do that, all other forms of digital currency will most likely be outlawed…. Fed Head Brainard recently mentioned that the Fed is well into their work on their own digital currency…. 

So, I won’t be putting Bitcoin in the roundup, and I won’t be talking about it, that is if I can get away with that, I won’t!

OK…. So, last week I went all bananas on JPMorgan and their 2 new felony counts of price manipulation that gives them 5….   And the wrist slap for their illegal trading wasn’t enough…. But….  I wasn’t aware that the bank now is operating under a “deferred prosecution agreement” with the Justice Department and isn’t likely to mess with the gold and silver futures markets for a while.   JPMorgan is the ringleader of the price manipulation games they play, so… without them in the game….  Maybe, just maybe we can get back to a real price for Gold?   I sure hope so!

And while we’re talking about the revelation last week that JPMorgan received 2 more felony counts of price manipulation, I have a question for the mass media…. “Where has this story been on the 5 or 6 or 10 o’clock news? Local news, national news, cable news? No where! Crickets! And why is that? Because this news doesn’t \no, wait Chuck, don’t go there… You already had a reader tell you to stay out of politics when you said something about the Veritas finding of bundled mailed votes…  So, I know why the mass media has been absent in reporting about these felony charges at the U.S. ‘s largest bank, but that’s going to have to be a discussion on the Butler Patio….

And then there’s this final thing here….  I know in my heart of hearts that this slap on JPMorgan’s wrist and their “deferred prosecution agreement” isn’t going to be the end-all of price manipulation… There’s just too much money involved to these price manipulators to go Cold Turkey and quit….

And Oh, I do have another thought here….  Why did it take the DOJ to find these unlawful trades, and file felony counts? Where was the CFTC? Aren’t they supposed to be the regulator of commodities?  What the hell do we need the CFTC for, when they failed miserably at their jobs?

Well, I had a lot of pent up thoughts on all that as you can tell….  So, as the day went on yesterday, and I’m looking at stuff, I see a headline that says that the “dollar soared back on Friday”…. Really? You call a ¼-cent move “soaring back”?  I wanted to fire off a response but couldn’t find a place to click to respond! Just shows to go ya that you have to be careful who you get your news and market updates from… 

The other misleading headline was this on Thursday… “Jobs come roaring back in Sept”….  Really? Let’s see the previous week 840,000 people filed for Unemployment and last week the number was 837,000… So, I’m to believe that these days, we think 3,000 is to considered “roaring back”? 

And also on Thursday, the Continuing claims increased from the previous week when they were 26.04 Million, last week they were 26.53 Million…. So, once again I can eyeball that and say that more people are staying on Unemployment!    So, then I did a quick computation on the back of a napkin, and came up with an Unemployment Rate of 8.8%…  The BLS said on Friday that the Sept. Unemployment Rate was 7.9% down from 8.4% in August….   

Riddle me this Batman….  The Continuing Claims are still high… And the monthly jobs created by the BLS were 661,000 in Sept, when the jobs created in August were supposedly 1.489 Million… So, take those two things into consideration, and you get a…..  lower Unemployment Rate?  Only the corrupt BLS could compute that, folks…  I’m just saying…

OK, enough of all that jobs talk… It’s all a bundle of confusion about the real number as far as I’m concerned… And really, I have no idea why I spend so much time on it, other than I have this inner drive to prove the BLS and ever other Gov’t report wrong! 

OK, enough of that too…. I’m just going to get myself all riled up and being to yell at the walls, it’s ok, I’m here alone..  No one will hear me, and then it all be me getting my blood pressure rising, when the walls don’t yell back!

Well, The GATA Folks let me know this weekend that this year’s New Orleans Investment Conference, to be held Wednesday to Saturday, October 14 to 17, and will be a “virtual” conference!  The New Orleans Conference is the granddaddy of conferences, and I was always very delighted to be chosen to speak there…. One year, it was held over Halloween…. And if you’ve never been to New Orleans, you would not be aware of the love the people of the are have for Halloween…  Frank Trotter, David Galland and I walked down Bourbon street,  and were amazed at the costumes the people walking up and down the venerable street were wearing…  I haven’t spoken at the NOLA Conference for a number of years now… I remember the crowds there being very lively!  If your interested in logging in to your computer to watch some of the presentations this year, you can click here to find out more: https://neworleansconference.com/wp-content/uploads/2020/09/NOICChrisPow…

The U.S. Data Cupboard last week had some other prints besides the labor reports….  Personal Income & Spending for August showed that Income was down -2.7%, and Spending was up 1%… Uh-oh… Mom, they’re doing it again!  Doing What?  Spending more than they take in…. Doesn’t that indicate that either savings or a credit card were getting used?  Yes…. It does…. Good boy!

There were a couple more prints on Friday… The ISM Manufacturing Index slipped in Sept from August, but my a miniscule amount, and Core Inflation remained at .3% for September…  Both of these reports are simply what the Gov’t wants you to see…  Nothing more, nothing less… 

To recap… The up one day down the next day for Gold & Silver continued through to the end of the week, and is looking as if today will be another run upward…  The currencies also saw some up one day and down another day, but this morning the euro is moving higher in the 1.17 handle, and taking the other currencies along. The price of Oil has slipped to a $38 handle, and all but one Petrol Currency is feeling the heat from this slippage…  Hey! you’ll have to read the letter to find out which currency that is! 

