The Dollar's share of reserves has fallen a bit

• Currencies & metals get sold on Tuesday.

• The dollar's share of reserves has fallen a bit.

Good Day... And a Wonderful Wednesday to you... 3 down, 1 to go... I never thought it would ever get here, but now I'm just days away from my Ireland sojourn... Cardinals were rained out last night, so as Ernie Banks used to say, "let's play 2!" Cardinals / Braves will play a double header today... The regularly scheduled game for today, was a day game, so the rained out game will be the 2nd game... I was watching the 5 o'clock news last night, and there was no mention of rain interrupting the baseball game... So, it was a surprise rain, that really cooled down the air, that had reached 102 during the day... That tied a record that was set in 1988... I'm not even going to go into what I think about that! My favorite John Denver song greets me this morning... Back Home Again...

I guess we'll hear today whether the Fed did actually get held ransom by a hacker... I don't think you'll hear Lester Holt, or any of the other National News outlet, tell you about that... I'm just saying... 

The dollar continued to get bought yesterday, and the BBDXY ended the day up a total of 2 index points to 1,266... The euro held on to the 107 handle, but the rest of the currencies, including the Petrol Currencies, saw their recent levels reduced... Gold ended the day down -$15 and Silver lost 69-cents and fell below $29 again... The short paper traders took Silver below it's 50-day moving average.  

The short paper traders have gone to a new tactic it seems... They are going to make Gold's rise bumpy, in an attempt to scare away investors who are used to see things that they buy go straight up... Well, these aren't the kind of investors I want to see buying Gold, because they will just sell it at the first sign of a good profit... They have no idea why they should be buying Gold, and it's better than we don't tell them, for they won't want to know! 

The price of Oil slipped below the $81 handle yesterday, at $80.89... One would think that with the political gyrations going on around the world, that Gold would be well underpinned, and only moving higher... The short paper traders know that, and so they'll make things bumpy for Gold & Silver from here on out.. The 10-year's yield saw some selling yesterday, and it ended the day with a 4.26% yield...  

In the overnight markets last night... Well, the foreign markets finally got the memo about how the U.S. markets were buying dollars, and they acted on it. The BBDXY is up 4 index points to start the day today. The euro fell further in the 1.06 handle, and the rest of the currencies have been sent directly to their respective sick beds, they can't pass Go, nor can they collect $200. Right to bed!  This dollar strength is way overdone in my opinion, but don't get caught stepping in front of this speeding bus!  

Gold & Silver are getting sold this morning to start our day... Gold is down $9 and Silver is down pennies... Wait a minute here... Gold & Silver got sold yesterday, isn't today a Gold & Silver rally day? Hmmm... OK, I don't really buy into the buy one day sell the other, as written in stone... 

The price of oil bumped higher overnight and trades, once again with an $81 handle... I read this morning that Oil traders are waiting on the economic data that will print tomorrow, before making any further bets on the direction of Oil... Well, I guess that's a prudent thing to do, but supply and demand would be my choice of direction giver! I'm just saying... The 10-year's yield continued to inch higher and trades with a 4.29% yield this morning... 

I read this morning that the bets (in futures) that the Fed Heads will cut rates soon, have been pared a bit, and I'm sure that has something to do withe the recent slide in the 10-year's yield... 

Ok, all the de-dollarization talk has grown recently, and this is beginning to show in the level of reserves that countries hold in dollars... Years ago, it ran around 64%, with the euro coming in second... Yesterday it was reported that the dollar's holding by Central Banks had slipped, here's the skinny: 58% U.S. dollars and 20% eurosThe remaining 22% is divided among yen (6%), sterling (5%), Canadian dollars or CAD (2.5%) And other currencies are each less than 2% (AUD, CNY, CHF).

I wouldn't say that the dollar is in trouble just yet regarding the amount of dollars held in reserve by foreign banks... I would say that this shows that the rot is on the vine, and that eventually the rot will take over the whole vine... The main component of the dollar still being used widely is the fact that a ton of Oil contracts are still traded in dollars... But with the Saudi announcement that I talked about here recently, this support for the dollar will fade... I would say that a fall from 64% to 58% is significant... I'm just saying... 

Well, then isn't that special (in my best church lady voice!) Janet Yellen, our Treasury Secretary, and former Chief Fed Head, is out telling anyone that will hear her, that all is clear, you can come out now... Here's the skinny: "Janet Yellen said excessive inflation will be over soon. The U.S. Treasury Secretary thinks the Federal Reserve could hit its 2% inflation target in 2025, with a soft landing for the American economy well in her sight."

Of course she said that! And of course she is wearing her (I'll lose my job if the POTUS doesn't win ) rose colored glasses... Or, maybe, she's just not privy to the deficit spending plans of the administration... Oh, Chuck, c'mon, she's not that out of it! OK, so, then it's all a political posturing then...  She should be put on a slow boat to China, in my opinion, because her politically charged rhetoric doesn't help you, me and the guy down the street that cuts his grass with his shirt off...  Again, I'm just saying...  

Here's the bugaboo with deficit spending... If you never reduce it, or taper it, of even stop it, it'll just continue to grow and grow until it breaks the financial system. You see, ever since Nixon took us off the Gold backing of the dollar, (it was billed as only temporary!) in August of 1971, the U.S. that was once a credit based nation, because a debt based nation, and once the lawmakers saw that there was no limit to their deficit spending, then they really began to pile up their boondoggles and spending promises for votes, until where we are today... $35 Trillion, in debt, $100 Trillion in unfunded liabilities (thanks to the Debt Clock.org) ... And you can't stop this without the whole shootin' match come crumbling down... Which it will do anyway eventually from the weight of the debt, but one comes now, and one comes later... 

