May 8, 2023
* currencies & metals get whacked on Friday…
* ECB and RBA both hike rates…
Good Day… And a Marvelous Monday to you! We’ll, after losing the first two games of their weekend series Vs Tigers, my beloved Cardinals woke up, and started to hit the ball all around the yard! So the team salvaged one game in their 6- game home stand… it finally warmed up here in my little river town… Yahoo! The original Santana band greets me this morning with their song: Of A Lifetime… Don’t know that one? YOUTUBE it… I think you’ll like it!
Well, everyone got a big jolt on Friday, when the BLS reported that 253,000 jobs were created in April… That was way more than the so-called experts had forecast (180,000), and it brought about all kinds of conjecture about how this strong jobs report will most likely mean the Fed Heads will hike rates again in June… Now, I’m on record as saying that there would be two more rate hikes of 25 Basis Points, but I doubt that this jobs report seals that rate hike up… There will be another Jobs Jamboree before the next FOMC meeting on Flag day.. There is one little caveat I want to mention about this 253,000 jobs created report… The BLS had to add 378,000 jobs to the surveys… So what does that tell you about what the surveys reported? Well, if you did the simple math, you get a gold star for the day, because the number would have been negative!
This new thought by the markets that the FOMC will hike rates again in June, provoked the paper traders to attack Gold & Silver… They can always say that the markets warranted it, since interest rates will be going higher still… But to me, it’s nothing more than an excuse to show up at the COMEX with arms full of short Gold/ Silver trades… I had dear reader ask me once; “what would you do to change the current situation with the price Manipulators”… Ok, this is easy… 1. I would prohibit shorting any metal that you don’t own in your portfolio… You see, a sell order should only represent what you own, and nothing more.. 2. I would send to jail without passing Go, and collecting $200 any bank, broker, etc. that violated that requirement…
But when the Gov’t is behind the curtain pulling the strings on when the short paper traders need to act, there’s not much hope of this every changing… I’ll repeat myself here but, so what? The Gov’t needs to keep a lid on Gold & Silver because it takes away from the glitter of the dollar… They need the dollar to be strong, to prevent importing inflation… And because they all have egos the size of the Hindenberg… I’m just saying…
Oh, and there’s one other thing that needs to be mentioned about the jobs Jamboree print… Remember a month ago, when they said that March payrolls were 236,000, and I said bulderdash? Well, there was a revision to the March payrolls, and they were really just 165,000… See, what happens when the BLS adds jobs out of thin air, and they don’t materialize? The sad part is that the markets rarely pay any attention to the revisions… But what do you think the dollar would have done if last month’s print was just 165,000? But that’s water under the bridge now, move along Chuck, these are not the droids you’re looking for…
So… The dollar didn’t gain or lose any ground on Thursday, but on Friday, even with the thought that the Fed Heads will hike rates again, the dollar lost ground. The BBDXY lost nearly 3 index points, the euro climbed back above 1.10, and the rest of the currencies all took the cue from the euro to rally… Last week, the European Central Bank (ECB) hiked rates 25 Basis Points, and the Resereve Bank of Australia (RBA) also hiked rates 25 Basis points… So, those two respective currencies saw some buying on Friday… But the buying wasn’t the kind of buying that, back in the day of fundamentals ruling, would have taken place… I’m just saying..
Gold lost $32.70 on Friday, as the short paper traders won the day. Gold ended the week at $2,018.60, and Silver lost 34-cents on Friday to close the week at $25.77… The levels these two metals were sitting after the trading day on Thursday were looking like they were ready for blast off… And that must have scared the bejeebers out of the price manipulators, so they showed up the COMEX with arms full of short trades…
The price of Oil rebounded from the selling that occurred earlier in the week, and gained $3 to end the week trading with a $71 handle… Maybe, just maybe, cause you never know, someone read the Pfennig, and they were reminded that the summer driving season is coming… HA! The 10-year saw It’s yield rise to 3.43%… There was just one day last week where the yield on the 10-year dropped like a rock (from 3.50% to 3.36%) And after that was over, the yield began a slow rise upward once again… You don’t think that the Fed Heads were in buying Treasury bonds again do you? Because it had to be a HUGE purchase to move the yield like that… if it wasn’t the Fed Heads, then who?
In The overnight markets last night… the BBDXY lost another 2 index points, and the old Dollar Index is looking like it will fall below 101 this week. The euro is pushing the currency envelope across the desk, while the other currencies are booking their own gains… The Big mover last night was the Russian ruble, with the pound sterling coming in second. Gold is up $6 in the early trading this morning, and Silver is down 16-cents, I can’t make head or tails of that, so I’m going to go with the thought that Silver will turn around that loss to a gain today.
The price of Oil continues to rebound after last week’s drubbing that nearly brought the price of Oil to its knees… Oil has a $73 handle this morning, and the 10-year Treasury, has a 3.46% yield…
Each day the calendar turns over to a new day, means we, as a country, move closer to the day when the “extra funding” for the country runs out… Treasury Sec. Yellen says that June 1 is the day, which means that something will have to be worked out before we head into the Memorial Day Holiday Weekend! You and I know that an 11th hour deal will be made to extend the funding, and then the debt ceiling will be raised for the 79th time.. I’m just saying…
Well.. did you hear that Fed/ Cabal/ Cartel Chairman, Powell, told reporters that his merry men of ruining economies, would be happy to buy the defaulted Treasuries, should the U.S. default next month… Now, just where will he get the money to buy those worthless pieces of … you know what? Well, just like when the banks were in trouble last time, the Fed/ Cabal. Cartel bought all the treasuries that the Primary dealers didn’t want, and trust me on this one, they didn’t want, or couldn’t accept any more Treasuries at that time… And how did they pay for those bonds? They printed new cash… (I know they don’t really print cash any longer, they just hit a button on a computer, and voila, Bank X has money in their account!)
