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Money Daily has been providing business and financial market news, views, and coverage on a nearly continuous basis since 2006. Complete archives are available at moneydaily.blogspot.com.

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Wall Street Insiders Painting the Tape Practically Every Day; Silver Gains Again, Approaching Key Level

Friday, March 15, 2024, 9:12 am ET

Another exciting week of market hijinks comes to an close with Friday's quad witching session. Worth noting from Thursday's trading was yet another iteration of the common pattern in the final half hour or so of the session.

The Dow, NASDAQ, and S&P managed to erase more than half of the losses incurred earlier in the day, a trading anomaly that's been mentioned here at least a half dozen times over the past few years. Thursday's pattern needs to be pointed out because it was so obvious and standard fare for the manipulation that continues to occur.

Just after 3:30 pm ET, all three major indices hit the lows of the day.

The Dow was down 329 points. It finished down only 137.

The NASDAQ was down 136 points. It closed down 49.

The S&P was down 42 points. It closed with a loss of 14.83.

Now, some will argue that these late-day trades are nothing more than short-covering, and that absolutely could be the case. However, this pattern being so consistent, it is also just as likely the work of some big money players moving the market higher, to conceal the true extent of intra-day losses from the general public, who hears, "the Dow was down 137 points," not "the Dow was down 329 at the lows of the day." Most people aren't watching the charts, looking for trading patterns, or even suspicious that operators behind the scenes are keeping stocks at elevated levels.

Whether its the Plunge Protection Team (PPT), people working the Exchange Stabilization Fund, the NY Fed's trading desk, or traders at JP Morgan, an acknowledged criminal enterprise, which just was assessed a $348 million fine for alleged failures to monitor the trading of its clients and employees, matters little. It very well could be a collusion of various back-room operators responsible for the recurring late-session tape painting parties or traders at Blackrock or Vanguard, the two of which control an enormous amount of publicly-traded stock.

The JP Morgan fines were imposed by the Federal Reserve and Office of the Comptroller of the Currency (OCC) in separate orders Thursday. JPM has been fined billions over the past decade, yet their practices are seldom reported by the lazy financial media reporters, most of whom are captured, victims of Stockholm Syndrome.

Practicing deceit and distortion is how Western oligarchs roll these days. According to Wall Street on Parade, "Wall Street mega banks have drawn a law-free zone around themselves and are more dangerous today than they have ever been in U.S. history."

So, believe what you like, though the levels of corruption in business, government, and the media are at extreme levels.

With that said, the major indices are looking at reversing last week's losses. Through Thursday's close, the Dow is up 183 points, the NASDAQ ahead by 43, and the S&P is clutching a gain of 26.75 points.

Continuing to forge ahead, silver dipped slightly on Thursday, but gained ground overnight, putting the price of an ounce at $25.36, close to the key resistance level at $26. Riggers at the LBMA and in COMEX futures are busy doing their dirty work again this morning, sending gold and silver lower. In the case of silver, it's actually up about 30 cents, while gold is down about four dollars.

With the market opening in half an hour, stock futures are mixed, with Dow futures up 43 points, the S&P flat, and the NASDAQ down 26. The week may well end on a positive note, especially if there are losses through afternoon trading. The guys behind the curtains have it covered.

Incidentally, Bitcoin has been savaged the past two days, currently hanging around $67,000, down more than $3,000 already today, after Thursday's huge drawdown. At this juncture yesterday, bitcoin was priced around $73,400. Easy come, easy go.

At the Close, Thursday, March 14, 2024:
Dow: 38,905.66, -137.66 (-0.35%)
NASDAQ: 16,128.53, -49.24 (-0.30%)
S&P 500: 5,150.48, -14.83 (-0.29%)
NYSE Composite: 17,886.27, -132.37 (-0.73%)


Inadequate Retail Sales, PPI's Surge Suggests Inflation Has Consumers Tapped Out; Silver Makes Dramatic Gains Over $25/oz

Thursday, March 14, 2024, 9:25 am ET

Wednesday's midweek session was a disappointment, as stocks gave up early gains to close on the low side, with the Dow ending just barely in the positive, the NASDAQ down the most, the S&P falling short of another record close and the NYSE continuing to show strength in small caps.

The big stories on the day - aside from now daily Boeing incidents - were the massive fourth quarter loss by Dollar Tree (DLTR) and passage of the "Tik-Tok ban” bill in the House of Representatives.

