Gold becomes the safest option

• The Dollar continues to go higher to overbought, per Chuck!

• A $100 Trillion Time Bomb is ticking.... Who will blink first?

Good Day... And a Tom Terrific Tuesday to you! Well, a PT guy came to the house yesterday, sent by my doctors, to get me strong again... I told the PT that my youngest son was a PT, and he about turned around and left, but then I told him that my son hadn't checked with me, so he was more than welcome to begin... I passed all the tests! I even blew the guy away with my balance! And That, was the highlight of my day! I did sit outside and read again, marking two days in a row of me getting outside... It's the little things that I work toward these days.... Uriah Heap greets me this morning with their 70's anthem song: July Morning... This is the song that I quote the lyrics to the first Pfennig of July... 

Well, I have to say that the dollar bugs have got me... They've got me for being so jaded about the dollar's current rally... They just had to prove to me that it was real, and that, they did yesterday, with the BBDXY gaining 4 index points to 1,257... Now, all I ask, is that one of these dollar bugs to explain why they should be buying the dollar, and I'll give up dissing the dollar... But seeing that's not going to happen (explanation and me stop dissing the dollar) I'm just wasting my time and yours... I guess the dollar bugs believe all the political nonsense that the U.S. economy is working in all facets... If that had even an inkling of truth to it, Gold wouldn't be hitting new all-time highs... 

Speaking of Gold... Yesterday morning Gold was continuing its rally from last week, until it wasn't... Something stopped Gold's run and by mid-morning, Gold was fighting to get back to flat on the day... Then I listened to an interview with Egon Von Greyerz of Gold Switzerland, and he talked about how what he was seeing was a lot of his clients selling Gold to pay for housing, etc. So, as long as this brief sell off doesn't gain legs... Silver did continue its rally, but fell back below $34... James Turk of Gold/ Money had this to say about Silver: "I see $50+ silver is days or weeks away, not months." 

Chuck again... WOW! You know when I told a magazine years ago that Silver would trade above $50, Silver was around $40, so it wasn't that large of a spread difference for me... The thing is, everything I read about the industrial demand for Silver overtaking a large portion of the mined Silver each year, and how dealers are having to dip into their reserves to have Silver to deliver, I can't argue with Mr. Turk on this one....

The price of Oil remained range bound in the $70 handle yesterday, while the 10-year's yield rose to 4.19%... This bond doesn't appear to be in any hurry to stop the rise in its yield... I'm just saying... Any old way, Gold closed yesterday at $2,714.90, and Silver closed at $ 33.75...  And after all the intervention and gyrations yesterday Gold was down 2-cents, and Silver was up 7-cents... Darn short paper traders were out in force yesterday... 

Here's what Ed Steer had to say about that from his letter this morning: "The collusive commercial traders of whatever stripe were at battle stations in the precious metals in both Globex and COMEX trading on Monday -- and in overseas trading, it was most obvious in gold.

But once that phony-baloney dollar index 'rally' began at 8:30 a.m. in New York...they really got serious...as both these precious metals continued to rally in the face of that...plus the rise in the yields of U.S. treasuries. Shortly after the 10 a.m. EDT afternoon gold fix in London was put to bed, they leaned on both silver and gold pretty hard...especially the latter."

I know I highlighted a quote from Andrew Maguire yesterday that talked about how strong demand has put the short paper traders on the sideline... Apparently that thought is not ready for Prime Time just yet... I'm just saying... 

In the overnight markets last night.... Maybe there was a realization that the dollar was overbought, as there was a spot of selling overnight... The BBDXY is down 1 index point to start our Tuesday... This is NO sign that the markets have to come to the realization that the dollar is overbought... We'll half to see more selling in the U.S. session today for that to become a reality... Gold is back to booking gains today and is up $18 in the early trading today, and Silver is up 60-cents this morning... Just shows to go you, that you can't snuff out a strong rally with just one day of intervention!  

The price of Oil has bumped higher overnight, and trades this morning with a $71 handle... Still range bound, folks... And the 10-year just keeps moving higher and trades with a 4.20% yield this morning... 

Usually, or normally in times like this with rising yields in U.S. Bonds, Gold take a backseat... But not this time, because the rising yield is a sign that there are bad times ahead for the U.S.  And gold is a better option at this point... I have something that will bust your buttons in the FWIW section today, regarding this thought... Be sure to stay tuned, don't touch that dial! 

Well, the good folks at GATA sent me this yesterday, and well I have something to say about it, but first here it is "TD Bank just made headlines for pleading guilty to the crime of money laundering and a variety of other charges.

Bankers there provided services to despicable people who needed a way to recycle the cash proceeds acquired by selling everything from drugs to children."

Chuck again... I have to ask you, is this the kind of bank you would want to handle your money, loans, etc? If you have serious concerns about your bank account, Battle Bank is waiting on the FDIC to approve them to open their virtual doors...  

OK... Now back to the markets, economies and dolts... I have all three tied up with a nice bow on top here... first: The IMF’s Fiscal Monitor on Wednesday will feature a warning that public debt levels are set to reach $100 trillion this year, driven by China and the US. Talk about weighing down economies.... I'll come back to that but first we've got to go to number 2: Managing Director Kristalina Georgieva, in a speech on Thursday, stressed how that mountain of borrowing is weighing on the world. As if, we didn't know that already! She must take us idiots! But I've got news for her... We're all on to this weighing down the world thing, and that's why 3: Gold is setting new all-time records, coming from $1800 a year ago (in Rocktober) to more than $2,700 now... 

As far as weighing down economies go... I used to talk about his all the time until I was blue in the face... That too much debt in the U.S. didn't allow the economy to grow, and thus the reason for our avg GDP of 2% for the last ten years! And now China has joined the ranks of indebted countries up to their collective eyeballs, that includes: The U.S., Japan, China, Eurozone, and U.K.  

