April 11, 2022
* Gold & Silver ignore the dollar buying
* Commodity prices continue to rise…
Good Day… And a Marvelous Monday to you! Well, I’m back in the saddle here at home, but not without a lot of whining the other night… Friday night I went to see my grandsons, (Everett & Braden) play indoor soccer. While, yes, the game was in indoors, the walk to the arena wasn’t, and it had many steps, and it was freezing cold with a blustery wind… I kept saying to myself, “why did I come back here?” I mean it is April… And also on Friday morning it was snowing! No accumulation, but snow nonetheless! Golden Earring greets me this morning with their song: Radar Love…
Well, the breather the dollar took on Wednesday last week, didn’t last long, and the dollar continued to get bought hand over fist, through Friday, with the BBDXY ending the week at 1,206.51, after starting the week at 1,195.41… The euro dropped through the 1.09 level and finished the week with a 1.08 handle… Even the Aussie dollar (A$) which was trading early last week with a .76 handle lost ground to the dollar late last week…. Gold ended the week up $15.50 to close the week at $1,947.70. Silver also gained on Friday by 19-cents to close the week at $24.87…
The price of Oil dropped below $100 again, and bonds got sold once again with the 10-year’s yield rising to 2.72%….
In the overnight markets last night…. there was more dollar buying, albeit, watered down, when compared to last week’s buying. Gold & Silver, however are not letting the dollar buying interfere with their respective rallies. Gold ID up $16 and Silver is up .34-cents in the early trading today. Silver’s rise this morning puts the metal back above $25…. The price of oil has fallen $3 more, and trades this morning with a $94 handle… Bonds continue to get sold and the 18-year’s yield is up to 2.75% this morning…
These rallies in Gold and Silver this morning are ripe for some short selling, so let’s just hope for the price manipulators to oversleep this morning…
I really don’t know what to think about 1. Stock prices and 2. Why the dollar is so strong…I’ve said all I have to say about both of those items, so I won’t get into that anymore at least for today…
Speaking of stock prices… there’s a new warning out on the street, and according to the report I read… you have until June 15th before the stock market crashes…..this is the 4th warning of a stock market crash that has been issued…
OK… Late last week, the current administration announced that they were going to issue another extension in the Student Loan Payments… Well, last August they issued a “final extension”, but that proved to be false, as there have been two more extensions since then. And when this extension expires in August, I would expect that another extension will follow, for this has all become very political.. And the mid terms are just around the corner, and I just don’t see lawmakers telling students that they now need to start paying on their loans right before an election… But this goes further, folks… I see this kicking the can down the road leading to a complete student loan forgiveness… Like the country is Uncle Moneybags, and can afford to wipe these loans off their books… Utter disbelief at the ignorance of our lawmakers, that’s what I say…
Man did you see the explosion of credit card debt in the U.S.? here’s the skinny from MarketWatch: “The numbers: Total consumer credit increased $41.8 billion in February, up sharply from a rise of $8.9 billion in the prior month, the Federal Reserve said Thursday. That translates into an 11.3% annual rate in February, up from a 2.4% gain in the prior month. This is the highest rate since November 2001″
Chuck again, and the so-called experts had forecast an increase of $15 Billion… This is what happens, folks, when people run our of savings, inflation has eaten away their disposable income, and the have to revert to buying on Credit… mortgage rates will rise, and house prices will drop…
This is really getting ugly folks… inflation is soaring and our protector of the dollar/stock market, is doing little to help you, and me…. The Fed/Cabal/Cartel announced last week that they will allow up to $95 Million of bonds to mature without rolling into new bonds, thus reducing their balance sheet….well I’m from Missouri so… I’ll have to be shown that they are truly reducing their balance sheet….so what does that mean for you? Well it means that bonds no longer have a crutch to lean on in the Fed/Cabal/Cartel…..and bond yields will continue to rise….
And if you own a bond you will experience buyers remorse…..
I’m just saying…
Oh and quantitative tightening is a stealth rate hike…. The boys and girls in the Eccles Building seem to think they can fight inflation this way…. It’s their way of not making a big deal out of a rising fed funds rate, so not to spook the stock jockeys….
The U.S. data Cupboard will be somewhat busy this week, with some days not participating and the other days bulking up with a plethora of data… For instance, today’s cupboard doesn’t have much… But tomorrow we’ll see the color of the latest stupid CPI…. And more, so you’ll have to be patient today…
To recap…. The dollar went on a rampage last week, and pushed down the euro and the A$… Chuck is at a loss trying to figure out why the dollar is getting bought… The administration announced that they were going to extend the Student loan payments pause… where did the money come for this boondoggle?
For What It’s Worth…..this article was featured in Ed Steer’s Saturday letter, and its about something that I’ve been ringing the bell about, rising commodities and it can be found here: The commodity currency revolution (goldmoney.com)
Or, here’s your snippet: “We will look back at current events and realise that they marked the change from a dollar-based global economy underwritten by financial assets to commodity-backed currencies. We face a change from collateral being purely financial in nature to becoming commodity based. It is collateral that underwrites the whole financial system.
The ending of the financially based system is being hastened by geopolitical developments. The West is desperately trying to sanction Russia into economic submission, but is only succeeding in driving up energy, commodity, and food prices against itself. Central banks will have no option but to inflate their currencies to pay for it all. Russia is linking the rouble to commodity prices through a moving gold peg instead, and China has already demonstrated an understanding of the West’s inflationary game by having stockpiled commodities and essential grains for the last two years and allowed her currency to rise against the dollar.
China and Russia are not going down the path of the West’s inflating currencies. Instead, they are moving towards a sounder money strategy with the prospect of stable interest rates and prices while the West accelerates in the opposite direction.
The Credit Suisse analyst, Zoltan Pozsar, calls it Bretton Woods III. This article looks at how it is likely to play out, concluding that the dollar and Western currencies, not the ruble, will have the greatest difficulty dealing with the end of fifty years of economic financialization”
Chuck again… in the words of the A-Team… I love it when a plan comes together! This is a very thought provoking article from the author… Check it out if you have time…
Market Prices 4/11/2022: American Style: A$.7447, kiwi .6845, C$ .7944, euro 1.0901, sterling, 1.3038, Swiss 1.0706: European Style : rand 14.5930, krone 8.7328, SEK 9.4406, forint 348.44, zloty 4.8571, koruna 22.3904, RUB 81.04, yen 125.50, sing 1.3643, HKD 7.8384, INR 75.72, China 6.3692, peso 20.02, BRL 4.6989, BBDXY 1,206.99, Dollar Index 99.79, Oil $94.86, 10-year 2.75%, Silver $25.21, Platinum $982.00, Palladium $2,441.00, Copper $4.68, and Gold… $1,951.00
That’s it for today… it finally got into the 70’s yesterday… my beloved Cardinals won 2 of 3 played over the weekend…. They looked good at times… And others? Well not so good… Day game today at Busch…. My hinting last week did not get me a ticket to Opening Day…. Good thing too, for it was a very cold day! Well, it’s Holy Week this week with Easter coming next Sunday… I sure hope the weather is warm that day…. I have a busy week, for me, starting Wednesday this week…I’m back on my weight loss regimen hopefully I can lose the weight I gained in Florida, quickly! Van Morrison takes us to the finish line today with his great 70’s song: Brown Eyed Girl… my former colleague and long time friend, Jen, used today that he was singing to her…. I hope you have a Marvelous Monday today, and please remember to Be Good To Yourself…
Chuck Butler