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  • China & Australia Team Up!

    In This Issue..

    * Risk is back ON!

    * Aussie GDP prints strong!

    * Home Prices rise in June...

    * Canadian GDP weakens...

    ...
  • Chuck asks 'Where's the money??'

    In This Issue..

    * Chuck's parting shots...
    * Greenspan still demands the spotlight...
    * Asian rally helps the kiwi and Aussie dollar...
    * Gold pauses its recent rally.

    Good day. Chuck is headed down to Springfield with his family for their annual summer camping adventure, so he handed off the responsibilities of the Pfennig to me. But as usual Chuck left me a good bit of information before heading out the door; and here it is:

    Well, folks... Just some parting shots for you before I headed out the door on Friday...

    Right after I hit 'send' on Friday, and had told you the euro has sold off 1-cent, and drug the other currencies (except yen and francs) with it... The euro turned around, and headed north! I felt as though I had sent out some bad information! But, there's always a time to cut off, and when I did, the selling was going on......
  • G-20, Schmee 20!

    In This Issue..

    * No clear direction from G-20...
    * A bias to sell dollars this morning...
    * Those guys are wrong, and I'm right!
    * Riksbank to hike rates this week?

    Good day... And a Marvelous Monday to you! A weekend that feels like it went by in a flash! WOW! Don't know how that happened, but it did... This coming weekend will be a 3-day Holiday weekend, so hopefully that 'went by in a flash' feeling doesn't repeat itself!

    Well... This past weekend was the G-20 meeting, and the anticipated brawl between the U.S. and Germany on spending VS cost cutting... Well, the brawl didn't happen, instead they agreed to say that they will 'tackle deficits once economic recoveries are assured'... Which here in the U.S. means... NEVER! Not that the economic recovery won't eventually come along, but that our lawmakers aren't going to stop spending... However, there are elections that might just change their minds, eh?

    ...
  • Let's Talk Deficits...

    In This Issue..

    * A$, kiwi, and C$'s outperform...
    * Yen gets what is deserved!
    * Deficit to reach 100% of GDP?
    * Don't they work for us?

    Good day... And a Thunderin' Thursday to you! It has been Thunderin' here most of the night, so it was quite fitting to call our Thursday, Thunderin'! It's been a week of pop-up Thunder Showers for us here in the Midwest... If summer plays out the way most summers play out, we'll be pining for rain come August!

    The Japanese have a new Prime Minister (Kan), and the currency markets don't like it! The once so-called 'safe haven' of yen, is getting sand kicked in its face, and rightly so, as the new PM has previously stated his goal of a weaker yen...

    ...
  • 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.

    ...
  • Japan Posts a 4.8% GDP!

    In This Issue..

    * Risk Aversion goes away mad...
    * China just says 'no' to currency flexibility...
    * Maybe a return to fundamentals?
    * Gold continues to soar!

    Good day... And a Marvelous Monday to you! It's raining here, so it's one of those Rainy Days and Mondays... But I won't let it get me down, as opposed to the song! I got a chance to check out our new digs in the building next door to us here... Very nice! And... A long way from that small office I sat in on Olive St. a decade ago, when we started EverBank... To think back 10 years ago, and where we are today... Simply amazing!

    OK... As I told you Friday, the President was in China this past weekend, trying his best to get the Chinese to agree to a greater flexibility for the renminbi... Well... There were a few stories this past weekend that hinted about the Chinese agreeing to do such... But I prefer to go with this story that appeared on Reuters last night... 'The Chinese government has sought to distance itself from speculation surrounding a central bank statement earlier this week that was interpreted as a shift in currency policy towards a stronger yuan. However, a report on Saturday by Xinhua, the state-controlled Chinese news agency said that the government would not allow the currency to gain against the dollar in the short term.'

    ...
  • Consumer Spending Drives GDP?

    In This Issue..

    * Dollar rebounds after spending fades...
    * Chinese Manufacturing rises...
    * Eurozone Manufacturing rises...
    * Australia as the proxy for global growth...

    Good day... And a Marvelous Monday to you! And Welcome to November! My least liked month! But that's a story for another time! I hope your Halloween was fun! The rain stopped here, there was a near full moon shining in the sky, and the little kids had a blast! And Hey! The Rams won a football game! WOW!

    OK... Well... Friday was a blur to me, as I went to the doctor's office for a test, and then on my way to work, they called my cell and asked me to turn around and go to a lab for more tests... UGH! So, by the time I got to work, Jennifer had set everything up and begun trading for me... Then it was time to go home! So, I'm sitting here this morning, scratching my bald head trying to recall the currency prices on Friday... And Oh yeah! Now I remember! Do you recall the Thursday action after the GDP report showed such strength (whether you believe it or not) and the dollar got sold like pet rocks?...
  • 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!...
  • Stuck In A Range...

    In This Issue..

    * A Turn Around Tuesday?
    * BRIC meeting doesn't get covered by the media?
    * Are the Bearer Bonds real or fakes?
    * QTC's get Gov. backing!

    Good day... And a Wonderful Wednesday to you! Remember last week, when I said that we had a 'Turn Around Tuesday?' I came in this morning to find a story that Chris Gaffney had printed off the Bloomie for me... The writer refers to the price action yesterday as 'Turn Around Tuesday!' OK... I for one, don't even begin to believe that I was the originator of a saying like that for the currencies... I just find it interesting, that a week after I make a big deal out Turn Around Tuesday that it is used in a story with much wider distribution than my little old Pfennig!...
  • More Wild Swings!

