January 20, 2022
* The dollar remained steady on Wednesday…
* Bonds are off to their worst start in 22 years!
Good Day… And a Tub Thumpin’ Thursday to one and all! Another Chamber of Commerce day here in S. Florida yesterday, but at sometime during the afternoon, I think my nightly chemo caught up with me, because I began to feel like death warmed over… After a quick nap, I felt better, and then went out to eat at a local restaurant, with friends, and had a marvelous time, thus forgetting that I didn’t feel right when I left… Wine Wednesdays is what the restaurant is known for, and we all took part in the promotion! Maybe that’s why I forgot about feeling not right? HA! Our Blues won their game two nights ago VS Nashville, coming from behind once again to win the game… Now they have to travel to Seattle (long trip) to play Friday night, very late for me! Do the baseball players union and owners know that everyone’s travel plans are up in the air, right now, because they don’t know if spring training is going to start on time, or be delayed… The union and owners are no different than everyone else here… It’s all about me! Supertramp greets me this morning with their song: Even In The Quietest Moments… A good song so early in the morning, eh?
Well, did you see what Gold did yesterday? WOW! Up $26.70 on the day! This came out of nowhere, folks, as I whined yesterday about how Gold had lost ground, while Silver gained it the day before… Ok, so now, when do the price manipulators show up with their arms full of short Gold paper trades at the COMEX? Wouldn’t it just be wonderful to no end, if the price manipulators threw in the towel and announced that they were doing so? I know, I know, I’m having a dream there, but it never hurts to dream! Silver also gained on the day adding 68-cents to its value…
The thing I want to point out here is that the move in Gold (& Silver for that matter) was all about buying the shining metal and very little to do with a weakening of the dollar, as the BBDXY started the day at 1,170 and ended the day at 1,170… I was as excited as a school girl yesterday when I checked the Gold screen as saw its intra-day gain…
So, like I just said, the dollar saw little to no movement yesterday, But I do want to point out that while the BBDXY remained at 1,170 for the day, the dollar did lost ground, to Gold… The price of Oil remained high, with just a little slippage, and bonds rallied… Wait, What? Bond rallied? Yes… strange as it may sound, there were buyers of bonds yesterday, even with the deep negative rate when inflation is factored in…
Speaking of bonds… Treasuries aren’t the only bonds in town, and the Corporate world uses bonds to finance their personal bonuses… Well, maybe not, but it sounded good… And why wouldn’t they issue as many low yielding bonds as they could? The problem for the owners of these bonds is that as rates rise, they hold losses, unless they are going to hold the bond to maturity, and who among us can afford to hold a loss for however many years, in most cases 5-10 years?
And this morning there was an article on Bloomberg.com discussing the losses Corporate bonds are taking in right now to start the year, so let’s see what Bloomberg.com has to say about this: “The safest corporate bonds in the world are having their worst start to the year in just over two decades as investors brace for tighter monetary policies.
A global index of investment-grade company debt has posted total return losses of 2.2% since the start of the year, the most since data going back to 2000. The gauge is faring worse than all others in the category of credit securities outside of emerging markets.”
So, think about that for minute… if Corporate bonds are experiencing the worst start to a year since 2000, then Treasuries are too…
All over Bloomberg.com there are articles about why Gold soared yesterday… Some pointed to the POTUS and his speech which talked about how he thought Russia would move on Ukraine soon, and of course Gold being a safe haven when Geo-political problems arise, would have been the beneficiary of that statement… Another article talked about how traders are looking to hedge their portfolios with an inflation hedge (Gold)… And still another was about how Gold had finally stepped up to the plate to fight inflation… Here’s a quick snippet from Bloomberg.com:
“Gold is finally responding to high levels of inflation around the world,” said Fawad. “It remains to be seen whether the latest breakout attempt by gold can be held, but now there are more compelling reasons why the bulls might hold their ground.”
Well, that’s what remains to be seen, right? If Gold can add to yesterday’s gains with more positive days… That’s the $64 question!
In the overnight markets… There was a little dollar buying, not much, but a little, and the BBDXY starts today at 1,171.02… So, like I just said not much buying… Gold starts the day down a buck, and Silver starts the day up 6-cents… No biggies either way there, I do want to see Gold follow that big move yesterday, with a positive day today…
I’m very concerned about the Russian ruble folks… After getting accused of everything including the kitchen sink drip, and after dealing with economic sanctions out the wazoo, now they have to deal with ill-effects of a military buildup near the border with Ukraine… And if, as the POTUS said yesterday that he believed Russia would move on Ukraine, will the U.S. get involved?
The thing that really scares the bejeebers out of me, is the idea that China has been waiting for Russia to move on Ukraine, before they move on Taiwan… Now, that would be a real problem for the U.S. folks, for who do we keep our promises to protect? Uh-Oh…
Sorry about that, I know that these things don’t play in the currencies, but they will play into Gold BIG TIME should they occur, which I’m wishin’ and hopin’ and prayin’ that they don’t!
