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  • Kiwi Reaches A Post-Float High!

    In This Issue.

    * Germany to push aid to Greece.

    * Bank of Canada to meet today.

    * Australia to print a negative growth report?

    * Recession has ended?

    ...
  • A New All-Time High For Gold!

    In This Issue..

    * Deflation to deep six Gold?
    * German data points to recovery...
    * The U.S. sponsored Ponzi Scheme...
    * ECOFIN internalizes their debt problems...

    Good day... And a Terrific Tuesday to you! I hit the "wall" yesterday about 2 o'clock... All the fun and sun of the weekend, became the wall, and I hit it square on! But I'm well rested now, so here we go!

    Front and Center this morning... Gold has reached a new all-time high this morning. Yesterday I kept watching the shiny metal tick higher and higher, and I would yell out across the desk each rise in Gold... Gold was $1,250 when I turned on the screens this morning. It has given back $2 since, as I did some reading and research, but Shoot Rudy, the move yesterday was something to admire!...
  • The Hits Just Keep Coming...

    In This Issue..

    * Merkel sends the euro lower...
    * Gold Sells off again!
    * Bond Vigilantes...
    * Aussie Confidence falls 7%...

    Good day... And a Wonderful Wednesday to you! The rain stopped, the sun came out, I got to sit outside and listen to the ballgame on the radio, all was right in Chuck's world again yesterday... The rain is supposed to come back tonight though... UGH! My little river town is watching the river rise to the top of the banks now...

    The hit songs just keep coming for the euro... As often as the Beatles put them out from 1963 to 1970, or Elton John put them out in the 70's...

    Well... It's the same for the euro... Just when it looked as though the euro might survive a day without being taken to the woodshed... The Eurozone officials just couldn't stand the prosperity! ( and I use that word loosely!) German Chancellor Angela Merkel made some proposals to gain control over 'destructive' financial markets... Her first move was to place a ban on naked short-selling......
  • FOMC Day – 04/28/2010...

    In This Issue..

    * Euro goes into a tailspin...
    * Portugal gets downgraded...
    * Germans talk with IMF today
    * Aussie CPI indicates rate hike...

    Good day... And a Wonderful Wednesday to you... Today marks 1-week since I've been back writing the Pfennig... I simply love writing the Pfennig each day, and boy did I miss it when I was unable to write... Vacation is one thing, those are well deserved breaks, but to not be able to write is another. So... I'm thankful that I'm able to write again...

    Well... The euro went into a tailspin yesterday, and for once it wasn't Greece so much... This time it was a little Greece, and a lot Portugal. The ratings agencies downgraded Greek debt to junk... And they downgraded Portugal's debt from A- to A-2, with a negative outlook. The fear that Greek's debt problems would spread, is coming to fruition... The euro fell to a 1-year low during the day, and the selling didn't stop in the U.S!...
  • Clairvoyant Pundits?

    In This Issue..

    * Euro backs off yesterday's high...
    * More tough talk from Germany....
    * Brazil talks about weakening real...
    * Waiting on Aussie CPI tonight...

    Good day... And a Terrific Tuesday to you! It's still raining here, but forecast to stop today... The temperature dropped big time too, bringing back cold air... Little Delaney Grace, and I were bummed out that we couldn't go outside yesterday!

    Well... As the day went on yesterday, things got more mixed up... I kept reading news stories stating that the euro was falling VS the dollar, but all the while, the currency screen kept showing the euro rising, actually getting very close to 1.34 on the day...

    So, you can't always take what you hear or read as fact... Or... As Marvin Gaye would said years ago... People say believe half of what you see, Son, and none of what you hear....
  • US$ stuck in a rut...

    In This Issue..

    * US$ stuck in a rut...
    * Australia is rising star...
    * BOE keeps rates on hold...
    * Frank reflects on Olympic boycott...

    Good day, and welcome to Friday!  The dollar kept within the fairly tight range it has established over the past few weeks.  The dollar index has remained between 81 and 82 for the past 15 days, after jumping higher on the Greek financial crisis.  Currency traders are uncertain of where the global economy is heading, and seem to be taking a 'wait and see' approach.  Eventually a clear picture will start to emerge, but for now, the currency markets are stuck in a rut.

    The weekly jobs data released yesterday morning didn't give investors much to go on.  The numbers came in slightly higher than expected, surprising many who thought the improvement we saw in the monthly numbers at the end of last week would carry over to the weekly report.  But it still looks like any improvement in the labor picture here in the US will be slow to come, and pretty sporadic.  The Labor Department blamed the Easter holiday for skewing the numbers, saying the two weeks around the Holiday weekend are traditionally volatile making it difficult to discern an underlying trend.  But the less volatile 4 week moving average of claims, a less volatile measure, also increased to 450,250 last week from 448,000.

