Daily Pfennig : Retail Sales

The Dollar Gets Ambushed!

Chuck Butler — Tue, 22 Sep 2009 14:43:15 GMT

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In This Issue..

* Non-dollar currencies soar!
* Weber gives the green light...
* Is the Fed buying more Treasuries?
* China considering IMF's Gold!

And Now... Today's Pfennig!

The Dollar Gets Ambushed!

Good day... And a Terrific Tuesday to you! A Tuesday that needs no "turn-around", as the currency actions VS the dollar overnight are amazing! The dollar got ambushed overnight, as the euro shot right straight through the 1.47 handle, and has just traded 1.48! Hmmm... Didn't I say yesterday that the I didn't think the dollar strength we were seeing was any change in the recent trend? ... I love it when a plan comes together!

Traders have found a "soft spot" in the dollar, and are really going after it! I don't recall the last time I saw this kind of a move overnight. It must have been back when the dollar was getting sold like funnel cakes at a state fair, almost every day in the spring of 2008... But, I really don't recall... But, that doesn't put a damper on this morning's move! No way!

The only thing I can think of, or find in the news, that brought about this HUGE move in the currencies VS the dollar, is the fact that European Central Bank (ECB) Council Member, Axel Weber pretty much gave the "green light" to traders, when he said in an interview that the euro's strength is not out of line with fundamentals... That's right! The way I read that is this... It's Central Bank parlance for... "go ahead and drive the euro higher!"

Weber also said, "There were some stronger data coming from the Eurozone compared to some other regions. So, I think that the behavior of the foreign exchange markets is not out of line with these developments over the recent months."

Now... These comments carry even extra weight due to the position Axel Weber holds as President of the Bundesbank... Buba, as I used to call them, is Germany's Central Bank, and has always held a position of influence on the ECB...

So, Axel Weber says the euro's rally is OK with him... That's Big Folks... For, currency traders like to know that they can run up or down a currency and not fear that the Central Bank is going to step in with currency intervention to stop the run. And, for all intent gives them the Green Light...

OK... Now that the euro has pushed the envelope to 1.48, I expect to see some strong profit taking when the U.S. traders arrive... But, keep this in mind... The euro hit 1.48, and therefore, we now know that traders will take it there a few times before they give up... So, if the euro falls back into the 1.47 handle, look for it to bounce, at least a couple of times. I've explained this trading before... It really comes down to how badly the euro bulls want to push the envelope... Or the dollar bears want to push too!

The euro isn't the only currency gaining VS the dollar... Euro, Swiss francs, kiwi, and Swedish krona have all hit 2009 highs overnight, with kiwi gaining to .7215... A quick look at yesterday's currency round-up shows that kiwi was trading at .7040... Using my "new math" talents... That's a 175 pips move! WOW! New Zealand received some very good news on their deficit problem, as their annual deficit fell from 8.1% of GDP to 5.9% of GDP... Still too high, but moving in the right direction!

For once, it seems, the Aussie dollar (A$) followed its kissin' cousin from across the Tasman, kiwi, higher... It's normally the other way around!

You know what I think? I think that the markets are beginning to look at the man behind the curtain at the Fed, and realize he's just pulling levers, and creating special effects...

OK, I'll explain... Yesterday, I talked to you about the "new record" in size of Treasury Auctions will be shoved down the throats of the markets this week, to the tune of $112 Billion worth of 2, 5, and 7 year notes...

Well... I came across this yesterday, from Morgan Stanley...

"Households reduced Q2 Treasury purchases from their blistering pace in Q1 Foreign accounts reduced Q2 UST purchases as the Fed ramped up Q/E ops. Bank Q2 purchases remained anemic."

In normal speak, what that's saying is that Mom and Pop buying of Treasuries has backed off... You may recall me telling you many months ago that Mom and Pop buying of Treasuries had taken up the slack from declining foreign purchases... The Mom and Pop buying was credited to the "flight to safety", when the walls came crashing down last fall...

So... If Mom and Pop buying is backing off, and it was used to offset declining foreign purchases, who's left at the table to buy the Treasury's issuance this week and in a couple of weeks, and a couple of weeks after that?

Well... It's the Fed... I read this, and just couldn't believe my eyes! The Fed is taking on more and more.. I read where it is believed that about 50% of U.S. Treasury issuance in the 2nd QTR saw Fed intermediation... $164 Billion in the 2nd QTR ended up on the Fed's books, while foreigners bought $101 Billion and Mom and Pops bought $29 Billion... When you add in the Primary Dealers, the total of Non-Fed buying was $158 Billion...

Let me be perfectly clear on this... This is only speculation at this point... But it certainly makes sense doesn't it?

Now... Why isn't the main media all over this? Where are the questions about how the upcoming record amounts of Treasury issuance will be taken, and by whom? Why am I the only one asking these questions? It's just little old me (yeah, right! HA!), and my laptop... Oh, and let's not forget that the Administration has already given us the bad news that $9 Trillion in Budget Deficits will need financing in the next 10-years...

This all makes me sick to my stomach... I mean come on! This Deficit Spending has got to stop! And We've got to say NO to any additional new Deficit Spending! Stop it, right here, right now! Cut government in half... Get rid of non-Constitutional agencies... Audit the Fed, and turn this around!

OK... I've got to talk about something else before I throw my keyboard! I used to throw my keyboard, slamming it down on the desk all the time, and break them... The IT people would laugh, and just bring down a new one for me... But, since I got sick two years ago, I don't throw my keyboard any more... But, I was tempted... I could have gone into a song by The Squeeze there, but I didn't...

Remember last week, when I told you about the IMF wanting to get permission to sell quite a bit of their Gold? And at that time, I said... "China, are you ready to buy?" ... Thinking, of course, that China would be the only country that could / would buy up the 403 tons of Gold that the IMF is putting up for sale...

Well... Guess who answered my call? That's right, China! It is reported this morning, that China is considering buying the Gold that the IMF is offering. It's not clear whether they want just "some of the offering" or "all of the offering"... My guess would be the latter... As this would just add to China's goal of diversifying their U.S. dollar reserves...

And... If China does take down 403 Tons of Gold, that will take away from their Treasury purchases, don't you think?

But, I'm not going down that Treasury road again... I'm staying on the high road with Gold! Which at one point yesterday morning, looked weak... I even mentioned on the desk that it looked like Gold was getting spanked, as it was down over $10... But, later in the day, the shiny metal had come back and was on the positive side of the ledger for the day! And now, this news that China is considering buying the IMF's offering of Gold, has Gold on the high road too... Gold is up $12 this morning, back to $1,016!

So... Throwing stones at the dollar this morning on two fronts... The currency and Precious Metals fronts... Hey! I'm not throwing the stones! The markets, traders, investors, etc. are doing the throwing!

You know, each day, when I'm writing the Pfennig, the currencies are all trading, except... The Brazilian real... The real is still not a floating currency, as it goes through a "fixing" each day, but then the markets take it over, and trade it the rest of the day. So... When you have an overnight market like we've just had, when the non-dollar currencies have all spring-boarded higher, I sit with anticipation for the "fixing" for real, and then watch as the markets play catch-up... The move will be stunning, I'm sure... As real is much like South African rand, when it come to the wild swings...

There's not really any data in the U.S. cupboard this morning... In fact, the only thing I see globally is July's print of Canadian Retail Sales... And with it being so delayed, I doubt it will mean much when it does print!

