Dollar buying takes control

Good Day... And a Tom Terrific Tuesday to you! Well, it's been 1 week now, being all by myself... Things have worked out just fine for me this past week, I've had a couple of bleeding incidents, but I have bought clotting gauze pads, that seem to do the trick, quickly, I might add... No baseball for me last night, and I guess I'm going to have to get used to that, for the Cardinals will not be in the playoffs this year... UGH! And deservedly so, I might add... I was embarrassed for them with their bonehead plays at times this past year... But now our Blues are getting their collective skates sharpened in exhibition games, and their season will start soon. And I will not forget about my beloved Mizzou Tigers who sit at 4-0 so far this season! 10-CC greets me this morning with their song: Dreadlock Holiday... 

Nothing like some ray-gay to start the day! OK... Well, the dollar buying continued again all day yesterday, with the BBDXY Gaining 3 index points on the day, to end the day at 1.262... The euro has dropped below the 1.06 figure for the first time since March 9th... I would have thought that its days of being that cheap were over, but here we are again... The rest of the currencies got whacked too by the dollar yesterday, and they all look very beaten down, and weary... I told you last week that it was time to batten the hatches, and I meant it... I wasn't fooling around here folks, I wouldn't do that when it comes to money... 

The price of Gold got lowered throughout the day yesterday, and gave up $9.70 to close the day at $1,916.10... Silver gave up 43-cents to end the day at $23.20... Why Gold & Silver are getting beaten down like this is no reason to bail out on them, folks... Buy Gold/ Silver and put it away, and forget you have it... Do not be tempted to sell it unless things come to a head with your finances... Here's how I'm currently thinking about Gold (& Silver), the short paper traders have had their days... But sooner or later, probably sooner, they will grow tired of taking a pound of flesh from Gold and move onto something else, until they need to come back... That's give Gold all the momentum it needs to gather a head of steam and go charging ahead/ upward... 

Same goes for the dollar... eventually, the dollar bugs will grow tired of trading on "Higher longer, mantra", and wasn't something else to goose them and awaken them from their slumber... But unless the FOMC decides to hike rates again this year, that goosing isn't going to come from that... And it's at that point the the long dated longs positions begin to sell, to take profits, and move onto something else... 

That's how I see it happening, folks... Go ahead shoot holes in it, it's ok, because it's just how I see things, it doesn't mean this is what IS GOING TO HAPPEN! But I ask you this... How many times in the past have I said I see things happening, and they eventually happen? I'm not batting 1.000.... here, but I learned something long ago from an older trader that I knew... "it's not about being right... But, all about not be wrong" 

And so wouldn't you prefer that you were prepared for what I might be right about, even if I turn out to be wrong? 

Here's something for you to think about... The U.S. current debt has risen 31X since 1981... But in that same time line tax revenues have only gained 6X... Now you can figure out how we got into this mess of debt, and unfunded liabilities that probably will be equal to $200 Trillion by the time I hang 'em up..

I've got a snippet from Ed Steer this morning for you regarding this egregious short paper trading, you can find Ed at www.edsteergoldsilver.com but for now, here's Ed talking about the short paper traders... "So, are we done to the downside now?

Who knows for sure, but they can't keep this up forever, as there are limits as to how much long and short selling the Managed Money traders will do. After yesterday's shenanigans, 'da boyz' are back to picking up nickels in front of that proverbial steamroller, as I suspect that these Managed Money traders are pretty much done.

But as Ted always points out -- and that's that the commercial traders will keep pounding away until they've bought every long that the non-commercial and small traders wish to sell -- and bought the long side of every short contract that they put on. They'll use every dirty and illegal trick in the book to cover as many of their short positions that they can.

Of course, the regulators are nowhere to be found in all of this, as they are aiding and abetting the big commercial shorts...as are the CME Group -- and there's nothing but crickets from the miners."

Chuck again... I sure hope you are correct Ed... this has been quite ugly... 

The price of Oil fell back below $90 yesterday... it looks like there's been some profit taking on Oil contracts if you ask me, and the commodity is just biding its time before moving onward/ upward... 