Dollar Tree suffered a fourth quarter loss of $1.7 billion, due to underperforming stores and consumers cutting back even on low-priced purchases. Family Dollar, which was bought out by Dollar Tree in 2015 for $8.5 billion was at the root of the losses. The company has failed to capitalize on their former rival, failing in its attempt to compete with the likes of Walmart and Target stores. Family Dollar will be closing about 1,000 stores, 600 locations in the first half of 2024, with another 370 closing in the next few years as leases run down. Dollar Tree will also be closing 30 of its stores.

In the House, legislators crossed aisles to overwhelmingly approve a bill that would force China's owner of social media app, Tik-Tok, ByteDance, to divest its interest in the company within six months. The bill moves to the Senate, where passage is assured, then on to Biden's desk where it will become law. Various reps expressed their displeasure with the bill, which they say is a Trojan Horse designed to further limit free speech online.

Thursday brings two important economic reports, retail sales and PPI, both out at 8:30 am ET.

First, the Census Bureau reported an increase for February 2024, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $700.7 billion, up 0.6 percent (plus or minus 0.5 percent) from the previous month, and up 1.5 percent (plus or minus 0.7 percent) above February 2023.

The report was an improvement over January, which was revised even lower, to a loss of 1.1%. As usual, the figures are estimates, unadjusted for inflation, and hardly reliable. Adjusted for inflation, real retail sales were down 1.7%, intimating that US consumers are tapping out and buying little more than absolute necessities, tying in with the sordid details of Dollar Tree and Family Dollar stores.

On the heels of Tuesday's disappointing CPI figures, the BLS announced the Producer Price Index (PPI) for February, which was somewhat of a shock.

Per the press release:

The Producer Price Index for final demand rose 0.6 percent in February, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices increased 0.3 percent in January and edged down 0.1 percent in December 2023. (See table A.) On an unadjusted basis, the final demand index advanced 1.6 percent for the 12 months ended in February, the largest rise since moving up 1.8 percent for the 12 months ended September 2023.

Both reports were short of estimates, +0.8% for retail sales (+0.6 actual), and +0.3% for PPI (+0.6% actual). In the case of PPI, lower would have been preferred, showing inflation slowing. However, the numbers, if they don't lie, suggest inflation is hardly going away, and is, in fact, re-accelerating higher.

Despite the obvious failings, stock futures remained in positive territory, through marginally lower, ignoring the reports as they did the CPI figures. Wall Street seems to have some kind of death wish in regards to inflation, the economy, and interest rates, insisting that the Fed must lower rates by roughly 0.75% this year, although indicators continue to infer the opposite. Should the Fed actually cut rates at the June meeting, it would be a policy mistake of great significance and would work to re-ignite inflation.

On the real money front, silver caught a huge bid on Wednesday, sending the price from a low of $24.30 to a high of $25.31. The $1.01 move was a long-overdue one day gain of 4.16%. The next move higher should test $26, which has served as hard resistance for the shiny metal.

Futures appear to be dipping. Thursday's traders might want to put on some tight stop-losses. Recent data is sending a clear message that inflation will not be easily defeated and the Fed may actually have to raise rates in coming months, lest they damage their credibility further (if that's even possible).

At the Close, Wednesday, March 13, 2024:
Dow: 39,043.32, +37.83 (+0.10%)
NASDAQ: 16,177.77, -87.87 (-0.54%)
S&P 500: 5,165.31, -9.96 (-0.19%)
NYSE Composite: 18,018.63, +44.57 (+0.25%)


Stocks Rally as Gold, Silver, Bitcoin Are Temporarily Punished by Elitists; Future Appears Uncertain for Equities

Wednesday, March 13, 2024, 9:12 am ET

Following a sloppy session Monday, stocks were apparently boosted by February's CPI reading, which, even though it suggested inflation was persisting, was sufficient to spark a strong rally on the major indices, led by the NASDAQ, which gained over 1.5 percent on the day.

Wall Street's continuing cry for the Fed to begin lower rates at some point this year - hoping for a 0.25% cut at the June FOMC meeting - was again amped up, even though the data was signaling anything but rate cuts. If inflation continues at current levels, the Fed will be forced to keep rates right where they've been since June of last year, disappointing the equity investing crowd and probably causing a correction, though not until mid-summer.

Not to get ahead of the narrative, stocks seem immune to any news, good or bad, as evidenced by the action on Tuesday. Leading the charge higher was Nvidia (NVDA), which shook off Friday's decline that extended into Monday by adding back some 61 points, for a gain of more than seven percent on Tuesday. As resilient as the NASDAQ has been thus far in 2024 (up 10.16% for the year), Nvidia and AI have proven to be Kryptonite to short-sellers. With the NASDAQ closing less than 10 points below the March 1 all-time high and NVDA finishing Tuesday less than eight points from its own record close of 926.69 from March 7, there appears to be little to stop either - along with the S&P, which closed at a record high Tuesday - from zooming further.

