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  • Jim Rogers In The News...

    In This Issue..

    * Currency rally overnight...
    * U.S. Retail Sales drop -1.2%!
    * The Chinese respond to Geithner...
    * History to repeat?...

    Good day... And a Marvelous Monday to you! WOW! What a great weekend enjoyed by yours truly... Lots of friends, to share good times with! The weather tried to ruin everything, but we didn't let it! I'll begin this week's Pfennigs with a little story that happened this morning...

    I arrived in the parking garage across the street from our building, not exactly the best situation for someone that's partially crippled and has a blood clot in their leg, but that's a story for another day. I got out of my car, and said, 'Hmmm... Wouldn't it be nice to see the euro trading with a 1.22 handle this morning?' Then said, 'Nah, it didn't look too good on Friday.'......
  • RBA raises interest rates...

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  • Risk Aversion Creeps Back Into The Currencies...

    In This Issue..

    * Comments spook currency traders...
    * A$ hits 15-month high, this time going up!
    * Geithner as the "joker"?
    * China changes statement about the renminbi...

    Good day... And a Tub Thumpin' Thursday to you! It's a Thursday, and it's not raining here! YAHOO! After a week of Indian Summer weather, we're slowly creeping back to the colder weather, but still, better than most Novembers of the past, so far!

    That was a strange feeling yesterday, having a holiday in the middle of the week, but the day was nice, and I got to spend the day with my granddaughter, Delaney Grace, who sang me songs all day long!

    So... Last night, I'm doing some writing, and before I put the laptop to bed for the night, I checked the currencies, and while they had drifted in the early Asian session, the Big Dog, euro was still trading above 1.50, and the Aussie dollar (A$) had set a 15 month high of .9368... But when I turned the currency screens on this morning after arriving to a pitch black office, which is the way I like it this early in the morning, the euro had given back about 1/2 cent, and so had the A$... So, it was my mission to find out what caused this slippage......
  • Time To Remove Stimulus?

    In This Issue..

    * Chinese stocks rise 5%!
    * Risk Assets follow!
    * OECD forecasts faster global growth...
    * Gold & Silver kicking sand again!

    Good day... And a Tub Thumpin' Thursday to you! Let's hope it remains a Tub Thumpin' Thursday later today, as I head downtown to watch my beloved Cardinals play a day game! For those of you who are baseball fans, you know what I mean when I carry on about how baseball should only be played during the day!

    OK... Before I get to the currencies, economies and the dolts in the world, I wanted to briefly talk about the SEC, who made an announcement yesterday that they had done an investigation of the Madoff audits, and did not find any fraud... Just mistakes... Really? Mistakes? That's what they call them? Even Bernie Madoff himself says that he was "astonished" that the SEC failed to shut him down after interviewing him in 2006!

    ...
  • Good news for housing is bad news for the dollar...

    In This Issue..

    * Home sales increase most in eight years...
    * Euro boosted by confidence...
    * Geitner sells the Chinese...
    * Carry trades back in vogue...

    The dollar lost more ground on Monday, but the reasons were different than those that caused last week's slow decline. Currency traders sold the dollar after a report showed sales of new homes rose the most in eight years. New-home sales in the US climbed 11% last month to a 384,000 annual pace. This was substantially higher than economists had forecast, and the most since November. The report also showed the number of houses on the market dropped to the lowest level in more than a decade. The housing numbers seem to confirm that the housing market may be approaching a bottom, but housing prices continue to fall, and more data is needed before I'm convinced the worst is over. Many of these homes have been sold to first time homebuyers taking advantage of government programs; and if unemployment continues to climb, housing sales are not likely to rise quickly....
  • A Dollar Roadblock!

    In This Issue..

    * Euro goes back and forth over 1.42...
    * Geithner make another promise to China...
    * RBA leaves rates unchanged...
    * The Mogambo on a Tuesday!

