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  • Thin trading brings tight ranges...

    In This Issue..

    * Thin trading brings tight ranges...
    * Searching for the exits...
    * Mixed data in Europe...
    * Yen and Real make strange bedfellows...

    Good day...We had a pretty quiet 24 hours in the currency markets, with the majors all trading in a very narrow band vs. the US$. We will probably have a few more of these days during the next two weeks, as currency desks are manned by the backups and trading thins out. Many of the institutional investors will be moving to cash in order to preserve gains for their year end statements, and individual investors will have the holidays to take them away from the markets. Occasionally we will get a rogue piece of economic data which shoves the market one way or the other, but we typically won't see any long term positions being put on during the last two weeks of the year....
  • Game off for risk trades...

    In This Issue..

    * Dollar hits 3 month high...
    * Norges bank raises .25%...
    * Fed repeats call to keep rates low...
    * Inflation in India rises...

    Good day...And welcome to Thursday. Chuck started his Christmas vacation, so I have the honor of bringing you the daily missive for the next week or so. The dollar continued to gain strength throughout the day as investors waited on news from the FOMC. Overnight, Greece sustained another rate cut, this time by S&P, which caused investors to move back toward the 'safety' of the US$. The news caused the dollar to rally to a 3 month high vs. the Euro and post gains across the board. The currency markets are becoming a bit volatile again, and much of this volatility can be linked back to the return of a transaction which dominated currency markets over the past decade....
  • Green Light, Green Light!

    In This Issue..

    * FOMC minutes make it a Risk On Day!
    * Gold hits $1,180!
    * Germany's ZEW is bang on with their forecast!
    * Russia to buy loonies?

    It's a Risk On Day, full on, no 'kind of' today! Or at least that's how it looks as I begin to write this morning... The Big Dog, euro, is back over 1.50 this morning, and Gold is trading at $1,177! What brought about this full on Risk On day?

    Well... It was the Fed's FOMC meeting minutes... And, when I read what the Fed Heads had to say, I had one song in my mind... Hey! You! Get off of my cloud! Because that's where their collective heads are with these minutes, folks... The Fed Heads viewed the U.S. economy on firmer footing and expects the growth to continue in the 4th QTR... Yeah, right, and I've got some swamp land I'd like to sell you! Snake Oil salesmen these guys!

    Any way... The Fed Heads also said that the dollar's depreciation had been 'orderly'... With no mention of doing anything to stop the depreciation! Green light, Green light, Green light... How many of these Green lights do traders and you need to realize that the Fed isn't going to stop the dollar's decline? And How about the Treasury? Oh! That's right, they're too busy shoving negative yields down people's throats! OK, I'm getting all ticked off, and I really don't feel like doing that today, so I'm going to talk about something else, fast!...
  • Rates To Remain Near Zero...

    In This Issue..

    * Dollar reverses sell-off...
    * BOE & ECB meet today...
    * New Zealand is not Australia...
    * Funny accounting...

    Good day... And a Tub Thumpin' Thursday to you! It's Tub Thumpin' because it's a Thursday and it's not raining! Yay for us! Well... Not only was I wrong, but the Bloomberg Economic Calendar was wrong too... The FOMC was not a 2-day meeting after all! Just one day, so no time to pull out the board games and cards...

    I nailed that FOMC statement yesterday... WOW! You might begin to think that I have some inside info on the Fed Heads, the way I've been able to basically call every move they've made since the beginning of this whole meltdown in August of 2007! But that's not important here... The important thing is that the Fed said that economic growth is not enough to hike rates, and therefore they will keep interest rates at near zero for an 'extended period'...

    ...
  • Another New Record Level For Gold!

    In This Issue..

    * Risk players come back out to play...
    * Waiting on the Fed's statement...
    * Yield differentials come into focus...
    * Lisbon Treaty gets signed / ratified...

    Good day... And a Wonderful Wednesday to you! Well... Did you see the strong performance that Gold put in yesterday? And it didn't stop yesterday, overnight Gold is up another $7 on top of the +$20 gain it had yesterday... I've got some info on that, we can talk about later...