As stocks were super-charged, the red-hot alternatives - bitcoin, gold, silver - were cooled down. Of course, it mattered not that there's a severe shortage approaching in silver output, nor that gold is probably $1000 to $2000 undersold, nor that the US Treasury will be refinancing roughly $10 trillion of its $34 trillion (and growing) debt load this year thanks to Secretary Janet Yellen's backwards plan to finance the government with short-term bills at the highest rates in years. No. The fact that Yellen, a former Fed Chair, and thus, an agent of a foreign private bank, has been on a course to completely bankrupt the US government isn't a concern to most people, especially not those involved in the high-finance Wall Street schemes to stretch equity valuations to previously unforeseen levels.

Gold, on the COMEX continuous contract, got taken down from $2,188 to $2,159, ending a streak of eight straight winning sessions. Silver didn't receive as severe a spanking, though it was knocked back from $24.67 to $24.32. The obvious COMEX shorting attempting to contain or suppress prices for gold and silver are failing. Tuesday's little cram-down was nothing like what used to occur when the riggers were in complete control. The LBMA has lost considerable credibility the past few years and the COMEX, with its non-deliverable contracts settled in fiat currency rather than actual metal, is in its final throes as a market pricing mechanism. Markets from Ankara to Shanghai to Moscow are rapidly reshaping commodity markets to better reflect actual supply/demand dynamics.

The end result is surely higher, probably much higher, prices for gold and silver than most people can imagine. $5000 gold and $150 silver is no longer considered out of bounds over the next two to four years. Gains may be sudden, and, from the appearance of Tuesday's punishment being rather subdued, the power to manipulate prices with futures contracts is diminished.

Bitcoin, which had screamed higher to almost $72,000, was knocked back to a low of $69,518. It has since recovered and early Wednesday morning reached a fresh all-time high at $73,661.60.

For those with a speculative bent, bitcoin is the place to play. Even those lucky souls who bought in at the start of the year when $45,000 was the target and held on (hodled) as it dipped below $40,000 late January, are ahead by 60-65 percent. Maybe its just a little too serendipitous that the two leading drivers of 2024 are imaginary: the promise of Artificial Intelligence (AI) and the vacuum of intrinsic value that is bitcoin. You can't see, feel, touch, or smell either of them, but they're winning, and winning big.

So it goes. In a world of false narratives, fake boobs, fake leaders, fake meat, and fakes of just about everything, maybe it's fitting that what people want is more of the same. Fake knowledge and fake money to the rescue.

Egad!

Minutes away from the opening bell, stock futures have reversed lower. Oil and commodities are gaining. Yield on the 10-year note has been gaining ground all week and is approaching 4.20%.

Was Tuesday a mirage?

At the Close, Tuesday, March 12, 2024:
Dow: 39,005.49, +235.83 (+0.61%)
NASDAQ: 16,265.64, +246.36 (+1.54%)
S&P 500: 5,175.27, +57.33 (+1.12%)
NYSE Composite: 17,974.06, +110.37 (+0.62%)


Everything Should Make You Very, Very Angry; CPI Shows Inflation Persistent; Why You Should Not Be A Slave

Tuesday, March 12, 2024, 9:20 am ET

It's probably about time to get angry. Very, very angry.

Unless you're one of the protected class of people immune to the barbarism of city culture, gross mismanagement of government, constant surveillance, media lies, captured markets, runaway inflation, weaponization of government functions, denial of liberty, war-mongering, and a host of other societal ills that have plagued Western civilization since the mid-1990s (and, to varying degrees, well before that), you're probably holding in some emotions that need to be exorcized. You should be angry. If you're not, you're on your way to being dead, which is how the wealthy elitists want you.

If the way things are going in this country (doesn't matter which country, they're all being turned to crap), isn't pissing you off, well, maybe you just don't give a damn, but, probably, you are chicken-hearted, afraid you'll lose your job, get arrested, make a fool of yourself, or somehow upset the balance that is life in 2024.

Rents are through the roof. Credit card interest rates now average over 21%. Twenty-one percent, folks! Anybody who hasn't already paid down their credit cards or defaulted on them might as well just slap on the yoke, tighten the chains and get busy slaving life away. You're lost. You're a tool and a coward. You're being used.