I thought I would play a game of "Remember when?" Here's how it goes... Remember when the Swiss National Bank said they would intervene to keep the franc weak? Or... Remember when the Brazilian Central Bank Gov. said that he would do everything in his power to keep the real above 2? OK, I'll stop there... Oh... Swiss francs? They have gained almost 15%, and Brazilian real? Well, it's trading at 1.82... So let's just say that the "2" thing wasn't in the cards!

So, what am I getting at here? Well... I've told you for years now that Central Bank intervention can stop currency runs for short periods of time only... And that Central Bank jawboning will only last as long as traders want it too, for if the Central Bank doesn't back up the jawboning, then just like a child, Traders will then push the envelope...

OK... Maybe some day we'll play again, only with Big Ben Bernanke!

So... Traders have ambushed the dollar overnight, and Axel Weber has given them the green light to do so. Could the Fed be the major buyer of Treasuries? China may be the buyer for the IMF's Gold sales, and no data today to speak of...

Currencies today 9/22/09: A$ .8740, kiwi .7215, C$ .9375, euro 1.48, sterling 1.6340, Swiss .9775, rand 6.8250, krone 5.8350, SEK 6.8275, forint 183.30, zloty 2.80, koruna 17, RUB 30.12, yen 91.40, sing 1.4110, HKD 7.75, INR 47.96, China 6.8269, pesos 13.30, BRL 1.8240, dollar index 76.13, Oil $70.80, 10-year 3.49%, Silver $17.26, and Gold... $1,017.10

That's it for today... Cardinals' magic number to win their division is 3... Pretty amazing, eh? With two weeks left in the season! Hey, Californians... Did you see the little blurb in the L.A. Times quoting yours truly? Yes, there was a story in the L.A. Times this past weekend regarding "Foreign Currency Investing"... I spend a good amount of time on the phone with the writer, Kathy Kristof, who seemed quite interested in what I was saying! Today, is the first full day of Autumn... YIKES, you and I know all too well what follows Autumn! Oh well, maybe we can make Autumn last longer than usual! HA! So... Welcome to Autumn! And with that... I'll hit send, and get this on the delivery truck to your computer! I hope you can make this Tuesday totally Terrific!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837

Retail Sales Soar!

Chuck Butler — Wed, 16 Sep 2009 14:20:00 GMT

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In This Issue..

* Currencies rally on Retail Sales!
* China likes investments in Canada...
* Big Ben the "inflation fighter"...
* Gold climbs to $1,018!

And Now... Today's Pfennig!

Retail Sales Soar!

Good day... And a Wonderful Wednesday to you! Good news for me this morning, the pain in my left knee has subsided... Now, If I could just get that swelling to go down, I'd be in tall cotton! This has been quite the ordeal on the old Pfennig writer, and one that I will be glad to put in the rear view mirror!

Well... When I turned on the currency screens this morning, the euro was trading with a 1.47 handle! WOW! It just skipped to my Lou right through the 1.46 handle, eh? It began yesterday afternoon, the dollar was getting sold on the news of a strong Retail Sales figure, more on that in a minute, and the euro was edging up the 1.46 ladder... The move to get it past 1.47 came in the overnight markets... Now, having gotten you all lathered up about 1.47, I have to say that since I turned on the currency screens, the euro has lost ground back to 1.4688, but still... That's quite an impressive move from yesterday morning, eh?

OK... The issue with the Retail Sales figure causing dollar weakness is a time honored tradition... NOT! Well, it is if you only count the last 9 months... But traditionally, a figure like the one that printed yesterday, would have attracted buyers for the dollar, not the opposite that occurred... Here's the skinny, as I see it...

Retail Sales for August were quite strong, and showed signs that the move was more than the Cash for Clunkers program, and Back to School buying... There are quite a few people/ economists/ analysts out there now jumping on the President's bandwagon that the recession is over based on this report... For those of you at home keeping score, Retail Sales for August printed at +2.7%!

Does one Retail Sales report that's being trumped up with a Government Deficit Spending program, and Back to School buying really tell us that the recession is over? Was it over when the Germans bombed Pearl Harbor? HA! (from Animal House, I know very well the Japanese bombed Pearl Harbor)... You know, it kind of ruins the funny line when you have to make disclaimers... But... I've had people send me emails before telling me, that I should know better that the Germans didn't bomb Pearl Harbor!

OK, I went off on a tangent there, eh? Any way... I wonder if all those people wearing the President endorsed end of the recession rose colored glasses ever stopped to wonder if gas purchases might have helped trump up this figure? Well, I did, you knew I would! And I found that rising gasoline prices sent service station receipts up 5.1% in the month. If we had journalists like we used to have, they would have known to go look at the rising gas price component of the report, since just last week the Trade Deficit jumped by 16% in one month due to rising oil prices!

So... With Retail Sales shooting toward the moon, the dollar selling increased... Because, if the thought here (and not my thought!) is that if Retail Sales are jumping again, it must mean the U.S. Consumer is buying again, and that will help kick the global recession in the rear, and the risk takers come out of the walls, the U.S. Treasury "safe haven" buyers sell to get out of their losses, and they all go to better investments... It may be what they think, to be better... Stocks... But for the most part, these investors seek out higher yielding or better income potential investments... And you won't find those on the Big Board... You won't find them at the local bond house... You'll only find them abroad, in foreign deposit rates, and foreign bond yields...

Now... That everyone is all lathered up about this euphoria going on in the markets... I'm still keeping a light on for a HUGE stock market sell off, which would adversely affect the values of all these risk assets that risk takers have been going into... Commodities, currencies, stocks would all be affected...

However, if that HUGE sell off never comes... Who wants to stand in front of the bus that has Gold above $1,000 and the euro posting a nearly 17% gains since March 1st... But that's nothing folks! The New Zealand dollar (kiwi) has gained 44% since March 1st... The list of currency gains since March 1st is amazing... Simply amazing... Here's a sample... Aussie dollars +38%, Norway +23%, loonies +21%, and so on... So, now you see the bus that I'm talking about!

Big Ben Bernanke had this to say yesterday... "Even though from a technical perspective the recession is very likely over at this point, it's still going to feel like a very weak economy for some time." He also said that he "may have to accept a slow recovery and high unemployment as the price for defending my inflation fighting credentials."

Ok.. Excuse me for a minute, I have to go in the other room and either laugh my rear off or, throw up! Big Ben has "inflation fighting credentials"? Since when? And just where is he hiding these credentials? Or... Maybe his description of "inflation fighting credentials" is different from mine! Hmmm... I shake my head in disgust...

Speaking of the Fed and inflation... My good friend, David Galland, who writes an absolutely fabulous daily letter regarding the goings on in the world called "Casey's Daily Dispatch", and can be found here: http://www.caseyresearch.com/casey-services/free-publications/caseys-daily-dispatch/ , had this to say yesterday regarding this subject of the Fed and inflation...

"Reason Magazine is one of the few magazines I read with any regularity. In the current edition, they had a couple of items that I thought were especially interesting. Ironic, actually.

The first was about a comic book the Fed has published discussing inflation, as well as defending its autonomy. You can view it by following the link below. What you should find interesting is that they make several clear mistakes in describing inflation - for instance, by saying that if the price of oil goes up, that causes inflation. And on the very first page, they state that "The dictionary defines inflation as a substantial and continuing rise in the general price level."

But that is not what the dictionary says - every entry I checked always includes ". related to an increase in the volume of money," or words to that effect. Kind of scary, when the organization charged with fighting inflation doesn't actually know what it is.