I titled yesterday's Pfennig: The Bond Rout Is On... And that rout continued throughout the day yesterday, with the 10-year adding 5 bips to yield 4.55% at the end of the day... It wasn't that long ago that this bond had a yield of .375%, so that means it has lost ton in bond prices, with the yield up more the 40X... This is when you begin to wonder if the Fed Heads will really stick with their "higher, longer mantra", because the cost to finance this debt has gone through the roof... And soon, they wil feel the pain of the refinancing rates being much higher than previous refinancings... OUCH! Now that's going to leave a mark! 

In the overnight markets last night...This is getting out of hand/ control folks... The dollar was bought hand over fist last night, and the BBDXY starts the day today up 3 index points! this is a runaway train, folks, do not attempt to stand in front of it to slow it down! All of the currencies, even the Mexican peso, are feeling the strength of the dollar this morning, and the weaker price of Oil is not helping the Petrol Currencies to fight off the dollar strength. 

The price of Oil remained below $90 overnight and starts today with a $89 handle.  

And in an exercise of believe it or don't, the 10-year's yield dropped overnight to 4.50%... 

Bill Bonner added to the talk about a bond market rout yesterday in his letter when he added: " Bonds topped out with a yield of only .11% on the 2-year Treasury note in July 2020. Now, the rate is nearly 50 times higher. "

Chuck again, yes it's across the board, but the one we need to keep an eye on is the 10-year, because this is the bond that is used to price mortgages... I read on Sunday that there are some mortgages out there with a 8% rate, and if that's a beginning then it won't be too much longer before 8% rates are the norm... Contracts to buy houses are being torn up and thrown on the floor... "Honey, we can't take the kids out to dinner this week, the mortgage is taking up all of my paycheck"... Now that's something that hope no one ever had to hear but it will be heard by many people coming soon to a mortgage near you... 

Moving on... one of the great minds in this country is someone that I've followed for years: Stephanie Pomboy... And yesterday she was on Twitter with this statement: "Stephanie Pomboy: "We Are on the Brink of a 2008-Style Financial Crisis — And I'm Not Trying to Be Hyperbolic" "We've got some major consequences coming at us, and I think it's going to devolve very rapidly because of all the leverage that's been built up here."

Uh-Oh... and you can follow the graphs and stuff that Stephanie puts out all the time at www.macromavens.com   

You know... and you're trying very hard to keep it from coming to mind, but it's there, go ahead and let it go, because holding back all this fear of another 2008 or even worse, is not going to go away... oh I Know, you've forgotten the pain of 2008... Well, for all of you youngsters out there that were in grade school, or high school at the time, it was a time of desperation, so many people out of jobs, so many houses lost, so much destruction of the stock market, and family's nest eggs...  It's been 15 years since then, so I don't blame you if you don't recall what 2008 was like, but if you will take my version, you'll understand... It was ugly... very ugly... And we as a country teetered on the edge of collapse... So, think about that... Oh, Got Gold? 

Ok, I told you late last week that the Russian ruble was the best performing currency of the day and that day it was a bit stronger VS the dollar... But the real gain had come VS the euro... Reuters has something to say about that: "Sept 25 (Reuters) - The ruble firmed against the euro on Monday while trading little changed against the dollar, in a week when companies' need for robles to settle end-of-month tax payments should lend the Russian currency some support.  the ruble was steady against the dollar at 96.24 and had gained 0.6% to trade at 101.98 versus the euro.

On global forex markets, the euro was at its weakest since March 16 against the dollar, reflecting views that the European Central Bank is unlikely to raise rates further, whereas the Federal Reserve set out a hawkish rate outlook last week."

Chuck again... I've said all along that the ruble is an oil play, and I remain steadfast in that belief... The Brazilian real is also an Oil play, so you know what you're looking for when you own those currencies... 

I read last week that Mexico was now the U.S's #1 trading partner... taking over the #1 position from China... Well, with 10,000 of Mexico's citizens coming into the U.S. there wil be continued demand for Mexican goods... I used to look at Europe and say thank goodness that immigration of people by the thousands isn't happening in this country, and now I'm sure someone in Europe is saying the same thing about us! 

But the thing to think about currency wise, is that the peso should be well bid as we go along... 