The Gov't's plans to have inflation melt away some of the debt, is going to come back to haunt them, in my humble country boy opinion... The general public cannot deal with continued inflation, they need to see some relief.. Sort of like the rain that came last night to cool down the temperatures... The public will blame whomever is in the President's seat... 

And to that note: This from the Pew Research.com "Public trust in the federal government, which has been low for decades, has increased modestly since 2023. As of April 2024, 22% of Americans say they trust the government in Washington to do what is right “just about always” (2%) or “most of the time” (21%). Last year, 16% said they trusted the government just about always or most of the time, which was among the lowest measures in nearly seven decades of polling."

That's right 7 decades of polling, the lowest measures... And probably going to go much lower... I'm just saying...

The U.S. Data Cupboard yesterday had the April Case/ Shiller Home Price Index, and it showed a deterioration of the housing prices across the U.S. We also saw the STUPID Consumer Confidence for June and it fell from 102 to 100... Big Deal! NOT! The talking heads talked about how the Consumer Confidence fall wasn't consequential... Hmmm... Well, for comparison this index was 132 before the plandemic... So there's that! 

The Data Cupboard today only has new Home Sales for May... Not a market moving data print in any way, so we'll move along now... 

To recap... The dollar buying message finally got to the foreign traders, and they acted on it, with the dollar being bought up overnight, following up on the dollar getting bought yesterday... It's all over done per Chuck... Gold & Silver continue to get whacked, and any moving average line you want to use, has been blown out by the short paper traders, and Janet Yellen has some encouraging words for us this morning. (NOT!) And the dollar's share of reserves has fallen , significantly, according to Chuck... All that and more is in today's Pfennig! 

For What It's Worth... I couldn't believe my eye yesterday, and the story was asked the question about would excessive debt ruin the U.S. Financial System?  I couldn't believe that the WSJ would print something like that! But since they did, it's my FWIW article today and you'll have to go to Ed Steer's letter to read it, or find it on the WSJ web site, because I couldn't get the link to work... 

Here's your snippet: "America is cruising into an uncharted sea of federal debt, with a public seemingly untroubled by the stark numbers and a government seemingly incapable of turning them around.

In the presidential race, there’s not much partisan difference or advantage on this subject. Donald Trump and President Biden have overseen similar additions to the nation’s accumulated debt—in the range of $7 trillion in each case—during their terms. The national response to both has been, by and large, to look the other way.

History, however, offers some cautionary notes about the consequences of swimming in debt. Over the centuries and across the globe, nations and empires that blithely piled up debt have, sooner or later, met unhappy ends.

Historian Niall Ferguson recently invoked what he calls his own personal law of history: “Any great power that spends more on debt service (interest payments on the national debt) than on defense will not stay great for very long. True of Habsburg Spain, true of ancien régime France, true of the Ottoman Empire, true of the British Empire, this law is about to be put to the test by the U.S. beginning this very year.” Indeed, the Congressional Budget Office projects that, in part because of rising interest rates, the federal government will spend $892 billion during the current fiscal year for interest payments on the accumulated national debt of $28 trillion—meaning that interest payments now surpass the amount spent on defense and nearly match spending on Medicare.

Washington has been adding to the national debt at an alarming pace. Not so long ago—beginning in the late 1990s—the federal government’s budget was actually in surplus, at least for a time. This year, it will be some $1.9 trillion in the red, the Congressional Budget Office forecast just this week."

Chuck again... Again, I was shocked to see the WSJ print something like that! They usually toe the line, and stay straight and narrow, not ruffling feathers... I'm sorry that the link I tried wouldn't work for me, so I couldn't give it to you... And I in no way am dissing the WSJ... They have been kind enough to print two articles about me in the past... One by Jeff Opdyke, and one by Craig Karmin... Those were long ago, and in a far away place, but still near and dear in my heart! 

Market Prices 6/26/2024: American Style: A$ .6655, kiwi .6095, C$ .7303, euro 1.0683, sterling 1.2646, Swiss $1.1262, European Style: rand 18.1734, krone 10.6574, SEK 10.5885, forint 371.17, zloty 4.0324, koruna 23.3156, RUB 87.37, yen 160.31, sing 1.3577, HKD 7.8083, INR 83.59, China 7.2667, peso 18.24, BRL 5.4313, BBDXY 1,270.08, Dollar Index 105.96, Oil $81.35, 10-year 4.29%, Silver $28.89, Platinum $995.00, Palladium $949.00, Copper $4.37, and Gold... $2,311.42.

That's it for today... Heavens me! What was i thinking yesterday morning, not mentioning the Championships that were won the night before! So... Congrats to the Florida Panthers for their Stanley Cup NHL Championship... And Congrats to Tennessee's Baseball Team for the NCAA baseball Championship! Well, I finally talked to my heart doctor yesterday, and we mapped out plan to maybe get me ready for my sojourn to Ireland... So, maybe, I can still get to go! I talked to good friend, and former Big Boss, Frank Trotter a week or so ago, and he tells me that he's waiting for approval from the FDIC to open his bank: Battle Bank... (he's a really patient man!) I really think that if you're looking for a better bank, that you should sign his register and when the Bank opens, they will contact you...  The Band Missouri takes us to the finish line today with their one hit wonder song: Movin' On... I hope you have a Wonderful Wednesday today, and will Be Good To Yourself!