You need to let it out. Tell somebody off. Anybody, even your cat. Reject climate change, transgenderism, the prosecution of Donald Trump, media mischaracterization of the news, the Ukraine meat-grinder, Israeli genocide, Google ineptitude, Joe Biden, Jamie Dimon, the politicization of everything.

Today, we're treated to another government number that's supposed to guide our every action, the almighty CPI, released by the Bureau of Labor Statistics (BLS) moments ago, showed inflation persisting.

This, somehow, is wonderful news to Wall Street. But, it isn't, really, is it? Wall Street wants lower rates, easier money. Annual inflation of 3.2% in February is higher than the 3.1% in January. Inflation is not going away.

Stock futures went straight up on the release. What a complete con job.

Read it for yourself, straight from the BLS:

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.4 percent in February on a seasonally adjusted basis, after rising 0.3 percent in January, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 3.2 percent before seasonal adjustment.

The index for shelter rose in February, as did the index for gasoline. Combined, these two indexes contributed over sixty percent of the monthly increase in the index for all items. The energy index rose 2.3 percent over the month, as all of its component indexes increased. The food index was unchanged in February, as was the food at home index. The food away from home index rose 0.1 percent over the month.

The index for all items less food and energy rose 0.4 percent in February, as it did in January. Indexes which increased in February include shelter, airline fares, motor vehicle insurance, apparel, and recreation. The index for personal care and the index for household furnishings and operations were among those that decreased over the month.

The all items index rose 3.2 percent for the 12 months ending February, a larger increase than the 3.1-percent increase for the 12 months ending January. The all items less food and energy index rose 3.8 percent over the last 12 months. The energy index decreased 1.9 percent for the 12 months ending February, while the food index increased 2.2 percent over the last year.

Let's see: "Indexes which increased in February include shelter, airline fares, motor vehicle insurance, apparel, and recreation." So, staying at home costs more, taking a trip on an airplane costs more, but, driving your car also costs more. Clothes cost more. Having a good time costs more. Are you getting worked up? Hope so.

That's right. The people pulling the strings of the puppets, aka, consumers, want you desperate (you can't afford your place of abode, nor can you take a trip), naked (clothes cost more), and miserable (having fun, i.e., recreation, costs more).

But stocks are going up, so all is well.

Well, Fu-k that.

Personally, I am very pissed off. I've been on this planet 70 years and I've never seen society as completely dysfunctional as it has been since the fake pandemic and the fake election of 2000.

Buy silver. It’s probably 200% undervalued, if not more.

Regards,

A very pissed off Fearless Rick

At the Close, Monday, March 11, 2024:
Dow: 38,769.66, +46.97 (+0.12%)
NASDAQ: 16,019.27, -65.84 (-0.41%)
S&P 500: 5,117.94, -5.75 (-0.11%)
NYSE Composite: 17,863.69, -25.93 (-0.14%)


WEEKEND WRAP: Situation Critical; Gold, Silver, Bitcoin Gains Signal General Economic Trouble

Sunday, March 10, 2024, 3:42 pm ET

In itself something of a fiction, Friday's February jobs number (275,000) and market response left participants a bit on the queasy side. At first glance, the numbers looked good, but once it was discovered that December was revised down by 43,000, from +333,000 to +290,000, along with January, revised down by 124,000, from +353,000 to +229,000, doubts about the veracity of the BLS estimates began to emerge. January's number being wrong by 35% rekindled long-standing suspicions over the BLS methodology and by the end of the Friday session, all earlier gains had been erased, leaving stocks down overall for the week.

Amplifying doubts about the strength of the US economy (after all, Biden told the world the US was strong just the night prior, in his SOTU address) was the unemployment number, up 0.2%, to 3.9%, the highest since January 2022.

Preceding Friday's flop session were two days of testimony by Fed Chair Jerome Powell, which helped recover some of the losses incurred on Monday and Tuesday. Not that the Chairman's ramblings were all that insightful. He might as well have been reading from a phone book for all the good - or bad - it did.

Over in fixed income, treasuries were being snatched up at a solid clip, with yields turning lower on long-dated maturities. Bond buyers are stealthily anticipating future, and by no means certain, rate cuts, trying to lock in yields as high as possible, anticipating they will go even lower.

Behind the curtains, On Wednesday, troubled New York Community Bank (NYCB) got bailed out a much needed cash infusion from the likes of former Treasury Secretary Steven Mnuchin's Liberty Strategic Capital and others including Hudson Bay Capital, Reverence Capital Partners, Citadel Global Equities and other institutional investors and members of the management team, to the tune of $1 billion. These fresh faces got their shares at $2.00, after trading on the stock was halted as it fell from opening at $3.10 to low of $1.70. NYCB has recently suffered the misfortune of receiving a large portion of failed Signature Bank's book of residential and commercial loans, mostly underwater, last April.