You can read the comic yourself here, straight off the New York Fed's website. http://ia301540.us.archive.org/2/items/gov.frb.ny.comic.inflation/gov.frb.ny.comic.inflation.pdf

OK... I'm back now... I saw a report last night that showed the results of a survey that showed the Chinese are very interested in investing in Canada... It was reported that China sees energy, natural resources, agriculture and biotechnology as the most promising areas of Canada's economy... Hmmm... Isn't that the same things I've listed over the years? (well minus the biotechnology) Any way... The report also showed China having interest in the U.S. and Australia...

Money flow is a very important thing to watch in the investment world... And if money is going to be flowing into Canada and Australia from China, that will be good for those countries and their respective currencies. As far as the U.S. is concerned... Forgetaboutit! Remember when China wanted to buy that oil company in California a couple of years ago? I doubt that China will want to get dragged through a mile of broken glass and razor blades again!

Yesterday, I told you about the dollar denominated bonds being issued by Germany, and how I viewed it as a green light from Big Ben Bernanke for other countries to take over the destruction of the dollar, that the Fed has carried the flag for since 1913... I told you I had another frightening thing that I would bring to you this morning... So with no further delay...

The Chinese government has told Chinese companies they do not have to honor derivatives and commodity futures contracts made with Western financial institutions. Ruh-Roh...

This appears to be one of those things that passes in the night, and then one day smacks us right between the eyes, and we say, "Where did that come from?" Well... If came from the Chinese Gov't that told Chinese companies that they did not have to honor derivatives and commodity futures contracts made with Western financial institutions... That's where!

Ok, I can hear you saying, How can they do that, Chuck? Well... When you're a 200 pound gorilla, you can sit where you want, and you can do what you want! China is taking the stance that you come get us, if you think you were wronged!

What does this do to the institutions that wrote these contracts with China, Chuck? Well... That's the cheese that binds folks... It's going to hurt... And it's going to hurt bad... But, nobody really knows just how many or how much risk is out there... But, if one day you wake up and hear on the news that the financial markets here are melting down once again, you'll be able to say... Ahhh, it must be that Chinese announcement that Chuck talked about!

Big Al Greenspan was back in the news last night... First, I want to quiz you on something...
Who said, "In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value."

Well... You'll never guess who, so I might as well tell you, but when you hear it you'll bust a gut, given the whole low interest rate, high money supply environment he created at the Fed... It was..... Drum roll please... Alan Greenspan, from an article written in 1966 entitled "Gold and Economic Freedom"

Any way... Big Al was back in the news, and said that he's worried that lawmakers will hamper the Fed's efforts to rein in its monetary stimulus, and that inflation might "swamp" the bond market. See, how Big Al is sticking up for the Fed, and putting down the groundwork now, to blame lawmakers when inflation is soaring on the other side of the recession?

Big Al is dastardly... I wouldn't be surprised to see a Commie flag nailed to the wall of his garage! HA! Long time readers know my dislike for this guy as a Fed Head, and how he might now have paved the road to this mess we've been in, but he laid the foundation!

OK... The data cupboard will yield a boat load of data today, and it will interesting to see how the dollar reacts to it... Leading off for the data cupboard today is the stupid CPI data for August... Batting second is the Current Account Deficit, and in the all important third position in the batting order we have The Tic Flows, batting clean-up is Chuck's faves Industrial Production and Capacity Utilization... WOW! What a line-up! A Murderer's Row for data if you will!

Since no one but me and my friends over at the Daily Reckoning and 5-minute Forecast, seem to care about the Deficits, the markets will probably wax over the Current Account Deficit... And I don't care about CPI... So that brings us the TIC Flows for July, and I'm fearful that this data will be harmful to our future... And the experts are forecasting a bump up in Industrial Production and Capacity Utilization, which would indicate a stronger economy, and given what we saw yesterday with the stronger Retail Sales, one would think that a bump up in Industrial Production and Capacity Utilization would be bad for the dollar...

Finally... Someone with some brains! I was beginning to think that these guys were all kin to the scarecrow! Yesterday, I told you about how the new governing party in Japan is calling for increased currency intervention... Well, finally someone that understands! Japanese Finance Minister, Fujii, said that he is "against intervention if their moves are gradual, and that I don't think they are fluctuating rapidly now."

It looks like currency traders in the overnight markets were paying attention, and immediately began buying up Japanese yen... The yen is pushing the envelope once again to a sub 90 level... And that! Would be a very good thing for yen holders!

While I'm on "feel good stories"... I might as well mention that Gold has finally made a strong move above $1,000, moving to $1,018 as I write! Silver is kicking tail and taking names later too, with a strong move to $17.35! The Retail Sales data in the U.S. yesterday kicked off a new phase of "inflation protection buying"

OK... To recap today... Retail Sales in the U.S. were very strong, setting off a new wave of dollar selling, to currencies and precious metals. China likes Canada and Australia, and China tells their companies not to honor derivative contracts with Western institutions. And we have a boat load of data to get through today in the U.S.

Currencies today 9/16: A$ .8720, kiwi .7135, C$ .9365, euro 1.4680, sterling 1.6525, Swiss .9665, rand 7.3625, krone 5.8615, SEK 6.9070, forint 184, zloty 2.8240, koruna 17.27, RUB 30.61, yen 90.30, sing 1.4120, HKD 7.75, INR 48.24, China 6.8260, pesos 13.24, BRL 1.8030, dollar index 76.30, Oil $70.75, 10-year 3.40%, Silver $17.35, and Gold... $1,017.50

That's it for today... I just looked up and noticed I was running late with the Pfennig this morning. UGH! So, I guess it's good that I don't have a lot to talk about here... I was going to the day game today... But had to back out because of the problem with my knee... But now the pain is subsiding... I wonder if there's still a ticket... Nah... I gave it away! Go Cards! As a part of the hockey Blues web site, they have a picture of Chris Gaffney's son, Brendan! He's a star! Chris has taken Brendan to hockey games since he could barely see over the side boards. When the games were on TV, you could watch Brendan running back and forth in his space, as Chris has ticket along the glass! Ok... Enough... Time to roll, April Showers is here, and that means I'm late! I sure hope your Wednesday is Wonderful!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837

German Investor Confidence Soars!

IIP Webmaster — Tue, 18 Aug 2009 13:14:00 GMT

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In This Issue..

* ZEW says Germany is on the mend...
* UK inflation remains higher than expected...
* Safe Haven, what safe haven?
* Housing data remains soft...

And Now... Today's Pfennig!

German Investor Confidence Soars!

Good day... And a Terrific Tuesday to you! Well... I received an injection of steroids into my left knee yesterday, and already today, I can tell that they are working their magic! I guess I'll have to give up my plans to try out for the Cardinals next year, now! HA! So, my knee is recovering from 3-weeks of agonizing pain and swelling... I've got that going for me!

And the currencies seem to be recovering this morning too, from the recent go around in the ring with the risk aversion campers. The currencies (except yen), were last seen yesterday up against the rope, doing their best imitation of the rope-a-dope.

But... This morning... The markets are just giddy about two pieces of data from Europe... First, German Investor Confidence as measured by the think tank, ZEW, beat the forecasts, and came in at the highest level in 3 years! That's right, not since 2006, as German Investor Confidence been this high... For those of you keeping score at home... The Confidence Index number soared to 56.1 from 39.5 the previous month! WOW!

Last week, I told you how the German GDP had posted a positive number, and therefore the economy had exited the recession. I don't believe the German economy to be "out of the woods" yet though... There are still things that go bump in the night that could very well drag the economic growth down... But for now... The Eurozone's largest economy is basking in the sun of not only exiting a recession but a strong Investor Confidence report.

