December 9, 2021
* Currencies rally on Wednesday, but metals don’t…
* Communists needn’t apply…
Good Day… And a Tub Thumpin’ Thursday to one and all… well, I Have nothing for you this morning regarding St. Louis sports, and I’m sure y’alll will have no problem with that! I made myself dinner last night again, and this time I really outdid myself! Yummy! I used white wine for my pasta sauce, and then drank the rest of the bottle myself! I’m sure Kathy is not happy about the fact that I emptied her bottle of wine in the fridge, but I don’t care, as I was alone by myself, and when I cook, I use everything! I was informed by my darling daughter, Dawn, that I would be reading to her class next week, outside, as the weather is supposed to be nice, and I’m happy as a lark about that! Each year, except last year, I read the T’was the Night Before Christmas to her class, and each year the kids want to know if I’m Santa Claus.. Well, maybe not this year, as I’m down nearly 100 lbs since a year ago! But, kids will be kids, right? And I love their imaginations! Up On A Housetop is the song that greets me this morning by the David Ian Trio…
Well, the dollar was sold on Wednesday… I guess traders finally got tired of waiting for a direction from economic data, to trade the dollar… The BBDXY started the day yesterday at 1,18201, and ended the day at 1,178.96.. The euro rose above the 1.13 handle once again, and all the currency looked perky.. albeit, well below where they were before the dollar went on this recent run higher… Gold and Silver never found a consistent bid yesterday and ended the day basically flat, but down pennies., with Gold down 70-cents to close the day at $1,784.40, and Silver down 8-cents to close the day at $22.52..
The data yesterday was not really to blame for the dollar selling, as we only had the Outstanding Job Openings and Job quits to deal with… So, there was something that pushed currency traders over the edge with regards to the dollar yesterday.. But they did sell dollars ,and that is about time as far as I’m concerned! The U.S. has a record debt that has now reached $29 Trillion, and the U.S. GDP is roughly $23 Trillion… Which means that our debt is greater than our GDP… And our Unfunded Debts are more than $161 Trillion… , and get this.. U.S. Personal Debt is greater than $22 Trillion!!! Who’s going to pay for these debts? Well, if things got really bad, you might get a letter in the mail telling you that your portion of the debt, as a taxpayer is $229,700..
Reuters tells us why the dollar got sold yesterday, “The dollar fell against several of its major counterparts on Wednesday, as easing concerns about the economic hit from the Omicron COVID-19 variant helped support riskier currencies, with the Australian dollar on pace to notch a third straight session of gains.”
In the overnight market last night… When will these two markets get together and sync up their thoughts on the dollar? As I just said, the dollar got sold in the U.S. session yesterday. But, in the overnight session the dollar was bought… C’mon guys, pick a lane! So, overnight the BBDXY has risen to 1,182.49, from yesterday’s close of 1,178.96.. That’s not a tiny move like we’ve seen lately as the dollar drifted.. The euro remains above 1.13, but doesn’t look as strong as it did yesterday…
The Chinese renminbi and Russian ruble take center stage again this morning, as both defy the dollar buying and see buying of their respective currencies. As I said yesterday, China’s current level VS the dollar hasn’t been seen since 2018. A record trade surplus was recently reported in China, and I think traders are of the thought that China will trade surplus their way out of the housing mess they are in…
How can China be printing trade surpluses when there is a distribution chain debacle going on? Well, apparently a lot of China’s exports are in the region, where they don’t have to be put on cargo ships, and sent around the world… I’m just saying…
The price of Oil slipped a bit overnight, and is trading this morning with a $71 handle, albeit a very high 71 handle! And the U.S. Treasury 10-year’s yield has inched higher once more, this morning to a 1.49% figure.. I still contend that by the time I’m sitting in my seat at Roger Dean Stadium this next spring that the 10-year’s yield will be 2%…
And now we’re going to talk about.. debt… I said many years ago, that “debt was slavery”… And now that U.S. consumers are in debt to the tune of $15 Trillion, they have to work to pay that off, and their work becomes associated with paying down their debt.. You know, I do get it, that people have taken on more debt at these uber low interest rates, but it still means they working to pay off the debt.. We, as consumers, are not the Gov’t, and we can’t just print dollars to pay our debts… So think about that for a minute, before you sign up for another loan… There’s going to be no one to bail you out of that debt…
Edward Griffen, author of The Creature from Jekyll Island, that I recommended to readers years ago to read, sent me this note yesterday: “The Fraternal Order of the Police reported that 314 officers have been shot in the US this year, more than any other year, with 58 of them being killed by gunfire, and there is still another month left in the year. Ambush attacks on cops are up 126% since 2020.”
I don’t know about you, but I’m appalled at this information.. You know… when the police decide that the risk is too great, and they go home, who’s going to protect the citizenry?
Ok, getting back to markets… The price of Oil continues to ratchet higher on news that the reserves are being restocked… And that means that the reserves aren’t getting released to sell and lower the price of Oil.. So much for that release that the POTUS made about 10 days ago, eh? I do believe I told you at that time that I didn’t think it would do much to the price of Oil… And look where we are now?