Initially seen as a positive, the bank's shares were sent to a high of nearly $14 last July, but had been slowly giving up ground until problems were exposed late January, sending the stock reeling from $10.38 on January 30, to $4.30 a week hence. Problems in small and regional banks were neatly papered over a year ago, but the underlying underwater loans and upside down asset allocations have re-emerged and may be about to convulse through the sector as the Fed shuts down the Bank Term Funding Program (BTFP, aka Buy The F--king Puts) on Monday, March 11.

With nowhere to go in the public sector other than the discount window, more banks with ugly balance sheets will be exposed unless they're quietly made whole (for now) by private investors. Many smaller banks are stuck with treasuries yielding less than two percent on their books and commercial real estate (CRE) loans that have been souring for years, especially since the pandemic (2020-21). Office and retail spaces have reported alarming vacancy rates across the landscape, with as much as $929 billion of such loans maturing this year.

Combing through employment data, banking woes, and dodgy economic reports, investor camps are divided over how the metaphoric rate structure of "higher for longer" will play out. Sensing that everything's still up in the air, groups have been fleshed out to "soft landing", "hard landing", "no landing", or "crash landing," depending upon which version of truth or dare they wish to play.

It is likely that these and other forces were responsible for the headliners of the week, bitcoin and gold, both of which soared to record high after record high in a signal that the party is coming to an end. Moving money from stocks and bonds into gold and bitcoin isn't rotation. It's capital flight, from the US dollar and other fiat currencies to safe haven assets.

The meteoric gains in gold and bitcoin over the past two weeks is signaling not only that a recession is dead ahead, but that another banking crisis is approaching quickly. As if such scenarios weren't bad enough, the coming currency crisis will absolutely dwarf them in terms of pain and suffering for those without protection.

This is a catastrophe long in the making and it seems perfectly timed for the upcoming elections in November. Why else would gold smash through all-time highs with most of the buying being done by central banks?


Stocks

It's been said that nobody rings a bell at the top of a rally or the bottom of a bear market. The unattributed (Jesse Livermore or Art Cashin, maybe?) Wall Street adage bears out the truth of markets, that they can turn on a proverbial dime. If a bell was rung on this latest bubblicious bull, it was a little over a week ago, when the NASDAQ exceeded its November all-time closing high (16,057.44) with a new top of 16,274.94, completing the index trifecta, after the Dow and S&P had attained record levels earlier in the current cycle. (DING!)

On Friday, AI darling, Nvidia (NVDA) may have struck the gong again, executing a 100-point reversal, from a mid-morning high of $975 to a low of $865 early in the aftenoon, losing over a quarter trillion in market cap. The share price remained near the lows to the end of the session, then moved even lower ($851) in after-market trading. (DONG!)

Since there are no random events on Wall Street or anywhere else for that matter, gains in gold and bitcoin, another bank failure and rescue, and the ongoing flight from Dow stocks to small caps are well-related to Nvidia's sudden demise. Money, and a lot of it, is moving rapidly out of stocks and heading elsewhere and some of the money is leaving the fiat money fantasy-land altogether. Central banks have been scarfing up gold for the better part of the last three years, and now retail investors and consumers are moving hard into crypto, as bitcoin and ethereum have clearly demonstrated.

Other indicators, including US Durable Goods, Factory Orders, recessions in Germany, Japan, and England (three of the G7), and the Shiller CAPE have already set off alarm bells.

Regarding the latter, the Shiller CAPE, which measures a price to earnings ratio for the S&P using ten-year averages, has only been higher than the current 34.26, twice, from January 1998 to April 2001 (dot-com boom and bust), and January 2021 to January 2022 (blow off top and reversal). For further reference, the high prior to the sub-prime bust was only 27.55, and the top prior to the October crash of 1929 was 31.48.

The VIX, the most reliable indicator of volatility, bottomed at 12.07 on December 12. It closed Friday at 14.74. It's not going to stay below 15 forever, that's for sure.

Throw in massive gains in gold and bitcoin the past few weeks and one really doesn't need to be hit over the head with a hammer or other blunt instrument. The market will find gains very hard to come by in coming weeks and months.

