The Dollar Continues To Weaken…

A Pfennig For Your Thoughts
 
November 16, 2020
 
* Currencies & Metals end last week on a good note… 
* There’s news of another vaccine ready to go this morning! 
 
Good Day… And a Marvelous Monday to you! The Classic IV had a song in the 60’s that went like this: Oh Stormy, Oh Stormy, bring back that sunny day! Man did we have some wind and rain this past weekend! The wind was the devastating kind, that uprooted trees, and caused damage across the region… Oh Stormy…. Little Evie, and brother Braden came to stay with us for a while on Saturday, she’s growing up so fast! And her brother, just loves her to the beach and back! I love to watch them interact with each other. Braden can get her belly laughing, which is so cute! I thank the Good Lord every day that he has allowed me to live with all that has gone wrong with my health, so that I can watch my grandkids grow up! And looky here…. The Jefferson Starship greets me this morning with their song: Miracles…  
 
Another weekend, went by and still no absolute verdict in the Presidential race. I know the media has made the call, but then they went out of their way to make sure the President lost his reelection bid… The media is so controlled these days, which is why you don’t see much “ investigative journalism” any longer… If Watergate would have happened these days, no one would even know…. But that’s all I have to say about that, before I go down a rabbit hole that I don’t want to, or need to go down…. And that’s that!
 
The currencies and metals both had good days on Thursday and Friday last week. On Thursday, when I left you, Gold was up $4 in the early trading, and then went on to gain $11 on the day. And then followed that up with another gain of $12 to close the week at $1,890.20…. It just shows to go you that you can’t keep a good asset down…. The price manipulators completely whacked the crap out of the price of Gold last week on two occasions… I wrote to a dear reader who asked me why I keep telling people to buy Gold, and then tell people that the price manipulators keep knocking its price down. I said, “Well, these are simply short-term movements that allow people to buy at reduced prices.” As long as you don’t allow the price manipulators to get to you, you will see how Gold continues to rise after their price engineered take downs.” 
 
The euro had climbed above the 1.18 figure again on Thursday morning, and stayed above 1.18 the rest of the day and added to its price on Friday to end the week with the euro trading at 1.1837… Remember what I’ve told you about the line in the sand that has been drawn by the dollar bugs, which is around the 1.19 handle… The Aussie dollar (A$) is still being held down below 73-cents, but it’s only a matter of time for that currency to take off, I do believe…  
 
One asset that can’t seem to get in line with the other anti-dollar assets, of currencies and metals, is Oil… The price of Oil slid $1 on Friday, thus not allowing the Petrol Currencies to follow the Big Dog euro off the porch to chase the dollar bugs down the street… Not only did the $1 buck slide in the price of Oil on Friday not allow the Petrol Currencies to get off the porch, It didn’t allow them to even get up, as they lost ground on a day when most other currencies gained ground.
 
The Big news, markets-wise, this past weekend, was the announcement of a 10 country Free Trade Agreement in the S.E. Asian countries… Hopefully this will soothe out the relations between China and Australia… Recall I told you how China was boycotting any shipments to China from Australia, because Australia had added their names to the list of countries that wanted a full investigation of the origins of the COVID-29 virus…
 
Speaking of the virus… here we go again! Tomorrow, our county will be shutting down businesses and demanding that people say home, unless they are going to work, for groceries, and the gym… Oh, and for doctor appts. Which is was I was happy to see, since that’s the only time I DO get out of the house these days! The first time they told us it was for two-weeks… And then 6 months later they relaxed the rules…. This time…. Who knows… how long it will be… All I know is this…. The definition of being Insane is doing something over and over again and expecting a different result… The lockdowns apparently didn’t work the first time, or else we wouldn’t be going into lockdown again…. I’m just saying…
 
Do, you know who Tom Woods is? If you don’t, you should know him, and his thoughts, which he shares with his readers each week, sometimes more than once a week! He’s a Libertarian and therefore his viewpoints aren’t always those that the mass media would follow… But they are bang on! Trust me when I say, I do believe you would like reading Tom Woods thoughts… I don’t even recall how I came to read him all the time, as it’s been a long time since I began that process…
 
In the overnight and early morning trading, the currencies have slipped a little bit, and Gold is getting sold by $14… What is up with these selling days in Gold? The Dollar Index is 92.76 this morning, as we start the week, let’s see where it takes us throughout the week… My suspicions are that the Dollar Index will continue to get weaker as the days go by… 
 
And there’s news this morning about another virus vaccine from Moderna, that’s 94.5% effective… Well, I’m from Missouri, they’re going to have to show me, for me to believe that! But still… that’s good news, because we’re going to need all the ammo we can get to push the virus across the river! 
 
OK… back to what’s going on in the markets… James Rickards was in the minds of the readers at the GATA org. this past weekend, as they posted something from him.. You can find this article in its entirety here: https://dailyreckoning.com/the-bogus-case-against-gold/ … And here’s just a small sample of what he had to say about Gold: “The first one you may have heard many times. “Experts” say there’s not enough gold to support a global financial system. Gold can’t support all the world’s paper money, its assets and liabilities, its expanded balance sheets of all the banks and the financial institutions in the world. They say there’s not enough gold to support that money supply.
 
