Good day… And a Happy Friday to one and all! I’ve got infusion confusion this morning, and can’t really focus, so this is going to be short-n-sweet today, I promise! I’ve had my CPAP machine for a month now, and while most mornings I wake up feeling refreshed and ready to go, that’s not happening this morning… So, infusions beat CPAP… Good to know! Don Henley greets me this morning with his song: End of The Innocence…

Well, to start the day, we don’t have any major news… No Central Bank meetings, no BIG announcement from China, no real economic data. I could discuss the new Health Bill, but why? It’s going nowhere folks… The dollar seems to be losing its grip again, as the currencies inch higher again this morning. The Big Dog euro seems to be stuck in the mud, as it attempted to get off the porch and run after the dollar, but the other little dog currencies have gotten off the porch, but seem to be sniffing around a bit before they take off after the dollar.

The New Zealand dollar / kiwi is the best performer overnight, and even that move isn’t anything to get real excited about! The price of Oil rebounded a bit, but not much, so there’s no reason to rush out and fill up the gas tank before it explodes higher! Not that I think it’s going to explode higher. The U.S. shale producers are really sticking it the OPEC countries.

The price of Oil has been a real problem for all the countries outside of the U.S. The problems are two-fold… One problem comes from countries that don’t produce Oil, and have to import it… As the price of Oil rises, their inflation forecasts grow, they hike rates, wring their hands with worry about inflation. As the price of Oil retreats, the country is left with no inflation worries and higher interest rates than needed, thus putting the brakes on their economy…  (see India for a good example of this scenario!)

And for the countries that produce Oil, their problems are really illustrated right here in the U.S.  Oil production goes down, the price of Oil rebounds, the Oil producers ramp up operations and begin to pump Oil by the truck loads, which leads to too much production, and supplies, and that causes the price of Oil to fall again, and now the producers have ramped up operations, taken on new debt for equipment, etc.  And the Merry-Go-Round just keeps going around and around and around…

Oh, boy, I’m doing it again! Promising a short-n-sweet Pfennig and then I go off on some tangent that fires up the word count! UGH!  Well, what else did you expect from me? My fat fingers get going on the keyboard, and the next thing I know I’m finished, and the Pfennig is as long as usual! UGH!

Gold saw another day of light from the tunnel yesterday, but once again before it could get its legs underneath it to run, the Gold short paper traders came forth and stabbed it with their steely knives, but they just can’t kill the beast! (Hotel California), and Gold gained $ 3.70 on the day…

The early morning trading has Gold up $ 8 today, but I just can’t get myself to get too excited about the early morning gains, for they come about before “da Boyz” (as Ed Steer calls them) arrive at their desks..

I’ve read a few reports this week from Gold analysts, Gold mining Co. Presidents, and so on, about how they feel that the manipulation of the Gold price is about to end… The reports don’t really ever get into why these people think that, but Hey! Who am I to question?  This is where I would pull out an old-time phrase that’s not used much any longer, and that is… Should the manipulation stop..  “I won’t look a gift-horse in the mouth”… That is an old one, Chuck! Where did you pull that one from? Ahhh grasshoppers, I pulled that from the archives of my memory. I can hear my grandma saying that to me…  And for those youngsters reading this letter the saying simply means, “when receiving a gift be grateful for what it is; don’t imply you wished for more by assessing its value.” You don’t really need to have horse! HA!

The Canadian dollar / loonie is challenging kiwi as the best overnight performer. Earlier this week, I told about how loonie traders were scratching their collective heads attempting to figure out how the loonie was pushing the currency appreciation envelope day after day, when the price of Oil was dropping, and the Bank of Canada (BOC) was sitting on their hands as the housing bubbles in Toronto and Vancouver continue to fill with air…

But then the loonie got caught up in all the Petrol Currency selling, as the price of Oil dropped into the $ 42 handle…  Well, like I’ve told you dear reader for a very long time now, “Traders are Fickle”… And they’ve gone back to pushing the loonie higher… Hey! That’s alright by me! Don’t let me get in the way of pushing the loonie higher! I’m just attempting to explain its strength to readers!