With the market badly in need of a catalyst, economic data will supply plenty with the February CPI reading and related cores, non-core and super core iterations on Tuesday. The weekly EIA report of crude oil, gas, and distillate flows comes out Wednesday. The Producer Price Index (PPI) report, February Retail Sales and weekly unemployment claims all emerge at 8:30 am ET on Thursday, followed by Friday's readings on capacity utilization, industrial production and the University of Michigan's consumer sentiment survey.

Just a few companies are still to report fourth quarter and full year 2023 results, including (ORCL) Monday after the close, followed by the likes of Archer Danials Midland (ADM), Lennar (LEN) Dollar Tree (DLTR), Dollar General (DG), Adobe (ADBE), Kohl's (KSS), Dick's Sporting Goods (DKS), and Jabil (JBL) through the rest of the week. These companies aren't likely to have a huge effect on the overall market, though the retail names could provide some inkling of guidance on inflation and consumer spending.


Treasury Yield Curve Rates

Date 1 Mo 2 Mo 3 Mo 4 Mo 6 Mo 1 Yr
02/02/2024 5.49 5.51 5.43 5.42 5.22 4.81
02/09/2024 5.49 5.51 5.44 5.43 5.26 4.86
02/16/2024 5.48 5.51 5.44 5.45 5.31 4.98
02/23/2024 5.49 5.51 5.46 5.46 5.32 5.00
03/01/2024 5.54 5.49 5.42 5.41 5.27 4.94
03/08/2024 5.51 5.48 5.46 5.40 5.34 4.92

Date 2 Yr 3 Yr 5 Yr 7 Yr 10 Yr 20 Yr 30 Yr
02/02/2024 4.36 4.14 3.99 4.02 4.03 4.33 4.22
02/09/2024 4.48 4.25 4.14 4.17 4.17 4.48 4.37
02/16/2024 4.64 4.43 4.29 4.31 4.30 4.58 4.45
02/23/2024 4.67 4.45 4.28 4.28 4.26 4.51 4.37
03/01/2024 4.54 4.32 4.17 4.20 4.19 4.46 4.33
03/08/2024 4.48 4.25 4.06 4.08 4.09 4.36 4.26

Full spectrum spread deepened out to -125 as the 30-year yield fell seven basis points while the 30-day dipped only three, putting the entire curve at its deepest inversion since January 12. 2s-10s dropped to -39. Yield on the 10-year fell 10 basis points while the 2-year note declined only six. Fives and sevens have dis-inverted in relation to 10s, 20s, and 30s. Threes and 30s are also dis-inverted (normal) by one basis point.

The rush into treasuries is nothing unusual. Fleeing stocks leads directly into the safety of fixed-income flows.

Monday, March 10, will mark the two-year anniversary of interest rate curve inversion, when 7s and 10s evened out at a yield of 1.98% back in 2022, after which the Fed pumped rates higher for then next 14 months, then suddenly paused and has kept the federal funds target rate at 5.25-5.50%.

With the March-April FOMC meeting still three weeks away, there seems to be more urging for the Fed to drop rates, especially in light of Friday's jobs numbers, though it's still quite unlikely that the Fed will move rates any time before June. Tuesday's CPI and Thursday's PPI reports will shed more light on rate prospects.

Spreads:

2s-10s
9/15/2023: -69
9/22/2023: -66
9/29/2023: -44
10/06/2023: -30
10/13/2023: -41
10/20/2023: -14
10/27/2023: -15
11/03/2023: -26
11/10/2023: -43
11/17/2023: -44
11/24/2023: -45
12/01/2023: -34
12/08/2023: -48
12/15/2023: -53
12/22/2023: -41
12/29/2023: -35
1/5/2024: -35
1/12/2024: -18
1/19/2024: -24
1/26/2024: -19
2/2/2024: -33
2/9: -31
2/16: -34
2/23: -41
3/1: -35
3/8: -39

Full Spectrum (30-days - 30-years)
9/15/2023: -109
9/22/2023: -99
9/29/2023: -82
10/06/2023: -64
10/13/2023: -82
10/20/2023: -47
10/27/2023: -54
11/03/2023: -76
11/10/2023: -80
11/17/2023: -93
11/24/2023: -95
12/01/2023: -105
12/08/2023: -123
12/15/2023: -154
12/22/2023: -149
12/29/2023: -157
1/5/2024: -133
1/12/2024: -135
1/19/2024: -118
1/26/2024: -116
2/2/2024: -127
2/9: -117
2/16: -103
2/23: -112
3/1: -121
3/8: -125


Oil/Gas

$77.85 was the close-out price in New York for WTI crude on Friday, retreating from last week's close of $79.81, a four-month high. Despite ongoing military confrontations spreading throughout the Middle East and production curbs from Saudi Arabia and Russia extended, the oil flow continues to be relentless. The US is producing at the top of its game, leading to downward price pressure.

