Returning to normalcy

Good Day... And a Tub Thumpin' Thursday to one and all! I have a special treat for your reading pleasure that will take place tomorrow. I will give the final piece of Frank Trotter's article on Currency Diversification in a special Friday Pfennig tomorrow. I didn't want to carry that last piece over the weekend, so we'll end it tomorrow... I can't thank enough for doing this for me and you... He even mentions little old me! Thank you Frank!

No skipping ahead allowed! HA! In observance of the late Great Mogambo Guru... here's snippet from one of his letters: ""Since before the time of the Pharaohs, all nations have contended with the same financial forces in existence today. They had (in one form or another) money, debt, and taxes.

They all had government spending. And every single one of these nations, in all of history, was eventually ruined by its government. Their money was debased to the point of worthlessness by the government spending too much to do too much, and then the country collapsed.

Why should we expect to be any different?"

Chuck again... Richard Daughty ( The Great Mogambo Guru) was a friend of mine and I think about him a lot, still after all these years he's been gone to play his banjo in heaven.

Well, all that to tell you that the dollar lost 3 index Points yesterday after the ADP Employment Reported that only 38,000 jobs were created in August... And then piling on The Fed/Cabal/ Cartel's Beige Book, which give us the pulse of the Fed Regions across the country said the Outlook: The overall economic outlook remained positive, but businesses expressed heightened uncertainty regarding future energy prices, policy shifts, and international conflicts ahead of the upcoming September 15–16 FOMC interest rate meeting".

And Gold/Silver finally saw some daylight yesterday with Gold gaining $63 on the day to close at $4,388 and Silver gained $1.59 to close at $65.45. I was happy to see that the STPs didn't bring the two metals down again yesterday... But the data was so skewed toward a weak dollar that I guess they decided to sit this song out.

They didn't sit out altogether though, Gold/Silver had posted even stronger gains on the day, but the SPTs made sure they stayed within a range, and knocked them down a bit... The SPTs wanted to make certain that all the damage they had done was not wiped out in one day's trading... No, it will take a few days to make up lost ground for Gold/ Silver.

The price of Oil bumped higher to end the day trading with a $91 handle... The POTUS was talking about IRAN yesterday and said that the U.S. had destroyed things... but, in my opinion, they haven't destroyed the power of the minds of the Iranians... So, And the Strait of Hormuz is still zipped up like a winter coat on a sub 0 day and that leads me to believe that the price of Oil is going to eventually revisit $100... UGH!

And the 10-year Treasury saw a bit of buying and the yield dropped to 4.78% yesterday... I guess I should have kept my mouth shut about it asking if it was going to 5%, eh?

But the U.S. Gov't bond rout isn't the only country experiencing a bond rout... I told the other day that Japanese 10-year's yield had risen to 3%, the first time since 1996... This from CNBC.com this morning: "Government bonds sold off globally on Wednesday, extending a rout that has driven borrowing costs to multi-decade highs."

Gold/ Silver continued to see daylight as both have rallied overnight, with Gold up $48 to start the day today, and Silver, up $52-cents... So, our Tub Thumpin' Thursday might just turn out to be a good one for these two.

The price of Oil bumped higher overnight to start this morning with a $91 handle in its price... And the 10-year saw a bit of slippage again last night and starts today with a yield of: 4.77% ... yield control by the Fed/ Cabal/ Cartel must be the culprit here... I still believe that the 5% yield on the 10-year is achievable... the charts even show this to be true, as that's where they are heading, up and up and away (The 5^th Dimension)

Circling the wagons on the bond rout... The yield on German 10-year bunds, the benchmark for the euro area, was 4 basis points higher at 3.378% on Wednesday — its highest level since 2011. Japan’s 10-year yield stood at 3.016%, after crossing 3% for the first time in three decades on Tuesday.

The 10-year Treasury yield touched its highest level since November 2023 at 4.814%, as British 10-year gilts marked a fresh post-2008 high of 5.25%, before both retreated slightly.

Investors have been rattled by the resurgence of inflationary pressures, particularly as a fresh wave of conflict in the Middle East drives oil prices higher. That has added to longstanding concerns about the fiscal positions and high debt loads of major economies from the U.S. to Japan and France."

But John Williams president of the Fed/ Cabal/ Cartel NYC, said "that here in the U.S. that it's not a bond rout; the rise indicates that the economy is strong!" Yes, he actually said that on live TV... So, once again, the ability to keep one's mouth closed comes to us from all angles... 

