Chuck does a what if?

Good Day... And a Tub Thumpin' Thursday to one and all... I had said too much in yesterday's Pfennig to mention that our Blues two-game winning streak came to a halt Tuesday night with a 5-2 loss to the Bruins... UGH! I hadn't slept too well Tuesday night, having awakened at 1 am and not being able to fall back asleep... It was not fun... So, I tried like the dickens to keep awake yesterday during the day and not take a siesta... It seemed to have worked, as I received a very restful night of sleep last night... Tom Braxton greets me this morning with his version of the song: Let It Snow.

Well, the FOMC did indeed cut their Fed Funds rate 25 Basis Points (1/4%) to an overnight rate of 3.5%... The FOMC did tell the markets that they were only planning on one more rate cut for 2026... They have 8 meeting in 2026, so pick one and be done... The dollar got sold on the news, and the BBDXY lost 5 index points and closed the day at 1,209... Gold, which had spent the early morning gaining ground, but then saw the SPTs come in and wipe out the gain, only to see Gold rally again and end the day up $19 at $4,228.

Silver outperformed Gold once again and didn't mess with any of the foolishness from the SPTs and gained $1.06 to end the day at $61.78... I'm surprised that Gold & Silver rallied as strongly as they did after the rate cut announcement and their words about 2026... To me, the FOMC didn't really give us any real guidance, nor did they say that they were data dependent, so in essence, they will willy nilly cut rates when they feel like it... That's how I feel they left the markets yesterday, and that's the real reason for the selling of the dollar... An Unknown.

The price of Oil bumped higher to a $ 59 handle, and the 10-year got bought for the first time in a week, as the yield dropped to 4.15%... There was an article about how our friends (NOT!) at OPEC and Russia are cutting production and alleviating the glut of supply that currently exists in Oil... And the Oil futures are responding accordingly, which means the price of Oil should be going higher soon.

Silver's first foray above $60 has brought with it new onlookers, and that brings out the pundits to tell why they think Silver is going so strong right now... One of those that had never even given Silver a thought before, The Washington Post, said, "A mix of forces are boosting silver, including the weakened dollar, tariff politics and supply shortages." I find it to be funny, not funny ha-ha, but funny. That these folks that never had even heard of the Silver Shortage, but now seem to be authority on it, and come out of the woodwork, like cockroaches! 

I've been telling you about the shortage in physical Silver for some time now, and it has played along with the rise in Silver... Supply and Demand... For once, fundamentals come into play.

Not that STUPID Sentiment that rules the other asset classes... Oh well, I guess we'll have to put up with the Johnny-come-latelys as we go along here... I have a technical guru that we used to write for the Soveign Society and get together whenever possible... And I wonder if he thinks that Silver's next stop is $71, I've mentioned Sean Hyman in past Pfennigs... If the charts interest you, you should check out Sean's work, he a master! I sent him a note, and awaiting the response.

In the overnight markets last night... The dollar didn't move off the 1,209 figure in the BBDXY, but the euro rose above the 1.17 handle, so the currencies are perking up again as the dollar continues to get debased... Gold and Silver, after reaching another new high yesterday, have seen some profit taking from the short timers this morning. Gold is down $17, and Silver is up 30-cents... The moves yesterday after the rate announcement were good enough for the week, as far as I am concerned. 

Copper saw no SPTs yesterday, and therefore it rose in price to $5.42... Leave it to its own devices and it rises... Interfere with it and who know what you get... I'm just saying.

I guess all that talk in Oil was thrown to the wayside, and the price of Oil dropped to a $57 handle overnight... And the 10-year Treasury saw its yield drop to 4.12%... Which makes sense given the debasement of the dollar yesterday. 

And the froth that was on the Petrol Currencies on Monday, has disappeared and they are back to trying to eke out a gain VS the dollar. 

The Chinese renminbi was allowed to gain VS the dollar overnight and starts our day trading with a 7.05 handle.

Here's Zerohedge.com's take on the FOMC yesterday: "Consensus was expecting a hawkish rate cut, and while it got the cut, the hawkish elements - more dissenters, higher dots, a push-back by Powell during the presser - did not materialize, and instead we have a low-grade revolt by the non-voters at the Fed (6 dots for unchanged today, only 2 dissents, more 3 dots expecting a rate hike in 2026), yet that will be promptly snuffed by whoever Trump picks to replace Powell next May.

In fact, one can say that today's meeting was much more dovish than expected when accounting for the $40BN in T-Bill purchases coming in two days (just as we said would happen) which was a very contrarian call. And not only was this announced by a New York Fed implementation, but Powell decided to put that right in the statement, something that has not happened since the liquidity crunch after covid in early 2020."