The other piece of data that has the risk takers fighting back for ground that was lost last week, was the U.K. inflation data that printed at 1.8%... Now, that sounds pretty low right? Well... You might recall that the Bank of England (BOE) had forecast a fall to 1% of inflation in the 3rd QTR... The other thing that makes 1.8% more robust than it looks is that the BOE has an inflation target of 2%, so... It's knocking at the door of 2%, eh? Can you hear me knocking? On the window... Can't you hear me knocking? On the door...

So... As I said it "seems" that the currencies are fighting back... But the move has been smallish in nature, but at least the euro has gained back the 1.41 handle, and the Aussie dollar has gained back the 82-cent handle, and so on, and so on...

The TIC's data for June that printed yesterday was quite strong... For Long-Term Treasuries, that is... The short end got ambushed and was so weak that the positive for the Long-Term Treasuries was wiped out by the selling on the short end...

This probably all those people that bought short term T-Bills last year in what they thought was a "flight to safety"... I'm sure they exited with some red in the numbers... They basically gave the Gov't a loan, paid the Gov't for that loan, and lost money... Great "flight to safety" I'd say... NOT! Safe Haven? What Safe Haven?...

There's no information right now about what games the Gov't played in these figures... I think that for now though we can believe in our heart of hearts that they are playing games, which means the question at heart is... When the Fed winds down their buying of Treasuries, what happens to yields... And in turn what happens to borrowing costs... And finally the economy. My opinion? It won't be pretty... But neither will the monetizing of debt that the Fed keeps performing... So, it's a case of pick your poison... I would prefer the quantitative easing / monetizing of debt to stop, and let's take our lumps on the economy that the Gov't has been so hell-bent in attempting to stop... Get it over with, and live to see another day, rather than prolonging all this bad stuff...

For instance, last week, I read an article that talked about how the Big Banks are still in trouble... That just stinks! See what I'm talking about here? If they had been told to close their doors a year ago, we would be probably be pulling our selves out from that mess now... But nooooooooo! Instead the Gov't spent hundreds of Billions of dollars to prop them up, and a year later, they still have problems! That just stinks!

So far this year, and I know, these aren't the Big Banks, but ones that have caused significant damage to the funds of the FDIC, there has been 77 banks close... 77 Banks folks! One of the banks that closed was sold to another bank, but with the Gov't guaranteeing that the buying bank didn't experience any losses... Well, that would be a big wouldn't it? If the closed bank didn't have losses, it wouldn't be getting closed! My friend and excellent writer, David Galland, had this to say about these back door deals for closed banks...

"Note that bit about the government "agreeing to shield acquirers from certain losses on assets of the failed bank." This sort of guarantee has become a popular backdoor way for the government to deal with various elements of this crisis, without the more overt method of writing a check to cover losses or, heavens forbid, actually letting the equity holders bear the brunt for having made a bad investment in a poorly run bank.

Instead, the government jiggers things to hand off the good assets of a bad bank to one of their buddies, while agreeing to shift the liability for the poor assets onto the backs of taxpayers - with the IOU due and payable at some point down the road."

OK... Back to me... I would not want to go on from that last note without mentioning that EverBank who sponsors this letter, and is my employer, which is not taken lightly, is enjoying a very good run of deposit growth and earnings growth. We just posted the 2nd QTR numbers, and I'll have them to give to you, as soon as the marketing people give me the details. I understand that they are quite good, once again!

The other piece of data that printed yesterday was the NAHB Housing Market Index, which printed a digit higher than the July print of 17... So, 18 is the index number, what does that mean to us? Well, first of all, the Index represents a survey of Home Builders of Single-Family detached homes, and is comprised of three surveys... 1. Present Sales 2. 6-month expectations 3. traffic of buyers. The index has a range between 1 and 100, with 1 being bad, and 100 being excellent... A figure above 50, suggests that survey participants are seeing good economic conditions for Home Sales.

So... Now that we've learned that in class today, who can tell me what an index reading of 18 represents? You, over there in the corner, please take the IPOD ear-phones out of your ears and answer the question! Yes... It means we have a LOOOOOOOONNNNNNGGGGG time to go before we get back to 50...

Today we'll see Housing Starts data for July... And Building Permits for July... These too will probably show a small uptick in activity, but nothing close to what it should be. And... Let's also keep in mind that the problem we have with Housing in this country is that we have a GLUT of inventory, and it continues to grow, given the record number of foreclosures that I talked about last week... So, what good does it do to have these two pieces of data print strong? Sure, somehow the builders are finding the money to keep building and employing people, but, I just don't see why that's a good thing overall... Given... The glut of inventory.

I just wanted to recap what we've seen in the past week... A very weak Retail Sales figure, that was supposed to be inflated with the Cars for Clunkers program sales, and was not! And we saw a huge drop in Consumer Confidence... No wonder stocks have taken it on the chin the last two trading days... And... You have to wonder where all those economists are now that claimed last week that the recession had ended! Ended? Over? It's not over until we say it's over!

Speaking of foreclosures... I would have to think that these days, these days I sit and think about all the things that I forgot to do, for you... No wait! I have no idea where that came from, well actually I do know who sang it, but I mean that I would just start typing that! UGH! Runaway fat fingers! Any way... I do think that these days, all those unemployed people that were losing their jobs all winter and spring are now having problems... That's a sad thing, folks... Something that might have been at least delayed with savings... But, recall back to before this financial crisis began, savings rates in the U.S. had gone negative! That's sad too... But has been turned around now that everyone sees how important it is to have a war chest of savings... Let's hope we don't ever get to the negative savings rate again!

At home, I use ATT-U-Verse which means my news when I log on, comes from YAHOO! Last night I logged in, and saw this on the front page of news items... So... I just had to click into it to see what it was all about...

"A USA TODAY/Gallup poll found that 57% of Americans think President Barack Obama's economic stimulus either had no impact on the recession or made it worse, while 41% said the spending was good for the economy. More than three-quarters said they are "somewhat worried" or "very worried" that some of the stimulus money is being wasted."

Hmmm.... Maybe there are more Pfennig readers out there than I imagined! Now, we need to make the other 41% see the error of their thinking, and get them to diversify a portion of their investment portfolio out of the dollar, and into the asset classes of currencies and metals!

And with that note... I think I'll head to the Big Finish! No wait! I wanted to mention that the threat of hurricanes in the Gulf have pushed the price of Oil higher, and will continue to have an affect on Black Gold's price!

Currencies today 8/18/09: A$ .8240, kiwi .6710, C$ .9050, euro 1.4120, sterling 1.6560, Swiss .9280, rand 8.05, krone 6.1410, SEK 7.26, forint 193.10, zloty 2.9525, koruna 18.14, yen 95, sing 1.45, HKD 7.7515, INR 48.75, China 6.8338, pesos 12.94, BRL 1.88, dollar index 79.18, Oil $67.75, 10-yr 3.50%, Silver $14.08, and Gold... $938

That's it for today... My little buddy, Alex, has his first day of school today... He's in the 8th grade this year... My, time has flown since he was just starting school! When I was a kid, we didn't start school until after Labor Day... I remind him and my two other children that are both teachers, of that whenever August rolls around! My beloved Cardinals won a big game last night in Los Angeles... Of course I'm in bed sleeping by the time the 1st pitch is thrown! Keep it going, Cardinals... Just keep it going... I'm very glad that I was able to get in to a good orthopedic doctor and get that shot as quickly as I did... I wonder how long I would have had to wait, no... Never mind I'm not going there! It's time to hit send... So... Let's get going on that Terrific Tuesday!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837

Cash For Clunkers Is A Clunker!

