A Pfennig For Your Thoughts November 19, 2019 * Currencies hold Friday’s gains, and inch higher* Gold makes a come back on Monday! Good day… And a Tom Terrific Tuesday to you! I wrote so much yesterday morning that I had to take a long nap to recover! HA! And now I don’t have a thing to talk about today! And if you believe that then I’ve got some land I’ll sell you, don’t worry about the reports of it being swamp land! The bad thing about what I have to say, is that it all makes me out to be gloom and doom… And if that’s what gets people to read what I write, and act accordingly, then so be it! The Charlie Daniels Band (CBD) greets me this morning with their song: Long Haired Country Boy… If you ever have a group of guys hanging around, play this song, and listen to them all sing along!
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A Pfennig For Your Thoughts
November 19, 2019
* Currencies hold Friday’s gains, and inch higher
* Gold makes a come back on Monday!
Good day… And a Tom Terrific Tuesday to you! I wrote so much yesterday morning that I had to take a long nap to recover! HA! And now I don’t have a thing to talk about today! And if you believe that then I’ve got some land I’ll sell you, don’t worry about the reports of it being swamp land! The bad thing about what I have to say, is that it all makes me out to be gloom and doom… And if that’s what gets people to read what I write, and act accordingly, then so be it! The Charlie Daniels Band (CBD) greets me this morning with their song: Long Haired Country Boy… If you ever have a group of guys hanging around, play this song, and listen to them all sing along!
OK… yesterday I told you that the currencies looked to be well bid going into the day’s trading, after rallying on Friday, for a number of reasons… And that bid held most of the day, and the currencies at least held their Friday gains and did move a tad bit higher on the day VS the dollar… And Gold fought back during the day and ended up gaining a buck or two VS the close on Friday… But after being down more than $9 in the early trading yesterday, Gold fought back, so the $2 buck gain was really $11 on the day! Good Show!
There was little to learn from the Trade Negotiations between the U.S. & China, but there was some closure on the negotiations between the U.S. and Canada… The stock jockeys just don’t care about all the bad economic data that keeps mounting for the U.S. It’s as if they have blinders on, or they’re doing the monkey thing See no evil, hear no evil, speak no evil…
So, let them keep buying at these high overrated prices in stocks, which will only make the fall even greater… A friend from way back, when I used to be a key speaker at the Agora Vancouver Symposium, Tom Dyson, is writing again after having some difficulties with his health, and yesterday’s postcard from Hong Kong had two charts that I wish I could show you… These two charts show the direction of the stock market for the next ten years… That’s right, I said next ten years! And all they while that I was looking at the charts, I was thinking… Got Gold?
My thought on stocks is… As my good friend and Retirementor that can be found at www.milleronthemoney.com says… “make sure your stop losses are kept up to date”…
OK… I know people have been warning you about a deep dark recession for sometime, and nothing appears… And do you know why it hasn’t? Well, the Fed Heads are doing everything they can to keep this economic ship out to sea… But what they’re not seeing is the Tsunami that’s forming out on the ocean and headed for the coast! I’ve chronicled the rotten tomatoes economic data for you whenever it prints, and then I read more that tells me that things are going south in a hurry…
For instance, yesterday, I wrote about the 4th QTR downgrade for GDP, to 0.3%…. That’s not 3% folks, that’s 3/10ths of a percent. A figure that’s so close to going negative, it could get there easily just with a rounding calculation! Yesterday, I told you that Industrial production was negative, but later in the day I read that the print was the worst decline for U.S. industrial production since 2009. And I talked about the Cass Freight Index and said that it was negative since spring, but later in the day I read that it had . fallen for the 11th month in a row!