Now doesn’t that make you wanna sit up and holler? Go ahead, yell at the walls, it always seems to help me get through the dolts and the demons that run our country!
The new King of England was coronated on Saturday… Something tells me that the rest of the world couldn’t care less about this coronation… But for the Brits, they had their day of monarchy!
Well, zerohedge.com had this news on Friday, and it wasn’t very good looking forward… Here it is: “The world has a handful of shipping companies, and one of the ones we follow is A.P. Moller-Maersk A/S, which warned of a “radically changed business environment” as profits declined in the first quarter due to slumping transport volumes and sliding freight rates, Financial Times reported.”
So, we have that going for us… NOT!
Well, the banking crisis is still gaining legs… I read this past weekend where $360 Billion of deposits have been withdrawn in the last 3 weeks… Good friend, Dennis Miller of www.milleronthemoney.com asked me on Saturday, that if these withdrawals are just going to another bank, isn’t that just reshuffling the deck?
I responded that, I had read recently that the withdrawals are going in Gold and money markets that pay higher interest rates… Those money market accounts are probably held at brokerage houses… not all of it, but at least the bulk of it…
And it made sense, since Gold was ratcheting higher and higher each day, until the price manipulators threw down the spiked tire deflation strips that the police use… I look at it like this… The population sees what’s going on, and the buying will continue, in my humble country boy opinion…
And one of the things that the population is seeing, is the end of the Empire (the U.S.), and wonder what kind of new world order will take the U.S.’s place… I told you all that I was reading Ray Dalio’s book titled: The Changing World Order… and here’s a snippet from that book: “In other words, there is little doubt in my mind that the existing world order is changing rapidly in challenging ways and that people who are living on the assumption that things will work in the orderly ways that they have gotten used to will be shocked and hurt by these changes to come.” – Ray Dalio
The U.S. Data Cupboard on Friday had the Jobs Jamboree that I spent a good part of the letter today addressing. Friday also had the Annual Hourly Wages, and they increased 4.5%… That’s still below the inflation rate, so there’s no joy in Mudville here… And then to finish off Friday’s data serving, Consumer Credit (read debt) rose from 15 Billion to $26 Billion in March… YIKES! That’s not going to end up in seashells and balloons folks… Tears are more like it…
The Data Cupboard starts this week with a whimper… And doesn’t have anything market moving until Wednesday’s stupid CPI print for April… The dollar is on its own for a couple of days, let’s see where that takes us…
To recap… The trumped up BLS Jobs Report for April came in hot, and above the expectations and that gave the price manipulators the cover they needed to show up at the COMEX with arms full of short trades in Gold & Silver.. Gold lost $32 on the day, and Silver lost 34-cents… The jobs report had 378,000 jobs added out of thin air by the BLS after receiving the surveys.. And March’s 236,000 print was revised downward to 165,000… Chuck says, see what happens when the BLS’s imagined jobs don’t materialize?
For What It’s Worth… Ok, I first saw this in Ed Steer’s Letter that can be found at www.edsteergoldsilver.com , and thought it was FWIW worthy.. It’s about how miners are warning the world that there will be a Copper shortage, and it can be found here: Copper mine flashes warning of ‘huge crisis’ for world supply – MINING.COM
Or, here’s your snippet: “As demand for copper surges, supply is increasingly likely to come from mines like this one on the arid steppe: expensive, technically complex, outside traditional copper jurisdictions and operating under the eye of governments jealously guarding their natural resources.
“There’s a huge crisis,” says Doug Kirwin, one of the earliest geologists to work at the deposit that became Oyu Tolgoi, or Turquoise Hill, named after the area’s rocks, stained by oxidized copper.
“There’s no way we can supply the amount of copper in the next 10 years to drive the energy transition and carbon zero. It’s not going to happen,” adds Kirwin, now an independent consulting geologist. “There’s just not enough copper deposits being found or developed.”
Analysts at Wood Mackenzie estimate a greener world will be short about six million tons of copper by next decade”
Chuck again.. And you want to change our energy grid? Get rid of gasoline powered cars and replace them with electric cars that require tons of copper? Hmmm… how’s that going to work? Does anyone ever think of the consequences of their statements or moves? I’m just asking…
Market Prices 5/8/2023: American Style: A$ .6792, kiwi .6346, C$ .7495, euro 1.1046, sterling 1.1251, Swiss $1.1251, European Style: rand 18.3287, krone 10.4755, SEK 10.1461, forint 337.15, zloty 4.1385,koruna 21.2065, RUB 76.92, yen 135.04, sing 1.3245, HKD 7.847, INR 81.88, China 6.9174, peso 17.77, BRL 4.9514, BBDXY 1,217.22, Dollar Index 101.08, Oil $73.20, 10-year 3.46%, Silver $25.65, Platinum $1,073.00, Palladium $1,522.00, Copper $3.82, and Gold… $2,024,76
That’s it for today… I asked a lot of questions this morning… I know you don’t have the answer to them, no one does at this time! Saturday was Kentucky Derby Day! I attended a Kentucky Derby party in the neighborhood, thanks to Denny and Nancy Franz, for hosting! It was something to take my mind off the bumbling, fumbling Cardinals… I start my new chemo med Tomorrow… Need to stop this growing tumor in its tracks, fast! I used to have to carry tea bags with me everywhere, because I never knew when my jaw would start to bleed… It’s been at least 3 years now since that has happened, and so I hope this new drug does the trick! Jackson Browne takes us to the finish line today with his song: These Days… I hope you have a Marvelous Monday today, and please remember to Be Good To Yourself!
Chuck Butler