For What It’s Worth….  OK, I’ve got another article from Pam and Russ Martens from their Wallstreetonparade.com web site for you today… This one really hit a nerve with me, so it’ll be interesting to see if it does the same with you… It’s about the Fed NY and their repos, which by the way have gone over $9 Trillion that they’ve doled out to the primary dealers (Casino Banks) since they began this last September… So, this article gets into the meat of what’s going on, and it can be found here: https://wallstreetonparade.com/2020/10/the-new-york-fed-pumping-out-more-than-9-trillion-in-bailouts-since-september-gets-market-advice-from-giant-hedge-funds/ 

Or, here’s your snippet: “

The New York Fed, the unlimited money spigot in times of need by Wall Street’s trading houses, has been conducting meetings with hedge funds to get their input on the markets. More on that in a moment, but first some necessary background.

Millions of Americans have seen the movie The Big Short, based on the Michael Lewis bestselling book by the same name. A key character in the movie is Mark Baum, played by Steve Carell. The character is based on Steve Eisman, who, during the financial crisis of 2008, was employed at FrontPoint Partners LLC, a hedge fund unit of Morgan Stanley. As widely acknowledged, FrontPoint was shorting subprime residential mortgages that were packaged into CDOs (Collateralized Debt Obligations). Shorting means to make a bet that a financial instrument will lose value. FrontPoint was, in fact, hoping American homeowners would be foreclosed on and their subprime mortgages would become worthless.

But here’s what else FrontPoint was shorting. Lewis writes in his book that during the financial crisis Eisman, while at FrontPoint, “shorted Bank of America, along with UBS, Citigroup, Lehman Brothers, and a few others.” Lewis notes further that “They weren’t allowed to short Morgan Stanley because they were owned by Morgan Stanley, but if they could have, they would have.”

The New York Fed was in charge of almost all of the secret $29 trillion in bailouts during the 2007 to 2010 financial crisis. Congress never approved these loans or was even aware of where the money was going. After the Fed lost a multi-year court battle to keep its bailouts a dark secret from the American people, we learned that Morgan Stanley was one of the largest recipients, receiving a cumulative total of $2.04 trillion according to the audit conducted by the Government Accountability Office (GAO).

Buried deep in the GAO audit is this bombshell:

“Morgan Stanley funds include TALF borrowing by funds managed by FrontPoint LLC, which was owned by Morgan Stanley at the time TALF operated.“

TALF was one of the Fed’s bailout programs. Which means the Fed was subsidizing FrontPoint with super cheap funding as it was shorting the hell out of the very banks that the Fed was desperately attempting to prop up with trillions of dollars in secret loans.”

Chuck again…  Sure that makes abundant sense doesn’t it? The Gov’t was bailing out a company that was shorting banks the same banks the Gov’t was trying to prop up?  I shake my head in disgust at all this…  Oh, and there are more goodies like that in this article, so if you have the time, check it out! 

Market  Prices 10/5/20: American Style: A$ .7185,  kiwi .6648, C$ .7535, euro 1.1770, sterling 1.2960, Swiss $1.0911, European Style: rand 16.4152, krone 9.2545, SEK 8.8940,  forint 304.28,  zloty 3.8227,   koruna 23.3216, RUB 78.10, yen 105.60, sing 1.3602, HKD 7.7498, INR 73.09, China 6.7899, peso 21.45,  BRL 5.6828,  Dollar Index 93.54,  Oil $38.72,  10-year .71%, Silver $24.09, Platinum $889.00, Palladium $2,357.00, and Gold… $1,905.80

That’s it for today…  I think that I’m going to boycott Twitter… I only use the social media site to see what the economists that I follow have to say, but every now and then a rogue post hits my screen, and there was one Friday that said, “The President has the virus, I hope he dies”….  What? You hope someone dies? What have we become? First it was “death to America” and now it’s “death to the president”?  The Twitter folks should track down this person and ban them from the site! But that won’t happen, it’s freedom of speech, right? I’m just going to choose not to see their freedom of speech! I use Parler now more anyway!  It’s 36 degrees outside this morning! BRRR!  I had to make the switch from Cool to Heat on the thermostat over the weekend, as the house was getting too cold for me! I used to have a rule of no A/C before May, and no Heat before Nov. But I guess I broke that rule!  This is day 15 of being alone… Oh! no Pfennig this Thursday, it’s my monthly visit to my oncologist…  Bill Withers takes us to the finish line today with his song: Lovely Day, which I hope it turns out to be… I heard this one on a Commercial recently, and thought… I guess I’ll have to delete it from my songs, now…  HA!  I hope you have a Marvelous Monday, and Please Be Good To Yourself! 

Chuck Butler

 

Rocktober 1, 2020

*Currencies move higher yesterday and overnight!

* Gold loses $12 yesterday, but is up $13 this morning…. 