I’ve chronicled how all the jobs that have been created in the last 10 years haven’t regenerated the economy, and that’s because a very large percentage of those jobs created barely paid $793 a week, with no health care benefits! The economy can’t grow with numbers like that folks! And so these people turn to their credit cards, and buying things on debt, like their cars…
I read last night that The NY Fed just announced that there are serious car loan delinquencies… Here’s the NY Fed… “auto loans that are 90 days or more past due – in the third quarter of 2019, after an amazing trajectory, reached a historic high of $62 billion…
What you do not learn about history, you a damned to repeat it… in 2007/ 08 it was subprime home loans… in 2019/ 20 it will be subprime car loans, and before you begin to think that car loans can’t be the size of home loans, that may be true for the McMansions, but regular homes aren’t that much more than a new Cadillac Escalade… Go on, price one and see what I’m talking about!
ENOUGH Chuck! You’re going to need to issue a warning about putting away the sharp objects before reading your letter if you keep this up!
Oh, and one more thing before I move on down the road… That college kid of yours that can’t find a job that will make him president on his first day, is going to be living with you F-O-R-E-V-E-R!
Man, you’re fit to be tied today, Chuck! Full of you know what and vinegar for sure… And when it all come crashing down, people will look around and say… You know, Chuck told us this was going to happen, but we all thought, the going is good and what’s going to stop it?
Quick question… Who’s the most indebted country in the World? Of course it’s Japan… but remember… over 70% of their outstanding debt is held domestically… That’s a HUGE difference to the country that’s number two in the World in debt…. The U.S. who relies on the famous quote by Blanche… We depend on the kindness of strangers… In other words, we’ve lost our control over debt, before we lost our sanity!
Last week I mentioned a Debt Jubilee… And said that would be a very bad thing… I had a dear reader, write me and say that a Debt Jubilee is the only thing that will save this country… The term comes from the scriptures, but did not actually refer, as the term does now, to debt cancellation, or debt forgiveness, nor did it discuss/ involve the distribution of property…
The term NOW, refers to Debt Forgiveness, along with redistribution of wealth. I can only imagine that this would involve a devaluation of the dollar, and not a small one… There are Pandora’s Box of evils that would come out of a Debt Forgiveness folks… Maybe some other time, I’ll write about those, but for now, I really got off on a tangent here and went down a deep rabbit hole that I’m now going to try to climb out of!
OK, one currency that didn’t maintain its gains from Friday was the New Zealand dollar / kiwi… And rightly so, given the news yesterday from the Reserve Bank of New Zealand (RBNZ)… “The Reserve Bank has increased its supervisory monitoring of the Bank of New Zealand (BNZ) and applied precautionary adjustments to its capital requirements following the identification of weaknesses in BNZ’s capital calculation processes.”
Wouldn’t you just get the major willies if you heard that the Fed Reserve was going to increase their supervision of your local bank? Or how about one of the Too Big To Fail Banks? Now that would send chills down the spine of the markets, now wouldn’t it? So, as I said it was “just” that kiwi got sold on that news…
But that was yesterday… In the overnight markets, traders have thought otherwise about this and moved kiwi higher again… Stranger than fiction, I know, but it is what it is…
Well, the optimistic campers have the conn in the U.K. again, and have been marking up sterling on their thoughts that a BREXIT deal will be made soon… I just shake my head and wonder what these guys are smoking, because there are so many hurdles to be jumped with a BREXIT deal, so many hands that need to be greased, and politicians that need to be assured of their reelection that a BREXIT deal is nearly impossible. That’s not to say they won’t eventually get there, but right now with all the political strife in the country I just don’t see it happening in the near future.