    Good day... And a Terrific Tuesday to you! Well... The currencies, led by the euro, ran into a dollar road block yesterday, not once, not twice, but three times... The first two times the euro traded over the 1.42 figure, it fell back, but recovered to again try to remain over 1.42... It was a classic case of profit taking at a line of resistance... But the third time, was no charm for the euro, and thus it ended the day and night sessions below 1.42... But hey! Has this run from 1.2578 on March 1st, been something or what?

    I see where UBS believes this is it for the euro... Sort of like the thought that a star burns the brightest right before it burns out... Hmmm... I guess they believe that the U.S. deficit problems are going to go away... Apparently, they drank the kool-aid from U.S. Treasury Sec. Geithner, who told the Chinese that the U.S. was going to shrink the deficit... He also told them that their assets were 'safe'... Ty sent me something on this that he found yesterday......
  • The Currency Rally Continues!

    In This Issue..

    * Euro trades past 1.42...
    * Geithner make a promise to China...
    * Central Bank meetings this week...
    * Canada's Fin Min, speaks...

    Good day... And a Marvelous Monday to you! And welcome to June... Tradition in the Pfennig means a quick rendition of: June is bustin' out all over... All over the meadow and the hill! Buds're bustin' outta bushes... And the rompin' river pushes... Ev'ry little wheel that wheels beside the mill! And you thought I was a just an old Rock-n-roller!

    Well, on Friday I left you with the story of a currency rally for the ages... And it didn't let up there! Although the rest of the day on Friday the bias was to sell dollars, the real chunk of the dollar wasn't taken until last night in Asia... Here's the deal folks, and this won't be the first time you've heard this from me either!...
  • The waiting game...

    In This Issue..

    * Waiting on G20 and the ECB...
    * US home prices plunge...
    * What will come from G20...
    * ECB to cut rates, but no quantitative easing...

    Good day... The markets will play a waiting game today, and I expect the currencies to trade in a pretty flat range. The focus will be on the G20 which starts tomorrow, and the ECB announcement which will also be released tomorrow. So today I will share my views on both of these topics, but first I will report on what occurred yesterday and overnight in the currency markets.

    The dollar climbed yesterday morning as data released showed US home prices plunged at a record pace and consumer confidence continues to bottom. US home prices fell nearly 19% in January according to the S&P Case Shiller index. This was even worse than economists had predicted, and December's numbers were revised down....
  • 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....
  • The Treasury Secretary rides to the rescue...

    In This Issue..

    * Geithner rescues the stock market...
    * Commercial real estate, the next big drag...
    * Norway: the new safe haven...
    * China pushes for a new reserve currency...

    It was a dramatic day on Wall Street yesterday, with the major stock indexes surging as much as 6 percent, including the Dow Jones which jumped more than 400 points. The reason for all of this euphoria on Wall Street? A combination of Geithner's plan to rescue the banks from the toxic debt in which many are mired, and a surprisingly large uptick in existing home sales. I touched briefly on the Giethner plan in yesterday's Pfennig and readers know I am more than a little skeptical about its possible success.

    But the housing numbers really caught me off guard. Existing home sales jumped a tremendous 5.1% in February, clearly above all expectations. But Chuck pointed out that the almost 1/2 of the sales were either foreclosures or short sales, hardly what you would call a 'rebound' in home sales! And these additional existing home sales came at deep discounts. The median price for an existing home fell 15.5% in February 2009 to $165,400 as compared to $195,800 in February of 2008....
  • High yeilders continue to rally...

    In This Issue...

    * High yeilders continue to rally...
    * Quantitative easing drives the markets...
    * Inventories to drive inflation...
    * Happy Birthday Chuck...

    Good day... I'm back from a long vacation with the family down in Florida, I had a great time but it actually feels good to get back to work. But before I get started this morning, I want to compliment Mike on what a fantastic job he did on the Pfennigs while Chuck and I were in Florida. Mike jumped right in and cranked out some great information, setting the bar rather high for me. We have a busy week ahead of us, so better get right to it.