Good Day… And a Tub Thumpin’ Thursday to you!  And welcome to Rocktober! I almost didn’t answer the bell this morning, as yesterday I didn’t get my afternoon nap, and last night, I fell asleep in my chair for the first 5 hours, then I climbed the stairs at 3 in morning to go to bed, and when the alarm went off… I said, “to hell with it,” and turned it off… But within a few minutes, my conscience got to me, and so here I am….  But not bright-eyed and bushy-tailed, for sure! In fact, I’m cranky! I have to think of something that will cheer me up… Oh! That’s right! My beloved Cardinals won Game 1 of their best of 3 series with the Padres yesterday!  Now, I’m in the mood to talk! Neil Young greets me this morning with his song from the great Harvest album: Out On The Weekend….  “think I’ll pack it in and buy a pickup, head on down to L.A.”…. 

Up one session, down the next…. This back and forth is about to give me a rash folks…. Like when I’m driving behind a guy on the highway, and he keeps weaving over into my lane. I say, “Come on bud, pick a lane, any lane, there are 4 of them to choose from”  I’m saying to the currency and metals traders, come on pick a direction, and stick with it….   I know in my heart of hearts that most currencies traders want to sell dollars right now, but then there’s the wolf (PPT) that’s always at the door, and traders are a fickle group of people… So, even though they know they should be selling dollars, they aren’t because of the PPT hanging over them like the Sword of Damocles….

So, yesterday, the currencies recovered the ground they lost in the overnight markets, but Gold never recovered its early morning loss of $12 and closed at $1,885.00 and Silver lost another 52-cents to go with the 46-cents it had lost in the early trading to close down 98-cents at $23.30….  The ADP Employment report showed that 790,000 jobs were added in September… One would think that hearing that kind of news would have pushed the dollar higher on the day, but it didn’t… except VS Gold & Silver…

And in the overnight and early trading markets, the dollar has continued to be sold… The currencies added to their gains yesterday, and Gold & silver have erased those losses from yesterday! Gold is up $13.50 this morning, and is once again within spittin’ distance of $1,900, and silver is up 50-cents this morning…  

And the fallout from the Presidential debate Tuesday night, sure didn’t give dollar holders any warm and fuzzy feelings… Recall I told you that I didn’t watch it, live… Watched some of it yesterday afternoon, and all I can say is that we learned one thing… The contempt that these two men have for each other”….  OMG… Did they have to display it to everyone, even the country’s creditors?

So… that’s done, and we await the 2^nd debate, which by all accounts has to be better than the first one….  My suggestion to the group of guys that came over to watch the baseball game with me outside yesterday, was simply to give a “mute button to the Host”, and if a debater tries to interrupt his counterpart, he gets muted”  now that would stop all those interruptions wouldn’t it?

Not that I want to turn the Pfennig into a letter on Politics, but this was so bad…. That I had to talk about it! HA!

OK… So, the dollar bugs are running away once again… What gives?  Yesterday they were puffing out their collective chests, and today they are cowering behind the wall boards they came from…  One day sure makes a difference, eh? But it’s these one day moves, and then backward the next day that are really giving me a rash… 

Well, it appears that the Bank of England (BOE) is definitely going to go negative with their rates very soon… Recall I told you a couple of weeks ago that they were thought to be leaning in that direction? Well, from what I read the BOE has sent signals to the markets that negative rates are on the docket for their next meeting.  

And you’d have to be a longtime reader to recall this, but… as I used to say long ago, that whatever happens in the U.K. seems to come to our shores about 6 months later, which would mean the U.S. economy will have dived deeper into the depression, and the Cartel, I mean the Fed will have no other choice but to go negative with rates… What’s the diff? The “real interest rates” are negative already, might as well go the rest of the way… 

These are not my thoughts, folks… I’m just telling you what the cartel, I mean the Fed, will be thinking… Oh, and by the way for those of you new to class, “real interest rates” are the current rate minus inflation…  Well, now that I’ve ruined your day, because you didn’t know that we were already in negative rates, I’ll try to do something to cheer you up! 

I’ve been treating myself to a lot of music lately from Leon Russell, and JJ Cale… Great stuff, but as I was looking for more, I came across some stuff that JJ Cale and Eric Clapton did together…. It’s been a long times since I bought a CD, but I just had to have this recording titled: The Road To Escondido, by JJ Cale and Eric Clapton…. It arrived sometime yesterday ( I was preoccupied with baseball) and so I can’t wait to get it in the CD player this morning! 

There did that make you feel better? I sure hope so… Because I’ve got nothing else, but complaints, whining and gloom and doom up my sleeve, ala Bullwinkle! 

The U.S. Data Cupboard yesterday had the ADP Employment Report for September, and they showed that 749,000 jobs were added, which I’m thinking that those won’t last too long… OK, because I see the economy dragging its feet… 

And today’s Data Cupboard is chock-full-o-data! The Initial Jobless Claims for last week will print, along with the Continuing Claims, which to me is more interesting… In addition, we’ll see the color of the Personal Income and Spending reports for Sept. These are important economic prints folks… And finally, the ISM Manufacturing Index for September will also print, and is also an important economic report… So, we’ll see 4 real economic reports in one day!  

To recap…  The currencies turned the tables on the dollar bugs yesterday, and then continued throughout the night to move higher VS the dollar. Gold gave back $12 yesterday, but is up $13 this morning… Chuck is growing tired of the back and forth, and just wants traders to pick a lane, I mean direction and stick with it! 