The question here is: Who is going to be able to play off al this debt? The answer to that question is: none of them! And the debts are so large that they won't be able to inflate them away, so the only thing that's left is a default... And then the question will be: Who will blink first? My guess.... The U.S. 

Speaking of debt.... The U.S. Government had a report for us last week, that flew under the radar of the major media outlets, so, as usual you, dear reader, can depend on me to give the news... And here it is: the US government ran a $1.83 trillion deficit in 2024 (the government’s fiscal year ends in September). It was the third-largest deficit in US history and was up 8% from the $1.69 trillion deficit last year. Yes, the Budgeting people keep telling us that we're at the point where the annual deficit numbers will multiply... So, I can hardly wait for next year's deficit number to be announced... NOT!  

The euro continues to wallow in the mud that has been created by the European Central Bank (ECB ) And the outlook for the euro is not good, as most observers see the ECB cutting rates a few more times in the coming months, thus keeping the pressure on the euro... 

The Petrol Currencies have taken their collective gut punches in the last couple of weeks, and now they are licking their wounds from the double whammy of a strong dollar and weak Oil price... I'm talking about the ruble, krone, loon, peso, rand, and others... Time to batten down the hatches here and wait this out... This currency environment will not continue for months, in my opinion... So, what's the pain in battening down the hatches for a few weeks? 

The dollar, to me, looks to be overstretched at this point... If I had a Bloomberg Terminal like I used to have when I was on the trading desk at EverBank World Markets, I would run the RSI on the dollar and I'm sure it would show me that the dollar was overbought... RSI is the Relative Strength Index....  So, take that with as many grains of salt that you wish, but I'm seldom incorrect on these calls... 

The U.S. Data Cupboard yesterday had the Sept. Leading Indicators, and they actually printed worse than expected for last month, which was negative -.3%... In Sept they fell further in negative territory to negative -.5%... This from the U.S. Conference Board: "“Weakness in factory new orders continued to be a major drag on the US LEI in September as the global manufacturing slump persists,” said Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board. “Additionally, the yield curve remained inverted, building permits declined, and consumers’ outlook for future business conditions was tepid."

Chuck again... Sure doesn't sound like an economy that's hitting on all eight to me! 

Today's Data Cupboard only has a Fed Head speaker on the circuit... 

To recap... The dollar continued to rally throughout the day yesterday, and Chuck challenges a dollar bull to explain why they are buying dollars right now....  Gold's early morning gains were erased during the day yesterday, it could have ben profit taking, or short paper trading, take your pick... Silver continued its rally, but fell back below $34 on the day... TD Bank now joins the ranks of Banks with felony records... Chuck offers up a different bank that you won't ever see on that list... 

Here's your snippet: In a stark assessment of the current economic landscape, Bank of America has issued a warning that gold may be the last remaining safe haven for investors as the United States grapples with an ever-increasing national debt. This pronouncement comes as the precious metal continues to set new record highs, reflecting growing concerns about the stability of traditional safe-haven assets like U.S. Treasury bonds.

Bank of America's analysts paint a troubling picture of the U.S. fiscal situation. The national debt, which recently surpassed $35.7 trillion, is projected to reach unprecedented levels over the next three years. This trajectory has altered the traditional relationship between gold and macroeconomic factors such as interest rates, making the metal increasingly attractive to investors seeking stability.

In a significant shift, Bank of America suggests that gold has become a safer investment option than U.S. Treasury bonds. This change is attributed to the mounting risks associated with what the bank describes as an "impending debt crisis." As the U.S. continues to accumulate debt at an alarming rate, the perceived safety of government bonds is being called into question.

The bank's analysis highlights a concerning lack of fiscal discipline in the political sphere. Neither of the current US presidential candidates appears poised to address the debt issue meaningfully. In fact, their economic plans are expected to further exacerbate the problem, potentially pushing the national debt to even greater heights."

Chuck Again... Well, bust my buttons! I can't believe that a major Bank is making this statement, because all they've done in the past is dis Gold, called it barbaric, and other names, and tried to get their banking clients to look to other forms of investment... This is a major shift, folks... And one that should not be ignored... ping, ping ping... What's the sound? It's the warning from the backing up truck! 

Market prices 10/22/2024: American Stye: A$ .6687, kiwi .6053, C$ 7230, euro 1.0827, sterling 1.2978, Swiss $1.1557, European Style: rand 17.5779, krone 10.9183, SEK 10.5360, forint 370.03, zloty 3.9942, koruna 23.3383, RUB 95.48, yen 150.91, sing 1.3155, HKD 7.7736, INR 84.07, China 7.1209, peso 19.92, BRL 5.6953, BBDXY 1,256.27, Dollar Index 103.77, Oil $71.22, 10-year 4.20%, Silver $34.45, Platinum $1,021.00, Palladium $1,078.00, Copper $4.39, and Gold... $2,734.82

That's it for today... Darling Daughter, Dawn, called last night to see if I needed her to deliver some dinner to me... I told her that was nice to offer, and then thought to myself that: if I wanted dinner delivered, I would just go to Door Dash APP!) Besides she has to cook two dinners a lot of nights, because of her kids' different schedules... I booked two more doctor appts for me next week, which makes 3 of them on Tuesday! One of them is an appt with a new doctor at SLU, for a second opinion, on the tumor in my mouth... The results of the echocardiogram I had last week were back, and they weren't good... The fluid around my heart hasn't budged / got smaller. So, third appt next week is with the doc who wants to do surgery to remove the fluid... UGH! Oh well, it is what it is... The Little River Band takes us to the finish line today with their song: Lonesome Loser... I hope you have a Tom Terrific Tuesday today, and please remember to Be Good To Yourself!