The U.S. Data Cupboard today has the usual Tub Thumpin’ Thursday fare: The Weekly Initial Jobless Claims for last week, which should remain well above 200,000, and another of those regional manufacturing indexes, this time the Philly Index, of which means nothing as an indicator of the national index will show, but with the Empire’s negative print the day before, this one becomes more interesting… Tomorrow we’ll see the latest leading Indicators, and I’ll tell you on Monday what that had for us.
To recap… Gold took for for higher ground on Wednesday, adding more than $26 to its price, and Silver gained 68-cents to push it over the $24 handle once again… Lt’s of reasons why Gold took off yesterday and none of them will exist if the price manipulators come back to push Gold’s price down again… The dollar really didn’t move one way or the other yesterday, do the Gold price rise was all about buyers pushing the price higher and not dollar weakness… In the overnight markets last night….
Before we head to the Big Finish today, I have something I need to get off my chest… It came to my attention yesterday that Sen. Dick Durbin of Ill. Recently told reporters that “senior citizens are the Greediest Generation as he compared “Social Security ” to a Milk Cow with 310 million teats.”
Now doesn’t that just tick you off to no end? It does to me, for sure… Because what in the hell is he talking about? I’ve been contributing to Social Security since I was in the 7th grade… And that money that comes to me each month now, is MY MONEY! It is NOT AN ENTITLEMENT! Greediest Generation my petunias! 40 years he’s been in the Senate, and I’m sure he has a nice chunk of change in his offshore bank account, along with a golden parachute of a health program and retirement! Talk about Greedy! Oh, I’m so ticked off by this, that I’m going to stop now, before I say something that has the men in dark suits and sunglasses showing up at my door!
For What It’s Worth… Well, believe it don’t, but there aren’t many worthy FWIW articles out there this morning… But there was one that barely qualifies for a worthy FWIW article, because it’s about the stuff I was just taking about above regarding Russia and Ukraine, but in case that’s your bag baby, then you can find the article here: US senators promise solidarity and weapons for Ukraine in warning to Putin (yahoo.com)
Or, here’s your snippet: “A bipartisan group of United States senators promised solidarity and weapons on a visit to Kyiv on Monday while warning Russian President Vladimir Putin against launching a new military offensive against Ukraine.
Kyiv and its Western allies have sounded the alarm after Russia massed tens of thousands of troops near Ukraine’s borders and pressed the United States for security guarantees, including a block on Ukraine joining the NATO alliance.
Russia denies planning a new military offensive.
The United States has been Ukraine’s most powerful backer in its standoff with Moscow after Russia’s annexation of Crimea in 2014 and the outbreak of the war in eastern Ukraine.
“I think Vladimir Putin has made the biggest mistake of his career in underestimating how courageously the people of Ukraine will fight him if he invades,” Senator Richard Blumenthal told reporters.
“And we will impose crippling economic sanctions, but more important we will give the people of Ukraine the arms, lethal arms they need to defend their lives and livelihoods,” he said after the delegation met President Volodymyr Zelenskiy. “
Chuck Again…. well, I’ve said enough about this stuff this morning, so I won’t go on here, other than to say, my mom, gee I miss her, used to say to be careful of whom you got in bed with…
Market Prices 1/20/2022: American Style: A$ .7240, kiwi .6775, C$ .8004, euro 1.1338, sterling 1.3600, Swiss $1.0925, European Style: rand 15.1810, krone 8.7847, SEK 9.1320, forint 314.44, zloty 3.9854, koruna 21.3907, RUB 76.52, yen 114.27, sing 1.3462, HKD 7.7855, INR 74.36, China 6.3450, peso 20.46, BRL 5.5183, BBDXY 1,171.02, Dollar Index 95.59, Oil $86.67, 10-year 1.83%, Silver $24.28, Platinum $1,057.00, Palladium $2,142.00, Copper $4.48, and Gold… $1,840.10
That’s it for today and of course this week… 16 became 8 and after this weekend 8 will becomce 4, in the NFL playoffs… Go Chiefs, Go Packers! A great meal last night… You know, when I’m down here for the winter, I always try to eat some kind of fish when we go out for dinner, because I can’t get good fresh, fish back home… And last night’s fish was sole picatta… Yummy! Another beautiful day here is on the docket before rain moves in tomorrow. The moon was shining on the ocean again last night, simply beautiful, in my mind… See? It’s the simple things that make my days/ nights! I announced to our friends last night that I’ve made tentative plans to travel to Ireland in June, and stay at The Butler House! This is a trip I’ve been wanting to make for years, and now if Covid can subside for the summer, We will travel to Ireland… I’ll let you know as time goes on if I’m actually going to get to go! Poco takes us to the finish line today with their song: Good Feeling To Know… I’m a HUGE fan of Poco’s music… I hope you have a Tub Thumpin’ Thursday today, and a Fantastico Friday tomorrow… Please Be Good To Yourself, and don’t forget to Be Positive, Test negative!
Chuck Butler