For What It’s Worth….  It’s been some time since I last was allowed to view articles on Bloomberg.com, but last night in my perusal of Twitter, I clicked on a Tweet about major U.S. companies laying off Thousands of workers in one day, and it then took me to Bloomberg, where you’ll find this article that really spells out the problems for the economy, and it can be found here: https://www.bloomberg.com/news/articles/2020-09-30/disney-shell-cuts-mark-warning-sign-for-global-economic-rebound

Or, here’s your snippet: “Tens of thousands of job cuts announced by blue-chip companies in a 24-hour period are a warning sign for the world’s recovery and emerge just ahead of two key reports forecast to show limited progress in the U.S. labor market.

In one of the biggest layoff announcements since the pandemic caused widespread economic shutdowns, Walt Disney Co. said late Tuesday that it’s slashing 28,000 workers in its slumping U.S. resort business. In the hours that followed, the pace of job cuts at some of the world’s biggest companies — across in a range of industries from energy to finance — quickened.

On Wednesday, Allstate Corp., the fourth-largest car insurer in the U.S., said it will cut 3,800 jobs, roughly 8% of its workforce. And Bloomberg reported that Goldman Sachs Group Inc. plans to cut roughly 400 jobs after temporarily suspending job reductions at the beginning of the crisis.

Announcements like these point to further challenges in a rebound that’s already slowed after an initial bounce back in May and June. Weekly figures due Thursday are estimated to show filings for U.S. unemployment benefits remain far above pre-virus levels, while Friday’s jobs report — the last before the November presidential election — is expected to reveal that employers added a half-million fewer workers in September than in August.

“Job losses were at first concentrated in service-sector jobs, but in any economic downturn you’re bound to get some more pruning as corporations are trying to protect profit margins,” said Brett Ryan, senior U.S. economist at Deutsche Bank Securities Inc. “You’ll see larger companies that may have been on a certain revenue trajectory before the downturn start to reevaluate.””

Chuck Again…. Yes, we’ll see the latest Weekly Initial Jobless Claims in just a few minutes this morning, so hold tight….

Market  prices 10/1/20: American Style: A$ .7203, kiwi .6652,  C$ .7526, euro 1.1753, sterling 1.2957, Swiss $1.0898, European Style: rand 16.6200, krone 9.2796, SEK 8.9200,  forint 306.08,  zloty 3.8226,   koruna 22.9013, RUB 78.24, yen 105.50, sing 1.3620, HKD 7.7500, INR 73.03, China 6.8012, peso 21.84,  BRL 5.6274,  Dollar Index 93.54,  Oil $39.47,  10-year .70%, Silver $23.80, Platinum $906.00, Palladium $2,372.00, and Gold… $1,899.70

That’s it for today and this week… I’ll have my thoughts on tomorrow’s Jobs Jamboree for you on Monday, you can be sure of that!  So, I’m sure most of you know my reason for calling this month Rocktober, and some of you are wondering what the heck is Rocktober all about?  Well, it’s Pfennig Tradition… I’ve writing the Pfennig now for 28 years, and when it was young, I decided to call this month, Rocktober, and that’s that! That first inning of the Cards/ Padres game yesterday, was quite the surprise, as the Cardinals brought their bats that haven’t had much use, to San Diego, and put up 4 runs and then added a few more to win the game…  Now, if they can do the same today….   I sure hope their not like the currency and metals traders!  The Cardinals will send the wily old Veteran, Adam Wainwright to the hill today, in hopes that he can conger up more magic….   The Beatles takes us to the finish line today with one of my fave songs by them: Norwegian Wood….   OK, short-n-sweet for you today, and with that I hope you have a Tub Thumpin’ Thursday and a Fantastico Friday tomorrow…. And Please Be Good To Yourself!

Chuck Butler

September 30, 2020 

* currencies & metals give back gains overnight… 

* Chuck asks, why do people keep getting more stupid? 

Good Day… And a Wonderful Wednesday to you! Well, did you watch the debate last night? I didn’t because after cooking for 2 hours, yesterday, for some reason, I just didn’t have anything left in the tank. So I sat down, played some music and forgot about the debate… I’m sure I know who “won” the debate, without looking…  But I’ll be checking that out later this morning…  I forgot to congratulate the Tampa Bay Lightening on their Stanley Cup Championship that was won Monday night…  Well, I hope they get to each individually get the Cup for one day, as is tradition. I say that because the new hockey season begins December 1^st!  Yes, less than two months of “down time”… I’m still waiting for the folks at Roger Dean Stadium to let me know about my spring training season tickets… The Stadium only has about 6,500 seats, so if they spread people out, this could get interesting! Tom Petty and the Heartbreakers greet me this morning with their song: You Got Lucky….  

Funny story, for years that I’ve been getting scans, I get into the room and they ask me about my medical history (as if they couldn’t look it up!) and I tell them about losing my left kidney, part of my right femur, my left eye, and I still have cancer in my right jaw, and then I tell them, “They call me Lucky”… That always gets a chuckle out of them!