And late last week we had the Bank of England (BOE) and Swiss National Bank (SNB ) both meet and discuss rates, and both decided to surprise the markets and keep a lid on rates... Stating from the same song sheet that they needed to see what their previous rate hikes had wrought, and that they saw inflation weakening... So, both of these Central Banks are falling for the same ruse that the Fed Heads have fallen for, and that is that inflation shows some weakening and just when you think it's ok to not hike rates, it comes back with a vengeance... These two Central Banks ECB & SNB, will rue the day they decided to pause... I'm just saying... 

In today's U.S. Data Cupboard, we'll see the Case/ Shiller Home Price Index (HPI) for July... This data set has been showing price drops in housing for many months now, but I do believe that in July, we saw the first pause of the FOMC And that may have tricked a few more people into buying homes, so that the price index doesn't show a negative number once again... We'll also see the STUPID Consumer Confidence... for last moth... 

To recap... The dollar continued to get bought all day on Monday, and took no prisoners, with the Big Dog euro dropping to a 6-month low, and the BBDXY gaining 3 index points. Gold got sold, Silver got sold, Oil got sold, and bonds got sold, with only the dollar gaining on the day... Chuck mentioned the Bond Rout yesterday, and follows up on that thought this morning... And update on the ruble and yen, and a warning from Stephanie Pomboy... 

For What It's Worth... ok, this is a little strange... Remember when the FBI raided the private safety boxes of customers at U.S. Private Vaults in California... Well, there's some missing property and no one knows where it is? 

Here's your snippet: "Two Americans are alleging the FBI lost or stole their property after seizing it through a "shady" process.

"All we know is that their property was in a box and safe before the FBI broke into the box," Joe Gay, an attorney with the nonprofit law firm Institute for Justice, told Fox News. "Once the FBI broke into the box, we honestly don't know exactly what happened."

"We don't know if they lost it. We don't know if somebody pocketed it and walked away," he continued. "We have no way to know."

The Institute for Justice filed two lawsuits Friday on behalf of clients who had property seized from their safety deposit boxes in a March 2021 FBI raid on U.S. Private Vaults, a Beverly Hills–based company. After prevailing in court, and the FBI agreeing to return their property, both Don Mellein and Jeni Pearsons discovered some of their property was missing and suspect the FBI's haphazard raid or sticky fingers are to blame.

"There’s literally been no explanation," Pearsons said. "I think you have to assume that it's the simplest explanation, and I think, unfortunately, the simplest explanation is they took it or lost it."

Chuck again... This is not good folks... think of what you would do if your Gold coins were in the safe deposit box at your bank, and it was raided by the FBI... And after the courts tell the FBI to give the property back, they say they don't know where it is... What would you do? 

Market Prices 9/26/2023: American Style A$ 6407, kiwi .5960, C$ .7411, euro 1.0597, sterling 1.2189, Swiss $1.0958, European Style: rand 18.9779, krone 10.7975, SEK 11.0071, forint 366.70, zloty 4.3513, koruna 23.0449, RUB 96.27, yen 148.95, sing 1.3681, HKD 7.8199, INR 83.23, China 7.3095, peso 17.48, BRL 4.9636, BBDXY 1,265.15, Dollar Index 106.00, Oil $89.07, 10-year 4.50%, Silver $22.97, Platinum $905.00, Palladium $1,223.00, Copper $3.67, and Gold... $1,910.81.

That's it for today... No doctor appts this week, Yahoo!  I'm here all week try the veal... and don't forget to tip the wait staff! So, are you all-in on the Taylor Swift/ Travis Kelce romance? I say, so what? It's not like this is the first-time famous people got together! And I promise not to mention it again! Just 6 games left in the regular season for my beloved Cardinals... It will be a long 5 months before I see them play again, hopeful with a new stable full of thoroughbred pitchers! This weekend the team will honor Adam Wainwright as he hangs 'em up... He was a very good pitcher for us through the years. He started out at the closer in 2006! He homered on the very first pitch he ever saw while batting, and was money in the playoffs through the years! We will miss you Adam! Grover Washington Jr & Bill Withers take us to the finish line today with their song: Just The Two Of Us...  I hope you have a Tom Terrific Tuesday today. and please Be Good To Yourself!