And look at the 10-year Treasury’s yield rising.. .This morning it’s trading with a 1.49% yield, when just last week it was trading with a 1.38% yield… Last week’s drop in yields had me telling you that the there were signs of short coverings going on, but once those cleared we could very well see the yield rise where it should be going… And voila! That’s what we’re seeing once again! I don’t want to get bursitis from slapping myself on the back here, so I’ll just let that ride…
I read an article in our local newspaper yesterday that detailed how stressful the Covid Plandemic has been on the Gen Z’s… (the young folks)… And I though back to my most stressful time as a young adult, the Vietnam War… There was no one out there patting us on the back and telling us that we needed a safe place to express ourselves… We got our draft number in the mail and reported for duty if we were called… I’m not saying that my generation was better than the Gen Z’s, I’m just saying we didn’t have people writing about how it was affecting us… And while I could be way off base here, I would think that being sent off to war, was more stressful than a plandemic…
The U.S. Data Cupboard yesterday show that there are 11 Million job openings up from 10.6 Million in Sept, and that the job quits were 4.2 Million in Rocktober… how can an economy grow when you have so many job openings that people refuse to fill, and that you have so many people quitting their jobs each month?
Today’s Data Cupboard has the usual Tub Thumpin’ Thursday fare of Weekly Initial Jobless Claims, and some new data prints… Real Household Debt, and Real domestic nonfinancial debt… While those won’t move the market because they have nothing to compare them with, they do set the base for future prints…
And in Japan, this is important because as I’ve been saying for over a decade now, “We’re turning Japanese, yes, I really think so”… Japan’s economy shrank 3.6% in the third quarter, worse than the initial estimate of a 3.0% contraction, revised government data showed on Wednesday, posting a decline as private spending took a hit from a resurgence in Covid-19. So, we have that to look forward to folks…
To recap.. The currencies found some room to rally VS the dollar yesterday, and it wasn’t just the Petrol Currencies rallying this time. Gold & Silver drifted lower on the day, but by pennies not by large chunks… The dollar got sold because the fears of the Omicron variant abated… Hmmm… The data yesterday showed that there where more job openings and more jobs quits in Rockober, and the great resignation continues… And then Chuck stops back on to his soapbox…
Before we head to the Big Finish today, you may recall me telling you about the nut that POYUS had nominated to be the Comptroller of the Currency, right? Well here was the news yesterday: Yesterday, Cornell Law Professor, Saule Omarova, withdrew from her nomination to become the head of the Office of the Comptroller of the Currency (OCC), the regulator of national banks. Emily Flitter, reporting for The New York Times, said it was because Omarova had been “painted as a communist.” In terms of the full story on why Omarova had to withdraw, that is like pointing to a single droplet of rain as the cause of a hurricane.
For What It’s Worth…. Well, this article comes to us from Ed Steer’s letter this morning, and it’s about the stupid, circus show that the debt ceiling talks are… And it can be found here: Debt ceiling: House takes step toward preventing U.S. default (cnbc.com)
Or, here’s your snippet: “The House took a first step Tuesday toward preventing a possible default on U.S. debt.
The chamber passed a bill that would allow the Senate to raise the country’s borrowing limit with a simple majority vote. Lawmakers attached the provision to legislation that would prevent automatic Medicare cuts set to take place at the end of the year.
The measure will head to the Senate. It will need 10 Republican votes to pass and go to President Joe Biden’s desk.
Once the president signs the bill, the House and Senate can hold separate votes to raise the debt ceiling with a simple majority — or without Republican support. GOP leaders have said the party will not join Democrats in hiking the borrowing limit, but as part of a new strategy, Republicans also are not expected to block their counterparts from preventing a default.
Chuck again.. It’s all a dog and pony, circus show folks… The debt ceiling is not really a ceiling, it’s just a suggestion for lawmakers to make a big deal out of so their voters think they are really working on something! What a bunch of bunk!
Market prices 12/9/ 2021: American Style: A$ .7140, kiwi .6790, C$ .7881, euro 1.1313, sterling 1.3133, Swiss $1.0841, European Style: rand 15.9104, krone 8.9704, SEK 9.0551, forint 323, 25, zloty 4.0734, koruna 22.4780, RUB 73.71, yen 113.54, sing 1.3659, HKD 7.7964, INR 75.55, China 6.3488, peso 21.04, BRL 5.5822, BBDXY 1,182.49, Dollar Index 96.14, Oil $71.94, 10-year 1.49%, Silver $22.30, Platinum $948.00, Palladium $1,916.00, Copper $4.33, and Gold… $1,778.50
That’s it for today.. A very slow newsday yesterday, had me scrambling looking for stuff to talk about.. There was one article yesterday that was interesting.. it was the end of Angela Merkel’s end as Chancellor of Germany, ending her 16 year reign as Chancellor, in which she presided over the meltdown of the European Union, when the debts of Greece and others were uncovered… I believe she did a good job throughout all of that, in her effort to save the European Union.. It will be interesting to see if the new Chancellor of Germany has the same thoughts about preserving the European Union, over the soveign duties of the country of Germany… OK… I’m off the rest of this week, and will enjoy my sleep later time tomorrow… And I hope my friends are back in town to meet up at our local drinking hole for Friday afternoon! I’m listening to my Christmas in the City CD by the Stephen Kummer trio this morning, and they are playing the song: When My Heart Finds Christmas to take us to the finish line today… I hope you have a Tub Thumpin’ Thursday today, and please Be Good To Yourself!
Chuck Butler