OK, onto the markets…. Well, the dollar bugs had really retreated yesterday… Last week at this time I was telling you that they were dancing in the street and inviting their neighbors to join them… And a week later the dollar bugs had all returned home to the wall boards they crawled out of!  The euro is leading the currencies back to higher ground, and Gold closed up $16 on the day to bring it back to within’ spittin’ distance of $1,900… 

However, the overnight markets have not been kind to the non-dollar assets.. Gold has lost $12 and Silver has lost 46-cents in the early trading today. There was nothing in the news or rumors or anything that would cause this reversal of yesterday’s moves… So, was it the wolf at the door? Sure smells like it to me… 

The dollar didn’t get sold yesterday, on the basis of the results of the Consumer Confidence Index for this month, as the index rose to an unbelievable high of 101.8 from 86.3 last month… I guess the 3 consecutive weeks of stock losses didn’t faze the folks they asked… And as usual, they didn’t dare ask me!  What on earth are these people who are confident smoking? Or drinking? Or just being plain stupid?  The Pearls Before Swine cartoon yesterday, had rat telling goat that…. for the fist time in history we have all the collective knowledge of the world in our hands. We can know anything we want to know about anything instantaneously… So, how did People get stupider?   Goat says, “you should Google that”, and Rat replies, “it’s says no clue”….

I emailed the cartoon to by good friends saying… I ask this question every day!  How in the world have people got more stupid?  Well, I’ll give you my two cents on that thought…. I believe it’s because of the education they receive…  When they don’t have to compute math equations any longer, or know the capital of every country in the world, or whatever, the knowledge gets weaker and weaker with every year….  And Google… Instead of having to know something, they can just Google it… I’m just saying…

I have something for you this morning, stay with it… read it carefully, because it proves me to be correct about price manipulation, etc.    here we go… Yesterday, I read a report from Wallstreetonparade.com  and it in they reported that Union Bank of Switzerland (UBS) had said that “Now that Indictments Have Outed Gold Manipulations at JPMorgan, UBS Says “Buy Gold” And that all sounds good, right?  Well, on the same day, I read on a GATA email that, “Don’t think for a moment, the TF Metals Report’s Craig Hemke writes today at Sprott Money, that manipulation and corruption in the monetary metals markets will stop with JPMorganChase’s admission of rigging them and the bank’s paying a $920 million fine.

Market rigging, Hemke writes, remains too easy and profitable and the market regulators too corrupt or incompetent to stop it.”

Chuck again… Yes, I agree, the market regulators are both too corrupt and too incompetent to stop it!

Oh, and once again JPMorgan has admitted to two new Felony counts of price manipulation, which brings the total to 5 Felony counts that have all occurred under Jamie Dimon’s leadership… or lack of, whichever you choose to use…   Now that’s me talking…  Here’s Pam and Russ Martens of wallstreetonparade.com  Read carefully…

“Under the richly compensated leadership of Chairman and CEO Jamie Dimon, JPMorgan Chase, the largest bank in the United States, has admitted to an unprecedented five criminal felony counts since 2014 and put on criminal probation three times. Dimon notched two of those felony counts in his belt today. (That’s five felonies more than the bank pleaded guilty to in its prior 100 years of existence. Translation: this is not normal even on Wall Street.)

The bank has agreed today to pay criminal fines and admit to two felony counts of wire fraud for manipulating (spoofing) trading in the precious metals and U.S. Treasury markets. Why the Justice Department is bringing only two counts when its own charging document indicates that traders engaged in “tens of thousands of instances of unlawful trading in gold, silver, platinum, and palladium…as well as thousands of instances of unlawful trading in U.S. Treasury futures contracts and in U.S. Treasury notes and bonds…” is one more sign that this Justice Department is egregiously failing the American people and making a mockery of the word “justice.””

Chuck again…  I just had to include their explanation of what’s going on at JPMorgan’s metals and Treasuries desks…. Now, back to regular programming… Oh, and JPMorgan’s fine?  It was $920 Million… Like I said earlier this week, that’s just chump change for what they made doing the unlawful trades… 

So… the question is this about the dollar rebound overnight… As I said yesterday, the wolf is always at the door here, and we had better not forget it… And like I said above, this rebound overnight smells of PPT….  But they’ll come a time when the markets say, “to hell with the PPT, we’re selling dollars before we get caught holding them” And when that day comes, and it will come in my opinion, I don’t think the PPT will want to stand in front of that bus…. Do you? 

The U.S. Data Cupboard yesterday had the aforementioned stupid Consumer Confidence. In addition, it also had the Case/ Shiller Home Price Index for July, which showed that home prices were rising at a good clip in July… Of course we’re one day away from Rocktober, so that data is a little stale, eh?

Today’s Data Cupboard has the ADP Employment Report for Sept, which the forecasters believe will be around 430,000, which if you were paying attention in class on Monday, I told you that the forecasters has thought the BLS Jobs Jamboree would be around 880,000…. Now there’s a Big Difference there isn’t there? As always, I say we should pay attention to the ADP report, but then that would mean the markets had to change their minds, and we can’t begin to have that happen! They aren’t smart enough to adapt, Change, innovate…  In addition, the 2^nd Revision of 2^nd QTR GDP will print and is expected to remain unrevised at negative 31.7%…  And there will be a regional manufacturing index that I’m boycotting, so we’ll just move along from here…

To recap…. The dollar bugs had all returned home to the wall boards they crawled out of yesterday, but that all reversed in the overnight markets…  Gold climbed higher by $16 to $1,897, and Silver followed along…  But has given those gains back early this morning… JPMorgan has admitted to being guilty of 2 more felony counts on price manipulation of metals and Treasuries…  Chuck has a long explanation of it all from the good folks at www.wallstreetonparade.com   In addition Chuck asks how people continue to just keep getting more stupid?