    Oh Shoot Rudy! Let's talk about it right here, right now! It's not every day that Gold not only goes past its previous all-time record high, but obliterates the previous figure! I know you're wanting to take a peek at the price of Gold in the currency round-up portion of the Big Finish, so go ahead, and then come on back... How'd that $1,090 and change price look to you? Pretty sweet, eh? That is as long as you are a Gold holder!...
  • Oops, Did I Say That Out Loud?

    In This Issue..

    * A Wild and Wacky Wednesday...
    * FOMC leave stimulus and QE in place...
    * Will G-20 try to throw cold water on commodities?
    * GATA receives a letter from the Fed...

    Good day... And a Thunderin' Thursday to you! It's Thundering and raining here, so I felt that naming today a 'Thunderin' Thursday' was bang on! We had a wild and wacky Wednesday yesterday, with the Fed Heads playing the part of the court jester... And... I want to know, right here, right now, why the media isn't blasting Fed Head Honcho Big Ben Bernanke! I'll tell you why they should be, in a minute...

    OK... As I said, we had a wild and wacky Wednesday yesterday, as the non-dollar currencies went for a spin on Mr. Toad's Wild Ride, with Big Ben Bernanke in the role of Mr. Toad! HA! That makes me chuckle! Here's the skinny, and what everyone should be up in arms about......
  • Catching Up With Richard Duncan...

    In This Issue..

    * Non-dollar currencies give back very little...
    * The Unemployed are remaining unemployed...
    * FOMC puts away the board games today...
    * China invokes a 'Public Morals' defense...

    Good day... And a Wonderful Wednesday to you! Well, the Fed Head put away the board games today, and make an announcement this afternoon... Yawn... Norway's Norges Bank will also make an announcement with theirs coming this morning. I still contend that the Norges Bank will keep rates unchanged and give a hint as to when their rate hike cycle will begin. If that were to happen as I think, then it would be very bullish for the krone......
  • Currencies Hold Their Gains...

    In This Issue..

    * Consumer Borrowing Collapses...
    * What's up with sterling?
    * Option ARMs get ready to reset...
    * Gold falls back to below $1,000...

    Good day... And a Wonderful Wednesday to you! Well... The currencies, for the most part, kept the heat on the dollar throughout the day and in the overnight markets. The euro, did rise to 1.45 and change yesterday, while it is hovering right at that figure this morning, so it did give a little bit back.

    There were no big announcements last night like we saw on Monday, so the currencies didn't have anything to push them further. In fact, there may be a 'letting the dust settle' period of time, with the Big Dog, euro, before we see any further advancement, given the euro's huge gains yesterday......
  • Germany & France Exit The Recession...

    In This Issue..

    * Currencies rally...
    * Eurozone growth unexpectedly stronger!
    * FOMC extends QE...
    * Norges is the first!

    Good day... And a Tub Thumpin' Thursday to you! Well... Turn-around Tuesday came 24 hours later this week! HA! Yes, the currencies came back yesterday, but not with a lot of conviction... You see... Stocks rallied, but that doesn't mean what I talked about yesterday still won't happen... Be careful there!

    The euro has received some additional love this morning, as the Eurozone's economic growth printed better than expected, albeit still negative... But... Germany and France showed growth, which I must say is very unexpected! That means that both Germany and France have exited the recession... Well, that is at least for now! For those of you keeping score at home, Eurozone GDP fell -.1%, which is far better than the -.5% that was expected... Oh! And this is for the 2nd QTR... You would have to think that data like this would be very good for the euro, and from the looks of it, that's exactly what's happening!...
  • On The Soapbox!

    In This Issue..

    * Currencies trade in a tight range...
    * Soapbox talk...
    * QE talk...
    * FOMC Day

    Good day... And a Wonderful Wednesday to you! I've got an interesting thought for you all this morning... I think you'll want to read what I have to tell you this morning and not just skip to the Big Finish! HA! But first, a review of what happened yesterday and in the overnight markets. Are you ready? Then let's go!

    Well... Yesterday did NOT turn out to be a Turn-Around Tuesday after all... The small rally I saw right before signing off on the Pfennig yesterday, went 'poof' and it was gone. The currencies then traded in a tight range the rest of the day. The High Yielders and Commodities have really taken on some water in the past two days.

    ...
  • Desperately Seeking Yield...

    In This Issue..

    * Currencies rally...
    * More on the BRIC's...
    * New Zealand's GDP contracts..
    * Bernanke gets grilled!