Another factor in play continues to be consumer health. It comes as no surprise that when gas prices begin to rise, consumers, many of whom are close to tapping out or topping out on credit cards, back away from the pumps. Like oil, there's no shortage of gas or any other type of fuel and demand just isn't that strong.

The mildest winter in recent memory, thanks to El Nino, has also kept general fuel prices in check. With Spring arriving in less than 10 days (March 19), demand for natural gas and fuel oil will be falling fast. In deference to experts who see higher prices in their crysal balls, crude prices continue to percolate just below $80, but may begin to settle down in the absence of further military escalation or other obscene, unpredictable events.

Gasbuddy.com reports the national average for a gallon of unleaded regular gas at the pump at $3.40, up five cents from last week after a nine-cent gain the week before. Since late January, when gas was selling right around $3.00 nation-wide and well lower in mostly Southern states, gas is up more than 10%.

The Northeast and the West coast remain the places with the most expensive fuel, with California up another nickel to at $4.87, while Pennsylvania, tops in the Northeast, down a penny to $3.52. Illinois remains the Midwest outlier, at $3.70.

Texas ($2.89) is one of just three states reporting prices under $3.00. Mississippi ($2.92) and Louisiana ($2.99) are the other two. Prices have risen, albeit modestly, across the country, but mainly in the midwest.

California and Washington ($4.18) were joined by Nevada ($4.04) in the new $4+ club. Oregon ($3.89) and Arizona ($3.57) remain elevated. Suppliers will be switching over to the more expensive summer blend in about six weeks. May 1 is the official date. Gas prices might increase, but politics and slack demand will have a say in how much.

Bitcoin

This week: $69,603.00
Last week: $62,240.30
2 weeks ago: $51,498.70
6 months ago: $25,830.70
One year ago: $20,646.70

Bitcoin continued to attract investors of all stripes, mostly speculators via various ETFs, topping out just over $70,000 on Friday before falling back, but ground has been gained over the weekend.

The logic behind buying bitcoin - aside from the fact that the ruthless federal government now requires any crypto transactions to be declared on individual tax returns - is similar to investing in hard assets and precious metals in many regards, but remains highly speculative as a means of wealth preservation. To many, mostly millennials, GenXers, Zoomers and a smattering of Boomers with nothing better to do with their money, the lure of riches is also hard to resist.

Anybody who caught the bottom between mid-November, 2022 and mid-January, 2023, is already looking at a solid four-bagger, but that hasn't stemmed the flow into the crypto asset class as a whole. Seeing that the prices of various crypto-currencies and other alt-things are tethered to nothing at all, the sky is literally the limit. The upcoming "halving" in April is supposed to be the catalyst for the latest move, but it sure appears that the timing of SEC approval for the 11 ETFs earlier this year was the primary cause for a significant boost in adoption.

The other side of the crypto coin is its alternative to fiat currencies, just like gold and silver. How that plays out is anybody's guess, though history would suggest that prospects will be dimmed by regulations and possible outright banning of anything crypto by jealous regulators at the federal level. For now, however, the flow continues and the price keeps rising.


Precious Metals

Gold:Silver Ratio: 89.16; last week: 89.61

Per COMEX continuous contracts:

Gold price 2/9: $2,038.70
Gold price 2/16: $2,025.50
Gold price 2/23: $2,045.80
Gold price 3/1: $2,091.60
Gold price 3/8: $2,186.20

Silver price 2/9: $22.67
Silver price 2/16: $23.48
Silver price 2/23: $23.19
Silver price 3/1: $23.34
Silver price 3/8: $24.52

Gold outperformed anything and everything on the planet this week and it probably won't be the last time it reports in at the top of all investments. The nearly $100 gain this week, pushing to record high after record high, was good for a percentage gain of 4.52%.

Those crying about the "under-performance" in silver fail to recognize that even though it wasn't setting records, it still did better than gold, rising 5.06% from the week prior. This, and the tiny decline in the gold:silver ratio indicates that silver has begun catch up mode and should continue to outperform gold in the near term.

While the gains in gold have largely been the result of unprecedented buying by central banks and sovereign funds, silver is generally the province of the common man and woman, as it has been throughout history. The ancient adage, attributable to one Norm Franz, guiding forward the sudden uptake in precious metals goes like this:

Gold is the money of kings,
silver is the money of gentlemen,
barter is the money of peasants,
but debt is the money of slaves.