For What It’s Worth… since I spent a good part of the morning going through the price manipulation felony counts against JPMorgan this morning, I thought that this article tied it all up in a neat little bow for you… It’s an article about who’s behind all this price manipulation at JPMorgan, and can be found here: https://www.zerohedge.com/markets/how-jpms-precious-metals-trading-desk-manipulated-markets-crime-ring-within-bank?utm_campaign=&utm_content=Zerohedge%3A+The+Durden+Dispatch&utm_medium=email&utm_source=zh_newsletter

Or, here’s your snippet: “There was a time when the merest mention of gold manipulation in “reputable” media was enough to have one branded a perpetual conspiracy theorist with a tinfoil farm out back. That was roughly coincident with a time when Libor, FX, mortgage, and bond market manipulation was also considered unthinkable, when High Frequency Traders were believed to “provide liquidity”, when the stock market was said to not be manipulated by the Fed, and when the ever-confused media, always eager to take “complicated” financial concepts at the face value set by a self-serving establishment, never dared to question anything.

All that changed in November 2018 when a former JPMorgan precious-metals trader admitted he engaged in a six-year spoofing scheme that defrauded investors in gold, silver, platinum, and palladium futures contracts. John Edmonds, then 36, pled guilty under seal in the District of Connecticut to commodities fraud, conspiracy to commit wire fraud, commodities price manipulation, and spoofing, a trading technique whereby traders flood the market with “fake” bids or asks to push the price of a given futures contract up or down toward a more advantageous price, and to confuse other traders or HFTs which respond to trader intentions by launching momentum in the other direction. As FBI Assistant Director in Charge Sweeney explained at the time, “with his guilty plea, Edmonds admitted he intended to introduce materially false and misleading information into the commodities markets.”

A little more than a year later, former Deutsche Bank precious metals trader David Liew sat in a federal courtroom telling a jury about how he learned to ‘spoof’ markets from his colleagues, and that he considered the behavior to be “OK” because it was “so commonplace.” Unfortunately for him, federal authorities didn’t see it that way, and have aggressively prosecuted the big dealer banks for market manipulation across a variety of markets. His testimony led to convictions for two of his former coworkers. A few days later, JP Morgan agreed to settle similar allegations with a record $1 billion fine, netting another major victory for the government in the nearly decade-long campaign to root out manipulation from the precious metal markets.

Today, Bloomberg is finally catching up to years of “conspiracy theory” reporting, such as this article published here in 2014 and titled “Gold Rigging By Bullion Banks Exposed: The Complete Chart“, with a sweeping expose about the precious metals manipulation and spoofing scandal, focusing on the precious metals trading desk at JPM and its top trader, Mike Nowak.

And although Bloomberg inexplicably did not mention it even once in its lengthy report, Nowak’s desk was under the direct purview of Blythe Masters, who from 2007 until 2014 was the head of Global Commodities at JPMorgan.   

Which is ironic because going all the way back to 2012, the “tinfoil hat” crowd was abuzz with speculation that central banks, perhaps in league with the big broker dealers and occasionally aided by HFT momentum ignition, were conspiring to manipulate precious metals prices. When questioned about this in an interview with CNBC, Masters denied that JPMorgan was engaged in any manipulation, and instead insisted that JPM’s precious metals desk was reputable a “client-driven business.”

“Our business is a client-driven business where we execute on behalf of clients to help them with their…risk management objectives,” Blythe Masters said before going on to claim that the bank runs a “balanced book”, where its long and short positions are always evened out. But the punchline was when Master, who is perhaps best known for discovering the Credit Default Swap, said that manipulating markets to benefit the bank’s positions to the detriment of clients would be  “wrong, and we don’t do it.””

Chuck again…So where are all those naysayers that laughed at me, and made me stop talking about price manipulation now?  And to Blyth Masters’ comment about price manipulation would “be wrong and we don’t do it” I say… OOPS!  

Market Prices 9/30/20: American Style: A$ .7122,  kiwi .6578, C$ .7469, euro 1.1708, sterling 1.2830, Swiss $1.0838, European style: rand 16.8254, krone 9.4805, SEK 9.0253,  forint 312.08,   zloty 3.8871,   koruna 23.2323, RUB 79.08, yen 105.72, sing 1.3692, HKD 7.7499, INR 73.64, China 6.8168, peso 22.34,  BLR 5.6491,  Dollar Index 94.10,  Oil $39.15,  10-year .64%, Silver $23.81, Platinum $880.00, Palladium $2,382.00, and Gold… $1,885.60

That’s it for today… Well, today’s the day… My beloved Cardinals start their best of 3 playoff series with the Padres…  The American League started their playoffs yesterday, and the National League starts their playoffs today.  The Cardinals need to steal game 1…  I’m just saying… Man did I go Emeril in the kitchen yesterday, and made a very yummy dinner for me and Alex, I’m not doing that again! I am going to make some pig-cluckers today, but the Big Green Egg will do most of the work! It’s been 11 days now that, for the most part I’m alone… I liked it at first, but now it’s beginning to become a drag… Deep Purple takes us to the finish line today with their song: Hush….   And with that, I hope you have a Wonderful Wednesday, and I ask you to please, Be Good To Yourself!