    In This Issue..

    * Euro goes back and forth over 1.43...
    * Eurozone unemployment rises to 9.2%
    * Australia's GDP surprises!
    * Is it protectionism?

    Good day... And a Wonderful Wednesday to you! I'm draggin' the line today, as I was helping my oldest son, Andrew, with things in his brand, spankin' new house, last night. Congrats to Andrew, for finding a great bargain, with a low, fixed, interest rate!

    OK... Whew! What a day in the currencies yesterday! Another day, and another day of wild swings.. Volatility is the name of the game these days... Watching, for instance, the euro trade down to 1.4220, and then up to 1.4320 and not just on a one-way ticket! Oh No! this is a bounce here a bounce there... But just like it was going from 1.41 to 1.42, it took a few times over the 1.42 figure before it finally stuck, and headed to 1.43... All the other currencies followed in the swings, as usual......
  • Carry trades unwind...

    In This Issue..

    * Carry trades unwind...
    * Euro zone GDP falls...
    * Will TIC flows be enough??
    * Aussie dollar predicted to outperform...

    Good day...Chuck handed me the Pfennig this morning, as I took an early flight home yesterday and he got back to St. Louis much later than I did. The Las Vegas Money Show went well, as Chuck packed the presentation rooms with investors looking to learn more about investing in Gold and currencies. Attendance seemed like it was down a bit, but we stayed busy at the booth with investors looking for diversification. We also got to see a number of 'old friends' who stopped by the booth to say hi. All in all it was a good three days, but as always, it is good to get home and back into the routine.

    The currency markets fell back into their established routine also, as fear drove investors out of riskier assets and back into the US$. We saw a general reversal of the carry trade, with the Japanese yen the only major currency which appreciated vs. the US$. As Chuck pointed out last week, investors feeling more confident about the global economy, dusted off their carry trades which had made them good money over the past few years. But traders are still a bit skittish, and move back out of these leveraged trades at the first sign of trouble in the global economy....
  • 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....
  • RBA Surprises The Markets!

    * Everything but Treasuries trades heavily... * Fundamentally speaking on Australia... * Bank of Canada to cut rates today... * Tell me your story... ** RBA Surprises The Markets! Good day... And a Terrific Tuesday to you! Well... The BIG NEWS this morning comes to us from down under, where the Reserve Bank of Australia (RBA) surprised the markets and left rates unchanged for the first time in 7 months... Now, that's the horse of a different color! How dare they? How could they? Why everybody is doing it, Where do they get off thinking they didn't have to? Ahhh, grasshopper... The RBA continues to shine in my eyes as the best run Central Bank in the world, and this is one of the reasons why... Yes, they could have gone with the rest of the crowd, and cut rates to the bone, but why stoke inflation? Now, having said all that... It doesn't mean the RBA won't cut rates again in the future... It just means that they were being prudent, and taking a step back to see what their previous rate cuts had done to the economy, and how the economy would be affected by them. So, the proverbial "pause for the cause"... But, I believe it to be warranted, given the RBA had cut 400 BPS away from their once lofty rate in 7 rate cuts......
  • Housing stats show more rot on the housing vine....

    * US$ continues to be propped up... * SEK moves up vs. the US$... * Japanese yen falls.... * Gold prices come down ... ** Housing stats show more rot on the housing vine.... It has been a while since Chuck turned over the reigns of the Pfennig to me, so I'm a bit out of practice. But there was a lot of movement in the currency markets over the last 24 hours, giving me plenty of Pfennig fodder. I'll get right to it. The 'Safe Haven' status of the US$ continued to prop it up yesterday as bad housing data in the US scared investors. Sales of previously owned homes fell 5.3% in January, after rising slightly last month. And even worse for US homeowners, the median price of a home fell to $170,300, down nearly 26% from its peak in July 2006. These numbers reflect a worsening housing market which will weigh on the US economy through most of 2009. The inventory of unsold homes did fall, but still stands at 3.6 million. At the current rate of sales, it would take 9.6 months to exhaust the excess supply of homes. And this is assuming no more homes come into the market. The housing downturn will continue well into 2010, and will likely keep the US economy in the doldrums....
  • Holiday pause...

    * US data may wake up the markets... * Toyota reports a loss... * NZD falls, AUD gains... * Will the Rupee shine in 2009?... ** Holiday pause... Good day... The currency markets remained in a tight range through the day yesterday with no movement from the majors currencies vs. the US$. Japan has a public holiday today, so trading this afternoon will be very quiet. Jennifer, who is doing all of our currency trading while Chuck is out, let me know that the trading desks were extremely quiet yesterday afternoon. But the markets may wake up a bit this morning, as we wait for data on 3rd quarter growth in the US. GDP is expected to have fallen .5% in the 3rd quarter, and Personal Consumption is also predicted to have dropped last quarter. Later in the morning we will get reports on the sagging housing market. New home sales and existing home sales are both expected to have dropped slightly during the month of November. And with sales dropping, prices of both existing homes and new homes are also expected to have dropped. Finally, this afternoon we will get the ABC Consumer Confidence number which will likely show another drop in consumer sentiment....