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A Pfennig For Your Thoughts

April 17, 2019

* Currencies see some slippage VS dollar…
* Chuck looks at another recession indicator….

Good Day… And a Wonderful Wednesday to you! Here I am… back from the heart doctor, and I’ll share with you a few thoughts I have for today… Nothing big like a regular letter, just a few thoughts, and a recap… No FWIW, just keeping the juices flowing… I’m greeted as I begin to write today by Paul McCartney and Wings and their song: Band On The Run…

OK… One of the things I want to talk about today is this thought I’ve had for some time now that we are heading for a recession, not that in normal times that would be that big of a deal, but in today’s world, it could be the snowflake that causes the avalanche, if you will… A couple of weeks ago, I told you that the U.S. Treasury yield curve had inverted, and that historically when this happens it’s an indicator that a recession is on the way… But yesterday, I received an email from the St. Louis Fed Research team, and in it they looked for other indicators of a recession…

One such indicator was Manufacturing employment… In the past when Manufacturing employment begins to drop steadily, it’s a very good recession indicator… So, then I went to my research and found that Manufacturing jobs dropped by 6,000 in March… No biggie, but the start of something Big? I guess we’ll have to wait-n-see, eh?

The U.S. Data Cupboard yesterday had another brick for our wall… Industrial Production for March, was negative -0.1%, and Capacity Utilization fell from the previous month. I was hemming and hawing about being negative here, but then I saw one of my fave economists, David Rosenberg, tweet something, and thought he would do it far better than I… So, here’s econoguy David Rosenberg from his Twitter feed: “The three-month trend in production of consumer durable goods has collapsed to a -15% annual rate – this takes out 2016 and takes us back to the late stages of the 2008-09 recession. Shhh! Don’t tell the stock market that the recession may have already started!”

You know me… I like to be right, so that that people listen to me, but I also don’t like to be right, because that means bad things are going to happen… In this case… I told you months ago that most economists were calling for the recession to hit the U.S. in 2020, but I had gone out on a limb and said it would hit us this year…

Maybe, just maybe, ‘cause you never know… I’ll be right on that one too!
The currencies yesterday (Tuesday) and today, have really not done much, a little slippage Vs the dollar, but that’s not the kind of movement we used to see in the currencies… Everything is muted these days… I’m just saying…

Gold got whacked by over $10 yesterday… this is getting ridiculous folks… I really don’t want to go down that rabbit hole right now, so I won’t…

China printed some good data this morning… Retail Sales were up, GDP was up, and a report said that they were producing more steel now than in the past… I still don’t think this is enough to stop the momentum of a global slowdown, but China does have this in their back pockets when negotiating with the U.S. on Trade…

Currencies today 4/17/19 American Style: A$.7180, kiwi .6728, C$ .7493, euro 1.1305, sterling 1.3040, Swiss $.9898, European Style: rand 13.9692, krone 8.4870, SEK 9.2394, forint 282.37, zloty 3.7784, koruna 22.6998, RUB 64.21, yen 112.05, sing 1.3524, HKD 7.8445, INR 69.37, China 6.7094, peso 18.79, BRL 3.8826, Dollar Index 97.02, Oil $63.76, 10-year 2.59%, Silver $14.94, Platinum $889.00, Palladium $1,398.12, and Gold… $1,273.97,

That’s it for this afternoon… Sorry it’s later than planned… I came home, sat in my recliner, turned on the baseball game, and fell asleep… And slept all afternoon! Slacker! HA!… Heart doc told me to keep doing what I’m doing… Hmmm…. Tomorrow I’ll see my oncologist, and she’ll tell me something different… Cardinals win today, and come back home for a weekend series with the Metropolitans! AC/DC takes us to the finish line today with their song: Back In Black… I hope you have a Wonder Wednesday evening and night… No Pfennig tomorrow, talk to you again next week… and Be Good To Yourself!

Chuck Butler
Creator & Editor of:
A Pfennig For Your Thoughts