I had mentioned earlier in the week that the Reserve Bank of Australia (RBA) would print their last meeting’s minutes this week, and then completely forgot about them, until now! I guess I forgot about them because they didn’t contain any earth shattering comments, and they sure didn’t give the markets anything to trade from…  Here’s a sample of what they were talking about…

“Members noted that the broad-based pick-up in the world economy was continuing. Labor markets had tightened further in many countries and this was expected to lead to a pick-up in wages and prices over time. Headline inflation rates in most countries had moved higher over the past year, partly reflecting higher commodity prices. Nonetheless, core inflation had remained low.”  And as we all know, they left rates unchanged…  And, that lack of optimism by the RBA hurt the Aussie dollar (A$ ) for a day but the A$ has recovered that lost ground, and now sets its sights on 76-cents!

The U.S. Data Cupboard today is till restocking, but will have New Home Sales, and the Markit print of PMI (manufacturing index), which I will remind you is NOT the national ISM manufacturing index. Existing Home Sales were better than expected when they printed earlier in the week, and so I expect New Home Sales to be better than expected too… The Fed hiked rates last week, but let me point out that our internal rate is still very low at 1.25%, and the all-important 10-year yield that is used to price mortgage rates is still below 2.20%!!!! So, why wouldn’t home sales be good?

To recap… It’s a infusion confusion Friday for Chuck, which is good because there was not a lot going on overnight and this morning in the currencies, metals, bonds, commodities, economies and dolts! I was watching the news last night, and couldn’t believe they had not one mention of China’s A shares being included in the MSCI that I talked about yesterday! UGH!  Oh well, Gold was up another $ 3.70 and the price of Oil rose about 60-cents…

For What It’s Worth…  It brings me great delight to be able to direct you to this website today, dear reader…   I would like for you to read an article by my good friend, who is also known as the Retirementor, Dennis Miller… He sent me a note this week, when I went on and on about debt, and said, “wait till you see my letter this week, great minds must think alike”…  So, anyway, it’s titled: Don’t Get Caught In The Debt Trap!  and you can read it all here: http://milleronthemoney.com/dont-get-caught-debt-trap/

Or, here’s your snippet… “Hardly a day goes by without an article blaring about record levels of debt and warning of a collapse. Irresponsible borrowing can adversely affect everyone, including those who lived within their means.

Reuters reports, “Americans’ debt back at record high after nearly a decade: “Americans’ debt level reached a record high this year, surpassing the peak touched just as the worst of the recession was taking hold in 2008, …households …now lean …more on auto and student loans.”

Bloomberg weighs in on student loans, “Student debt in America has hit a new record”: “Total U.S. student debt hit a record $ 1.31 trillion last year, the 18th consecutive year Americans’ education debt rose, according to the Federal Reserve Bank of New York.”

Chuck Again… Dennis does a great job of being fair and balanced on this, and I sent him a note saying that, his quote from Noah Smith, reminded me of my note about the Commodity Analyst yesterday… One day, they’ll rue the day they said those things..

Currencies today 6/23/17… American Style: A$ .7565, kiwi .7280, C$ .7560, euro 1.1168, sterling 1.2737, Swiss $ .9712, … European Style: rand 12.93, krone 8.4752, SEK 8.7560, HUF 276.61, zloty 3.7898, koruna 23.5227, RUB 59.97, yen 111.20, sing 1.3866, HKD 7.7993, INR 64.48, China 6.8321, peso 18.05, BRL 3.3340, Dollar Index 97.40, Oil $ 42.81, 10-year 2.16%, Silver $ 16.80, Platinum $ 931.73, Palladium $ 891.75, and Gold… $ 1,258.00

That’s it for today… no extra innings, no win for my beloved Cardinals yesterday… UGH! It’s feast or famine with this team, and that’s not the Cardinals I’m used to watching… Well, they took a new measurement of the tumor in my mouth yesterday, and compared it to the measurement taken right before I began my infusions again, and the tumor is shrinking again! That’s a good thing, even though I feel like death warmed over this morning! But that won’t last long, and I’ll be back to myself by noon! I’ll have to wait to do my crossword puzzles until then, because I couldn’t concentrate on them now even if I wanted to! John Mellencamp takes us to the finish line today with his song: The Authority Song…  I fight authority and authority always wins… (story of my life!)  And with that, it’s time to get off the bus this week, and send you to the corner of a Fantastico Friday and a Wonderful Weekend!  And Please… Be Good To Yourself!

 

Chuck Butler

Daily Pfennig