Chuck Butler — Fri, 14 Aug 2009 15:13:00 GMT

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In This Issue..

* Currencies trade in a tight range again...
* U.S. Retail Sales are a clunker!
* RBA's Stevens is upbeat!
* Thoughts on Brazil...

And Now... Today's Pfennig!

Cash For Clunkers Is A Clunker!

Good day... And a Happy Friday to one and all! The end of the week... It's been a tough week for yours truly, as I've hobble around in pain all week. But, as I recall, I promised 2 years ago that I would not complain about these things in the future... So! I carry on!

Well... Front and center this morning... The currencies are trading near levels they were when I signed off yesterday morning. They did have a brief rally, after the U.S. Retail Sales data showed some real rot on the "recover is here" vine... But that rally was snuffed out, as the risk aversion campers came back to the markets...

Overnight, the Reserve Bank of Australia's (RBA) Gov. Stevens, game his semi-annual report on the Australian economy to Parliament, and he was quite upbeat... And not just about the Australian economy. Stevens was quite upbeat about most of Asia, including Australia's largest export country... Japan. I bet you thought I was going to say China! I thought that Stevens did a fantastic job of putting his thoughts out there for all to hear. Like, talking about how future quarters could show softer growth as the RBA removes "fiscal candy"... Good Show!

One thing is clear, at least to me, from this upbeat report, and that is I believe we can look for the RBA to hike rates aggressively in the first QTR of next year... And, if the future quarters are stronger than Stevens now forecasts, we could very well see a rate hike before we turn the calendar page on 2009!

Speaking of future rate hikes... Since Norway's Norges Bank moved to a tightening bias on Wednesday morning the Norwegian krone has gained 3.2%! Go krone, Go krone... I'm dancing in my seat. Carlos Santana is playing, dance, sister dance on the radio... It's all good... OK, I'm sure that's a sight you didn't want flashing before your eyes!

OK... So... Here in the U.S. we saw Retail Sales for July, which I told you yesterday was expected to be stronger because of the Gov't's cash for clunkers program... U.S. retail sales unexpectedly fell -.1% in July despite the debut of the government's "cash for clunkers" program meant to jump-start the auto business and help turn around the economy. So... Here we go again... The Gov't promises something, and it falls short of expectations... Looks like "cash for clunkers" is a Clunker!

That Retail Sales shocker yesterday really makes one stop to think about all the euphoria being exhibited about the end of the recession... So... When Retail Sales printed, you can understand the return of the risk aversion campers, eh? I wonder how this report fits into the Fed's view that the economy is "leveling"?

Today, we'll see the stupid CPI report... Just what we need on a Friday! A reminder of how the Gov't cheats those that are on fixed payments, and those that buy TIPS... Don't know what I'm talking about here? That's OK... You must be new to class! No worries! You see the Gov't began making changes to the way we calculate consumer inflation back in the mid 90's, and it's been a huge mess ever since! I'll just say this... Consumer inflation in this country has been grossly understated for 15 years... It was all done as part of a plan to allow interest rates to remain low, so that housing would become affordable for everyone... Now, that plan sure worked out well, eh? NOT!

So, enough of that! Let's talk about Brazil! Before I get into this, I must make this perfectly clear... Brazil is an emerging market, and with that moniker, they should be viewed as a speculation investment only, that is unless it's got principal protection like our BRIC MarketSafe CD! WOW, did you see how I segued right into that? Man... I are so smart!

OK, back to Brazil... I was reading a story on the Bloomie this morning about how a currency strategist at Standard Chartered Bank in New York, has forecast a level of 1.80 for the real by the end of this year, and 155 by the end of 2010... WOW! That would mean that on top of this year's already top performance of +27%, the real would add another 15% next year... That's all nice and sweet... But it is just a forecast by someone I've never hear of, so take that with how ever many grains of salt you wish!

Now that I have you all pumped up... OK, for a second there the old Hans and Franz Saturday Night skit, "were going to pump you up" flashed before my eyes... OK, were was I? Oh, now that you're all pumped up, I will remind you of what I said on Wednesday of this week... And that is, that I'm becoming very scared of this stock market run, and if it runs out of steam, the resulting sell off of stocks could adversely affect the currencies, since these two asset classes are being hog tied together, along with commodities!

Oh, and this just in this morning... Brazilian Retail Sales rose 1.7% in June beating the forecasts of a 1.2% gain. You would have to think that given the strength of this report that Brazilian domestic demand is growing and will contribute further to the thoughts that the Brazilian economy is going to rebound faster than most other countries. And when you have some of the highest yields in the world, and an economy rebounding faster than others, you get a ton of foreign investment into the country, which... Will drive up the value of a currency, which in this case is the real!

It's been a while since I last talked about Gold & Silver... And then I was reading a report written Sean Hyman about Gold, and decided to share with you some of Sean's thoughts... Sean believes that we'll see $1,300 Gold by the end of this year, and $2,500 Gold in 2010... He bases this on a number of things, but mostly on the fact that the IMF announced sales of Gold made earlier this year, is being completely offset by Chinese buying. With all the demand for Gold, having this huge IMF selling of Gold offset by the Chinese if HUGE! So... I thank Sean for his thoughts here...

Sean is a regular contributor to the FX University Daily newsletter that the Sovereign Society publishes... I'm a part of FX University, along with Sean. Speaking of FX University... Many of you know how the FX University did what we called "currency tours" last year, visiting 8 different cities to hold one-day classes on Foreign Exchange (FX)... That format is going to change... In February 2010, we'll hold a 3-day event in Scottsdale Arizona... So... The number of people able to attend these classes will be greatly reduced! I suggest that you visit http://www.worldcurrencywatchfxu.com/main/

OK... Thanks for all the positive notes about abolishing the Fed yesterday... I did receive a few that thought I had lost my marbles, and didn't have any problem telling me so! But that's OK... I didn't think it was going to be met with 100% approval / participation! Quite a few told me to join Ron Paul's bandwagon... I've been on his bandwagon for some time now! But for those skeptics to my call to abolish the cartel, I mean the Fed, I simply suggest you read the book: The Creature From Jekyll Island... But for an appetizer, I suggest you first read William Fleckenstein's book, The Age of Ignorance at the Fed, Greenspan's Bubbles...

And... Let me make something perfectly clear... This letter is Chuck's letter... And therefore it is Chuck's opinions, not those of the Bank! While I'm sure that I'm loved by one and all at EverBank, they do not influence my opinions, this is all me, folks... Just imagine what my poor beautiful bride has had to put up with for 33 years!

OK... We had some housecleaning to do this morning, I sorry about that, but just some things to get off my chest and out the door...

Before I head to the Big Finish, I wanted to talk a bit about Canada... While the U.S. was posting an increase in their Trade Deficit, Canada printed a narrowing Trade Deficit! Rising exports and falling imports resulted in a HUGE narrowing in Canada's trade deficit in June which came in at C$55 million, which was much smaller than May's revised C$1.1 billion trade shortfall... This is a nice piece of data for Canada, and I would love to see this deficit narrow further next month, and get back to the days of surpluses in Canada!

One would think this data to be a feather in the loonies' cap!