Russia is going to reduce the share of the U.S. dollar in its National Wealth Fund and is considering investing in other foreign currencies including the Chinese renminbi, Deputy Finance Minister Vladimir Kolychev said last week… Hmmm…. Now, wouldn’t it be nice if they had told us just how many dollars are involved here? Well, yes, but… The idea here is this is just another chink of the dollar’s armor being removed… One day, we’ll all wake up and find that the Emperor has no clothes… I’m just saying…
Well, President Trump met with Fed Chairman Powell, and Treasury Sec. Mnuchin yesterday… The reports from the meeting claim that the President focused on interest rates with Powell, and the strength of the dollar with Mnuchin… I wish I was a fly on the wall for that meeting! I can hear President Trump just lambasting Powell, for keeping interest rates from going negative (like the rest of the world), and the same harshness in his voice in talking to Mnuchin about how they’ll never get the Trade Deficit down with the dollar so strong…
The U.S. Data Cupboard has some housing sector data for us today, but in reality the markets are focused on what’s in the Fed’s FOMC meeting minutes that will print tomorrow afternoon. Other than those meeting minutes, there’s not much for us to see this week, other than housing data, so unless that’s your bag baby, I’ll leave that for others to comment on…
To recap… The currencies held their gains yesterday and inched higher during the day and in the overnight markets. Gold made a comeback yesterday, and wiped out its early loss with a $3 gain on the day. Good show, Chuck said! The euphoria campers have the conn in the U.K. again, with regards to a BREXIT deal getting put to bed… Chuck’s from Missouri, he’ll have to shown! No data today other than housing stuff…
For What It’s Worth… Well, I really went out on a limb today and bared my soul with what I feel is going to happen here in the coming months… And the accumulation of Debt is the root cause of those problems. This article talks about the U.S.’s share of the Government Debt in the world, and it can be found here: https://www.usnews.com/news/best-countries/articles/2018-10-23/america-takes-the-largest-share-in-the-global-debt-pie
Or, here’s your snippet: “WHILE POLICYMAKERS IN the United States wrestle with a growing federal budget deficit, America isn’t alone in facing soaring government debt.
According to the International Monetary Fund, the level of global debt is at historic highs, reaching $164 trillion in 2016. Debt in advanced economies peaked at 105 percent of the gross domestic product, or GDP, the highest level since World War II, while the total debt is at 225 percent of the world’s GDP. Overall, the world has amassed $247 trillion in debt, with $63 trillion owed by central governments, according to a report put together by Visual Capitalist, a Canadian digital media company.
The United States, Japan and China report the biggest shares of overall global debt. Using data from the IMF, the Visual Capitalist report states that the U.S. reports having $20 trillion in government debt, which is nearly a third of the overall global debt pool. Japan follows with about 19 percent of the global debt, while China, one of the leading economies by growth, owes about 8 percent of world’s debt.
The report highlights Japan as a special case, with its debt reaching 239 percent of its own GDP. A similar situation is reported by Greece, which has a debt-to-GDP ratio of more than 200 percent and owes 0.6 percent of the world’s debt.
“The IMF warns that if Greece continues at its current pace, debt-to-GDP will hit a whopping 275 percent by 2060,” the report states.”
Chuck again… So… if everyone has debt, who’s holding all that debt? Look in the mirror folks… When a negative yielding Greek Gov’t bond is oversubscribed by 4X, you can’t talk sense to these investors… Do you know what investment doesn’t have debt? That’s right, Got Gold?
Currencies today 11/19/19 American Style: A$.6821, kiwi .6417, C$ .7569, euro 1.1069, sterling 1.2937, Swiss $1.0089, European Style: rand 14.7790, krone 9.1024, SEK 9.6153, forint 302.30, zloty 3.6153, koruna 23.0685, RUB 63.78, yen 108.73, sing 1.3602, HKD 7.8276, INR 71.54, China 7.0161, peso 19.26, BRL 4.1950, Dollar Index 97.82, Oil $56.50, 10-year 1.81%, Silver $17.11, Platinum $897.97, Palladium $1,737.42, and Gold… $1.468.10
That’s it for today… Our Blues get back on the ice tonight at home and attempt to end this current winless streak! Let’s Go Blues! MNF played a game in Mexico City last night, and while watching some of it, I had a thought about former quarterback, Colin Kapernick, who started the kneeling during the U.S. National Anthem… He would be welcome to play in Mexico! So, there you go Colin… Oh my, oh my… what goes through these individual’s minds is beyond me… Did their parents not teach them anything? OK, stop! Whew! That was a close one, I almost went down another rabbit hole that I doubt I would have been able to climb out of! OK, so for all you “older folks like me” you’ll enjoy this… Dion takes us to the finish line today with his song: The Wanderer… I hope you have a Tom Terrific Tuesday and please Be Good To Yourself!
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A Pfennig For Your Thoughts