Chuck Butler

 

September 29, 2020

* The overnight markets sell dollars! 

* What up with the weakne

Good Day…  And a Tom Terrific Tuesday to you! Well, I tried something new for today… I got an instacart app, ordered our groceries and today I go pick them up, and they’ll bring them out to the car! No more having to walk around a grocery store with a face mask on….  ( I always had the feeling that they were going to arrest me with my mask on!) But no more! I could have them delivered to me, but I need to get out and drive my car a bit more, as I’m now getting 1 month to a gallon of gas! Tomorrow will be a busy day for me, as I go to the eye doctor to get a new prescription for my one eye… I ask them every year why the bill for such procedure isn’t cut in half, since they only have to deal with one eye, and they always look at me like a deer in headlights… and  then I need to get ready, as my beloved Cardinals begin their playoff series with the Padres…. Man did it turn cooler yesterday, I wore my Blues hoodie all day and evening… And the wind last night was taking no prisoners…. UGH!  Graham Nash greets me this morning with his song: I Used To Be A King…   (I relate that song’s lyrics somewhat!, not that I was once a King, but… I was somebody… I’m just saying)

Well… The reason I went into that bit of depressing stuff was I read an article last night in Grant Williams’ Things That Make You Go Hmmm, and it was about as people, especially men, get older they lose that feeling of relevance, and that takes them down a deep rabbit hole that most do not come out of….  But I am STILL somebody, I’m my wife’s husband, my kids’ dad, my grandkids, General, and so on… And I have thousands of dear Pfennig Readers too!  So, I haven’t lost that feeling of being relevant… yet…

OK… Well, I told you yesterday that the dollar bugs had backed off their assault on the currencies and metals, and that was quite evident in Gold & Silver… Gold closed up $20 on the day, at $1,881.20, and Silver closed up 71 cents to $23.71…  The currencies held their ground, and some moved positively VS the dollar, but the moves were very small… But at least they held their gains from late last week…. Which is saying a lot, given the PPT is like the wolf, and is always at the door….  The PPT’s knocking on the door… Do Not open the door and let ‘em in!  (a play on the Paul McCartney song) 

In the overnight and early morning trading the dollar bugs have retreated even more. Gold is up a buck or two, and the euro is back above 1.17…  It’s a watered down version of the trading pattern we witnessed a few weeks ago, where the overnight markets sold dollars, and the U.S. markets bought dollars…  There are just so many articles out there, folks, that are talking about a collapse of the dollar is coming…  

But who said that first? Yes, they’re all jumping on my bandwagon, let’s hope that bandwagon doesn’t lose a wheel, eh?  Even the former head of economics at Morgan Stanley, Stephen Roach, is now on the bandwagon, and when he joined, it gave me a feeling of vindication for my thought… 

So, what’s up with the Russian ruble being so weak these days?  Well, according to an article on the Russian Times website,  the weakness can be attributed to the rise of coronavirus cases in the country. Negative investor sentiment and low oil prices, which were down in morning trading amid concerns over the possibility of new coronavirus restrictions, also affected the ruble exchange rate.

Last week, the Ministry of Economic Development said the ruble had weakened due to temporary factors, such as rising geopolitical strife and other risks felt by the financial markets.  But then they also said that they expected the ruble to rebound and average a price of 71.2 rubles to the dollar. It currently is at its lowest price of 78.71 since April of this year, when the Oil price plummeted….

So, all you ruble holders, don’t despair… We’ve seen these weak spots for the ruble before, and it has always rebounded nicely… And I fully expect to see a rebound here in due time… 

Well, what have we here?  New Zealand recorded its largest trade surplus since 2014 this month… Now normally that would be cause for celebration, but… because of the pandemic closing the economy down, this cause of celebration has been cancelled, because, it’s all about the pandemic… I’ve gone through this before for one of my fave countries… New Zealand is an Islands nation, and therefore besides, wool, lumber and dairy, they have to import just about everything, and that puts a strain on their current account, and in the past when New Zealand would post a trade surplus, it would mean that the demand for wool, lumber and dairy had exceeded expectations. And THAT my friends, would cause for celebration!

I do understand that this trade surplus was helped by a rash of dairy order deliveries, so one out of 3 ain’t bad… Shoot Rudy, 1 out 3 will put in baseball’s hall of fame!….  I’m just saying…

The U.S. Data Cupboard has the Case/Shiller Home Price Index for August to print today, along with the stupid Consumer Confidence report for September….  In August the Consumer Confidence Index rose to 89 from 84 the previous month… But I’m pretty sure that given the poor performance of the stock market in recent weeks that this index number will be weaker for September… But then it should be very weak, in my opinion… But don’t let that get in the way of a good time, eh?

There will also be 4 more different Fed Head speeches today, with Fed Heads Williams and Clarida doubling up to make two different speeches, for a total of 6 collective speeches today… I doubt that any of them say anything to upset the applecart, but…. If I were there I would ask them, “just what’s up with your backing off buying Corp Bonds and ETF’s?”  But I’m not there….