    Currency investors continued to pull out of the dollar and move funds back into higher yielding currencies on Friday. The best performing currencies on Friday were the higher yielding commodity based currencies of Australia, New Zealand, and South Africa. Investors were eager to move money back into the higher interest rates available in these currencies as markets began to stabilize. With the Feds announcement last week that it will buy $300 billion of US government bonds, deflation is now a thing of the past. This purchase by the Fed monetizes the debt, basically pumping the cash directly into the markets. It is the most inflationary action the Fed can take, Bernanke has now put the printing presses in high gear. With deflation no longer a worry, commodity currencies have begun to look attractive again....
  • Geithner's Plan Disappoints...

    * Trade Deficit to narrow further... * Currencies rally, then sell off... * Obama's stimulus loses backers... * Riksbank cuts 100 BPS unexpectedly... ** Geithner's Plan Disappoints... Good day... And a Wonderful Wednesday to you! Well... Tim Geithner didn't experience a Terrific Tuesday, as I had wished for him... And now, it looks as though the shine is coming off the new President as more and more individuals are "not buying" his appeal to the nation to get a stimulus package passed... The currencies rallied and then sold off after Geithner gave the details of his "new and improved" plan... We've got some potential market moving data printing today and more! So... Let's go to the tape!...
  • Talking Stimulus...

    * A very tight range for currencies... * RBA cuts rates to historic low! * Spending that doesn't create jobs... * Gold see profit taking... ** Talking Stimulus... Good day... And a Terrific Tuesday to you! On the road again, I just can't wait to get on the road again... Yes, all my bags are packed and I'm ready to go! Won't be back until late Saturday night, and back in the saddle next Monday. And I'm leaving just in time, as yet another cold front has moved into St. Louis! UGH! Well... Let's see... What to talk about today? I could talk about the Aussie rate cut and stimulus package... I could talk about the "new and improved" stimulus package and all the "non-stimulus spending attached to it... I could talk about how it sure seems as though the euro, and then the other currencies, are taking their cues to rally from equities... Now, this is certainly a short term phenomenon because we all know that currencies have different pricing mechanisms than stocks, and a very low correlation to stocks, which is why they make excellent diversification assets, along with Gold and Silver....
  • Another FOMC Day....

    * Currencies rally... * Davos begins... * A new and improved stimulus plan! * Happy Birthday, Chris! ** FOMC Day.... Good day... And a Wonderful Wednesday to you! A very cold and snowy Wednesday here in St. Louis. I got caught behind the line of snow plows this morning, and it too me what seemed like for-ev-er to get here! Oh well, I'm here, so let's get going, eh? Well... The currencies saw some profit taking yesterday, only rebound overnight, which seems to be the recent pattern... The overnight markets participants drive the euro and other currencies higher, and the U.S. market participants sell the euro and other currencies... Makes you want to side with the overnight markets participants, eh? Oh well, the euro is trading with a 1.3255 look to it this morning, as I turn on the screens......
  • "The Cheater" Speaks...

    * Currencies rally... * IFO unexpectedly rises... * Norway looks good... * Gold hits $900 again! ** The Cheater Speaks... Good day... And a Terrific Tuesday to you! We received the snow and ice they forecast, but the drive in to the office was no biggie, so the street crews did a fair job, I would say... We'll see when I head into the city for my radiation this morning... Hey! What a day for the currencies yesterday! Geez Louise, it's seems like it's been a month of Sundays since I could say that! And there's been follow up overnight, although, I do believe I'm seeing some profit taking right now... I went to radiation yesterday with the euro trading around 1.2965... I came back 2 hours later, and it was 1.31! And it didn't stop there, trading up to 1.3175, but running into a wall of resistance there... But that was temporary, as the overnight market pushed the single unit higher to 1.3250... It did trade all the way up to 1.33 and change on news that the German Business Confidence, as measured by the think tank IFO, unexpectedly rose for the first time in 8 months. This improvement was a result of the European Central Bank (ECB) cutting interest rates......