(We're not sure whose money is bitcoin)

Since all that green paper in your wallet or purse is nothing more than a promise to settle debt, the common man is following the kingly central bankers in a quest away from slavery toward for economic freedom.

This is just the beginning. As conditions surrounding the functioning of the US federal government and those of other nations around the world continue to deteriorate, demand for hard assets, especially gold, for the upper eschelon, but also silver for everybody, will increase as the mania develops.

Inflation, largely the result of government fiscal policies in the form of deficits and debt as far as the eye can see, will not abate in any meaningful way unless the Federal Reserve stomps on the brakes, an action they have neither the brains nor the nerve to consider. Interest rates would have to be much higher than they are today to slow down various sectors of the economy. The vicious cycle that has been created by the Fed and the government causes foreseeable actions. Businesses, forced to raise prices to make profits, are stuck in a loop so long as consumers continue to purchase, and those purchases have largely been the essentials, food and energy.

There are going to be disruptions as consumer appetites evolve, budgets are stretched, businesses can't keep up, but, overall, what's happened over the past two years is strikingly similar to other hyper-inflationary escapades seen in Zimbabwe and famously, the Weimar Republic of Germany between World Wars I and II. They also began gradually before the unfettered printing of the currency eventually caused complete, total economic collapse.

That is the likely path upon which the United States, Europe, Japan, and China are headed. The top thinkers at the Fed have the choice of saving the economy or the currency. They are currently trying to thread the needle by sacrificing parts of both, though that is not a complete solution. Should they continue on this "virtuous" path, feigning tightening while the government pushes inflation out the door, both the economy and the currency will go up in smoke.

Of course, this takes time, as in decades, but the US and the rest of the world has been under the spell of fiat currencies for well over 50 years, since Nixon closed the gold window in August, 1971, so that time may be growing short, counted in years, maybe even months.

No matter what happens, gold and silver (and likely, bitcoin) will continue to show gains against all fiat currencies. Gresham's Law posits that bad money drive out good, which is why there is fiat everywhere and gold and silver underground, at the bottom of lakes, and in shoeboxes in closets, attics and basements. The good money was driven out by the bad. It will take a very long time and probably much unnecessary blood and tears before the process reverses and good money drives out the bad.

Here are the most recent prices for common one ounce gold and silver items sold on eBay (numismatics excluded, free shipping included):

Item/Price Low High Average Median
1 oz silver coin: 30.54 45.77 37.45 36.00
1 oz silver bar: 31.51 40.50 35.79 35.50
1 oz gold coin: 2,235.70 2,417.94 2,291.34 2,290.71
1 oz gold bar: 2,245.00 2,305.91 2,270.14 2,270.16

The Single Ounce Silver Market Price Benchmark (SOSMPB) remained elevated, though slightly lower than the previous two weeks, dipping to $36.19, a loss of 33 cents from the March 3 price of $36.52 per troy ounce.

What was notable about this week's ebay survey was the amount of gold for sale. With prices up, there was no shortage of willing sellers looking to cash out. The spike was massive and sudden, so one cannot blame long-time holders of gold to take some profit. There's probably more where that came from and it will be heading out the door soon. Silver was a different story. It appears that the huddled masses of silver stackers aren't quite convinced and probably won't be until silver surpasses $26/ounce and then proceeds past $30. Though the silver is a much smaller market, buyers seem to have developed a little bit of discipline as buyers, probably the unintentional result of such a fluid physical market that ebay has become.


WEEKEND WRAP

Well, that wraps up what was one heck of a week. This edition of the "wrap" took much longer than anticipated to produce, but is hopefully well worth it.

The rest of this year promises to be a time of significant volatility and transformation. Politics, economics, and social trends are all coalescing toward the November US elections.

Be patient. Be resolute. Be vigilant, but, overall, be prepared.

Finally, this wide-ranging interview on Commodity Culture with Matthew Piepenburg is quite informative on a variety of fronts, but especially in reference to de-dollarization, gold, and the future of money.


At the Close, Friday, March 8, 2024:
Dow: 38,722.69, -68.66 (-0.18%)
NASDAQ: 16,085.11, -188.26 (-1.16%)
S&P 500: 5,123.69, -33.67 (-0.65%)
NYSE Composite: 17,889.62, -38.00 (-0.21%)

For the Week:
Dow: -364.69 (-0.93%)
NASDAQ: -189.83 (-1.17%)
S&P 500: -13.39 (-0.26%)
NYSE Composite: +161.35 (+0.91%)
Dow Transports: -114.40 (-0.72%)


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