Currencies today 8/14/09: A$ .8435, kiwi .6820, C$ .9205, euro 1.4290, sterling 1.6565, Swiss .9360, rand 8.0550, krone 6.0250, SEK 7.1250, forint 188.50, zloty 2.8875, koruna 18.51, yen 95, sing 1.4425, HKD 7.7505, INR 48.25, China 6.8344, pesos 12.84, BRL 1.8230, dollar index 78.35, Oil $70.75, 10-yr 3.60%, Silver $15.10, and Gold... $958.70

That's it for today... I'm late, I'm late... It took me the longest time to write this today... My friend David Galland told me to use this voice system to write. I'll have to look into that, with all the writing that I do! Hey! I forgot to mention to Chicagoans that Chris is in Chicago to speak to the Chicago Investment Seminar sponsored by Taipan publishing... I just booked my flight to Williamsburg VA to speak at a private meeting of investors... I fly on Sept 11... That's kind of creepy to me, but I'll get over it! Next week it's the San Francisco Money Show on the weekend... Yes, I give up a lot of weekends, but, when I retire, every day will be a weekend! OK... The knee doctor says there's nothing major, and I go back for a shot relieve the pain and swelling on Monday... That's all good! I have to get going now, hope you have a Happy Friday!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837

Currencies Rebound...

Chuck Butler — Wed, 15 Jul 2009 14:24:59 GMT

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In This Issue..

* Goldman posts a nice profit...
* I smell a rat!
* Euro nears the 1.41 mark... Again!
* Gold manipulation?

And Now... Today's Pfennig!

Currencies Rebound...

Good day... And a Wonderful Wednesday to you! Another All-Star Game, another win for the American League... I truly believed that with Tim Lincecum going for the National League, that we would win this year... But that didn't work out... I did truly enjoy the game though, and got to experience it with sons, Andrew, and Alex, with Darling Daughter Dawn's husband, Jerry... A truly memorable night...

The currencies slowly moved a bit higher yesterday, and the euro is back to 1.40 this morning... The move came as stocks rebounded some, after reports of a better than expected earnings report for Goldman Sachs. Hmmm... Now, doesn't that just tick you off a little? Here's Goldman Sachs who just months ago, changed to a Bank Holding Co, so it could take TARP money, then paid it back a month ago, and now, prints a Moon Shot profitable earnings report... I guess I should be happy for them... Unfortunately, I smell a rat...

It's as if the Risk Aversion crowd just took their dollars and yen and went home! They are nowhere to be found this morning! The euro is pushing toward 1.41 again, which... Lately has been a tough row to hoe for the euro... Every time it gets close to 1.41 or even past it, albeit briefly, it comes back... So, it will be interesting today to see if the euro can add to the overnight gains.

The negativity toward the U.S. dollar and the so-called green shoots is really building steam once again.

We saw Retail Sales for June yesterday... The "experts" believed the report would print at a positive .4% gain, following up May's .5% gain... And that's exactly what it did! Just goes to show you that no matter how many people are unemployed, and how bad the recession / depression is... Consumers still spend! And that's what makes the world go around, as my dad used to say! The Butler Household Index (BHI) was a little fuzzy this month, as I haven't exactly seen the shopping bags come into the house, but I have a funny suspicion that they were there! Lots of UPS Deliveries for sure! So... The BHI believed that June Retail Sales would be probably better than expected... ( I wrote that yesterday when I thought Chris had bailed on me... Only to find out he had already written the Pfennig! UGH!)

The German Economic Sentiment, as measured by the think tank, ZEW, printed weaker yesterday for the current month... This report had trended upward in recent months, but with the recent loss of momentum in stocks, you can understand the reason for the weaker print.

And down under... Reserve Bank of New Zealand (RBNZ) Gov. Bollard, gave a speech Tuesday night, that, as far as I'm concerned pretty much drives the final nail in the New Zealand rate cut coffin... Bollard's speech was titled, "Savings, Investment, Funding Markets Are Key To Recovery." In the speech, Bollard really made a point of expressing his fear of reigniting the housing market... Therefore, I was sure after reading the speech that the RBNZ will NOT cut rates further, since the Gov. fears reigniting the housing market! And... We all know, even if Big Al Greenspan still doesn't admit to knowing, that those low interest rates ignite housing bubbles!

You know, I just won't let Big Al Greenspan off the hook will I?... NO! Never! You can't make me do it! Pink Floyd said that money is the root of all evil today... But... I believe that Big Al Greenspan is the root of all evil today!

OK... On to other things!

There are reports this morning of a major earthquake hitting New Zealand... 8.2 magnitude, I believe I heard... If so, it would cause a short-term loss for kiwi, but afterward, it would probably be a springboard for the currency, given the re-building needed... More importantly though, I truly hope this isn't as bad as first reported and that there isn't any loss of life.

Aussie dollars are back to 80-cents again this morning... I'm sure there was some moves from kiwi to Aussie on the earthquake news...

Chris talked a bit about this yesterday, but I thought it was very important to give it to you again...

With three months left to go in the budget year, the U.S. government's deficit has hit an all-time high of $1 trillion. The Congressional Budget Office predicted that by the end of the year, the deficit will be 13% of the country's GDP. That compares with a recent high of 6% of GDP in 1983 during the Reagan administration and 30.3% in 1943, when the U.S. spent a huge amount of money to fight World War II. OUCH! But, that's nothing folks! This budget Deficit is going to get larger and larger! And IF all the beans are counted... This will be quite ugly!

But, that just means more supply of Treasuries that will have to get auctioned folks... More and more... And it just scares the bejeebers out of me, what will take place...

OK... Before I go to the Big Finish... I want to talk to you about two things that hit the newswires yesterday... I get a lot of flak from some readers whenever I talk about the direction the U.S. Gov't is taking our "republic"... But that doesn't stop me, no sirree Bob!

Here's the first one...

Increased taxes for households with an annual income of more than $350,000 could pay for an overhaul of the U.S. health care system, according to a plan supported by House Democratic leaders. Proposed measures include a 5.4% surtax on couples earning more than $1 million a year. Charles Rangel, chairman of the House Ways and Means Committee, said the wealthiest Americans were singled out to pay the extra taxes because that option imposes "the least amount of pain on the least amount of people."

I guess it all depends on who you are talking about with regards to people experiencing pain!

And then there was this...

U.S. government officials are weighing a plan that would let borrowers who have fallen behind on their mortgage payments avoid eviction by renting their homes instead, sources familiar with the administration's thinking said on Tuesday.

Under one idea being discussed, delinquent homeowners would surrender ownership of their homes but would continue to live in the property for several years, the sources told Reuters.
Officials are also considering whether the government should make mortgage payments on behalf of borrowers who cannot keep up with their home loans, tapping an unused portion of a $50 billion housing aid kitty.

As part of this plan, jobless borrowers might receive a housing stipend along with regular unemployment benefits, the sources said.

Remember the famous line by President Reagan when he said the scariest words someone could hear... "I'm from the Government and I'm here to help"...

I see that Gold has finally shown some life this morning, adding $12 overnight... A reader sent me a link to a story about the manipulation of the Gold price, which I truly believe has been going on for years, but keep it in my back pocket only to bring out when it makes sense to do so... Here's a snippet of the report by GATA (Gold Anti-Trust Action Committee Inc.)

New York and Tokyo commodity exchanges have been permitting their gold futures contracts to be settled not in real metal but in shares of gold exchange-traded funds (ETFs). This essentially allows the gold shorts (and the exchanges themselves, which guarantee futures contracts) to transfer their obligations to third parties that may not have the metal they claim to have and that, in any case, are operated by the investment banks running major short positions in gold.