    ...
  • Germany Weighs Possible Bail Out...

    In This Issue..

    * Some healing in the currencies...
    * Brazilian real heats up!
    * Is there a secret central bankers meeting?
    * Aussie Confidence weakens...

    Good day... And a Wonderful Wednesday to you! It sure turned out to be a Terrific Tuesday yesterday, even with 5 inches of snow on the ground! There are rumors going round that someone's underground, and she will rock you, no wait, the rumors are... 1. There is a secret central bank meeting going on, and 2. that Germany is weighing bailout possibilities for Greece...

    The latter really lit a fire under the risk assets yesterday, allowing stocks, currencies and commodities to enjoy a day in the sun, away from the shade the dollar was casting on the risk assets. Stocks turned around and had a strong showing for the day, Gold was up $15, and currencies, led by the Brazilian real gained back some precious ground VS the dollar. I know that sounded a little strange saying 'led by the Brazilian real' as I normally associate the currencies being 'led by the euro'......
  • German Business Confidence Slides...

    In This Issue..

    * Currencies trade in a tight range...
    * $81 Billion in Treasury auctions this week!
    * Fitch fans the flames of a fire in the U.K....
    * Aussie Business Confidence rises...

    Good day... And a Terrific Tuesday to you! I didn't start out this Tuesday on the right foot, and now I'm really running late! Oh well...

    The non-dollar currencies didn't move much yesterday, the euro bumped up and down against the 1.50 figure, while the A$ did the same against 93-cents, and Swiss against parity... So the currencies are trading in the same clothes they went to bed in last night!

    The Big Dog, euro, did attempt to move stronger into the 1.50 level, but that move was thwarted by a poor reading of German Investor Confidence this morning. German Investor Confidence as measured by the think tank ZEW, reported that their index had fallen to 51.1 this month VS the 56 in October. Most of those Germans surveyed said that they expect the economic recovery to be slow once the Gov't removes the stimulus in the economy. So... Previous euphoria is being replaced by realism... But that's OK... Better to have a reality grip on things than to go around thinking that everything is seashells and balloons......
  • Currencies and Commodities Sell Off...

    In This Issue..

    * Overnight markets ambush risk assets...
    * Germany's IFO Business Confidence gains again...
    * A$'s get pounded by opposite thought story...
    * More supply to auction off for the U.S....

    Good day... And a Marvelous Monday to you! I hope your Father's Day weekend was grand... Mine sure was! I'm feeling the affects of the 'grand' weekend this morning too! And... It was the first day of Summer! So we had all that going for us, eh?

    Front and center this morning, I'm as proud as a peacock this morning. I just read an email from good friend, and excellent market analyst, Mary Anne Aden... Mary Anne sent me a note letting me know that the one and only Richard Russell had quoted me in his letter June 10th... She said it went something like...'this is from Chuck Butler's always terrific column...' WOW! Being quoted in Richard Russell's letter is like the top of the list for me!...
  • Bad news for GM and Chrysler rallies the US$...

    In This Issue..

    * Bad news for car makers rallies the US$...
    * Yen comes back strong...
    * Singapore to devalue?...
    * German Chancellor Merkel gives warning...

    Good day... And good Monday morning to all of you. I can't believe March is nearly over, it seems as though it just started. March will end up being a pretty good month for the currency markets, as investors exited the safety of US treasuries and started moving funds back into higher yielding assets. But the markets continue to be volatile, and news released on Friday and over the weekend has sent these investors rushing back to the safe haven of the US dollar.

    The Japanese Yen and US dollar benefited after a US Government official said Friday that bankruptcy may be the best option for GM and Chrysler. The dollar continued to gain strength this morning after US Treasury Secretary Geithner warned yesterday that some financial institutions will need 'large amounts' of aid. When the Treasury Secretary says large amounts, you know it is going to be billions or trillions! Geithner was making the rounds of Sunday morning talk shows to try and justify the money already spent and prepare the taxpayers for another request of funds....
  • Geithner tanks the dollar, but then pushes it back up...

    In This Issue..

    * Geithner sends the dollar on a thrill ride...
    * A failed UK gilt auction...
    * China set to recover first...
    * AUD and NZD rally again...

    Good day... The currency markets took back what little strength the dollar mustered over the past two days with the Euro moving back above popping back above 1.36 and the Australian dollar moving back up over .70. The cause for this dollar weakness? Data released in the US yesterday was surprisingly strong again, so investors dumped the 'safe haven' holdings of Treasuries and moved money back into higher yielding investments.

