Weekly Market Commentary
The Fed’s favorite inflation gauge, “Core PCE”, rose 0.3375% m/m [3.62% y/y] this month – the highest increase since the early 90s. Powell’s speech (released at 10 am on Friday) was seen by the market as dovish, however, and that drove PM prices higher in response. Even so, my sense is that the Fed will start maybe-sort-of-thinking-about-tapering, either at this coming meeting, or the next one.
The buck retreated [-0.80%] this week, unwinding most of last week’s rally. After breaking out last week, the buck’s trend is looking a little bit bearish this week.
The drop in the buck helped gold substantially [+37.98 +2.08%]; gold even managed to close back above the 200 MA. Most of this week’s move came on Friday following the release of Powell’s speech at 10AM. The trend for gold – call it a weak uptrend.
Silver performed even better [+1.07 +4.65%], with most of the moves happening on Monday and Friday. Interestingly, commercial shorts continued to flee silver during this week’s rally, which I take to be a bullish sign. Commercial shorts remain at two-year lows – and they are not far from a three-year low. Last time we were here was back in 2019 when silver was trading around $15/oz. It sure looks like the banksters do not want to be short silver at this time. This sort of thing usually happens around the lows. I know, I keep saying this – but then the commercial short levels drop some more!
Its almost as if the commercials really don’t want to be on the hook to deliver actual silver bars if price ends up rallying.
The miners recovered from last week’s plunge, erasing most of last weeks loss [+6.81%], printing a strong-looking bullish reversal pattern, and it seems as though the miners are back in an uptrend – after dropping for much of the last 11 weeks.
Crude retraced all of last week’s losses and then some [+6.75 +10.92%]. As with silver, the commercial shorts are hovering around multi-year lows – even though the price has fallen less than $10 over the past 8 weeks. Last time we saw the commercial shorts at these levels, oil was around $40. This behavior suggests to me that the commercials do not want to be caught short crude right now – just like silver. It seems like higher oil prices are probably ahead, since the well-connected banksters are usually right about these sorts of things. Perhaps if President Grandpa just grovels a little bit more – Saudi Arabia will produce more oil, and that will fix everything? Not likely. The Oligarchy definitely wants higher oil prices. Because – “climate change!” Higher oil prices = “easy”. Energy independence = “hard.”
Equities broke out to yet another new all time high this week, up +39.37 [+0.88%]. All news is good news for equities, it seems. At least right now. Sector map was bullish, with energy & financials in the lead.
While crappy debt is doing well [+0.83%], the 10-year moved slightly lower [yield rose +4.7 bp to 1.31%]. While the 10-year did seem to like Powell’s speech, it didn’t really move all that much.
If the Fed is going to stop printing, they don’t seem to be in a big hurry to do it. At least not this week anyway. Even with core PCI near 30 year highs. Perhaps inflation is the goal too? Hmm. No “perhaps” about it. The country is getting the outcome they want. Same as for what is happening in Afghanistan.
News That Caught My Eye This Week
Get Vaccinated or Families Lose Pensions, Local Chinese Authorities Say
In a bid to improve vaccination rates, local authorities in China are punishing entire families if one member refuses to receive jabs against the CCP (Chinese Communist Party) virus.
Officials from several counties and cities governments said they will stop giving pensions and medical aid to the unvaccinated. Authorities will also bar unvaccinated individuals from visiting schools, workplaces, or other areas outside their homes, such as shops, banks, and libraries.
In China, the shots are so good, and so widely accepted, that Chinese Plebe families will face collective punishment (an “unvaxxed lockdown?”) if any individual Plebe within the family decides they don’t want the shot. This is interesting, because as we know, “COVID lockdowns” started first in China, and then migrated worldwide. Now we’re seeing “unvaxxed lockdowns.” Oligarchy is incredibly jealous of the CCP’s vice-grip over its own population. The “China Model” does appear to be the global governance model they want to adopt.
I must confess I am curious how much someone has to pay in China to get their “compliance card.” I’m just guessing that the Leadership won’t need to get the shot if they don’t want it. That’s also how it always is. Shots for thee, but not for me.