    Good day... And a Happy Friday to one and all! The end of what seemed to be a very long week... The last weekend in June, can you believe that? Next week, we'll be getting ready for the 4th of July celebrations! WOW!

    Well... What a volatile week it has been in the currencies! Up, down, all around, and settling back to levels that we saw before the Fed's FOMC meeting earlier this week. Suddenly, investors are looking for yield again... Looks like they are "Desperately Seeking (not Susan) Yield! And why not? The Fed, and the Bank of Canada (BOC) have come out and said that there will be no interest rate hikes until we've turned quite a few pages on the 2010 calendar....
  • Increasing SDR Issuance...

    In This Issue..

    * Fed confuses markets, risk assets get sold...
    * SNB intervenes to stop franc's rise
    * ECB issues 12-month liquidity...
    * Bernanke to get grilled?

    Good day... And a Tub Thumpin' Thursday to you! Yes, I know the currencies and commodities got whipsawed yesterday, and my Cardinals got spanked, but that's no reason for us to not enjoy a Tub Thumpin' Thursday! Every day is a gift, and it has nothing to do with stocks, bonds, currencies, and commodities!

    OK... Not that I try to be philosophical, sometimes it just comes out that way! Besides, you don't want to think that I'm just a smart *** all the time! HAHAHAHAHAHA!

    Well, as I said in the open, the currencies and commodities got whipsawed yesterday, and the culprit was the FOMC minutes... You see, the Fed Reserve met to discuss rates, and other items. And what they said just blew away the bond vigilantes, and really ticked off the Hawks, but in the end, what they said, was really that things will remain status quo......
  • More Stimulus On The Way?

    In This Issue..

    * Euro leads currencies higher...
    * Commodities rally back on FOMC thoughts...
    * FOMC meeting today...
    * NZ Consumer Confidence on the rise...

    Good day... And a Wonderful Wednesday to you! Well... Yesterday, the title of The Pfennig was: So Far... It's A Turn Around Tuesday! And... That theme played well throughout the day, and by day's end, it had been quite the Turn Around Tuesday! Now, we have to see what's in store for us today, as the last couple of weeks have seen the Wednesday trading quite the opposite of Tuesday's trading! Strange trading pattern don't you agree?

    Overnight, the euro climbed as high as 1.4140, only to sit at the cusp of 1.41 as I begin to write this morning. Of course 1.41 certainly looks a lot different from the 1.35-1.40 range we've seen in recent days. But then, we've seen these probes above 1.40 before only end with the euro falling back to the 1.35-1.40 range again......
  • Fundamentals Return...

    In This Issue..

    * Currencies & Gold move together!
    * Fed downgrades economic growth...
    * More on China...
    * Yen breaks the trading pattern...

    Good day... And a Tub Thumpin' Thursday to you! It's Tub Thumpin' here, as the warm winds of spring have finally sprung, the Cardinals have won two in a row from the rival Cubs, and I'm headed to Busch Stadium tonight! Oh! And fundamentals, as far as currencies and metals are concerned, seemed to be in place yesterday...

    That's right... The rout on the dollar was on (recall yesterday, Wayne and Garth playing street hockey... Game On!) and this time... Not only did the currencies rally VS the dollar, Gold and Silver took part in the proceedings too! It's been a long time since we've seen this happen... For the most part, whenever the currencies (minus yen) rallied, Gold would back off, and vice versa... Not yesterday! For the first time in a long time, the negativity toward the dollar was front and center BIG TIME!...
  • A shrinking US economy puts pressure on the US$...

    In This Issue..

    * US GDP falls more than expected...
    * FOMC holds course...
    * Canadian dollar has a great week...
    * Oil helps commodity currencies...

    Good day... Yesterday was a big day in St. Louis as President Obama came to visit on his 100th day in office. I can't believe it has been 100 days since the inauguration. Time sure does fly! I'm sure Obama and the rest of his administration would like the calendar to move even faster as this recession will likely last through the end of 2009. While the government has thrown trillions of dollars at the markets in an attempt to turn them around, the key ingredient for recessionary cycles to reverse is time. There is now 'quick fix' for the problems we are in, and the policies the administration has begun will take time to have an impact on our shrinking economy. Obama said as much in his nationally televised press conference last night....