Chuck again... so, they think that the FOMC was "dovish", and so much for the thought that the FOMC would be "hawkish"... I truly believe the FOMC and Jerome Powell was "meh"... But he was good for Gold & Silver, so he gets credit for that!

You know what I've been thinking about with this shortage in physical Silver and the strong demand? Bank of America (BOA) they are short about 1 Billion ounces of Silver... What would happen if they got hung out to dry? It would be a Bear Stearns situation all over again, but this time there would be no one to rescue them, like JPMorgan did for Bear Stearns... This would be the biggest blow up of a Casino Bank that's considered Too Big To Fail.... I'm really concerned that this could go down that road the way Silver is getting bought by the boat loads these days... 

You could wake up one morning and call your metals dealer and say, "I want to buy some Silver... .and he responds, "Sorry, there's no bid for Silver right now, unless you want to pay hundreds of dollars for an ounce"... You fall out bed, and begin scratching your head, and remember that Chuck Butler once gave you a scenario where this happened... "how'd he know?".

The U.S. Data Cupboard is beginning to get back on board the economic calendar train, today we'll see the Trade Deficit for Sept (Still stale though) and the usual Thursday fare of the Weekly Initial Jobless Claims.

I did find some labor data on Reuters.com: "The U.S. economy added the fewest jobs in 2-1/2 years in June, but persistently strong wage growth pointed to still-tight labor market conditions that most certainly ensure the Federal Reserve will resume raising interest rates later this month.

The Labor Department's closely watched employment report on Friday also showed 110,000 fewer jobs were created in April and May, indicating that higher borrowing costs were starting to dampen businesses' appetite to continue boosting headcount. There was also a jump in the number of people working part-time for economic reasons last month, in part because their hours had been reduced due to slack work or business conditions."

Next week we'll see the Jobs Jambore on Tuesday! This will be for November, so at least it will be somewhat newer than that data they keep giving us from September. Tuesday will be a BIG DAY For Data next week, so we'll have to strap on our boots!

Here's your snippet: "JP Morgan is going long on silver and making history. The bank now holds over 750 million ounces of physical silver, the largest stockpile in the world. In just six weeks, it added 21 million ounces. That’s a staggering move in a market already under pressure.

Between June and October, JP Morgan reportedly sold off its entire 200-million-ounce paper short position. This freed cash to acquire physical silver, leaving the bank long in both physical and paper silver for the first time ever. Experts say this is a rare and powerful market position.

The move coincided with the U.S. Mint announcing a shortage of silver coins. Physical supply is tightening while demand ..

If history is any guide, silver could move sharply upward.

Adjusted for inflation, silver’s 1980 peak would be over $600 per ounce today. Nobody can predict exact prices, but the structural setup favors a major squeeze. Industrial demand is rising, mine supply is falling, and institutional accumulation is accelerating.

The paper silver market is massive, estimated at 50 times the size of physical supply. COMEX open interest is about 244% of registered silver. Lease rates have climbed to nearly 30%, which is a sign that physical Silver is in high demand"

Chuck again... This is HUGE folks! It was one thing when JPM came out and told their clients to diversify 20% to Gold & Silver... And now they have gotten rid of their short positions, and gone long!  There's still the large short position at BOA but ... the short positioners are falling by the roadside... I'm just saying.

Market Prices 12/11/2025: American Style: A$.6661, kiwi .5820, C$ .7250, euro 1.1721, sterling 1.3394, Swiss $1.2556, European Style: rand 16.9320, krone 10.0880, SEK 9.2595, forint 327.34, zloty 3.6059, koruna 20.7034, RUB 79.34, yen 155.52, sing 1.2929, HKD 7.7816, INR 90.36, China 7.0581, peso 18.16, BRL 5.4337, BBDXY 1,209, Dollar Index 99.14, Oil $57.80, 10-year 4.12%, Silver $62.18, Platinum $1,673.00, Palladium $1,488.00, Copper $5.42, and Gold... $4,211.

That's it for today and this week... Next week is a busy week for yours truly... culminating on Thursday with my monthly infusion... Last month, I had a tough row to hoe with the infusion, so fingers crossed that I tolerate it better this month! The College Football Playoffs begin tomorrow night, with one game, and then 3 on Saturday... I hope it does snow this weekend, because I'll be glued to the TV watching Playoff Football! We are supposed to see temps plunge again so there's that... I switched back to my iPod this morning, and Stories take us to the finish line today with their song: Brother Louie... I hope you have a Tub Thumpin' Thursday today and Please Be Good To Yourself, and your neighbor!