How many CCP governance model imports will we put up with, I wonder, before it all blows up?
Biden to campaign for California Gov. Newsom ahead of recall vote
The recall drive against Newsom went into overdrive after he was photographed last November attending a maskless dinner with 11 others at the exclusive French Laundry eatery in Napa County after telling Californians to avoid gatherings of more than three households. He has also been criticized for sending his children to a private school that adopted a hybrid learning model while most public school students remained stuck in remote learning last school year.
So the increasingly unpopular President Grandpa is going to campaign on behalf of Governor French Laundry. I’m not sure if this will end up helping. However, it is an indicator that the Governor is in big trouble. First Cuomo, and now French Laundry – leaders of the two largest Blue states, under extreme pressure. Its not exactly a ringing endorsement of popular support for the Oligarchy’s pandemic policies.
Larry Elder, a black radio commentator, is leading the recall pack. You know they are worried about him when they start calling him, “the black face of White Supremacy.” I think the whole race-baiting thing is so 2020 – a sort of “fun-once” experiment that people are now tired of, after 18 months of “California Lockdowns”, where the elites do what they want, send their kids to private schools, while the Plebe children get Zoom “education” and are told not to leave their homes because, pandemic. Source
CDC’s COVID-19 eviction moratorium blocked by Supreme Court
WASHINGTON (AP) – The Supreme Court’s conservative majority is allowing evictions to resume across the United States, blocking the Biden administration from enforcing a temporary ban that was put in place because of the coronavirus pandemic.
The court’s action late Thursday ends protections for roughly 3.5 million people in the United States who said they faced eviction in the next two months, according to Census Bureau data from early August.
That’s hundreds of thousands of mom-and-pop landlords who will now be able to get paying tenants in their duplexes, allowing them to actually make their mortgage payments instead of having to default on them and lose their life’s savings. Perhaps the “forever-eviction-moratorium”, which is another cog in the middle-class-to-Oligarchy wealth transfer machine, will finally end.
The ongoing destruction of the US middle class is not a figment of our imagination. “Your middle-class biz is closed – our agent, Governor French Laundry, says it is non-essential, and whats more, the tenants in your duplex don’t need to pay – and you can’t kick them out because – pandemic – but you still need to make those mortgage payments! Its a pity you can’t borrow at 2.5% in the bond market like Blackrock can.”
The Supremes have called a halt to this particular plan. At least until Congress passes another one, and President Grandpa signs it.
“Build Back Better! You’ll own nothing. And you’ll be happy!”
A study confirms a small risk of blood clots after vaccines, but not as high as the risk Covid brings.
Wow! We finally have an acknowledgement that the shots really do cause clots! Welcome to the world of science, New York Times! Next step: risk/benefit calculations. For instance, if you are 14 years old, and your “COVID mortality risk” is 1:1,000,000, perhaps that “small” clotting risk may not be all that great a trade-off for you. Whadda ya say, paper of record? And – after talking vax risk/benefit, could we maybe address that “one-size-fits-all-vax-mandates-using-leaky-failing-vaccines-with-a-35%-COVID-seroprevalance?” Turns out, natural immunity really is a thing! And a bunch of people have it already! Maybe they don’t need the shot! And what’s the incidence of “rare” adverse events for people who already have natural immunity? More risk/benefit discussions! Actual science! Personal choice too!
Man will they look stupid – and not too long from now – to their own readership if they don’t get on board the “actual science” train.
Fed chair Powell says he supports starting to taper bond purchases this year
Federal Reserve Chairman Jerome Powell revealed on Friday that he was one of the majority of Fed officials who believe the central bank can “taper” or slow down the pace of its bond purchases this year.
I’m going to call our Fed Chairman taper-hesitant, and an inflation-denier. Well sure inflation is 4% annualized, even with the government’s grossly understated “Core CPI”, but – all this is “likely to prove temporary.” No wage-price spiral.