I have a funny story for you… Quite a few years ago now, I was invited to a breakfast meeting with St. Louis Fed President, James Bullard the featured speaker, with a  Q&A session following… I woke up that morning with laryngitis and couldn’t ask him any questions!  Chris Gaffney and Frank Trotter thought it was very funny…. I of course did NOT!

The Eurozone will also print their version of a Consumer Confidence report today, and I’ll betcha dollar to a Krispy Kreme that theirs is weaker! They’ll also see indexes on Services Confidence, Business sentiment and Economic outlook…  So, the whole shootin’ match in one morning’s data prints, sure sound like the way to do it to me!

To recap… The dollar bugs remained on the sidelines again on Monday, and the currencies inched higher while Gold gained $20 and Silver 71-cents….  OMG! Did I ever make an error in yesterday’s Pfennig, saying that Silver closed at 23-cents… instead of $23.00! What a dolt! And only one reader caught it…. Or maybe you’re just tired of highlighting my fat finger errors…. The overnight markets were….

Before I head to the Big Finish today…. So, project Veritas has found voter harvesting in Minnesota….  I just knew that this mail in votes thing was going to get really ugly, and it’s already starting….  I’ve absentee voted several times in my life but never for a Presidential election… That’s a day I like to go and see the ilk of the people that are there to vote…. 4 years ago, I bumped in a neighbor while getting ready to vote, and she said, “I guess we’re here to cancel each other’s votes”….  I couldn’t have agreed with her more! 

For What It’s Worth….  I find this news to be somewhat bad… Of course I don’t know what shape the world will be in 15 years, but this is an article about the California Gov. who signed a law that prohibits the sale of gas fueled vehicles by 2035, and it can be found here: http://www.restoreamericanglory.com/breaking-news/california-governor-signs-order-no-gas-using-vehicles-after-2035/

Or, here’s your snippet: “In a ludicrous move against climate change on Wednesday, California Gov. Gavin Newsom (D) signed an executive order that will prohibit car companies from selling cars and passengers trucks that produce emissions after the year 2035. The order, which is a transparent attempt on Newsom’s part to set himself up for a presidential run down the line, was touted as a move to help California to move closer to its stated “Greenhouse Gas Emissions” goals.

“This is the most impactful step our state can take to fight climate change,” said Newsom. “For too many decades, we have allowed cars to pollute the air that our children and families breathe. Californians shouldn’t have to worry if our cars are giving our kids asthma. Our cars shouldn’t make wildfires worse – and create more days filled with smoky air. Cars shouldn’t melt glaciers or raise sea levels threatening our cherished beaches and coastlines.”

At a press conference announcing the order, Newsom encouraged other states to follow California’s lead. But while Newsom was busy worrying about turning himself into America’s Grand Leader on Climate Change, there were some within his own party who wondered how the state’s non-rich residents could possibly afford to make the switch.

“The EV’s pictured in today’s signing of the EO cost more than $50k each,” tweeted Assemblyman Jim Cooper. “How will my constituents afford an EV? They can’t. They currently drive 11-year-old vehicles. This doesn’t even take into account the strain an all-electric vehicle fleet will have on our state electric grid.”

As of last year, only 6% of vehicles sold in California meet the standards set by the governor in his order.

Even so, Newsom’s office insisted that fifteen years would be enough time for things to change.”

Chuck Again… Yeah, in 15 years, we may well have figured out that the we all didn’t die from climate change, and then what happens?  I’m just saying…

Market  prices 9/29/20: American Style: A$ .7133, kiwi .6595, C$ .7477, euro 1.1703, sterling 1.2866, Swiss $1.0842, European Style: rand 16.9535, krone 9.4415, SEK 8.9905,  forint 312.05,  zloty 3.8739,   koruna 23.18235, RUB 78.71, yen 105.62, sing 1.3684, HKD 7.7498, INR 73.72, China 6.8149, peso 22.19, BRL 5.5895,  Dollar Index 94.05,   Oil $40.57,  10-year .65%, Silver $23.78, Platinum $874.00, Palladium $2,170.00, and Gold… $1,884.50

That’s it for today…  I was looking over all the pictures I have on my wall that’s the backdrop for my writing desk, and one of them is hilarious! Years ago, at EverBank, we used to sponsor this matchbox car race, and the folks on the desk would dress up as a group to see if we could win a prize for that, because our car entry was always a dud… One year, the folks on the desk decided to dress at the Flintstones…  And they did win! And the picture of them is hilarious!  I received fantabulous news from good friend Dennis Miller last week… He is cancer free!  His latest Pet Scan showed no sign of cancer…  Give thanks and praise to the Lord (Bob Marley)  Last week, Dennis’ weekly letter, which can be found here: : https://milleronthemoney.com/free/ He interviewed me! I really let loose in the interview too, so check it out and sign up for his letter if that floats your boat!  The Moody Blues take us to the finish line today with their song: I’m Just A Singer (In a Rock & Roll Band) …  I used to identify with that song!   And with that, I hope you have a Tom Terrific Tuesday, and Please Be Good To Yourself!

Chuck Butler