    At one point yesterday the dollar index dropped precipitously (more than 1.5% in less than 10 minutes), and then bounced back up within a half hour. Jennifer McLean, who takes care of our currency trading while Chuck is away from the desk, said the sudden moves were due to Treasury Secretary Geithner's comments. Apparently Geithner was asked about China's call for a new international reserve currency yesterday at a NY event. He said that while he hadn't read the proposal, he understood it as a plan 'designed to increase the use of the IMF's special drawing rights. And we're actually quite open to that.' After hearing those words, currency traders immediately starting selling off the dollar. After all, if the Treasury Secretary of the US says the administration is open to a new international reserve currency, why do you want to hold dollars? I guess Geithner got wind of what he had done to the currency markets pretty quickly (the power of Blackberries!) and 15 minutes later he clarified his comments to say the US dollar should remain as the world's reserve currency....
  • Another day for the currencies...

    * Disappointing data...
    * Euro held ground...
    * Down under...

    Another day for the currencies...

    Good day...And a Terrific Tuesday to you. Another Monday morning has come and gone but not before confirming the US economy is still heading down the wrong side of the slippery slope. The uneventful trading day from Friday certainly didn't carry over as we saw a sizeable run up in currencies along with equities during the morning session. As the day progressed, the equity markets shed their gains but most of the currencies remained resilient and held on. I guess I'll stop beating around the bush and get right to it...

    It seems that Bernanke's calming approach during his interview with 60 Minutes gave investors the feeling that we are not as bad off saying the risk of a depression has been averted. He went on to say if the government succeeds in calming financial markets, the recession will probably end this year and the economy will expand in 2010....
  • Paulson throws the markets a curve...

    * Paulson throws the markets a curve... * Goldman says to buy the yen... * RBA intervenes to protect the AUD$... * China provides support to commodities... ** Paulson throws the markets a curve... Good day... Chuck is out today, so I get the opportunity to share some of my thoughts on the markets. As many of you know, I spent most of last week in Washington DC giving presentations at the Money Show. On the way to the hotel, the cab driver who had noticed my EverBank luggage tag asked if I was a banker. He said he had seen a lot of us lately. I guess I was one of the few bankers flying into Washington DC who wasn't heading over to the Treasury Dept. to get some of the cheap money they are passing out. I had a great trip to Washington and really enjoyed the opportunity to spread the word about EverBank and the protection that portfolio diversification provides. I don't think Treasury Secretary Paulson is having as good a time as I did in the nation's capital. When he came down from NY a couple years ago to take over the Treasury, he was Wall Street's best paid CEO and looked to cap his career with a high-profile sojourn in public service. But his credibility has really taken a hit over the past year, and his update before congress yesterday didn't quite go as everyone expected. Chuck left me the following to share with readers this morning....
  • Turning Japanese?

    * Profit taking in the currencies... * German Business Confidence falls... * More talk of the bailout package... * A strong statement on Aussie dollars... ** Turning Japanese? Good day... And a Wonderful Wednesday to you! Another crazy day not only in the markets but on our trading desk, where the phones continue to light up. There's a ton of volatility in the markets these days, as witnessed by the roller coaster ride stock jockeys take every day, the no direction is a good direction course of currencies, and the ups and downs of bailout plans. It's all a little too much for yours truly some days, but I carry on... Take this morning... Please somebody take this morning! The euro was showing signs of wiping out yesterday's profit taking session early on, only to see its gains wiped out by a weaker than expected German Business Confidence report. Yes, German Business Confidence, as measured by the think tank, IFO, declined more than expected this month, to the lowest level in almost 3 years. I would say that with lower Oil prices, and weaker inflation, these German Business people's attitudes will be changing soon... The German economy, other than this report, is showing signs of strength, which is bang on what I've been trying to tell everyone that was throwing darts at the Eurozone economy... Remember 80% of trade in the Eurozone is among the Eurozone members......
  • Dollar range bound...

    * Dollar range bound... * German confidence falls... * Aussie and NZD continue to slide... * US to maintain pressure on Chinese... ** Dollar range bound... Good day... Chuck had a rough night, so he decided to stay home and try to get some rest. The Pfennig will be pretty short this morning, as I want to try and get it out as close to the regular time as possible. The currency markets were fairly calm yesterday, with the dollar staying in a pretty tight range before rallying some in early trading this morning. The Euro has lost some ground in European trading as German business and consumer confidence fell more than economists forecast. The Ifo institute's business climate index dropped to a three year low in July and consumer sentiment slumped to the lowest level in five years. Some currency traders pointed to these latest reports as further proof Europe is slipping into recession and that the ECB will need to cut rates before year end. It is obvious by now that the economies of Europe are weakening, and growth will not be able to match last years numbers. But I still believe Trichet and the other voting members of the ECB will continue their hawkish bias, and I don't expect any interest rate moves until sometime next year. This should keep the Euro from falling dramatically away from these current levels....