Thus it is likely that the paper claims to the world's supply of gold are greater than even GATA has suspected -- that the gold supply is even more oversubscribed and that "paper gold" is being created at an ever more frantic rate to suppress gold's price.

OH BOY, now that should stir up the drink, eh?

Currencies today 7/15/09: A$ .8030, kiwi .6475, C$ .8910, euro 1.4090, sterling 1.6450, Swiss .93, rand 8.1550, krone 6.3965, SEK 7.7820, forint 193.75, zloty 3.0425, koruna 18.38, yen 93.60, sing 1.4515, HKD 7.75, INR 48.60, China 6.8317, pesos 13.66, BRL 1.9460, dollar index 79.41, Oil $60.50, 10-year 3.50%, Silver $13.34, and Gold... $936.95

That's it for today... A late night for yours truly, got me into work later than usual this morning, thus the lateness of the Pfennig! There was a very interesting moment in the pre-game ceremony last night, that took me by surprise... It occurred during the talks by the past Presidents... I was also very disappointed in the way our Greatest Cardinal, Stan, the Man, Musial was presented... This was our chance to show the world what an unbelievable talent he was on a ball field, and off the field as a gentleman... We blew it! Can't go back and correct it now! A great moment by our catcher, Yadier Molina, getting a two-out RBI hit... And some spectacular defense by all-world player, Albert Pujols, but after a first inning error. UGH! OK. It's over... The All-Star week is over... Time to go to Vancouver! See you there! Wait, I don't leave until Monday! OK... Then let's make this a Wonderful Wednesday!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837

Happy Friday, Here We Go Again!

Chuck Butler — Fri, 12 Jun 2009 16:34:31 GMT

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In This Issue..

* Currency rally gets wiped out...
* Geithner to talk about a strong dollar?
* Brazil cuts rates!
* The Fed to control everything? YIKES!

And Now... Today's Pfennig!

Here We Go Again!

Good day... And a Happy Friday to one and all! Another seemingly long week for yours truly... Where's a 3-day Holiday weekend when you need one? Have you been following the goings on with the investigation into the Bank of America (BOA) purchase of Merrill Lynch? Whoa, there partner! I thought for sure this would get all swept under the rug, but it's all coming out, every dirty deed! Dirty deeds done dirt cheap!

Before we get into the goings on there... Let's talk about the currencies and their huge jump yesterday, only to see chicken traders come out of the woodwork overnight to support the dollar going into the G-8 meeting.

Yesterday, the currencies had it all going on VS the dollar... The euro at one point in the afternoon hit a high of 1.4170! You can imagine the long, stale trades that finally could take a profit there, eh? Well... It happened, and by the time I left for the day, the euro had backed off that lofty figure. But not like it backed off overnight... The reason I call these guys chicken traders, is that they are afraid to be short the dollar going into the G-8 meeting... Now... I have to ask this question... Did they NOT KNOW there was an upcoming G-8 meeting this weekend yesterday when they took the euro to 1.4170? I did, in fact, I told you 3 days ago that there was going to be a G-8 meeting!

Here's the skinny... The chicken traders are scared to death of having short dollar positions ahead of the G-8, where they fear U.S. Treasury Sec. Geithner will say that the U.S. favors a strong dollar! Geez Louise! Here we go again! How many times can a U.S. Treasury Sec. go to the well with that saying and get positive traction? For each time they do say that, they follow it up with an attack on the Chinese renminbi, saying it must appreciate. Well, how can that happen if they "truly" believe in a strong dollar? Add to that, the goings on now... How can anyone in the Gov't say they believe in a strong dollar when they are implementing Quantitative Easing?

The other thing boosting the dollar this morning is a report that Big Ben Bernanke is calling for reduced bond buying, thus reducing the pressure on the dollar. Now... That would be great news, if it were really going to play out... But these guys are like junkies now, this Quantitative Easing is like cocaine to the Fed, and the bond markets... And soon enough, the bond guys will be clamoring for more cocaine/ bond buying / Quantitative Easing! And the Fed is the pusher...
You know the dealer,
the dealer is a man
With the love grass in his hand
Oh but the pusher is a monster
Good God, he's not a natural man

OK... A blast from the past there! My good friend, Rick, likes to guess at the band's name when I put lyrics in the Pfennig... This one is waaaaaayyyy before your time Rick!

So... The dollar will end the week getting some love from the chicken traders... Bawk, Bawk... (I do that really loud, when pitchers pitch around Albert Pujols!)

The news that the Fed "might reduce bond buying" hit the high yielders in the mid-section, knocking the air out of them! But, these currencies are resilient, and after the wind is restored in their mid-sections, they climb back on the rally tracks! You have to love currencies that show resilience!

The dollar received an additional boost overnight... You'll want to sit down for this one... and put the coffee down, to not risk spilling it and burning yourself! Here's the skinny... Japanese Finance Minister Yosano who stated that "we have complete trust in the fact that the U.S. views its strong-dollar policy as fundamental," and "so our trust in US Treasuries is absolutely unshakable."

What else did you expect from a country that is the second largest holder of U.S. Treasuries? But... The dollar basks in the sun from those comments...

Did you hear that U.S. Treasury Sec. Geithner is clamoring for more power for the Federal Reserve. In Geithner's mind the Fed should be the Big Dog regulator in the markets... Hmmm... Let's see now... Could he want to see that because of the Fed's "wonderful" track record of allowing the dollar to lose over 90% of its value since they took over the stewardship of the currency? Yeah, that's the ticket! I shake my head in disgust that this is even being talked about... The Federal Reserve Bank is not even a Gov't Agency! The Fed is a Farce! Come on people, get your rakes, and pitchforks, and let Geithner and the administration know this is not in the best interest of this country!

OK... Right after I hit "send" yesterday, the Central Bank of Brazil announced a rate cut... This was a huge rate cut, VS the forecasts... The Central Bank cut 100 BPS or 1%. Let me tell you what's going on here... First of all, Brazil see's an opening... They can promote growth, and get a foot in the door of countries that have been struggling to show any growth... But first, there's the real... The real has really seen some strong winds in its sails lately... It has gained nearly 20% VS the dollar in the past 3 months... And what did the Central Bank Gov. say about 3 weeks ago?

Well... Let's draw this out... The real was trading around 2.03, and the Central Bank Gov. said he "would keep the real above 2"... You may recall at the time I said that in the old days, traders would take that statement as a challenge, and go after the real Big Time to make it stronger and to put egg on the face of the Central Bank... Well... While there may have been some of that... The currency pushed higher on the back of the High Yielders, and Commodity Prices rise... And the real soon was trading below "2"! (real is a European Style currency so the lower the price the more value it returns in dollars!) In fact, the real traded to 1.93!

Yesterday, after the announcement, the real lost some ground, as a currency should lose when a Central Bank debases the currency with an interest rate cut! But soon, the real was rallying once again, having put the rate cut in its rear view mirror. Now... That was a good sign for the real... But, I truly believe that the Central Bank here will look to lower interest rates on a couple occasions in the future... To me... That kind of information is like manna from heaven! For if the currency is going to weaken briefly after rate cuts, but rebound quickly, that would make for some good trading info... Of course, just because it's happened in the past, doesn't mean it will continue!