Snark aside, Powell might be correct about “no wage-price spiral.” I see three possible reasons for this: 1) In September, Blue states will stop paying people not to work, 2) the millions of “new worker”/illegals that are swarming across the southern border (no mask, ID, passport, or COVID test required, unlike you and me if we arrive on an international flight) will definitely reduce wage pressures, and 3) we just got 100,000 new workers airlifted in from Afghanistan! I suspect the current wage-price inflation (and all those “help-wanted”) signs will disappear by end of September – or, latest – end of October.
1.6m Moderna doses withdrawn in Japan over contamination
TOKYO/ NEW YORK — About 1.6 million doses of Moderna’s coronavirus vaccine have been taken out of use in Japan because of contamination reported in some vials, the Ministry of Health, Labor and Welfare said early Thursday.
Several vaccination centers have reported that vaccine vials contained foreign matter, according to an announcement from the ministry, which added it will seek to minimize the impact of the withdrawal on the country’s inoculation program.
The ministry said later in the day that the substance that had been mixed in may have been metal. “It’s a substance that reacts to magnets,” a ministry official said. “It could be metal.”
Interesting. A “foreign matter” reacts-to-magnets compound in the vaccine, you say?
What’s even more interesting is that Japan’s ministry of health actually checked. Can you imagine the NIH or the CDC conducting such a check? FDA? Not possible – they’ve staked what fragments remain of their vanishing credibility (Aduhelm: Doesn’t work, but – Approved!! Ivermectin: saved hundreds of millions of humans from river blindness but – For Cows and Horses Only!!) on the shot being “safe and effective” with only very, very, super-duper-rare side effects (*).
(*) such as the 13,627 deaths reported as of Aug 20.
U.S. retaliates against ISIS with drone strike in Afghanistan
There were a cascade of articles about the entirely predictable suicide bombing attack on our outnumbered and outgunned soldiers guarding the surrounded Kabul airport, including an all-of-media excitement over a new US drone attack – “we killed a planner! Woohoo!”
Step #1: first, shoot yourself several times in the foot. Step #2: be puzzled and angry when your self-inflicted wound starts to hurt. Step #3: to salve your wounded ego, blame someone else for your self-inflicted injury. Step #4: shoot this other person.
Can the US military be this incompetent? Maybe those in command who are pliable enough to actually execute the Oligarchy’s force-wide hunt for “extremists” just do not have the mental agility to organize any difficult real-world missions.
Or perhaps they’re all paid CCP agents. After all, if Swalwell is able to remain on the House Intel committee after having a relationship with a CCP spy, what does “impossible” really look like?
Or maybe Defense/Industrial is working overtime to create a pretext to stay there – or perhaps start a new war – by sociopathically sacrificing the lives of American servicemen and women as the mechanism. And the about-to-leave-via-the-revolving-door “Generals” are playing along because they know who will really butter their bread post “service to the country.”
Or maybe Oligarchy is getting ready to dump President Grandpa? With the incredibly inauthentic – even for a politician! – Kamala Harris waiting excitedly in the wings. And – who can say – maybe Pelosi has her eye on the about-to-become-vacant VP slot. Then, six months later, they pull a Cuomo and “encourage” Kamala to resign (because – whatever) and we end up with President Pelosi. Or – as Jim Kunstler suggests – President Obama! It sure would be quite the operation to backdoor him into office for a third term. And that sets Obama up for another $63 million “book deal” in 2025. For sure he gets another mansion – or maybe two this time!
Is this a conspiracy? Or incompetence? Its hard to say from 100,000 feet. But I liked Lara Logan’s take: the US is getting the outcome it wanted in Afghanistan. It has the power to change the outcome, and it is not using this power at all. Not even now. Lots of levers they could pull. They aren’t pulling any of them.
Same is true about inflation. Fed has levers – but they are not pulling any of them – with Core PCE at 4%! And oil prices – same thing. And unlimited immigration – same thing. And the destruction of middle-class small business, and middle-class mom-and-pop landlords. And, of course, No Treatments For You, leading directly to an increase in fear and death. These are – all of it – the outcome they wanted.
Its enough to make a guy a little bit skeptical of central authority.