In the overnight markets last night... the dollar continued to get sold and the BBDXY starts this morning down 3 index points to 1,192... Strong economy? I mean, it only leaves one to imagine where the dollar might have fallen to yesterday if not for the "invisible hand" saving the dollar from falling off the proverbial cliff... The PPT in action folks... right before your eyes and mine one.

There will be no Pfennig next Tuesday 9/8... I'll be meeting with the doctor that will be performing the Mohs surgery on my cancer spot... So, once again a pop-up Dr. Appt comes my way.

And it took about 3 weeks, but the euro finally rose back above 1.16... Let's face it here, the euro as Frank said yesterday isn't anyone's idea of a perfect currency, but it retains its status as the offset currency to the dollar, and with that title comes strength when the dollar gets sold.

The U.S. Data Cupboard today has the Trade Balance for July... And the usual Weekly Initial Jobless Claims to see this morning... Neither one is a major dollar mover most times that is.

To recap... The ADP Employment Report and the Fed's Beige Book split the duties of bringing the dollar down yesterday 3 index points in the BBDXY... Gold / Silver saw daylight yesterday, and that made Chuck happy... But, always keep in mind that the wolf is always at the door, ready to pounce on helpless sheeple... I'm just saying.

We pick his up with his discussion on currencies we as diversifiers would look to own with kiwi... here's Frank.

A word about the Kiwi

New Zealand’s dollar is routinely comingled with the commodity currency bloc, filed alongside the Aussie and the loonie as if the three were interchangeable. The grouping is correct as far as it goes but misleading past that point. The kiwi is genuinely commodity linked: Dairy, meat and horticulture dominate exports, dairy auction prices move the currency, and China’s appetite sets the tone as New Zealand’s largest trading partner. But the kiwi’s commodities are soft, not hard. New Zealand sells protein and produce, not energy and metals, so it participates only partially in the hard-asset cycles that drive the loonie and the Aussie. Add a chronically deficit-prone current account, a small and shallow float, and a central bank with a history of aggressive swings, and the kiwi becomes the most fragile member of the family.

The year 2025 demonstrated the distinction. While the Aussie gained against a falling dollar, the kiwi actually lost ground, sinking a bit as the Reserve Bank of New Zealand slashed its cash rate to 2.25% in response to a shrinking economy, a second-quarter GDP contraction of 0.9% and unemployment at a five-year high. Two commodity currencies, one dollar bear market, opposite outcomes. The lesson is that the commodity label is a necessary screen, not a sufficient one. The fiscal, monetary and external filters still have to be applied, and on those filters New Zealand currently fails where Australia passes.

Gold: The currency without a central bank

No serious discussion of currencies can end with paper. Gold is the one money in the system that no committee can print, and its price is best understood not as a commodity quote but as the inverse of confidence in the entire fiat complex. With that reading, the recent message is unambiguous. Gold surged roughly 65% in 2025, its largest annual gain in over four decades, and by mid-2026 it traded above $4,100 per ounce. Central banks, the same reserve managers that absorbed the 2022 lesson about the political conditionality of dollar assets, bought at elevated rates for a third consecutive year."

Chuck again... tomorrow we'll see the final installment of the article... Can't wait! Well. Actually I can since I've already read the article in its entirety when it was first sent to me.

Currencies 9/3/2026: American Style: A$ .7191, kiwi .5868, C$ .7243, euro 1.1607, sterling 1.3497, Swiss $1.2363, European Style: rand 16.0451, krone 9.3081, SEK 9.4399, forint 316.29, zloty 3.7252, koruna 20.8582, RUB 86.07, yen 156.12, sing 1.2682, HKD 7.8416, INR 94.69, China 6.7204, peso 17.01, BRL 5.0912, BBDXY 1,192, Dollar Index 99.12, Oil $91.61, 10-year 4.77%, Silver $65.97, Platinum $1,771.00, Palladium $1,385.00, Copper $660, and Gold... $4,435.00.

That's it for today... I'm juggling two articles in the air right now, and it's too early in the morning for me to do that! But I think I have sorted it out now... My beloved Cardinals' bats had come alive on Tuesday night, but went back to being absent last night for 5 innings. But they fought back and, in the end, they beat the mighty Dodgers in 10 innings.  Since there's no Salary Cap in Baseball, a team, like the Dodgers, can pay the best players the highest money that's in their coffers... Dire Straits takes us to the finish line today with their great song: Brothers In Arms... I hope you have a Tub Thumpin' Thursday today and Please, oh Please Be Good To Yourself!