OK... Now... Let's talk about the Bank of America (BOA) and Merrill deal... First, you might recall me telling you about a month ago that BOA Chairman, Ken Lewis, testified that the Fed and Treasury pressured him into buying Merrill Lynch, and not disclosing the losses on Merrill's books... The Gov't even gave BOA the money to make the purchase! And... You may recall that Big Ben Bernanke immediately dismissed these statements, as false... Well, someone with some intestinal fortitude decided to investigate this deal...

The other day I told you the records had been subpoenaed and that I thought it would get all swept under a rug... But NOOOOOOO!!!! Yesterday, it was revealed that Fed officials sharply criticized Bank of America and CEO Kenneth Lewis in emails to each other after the bank tried to pull out of its deal to buy troubled investment bank Merrill Lynch, according to documents unearthed by Congressional investigators. The emails confirm Fed Chairman Bernanke was willing to threaten Mr. Lewis's removal as CEO if he reneged on the Merrill deal and later sought assistance. OMG!

And now... Ken Lewis is telling lawmakers that government officials pressed him to buy Merrill Lynch even after he became aware of major losses at the investment bank. Uh-Oh! The Fed and Treasury need to pull a Lucy here and do some 'xplainin'!

The data cupboard was busy yesterday with Retail Sales and Weekly Initial Jobless Claims... First, Retail Sales for May were bang on expectations of a .5% gain... A closer look though revealed that the major move here was in gas prices, which if you take them out, Retail Sales only gained .2%... But you know me, I don't like taking things out, or adding things in... Let the data speak for itself!

The Weekly Initial Jobless Claims were better than recent reports coming in at 601K VS the previous week's 625K... The problem here folks is that while the Corporations may be cutting back on the layoffs, people that are out of work are remaining that way... The continuing claims rose to 6816K from 6757K the previous month... I mentioned on the desk yesterday, that the media was reporting the 601K number as "good", but somehow forgetting to mention that the continuing claims weren't good! There comes a time when you just can't fire anyone else!

Today, we see some minor data, with the U. of Michigan Confidence Index the only recognizable data print today. It's a Big Day in the Big Finish... And... I'm back to sharing a "Feel Good" Corporate story during this recession... So, let's get to it!

Currencies today 6/12/09: A$ .8140, kiwi .6410, C$ .8950, euro 1.4035, sterling 1.6475, Swiss .93, rand 8.0120, krone 6.35, SEK 7.65, forint 198.35, zloty 3.1920, koruna 19, yen 98.10, sing 1.4520, HKD 7.7507, INR 47.55, China 6.8352, pesos 13.41, BRL 1.9240, dollar index 80.07, Oil $71.52, 10-year 3.80%, Silver $15.09, and Gold... $950

That's it for today... Sunday is the 10-year anniversary of my long time friend Jen Mclean! It's hard enough thinking about EverBank (the internet bank) being more than 10-years old! This weekend will also be the 2-year anniversary of my first cancer surgery to remove my left kidney... Less than 2-weeks later I would undergo the most difficult of the two surgeries... I recall all the wonderful emails from readers at that time, they were, and remain very special to me. Two years, since I was told I had cancer... I knew I would be here 2 years later, and I remember telling you all that I would beat it! I'm not out of the woods, just yet... But I'm well on my way! And then finally... Today, 33 years ago, I said "I do" to my beautiful bride... She remains just as beautiful, and we have 3 beautiful children... OK, enough... I don't want our little Christine crying! HA! I hope you have a Happy Friday!

******************************************************
Here's this week's "feel good" corporate story...

The Garden House, a 10 room B&B in Key West, Florida where flip flops are considered formal attire, is having its best year ever. I attribute that to a great quality product, a passion for customer service, the poor showing of the dollar( which is why I'm an avid reader of the Pfennig ), and a miserable winter up north. Let it snow let it snow let it snow! When they're shoveling snow we're shoveling margaritas. Cheers!
www.stay@gardenhousekeywest.com

***********************************************

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837

Who's Foolin' Who?

Chuck Butler — Mon, 08 Jun 2009 17:17:07 GMT

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In This Issue..

* Jobs Jamboree gets a lift...
* The real numbers...
* The dollar comes back with vengeance!
* RBNZ to meet this week...

And Now... Today's Pfennig!

Who's Foolin' Who?

Good day... And a Marvelous Monday to you! You know the Jobs Jamboree data that printed on Friday, and created some HUGE euphoria among the media types that love to just "read the news" and not actually do the research to report it? Yes... It was a very good number, on the outside... Not that losing 345,000 jobs in a month is a good thing, but it is far better than the near 700,000 jobs lost a couple of months ago.

So... I've got that to talk about today... And the rebound by the dollar that has taken the euro to the 1.38 handle and looking as if it is going to go lower... And, then finally, I have to get on my soapbox again, because I don't think I want my President calling me names! So, all that and more as we begin this 2nd week of June...

OK... Well... Did you get all caught up in the euphoria of the Jobs Jamboree on Friday? I know the 2 different cable news stations we have on here in the office, sure took the number, hook, line and sinker. The markets all reacted violently to the number too... At first... You see, when the number was reported, which was -345,000 for May, the euro took off, and the dollar selling was incredible, but the flurry only lasted about 1/2 hour, then someone with an ounce of gray matter, looked closer at the number. It was like a game of Who's foolin' Who?

So... Here's the skinny... If the jobs losses were really just -345,000 in May it would have signaled a bottoming of the job losses, and a bottoming of the recession / depression, which would feed right into the inflation story, albeit a lot sooner than anyone would have expected... And with that thought, the dollar got sold. But... A funny thing happened on the way to the forum, and the currencies were soon to reverse their recent trend, and it all came back to the Jobs Jamboree...

First of all... The Bureau of Lying Statistics, I mean Labor Statistics, reported on their website that 220,000 jobs were created in May through the Birth / Death Model... And 43,000 of the 220,000 "ghost jobs" were Construction jobs... Really? You've got to be kidding me! But if you think that's all... That's just the tip of the labor iceberg... The number of unemployed persons actually increased by 787,000 in May! The number of long-term unemployed (those jobless for 27 weeks or more increased by 268,000 over the month to 3.9 million and has tripled since the start of the recession.

Not that I'm trying bum you out on a Monday morning, I just think you "should know" the score... The total number of unemployed persons is 14.5 Million... In January of this year 5 months ago it was 11.6 million... And... Oh, by the way... The 9.4% Unemployment Rate? It's probably nearing 20% in "real terms"...

The thing that gets me is that people, investors, traders, hedge funds, etc. all react to data and make investment decisions based on the data when it prints... I guess this will teach them to wait until all the dust settles and the numbers have had a chance to be exposed to the daylight! I just think it's a shame that we have to deal with these liars, and cheats, just to make us all "feel good"...

So... Eventually the truth comes to the top, because the truth... Is out there! So... Why is this bad for the currencies? Well... In normal times this news would be manna from heaven for the currencies... But these aren't normal times, as the President, U.S. Treasury Sec. and Fed Chairman all remind us at least once a week... And the trading pattern for this type of bad news, is that the inflation picture everyone was thinking of last week and the week before, just isn't going to come that fast... So... The currencies gave back gains that they had made in the last two weeks...

Whew! I typed all that "non-stop" and have to give my fat fingers a chance to rest here for a minute!

The euro also has had to deal with the Irelands rating was lowered by S&P to AA... But, I do have to say that since I've come in this morning, the bias has been to sell dollars, and buy euros... But, the move has been very small...

There's not much in the data cupboard this week, until Thursday when the May Retail Sales report prints... The Butler Household Index (BHI) tells me to expect stronger Retail Sales in May. