Have The World’s Investors Gone Stark Raving Mad?

September 8, 2021

* An ugly day on Tuesday, as the price manipulators were out… 

* 10.1 Million job openings, and 8.4 Million unemployed… where’s the problem? 

Good Day… And a Wonder Dog Wednesday to you! I don’t know where to begin to describe my hatred for price manipulators today… So, I’ll try to talk about something else for now… You know me, right? I truly believe in each person having the right to decide what goes in their bodies… Did you know that the ACLU (American Civil Liberties Union) the folks that fight for our civil liberties, have decided to stop fighting for our civil liberties, and fight for vaccine mandates? They, the ACLU doesn’t see any civil liberties problems with their stance on vaccines…  Now, that’s gotta make you wonder, what in tarnation is going on in this country? Foghat greets me this morning with their song: Fool For The City…

Well… sad to have to say this, but it was “one of those days” for the currencies and metals…  OK, I’m going to say something here that I have no proof of. I’ve just put two and two together, which in my book still equals 4, and the woke people can call me a white supremist because of that, I don’t care. It’s what I was taught… I’ve put together my thoughts on price manipulation through the years and used the WikiLeaks cables that go back to the 70’s regarding the U.S. Gov’t’s needing to diss Gold to protect the dollar.  I feel that the U.S. Gov’t basically is behind all price manipulation… They don’t do the dirty deed themselves, but they give the wink and nod to the Casino Banks to do the dirty work, and in return the Gov’t won’t prosecute them for price manipulation…

So prove me wrong on that scenario…

OK, so the dollar was bought by the bushel full yesterday… The BBDXY which began the day at 1,143.47, closed the day at 1,145.45…  The euro fell like a rock thrown from a cliff… And Gold? Well the price manipulators weren’t happy until they took nearly $29 from Gold’s price, and 39-cents from Silver’s price… It was a very ugly day for non-dollar investors… And then the ugly day turned even uglier when my beloved Cardinals lost again to the Dodgers… OK, back to the markets…

I have nothing more to add to what I’ve already said about price manipulation, which was so evident in yesterday’s trading that a blind man would be able to point it out… But… the silver lining here is that for investors wanting to buy Gold, they have an excellent buying opportunity after the price manipulators did their dirty deed yesterday… Dirty deeds, done dirt cheap! (AC/DC)

In the overnight markets last night… After all the dollar buying yesterday, the overnight markets, of which had started the dollar buying the night before, were plum tuckered out, but the dollar continued to move higher throughout the night. The BBDXY is 1,146 this morning, up from the close yesterday.  Believe or don’t, but Gold is up $5.60 and back to $1,800 in the early trading today, while Silver has gained 7-cents. Gold’s rise in the early trading has to be people taking advantage of the cheaper price, like I talked about above… 

All of the gains that the currencies put on their values last Friday have now been wiped out, with the only currencies holding to their gains being the Chinese renminbi and the Sing dollar… Of course I’ve explained the relationship of these two many times in the past so I won’t get into that again. Wait, What? You want me to explain it again? Really? Haven’t I bored you with that explanation many times before? OK, OK, here it is… 

The Sing dollar has had a history of staying in line with the Chinese renminbi, because they are in competition for exports, and Singapore can’t have the renminbi getting strong or weak without them following suit…  Now… aren’t you glad you pleaded with me to go here? 

OK… well I went out on a limb… I don’t have to find limbs that are so big any more… But I digress… I went out on a limb with a couple thoughts this morning…  Oh, believe me when I say that , I have more of these kinds of thoughts than you can shake a stick at… Most of them are reserved for the Butler Patio…

Speaking of the Butler Patio… we had it resurfaced this past spring, and it looks marvelous once again, so you can come barefoot or wear sandals, or flip flops, or sneakers, whatever footwear you choose, just make sure you bring a notepad, and a pen or pencil, because you’re not going to want to forget anything I talk about…

Silly stuff, I know, but you have to have some levity along with the serious stuff, or else I would be called the new “Dr. Gloom & Doom”…   

Well, I talked yesterday about the deficit spending programs that are on the docket waiting to be implemented… And I don’t think I explained what’s going to happen clear enough, so here’s my second try…  Congress is going to do everything under the sun and moon to get these deficit spending programs going by year end…  And, no wait, I’ve got to back up here…  The U.S. finances their deficit spending by selling Treasuries, and for months now, the Fed, I mean Cartel has been the major buyer of these Treasuries that have needed to be sold to finance all our deficit spending… And now, the Cartel tells us that they plan to Taper their Treasury purchases starting by year-end…

Now that’s two forces going against each other, which most times cause a HUGE EXPLOSION… And I don’t think this time will be different, that is, unless The Cartel decides to kick the Taper can down the road…  You see, where I’m going with this? The Cartel wants to taper, but Congress is going to make it so they can’t, and the Cartel’s Balance Sheet will continue to grow larger…  One day, the rest of the world is going to wake up and smell the coffee, folks… And when they do…  the dollar will be like Wiley Coyote, when he runs off a cliff…

So the Cartel will be just like Congress, who keeps kicking the debt can down the road… Credibility? The Cartel will have none left, but that won’t stop them from kicking the Taper can down the road, folks… 

And here’s something that I doubt you’ve heard about… European Junk bonds are now paying negative interest for the first time ever!  Here’s the good folks at GATA explaining what’s going on: “Investors in European junk bonds have begun accepting interest payments that are lower than eurozone inflation levels for the first time ever, in the latest sign that central banks’ crisis-era debt purchases have shifted the balance between risk and reward.

The yield on ICE BofA index of European high-yield bonds was pushed down to 2.34 percent this week, marking the first time buyers of so-called high-yield European currency bonds have accepted payments below consumer price inflation in the eurozone, which hit a decade high of 3 percent in August.”

Chuck again… Well, you what this tells me? That the world’s investors have gone stark raving mad! They call these bonds “Junk bonds” because their issuers aren’t exactly credit worthy, and their interest that they pay should reflect a “risk premium” to the buyers of the junk bonds… But that’s clearly not what we’re seeing here and it just proves to me that investors have gone crazy…

And then there’s this from the Data Cupboard today… 10.1 Million job openings in the U.S. and there are 8.4 Million people unemployed…  But yet only 240,000 jobs were filled last month… If you’ve got about 10 minutes to spare today, there was a good article on the Washington Post site that goes into detail what’s going on here…  you can find it here: Why America has 8.4 million unemployed when there are 10 million job openings – The Washington Post

The Data Cupboard today is basically empty of real economic data…  We will see the Cartel’s Beige Book, which rarely tells us anything… And Consumer Credit (read debt)… And that’s it!

To recap… The price manipulators had a field day yesterday takin down the currencies and metals. It was a very UGLY day for non-dollar investors… Chuck gives us his thoughts on how the price manipulation operates, and then gives us the silver lining for the day… Chuck is also a Big Fan of Civil Liberties… They’ve been taken from us ever since the cowardly attack on us 20 years ago this Saturday… Remember the Patriot Act? I digress here… There’s really no data to look at today, so there could be more dollar buying… Batten down those hatches!

For What It’s Worth….  Longtime readers know that I just don’t think that the Bitcoins of the world are going to be around forever like Gold has… China has already basically outlawed the digital currencies other than their own… Well, this came to me from the good folks at GATA and they took it from the NY Times, which you would have to have a subscription to read… But I have some of it here for you, and it can be found here: Crypto’s Rapid Move Into Banking Elicits Alarm in Washington – The New York Times (nytimes.com)

Or, here’s your snippet: “BlockFi, a fast-growing financial start-up whose headquarters in Jersey City are across the Hudson River from Wall Street, aspires to be the JPMorgan Chase of cryptocurrency.

It offers credit cards, loans, and interest-generating accounts. But rather than dealing primarily in dollars, BlockFi operates in the rapidly expanding world of digital currencies, one of a new generation of institutions effectively creating an alternative banking system on the frontiers of technology.

“We are just at the beginning of this story,” said Flori Marquez, 30, a founder of BlockFi, which was created in 2017 and claims to have more than $10 billion in assets, 850 employees, and more than 450,000 retail clients who can obtain loans in minutes without credit checks.

But to state and federal regulators and some members of Congress, the entry of crypto into banking is cause for alarm. The technology is disrupting the world of financial services so quickly and unpredictably that regulators are far behind, potentially leaving consumers and financial markets vulnerable.

In recent months, top officials from the Federal Reserve and other banking regulators have urgently begun what they are calling a “crypto sprint” to try to catch up with the rapid changes and figure out how to curb the potential dangers from an emerging industry whose short history has been marked as much by high-stakes speculation as by technological advances.”

Chuck again…  Ok, take what you saw happen to the Gold price yesterday, and then add in my explanation as to how that happens, and you’ll come to the same place I am with these digital currencies… The U.S. is going to issue their own digital currency, and I just can’t see them allowing other digital currencies to be in competition with their own digital currency… It just doesn’t make sense to me that the Gov’t would allow competition to their 1. Dollar, and 2. Own digital currency…

Market Prices 9/8/2021: American Style: A$ .7376,  kiwi .7105,  C$ .7896, euro 1.1822, sterling 1.3769, Swiss $1.0855, European Style: rand 14.2880, krone 8.6801, SEK 8.6047,  forint 296.02,  zloty 3.8189,  koruna 21. 4725, RUB 73.16, yen 110.29, sing 1.3450, HKD 7.7763, INR 73.48, China 6.4608, peso 19.91,  BRL 5.1690, BBDXY 1,146.08, Dollar Index 92.65,  Oil $69.32, 10-year 1.34%, Silver $24.47, Platinum $1,010.00, Palladium $2,454.00, Copper $4.19, and Gold… $1,800.80

That’s it for today… Another wordy letter for sure, but I seemed to have a lot to say today, so why save it for tomorrow… Today is all that’s promised to us… I actually got my iPad out last night, and tuned in to the Cubs game with Cincy, as my TV had the Cardinals on… The one time I was actually rooting for the Cubs to beat Cincy, they lost… I must have jinxed them! I sat outside for most of the game last night, and had to grab a hoodie as the temperature cooled to much for my liking… I keep my Cardinals hoodie close at hand because most of the time I need it as I get too cold in the house!  I basically live in the basement where my writing desk is, my large TV, my recliner, and bar are…  And it remains cool in the basement year round… Jack Johnson takes us to the finish line today with his song: Flake  I’m sure some of you are calling me that after my journey out on the limb today… But that’s OK, with me, just keep your opinions of me to yourself! HA!  I hope you have a Wonder Dog Wednesday, and please…. Be Good To Yourself

Chuck Butler