That argument is complete nonsense. It’s true that there’s a limited quantity of gold. But more importantly, there’s always enough gold to support the financial system. The key is to set its price correctly.
It is true that at today’s price of about $1,875 an ounce, pegging it to the existing money supply would be highly deflationary.
 
But to avoid that, all we have to do is increase the gold price. In other words, take the amount of existing gold, place it at, say, $14,000 an ounce, and there’s plenty of gold to support the money supply.
 
In other words, a certain amount of gold can always support any amount of money supply if its price is set properly.”
 
Chuck again… Do you know how people that make it big in something, like to write a book and tell people how they did it? Well, I didn’t make it big in something, but I still like to tell you how you should own Gold! HA!
 
The U.S. Data Cupboard late last week had the Weekly Initial Jobless Claims, which fell further last week to 709,000, but the Continuing Claims remained above 21 Million… which the back of a cocktail napkin accounting tells me the Unemployment Rates is 14%… I would go to my grave arguing with the BLS over what the real Unemployment Rates is, and I know I would be correct, and the BLS would wrong!
 
OK, but recall last Thursday I said I would bet a dollar to a Krispy Kreme that the U.S. Budget Deficit for Rocktober would be greater than the $100 Billion that was projected? Well, I would have won that bet, because the Rocktober Budget Deficit printed at $284 Billion!!!!! OK, let’s just think about this for a moment… Do you think that the Budget Deficit numbers will come down in the coming months or remain at high levels?  Me? I think they will remain at high levels, and could possibly make $284 Billion look like chump change! Oh, and BTW, $284 Billion annualized is $3.4 Trillion… 
 
Deficit spending has become a way of life for the U.S. And they (the powers that be) believe that none of it will matter… That deficits don’t matter… That running deficits so high, do not drag an economy’s growth through the gutter, and so on…. But they are wrong… And will be proven wrong on judgement day for the financial system… I’m just saying…
 
While last week’s Data Cupboard didn’t have much for us, this week’s offerings will be quite crowded at times. For instance, there’s only a regional manufacturing activity report, that I boycott, to print today, while tomorrow, we’ll see Rocktober reports for Retail Sales, Industrial Production and Capacity Utilization… And then on Wednesday, crickets, and on Thursday we go right back to the Weekly Initial Jobless Claims, etc. and end the week on Friday there’ll be nothing, nada, zip, zero, zilch, a big goose egg! 
 
For What It’s Worth… Man, I want to make sure that everyone reads today’s article in the FWIW section! I’ve quoted Egon Von Greyerz before here in the Pfennig, and weekly he sends me his company’s letter… And last week’s was so well written and the to the point of everything I’ve been talking about, so please, set aside a few minutes, and click on the link to read the letter… I wish I had written it, for it is so good! And it can be found here: https://goldswitzerland.com/the-madness-of-crowds-the-sanity-of-gold/
 
Or, here’s your snippet: “As for central banks who print money out of thin air to buy unwanted sovereign debts, they too are projecting miraculous solutions to otherwise staggering debt problems based on, you guessed it: Creating more debt.
 
And how will this debt be paid? Easy—with money created by a mouse click at a central bank near you.
 
Seem a little bit too good to be true for the economic future?
 
Well, the U.S. Fed’s track record for forecasting recessions is 0 in 10, but that has never stopped them from making inaccurate and contradictory projections which resemble a kind of open madness:
 
“You will never see another financial crisis in your lifetime.”
-Janet Yellen, spring 2018
“I do worry that we could have another financial crisis. ?
-Janet Yellen, fall 2018
“There’s no reason to think this (bullish) cycle can’t continue for quite some time, effectively indefinitely.”
-Jerome Powell –2018
“The US is on an unsustainable fiscal path; there’s no hiding from it.”
-Jerome Powell–2019
 
In the post-08 “new abnormal” of deficits without tears and embarrassing new theories which argue that unlimited money creation can never lead to inflation , the fantasy forecasters have been quite busy replacing reason with madness.”
 
Chuck again… so, if you only read the snippet, you’ve just found out how good this article is… for this is just one part of the whole letter… . Please Read it!
 
Market prices 11/16/20: American Style: A$ .7292, kiwi .6867, C$ .7643, euro 1.1830, sterling 1.3170, Swiss $1.0934, European Style: rand 15.4087, krone 9.0699, SEK 8.6661, forint 302.65, zloty 3.7769,  koruna 22.2726, RUB 77.34, yen 104.95, sing 1.3467, HKD 7.7533, INR 74.41, China 6.6053, peso 20.26, BRL 5.4565, Dollar Index 92.76,  Oil $41.93, 10-year .92%, Silver $24.43, Platinum $896.00, Palladium $2,366.00, and Gold… $1,876.00
 
That’s it for today…  Well, I have to say that I’m getting that good Old Revolt feeling… Several restaurants in our area are threatening law suits to remain open… What to go! Stay open! Do not shutter your businesses again! OK, I finished my book, The Madness of Crowds, and now have a new one waiting for me titled: Taming The Megabanks… I wonder what that could be about? HAHAHAHA! Well, the sun is supposed to make an appearance today, and the wind is gone so it should be a nice day, albeit quite chilly… The Five Americans take us to the finish line today with their song: Western Union… A great 60’s song, for sure! And with that… I hope you have a Marvelous Monday, and please Be Good To Yourself! 
 
 
Chuck Butler
Creator & Editor of:
A Pfennig For Your Thoughts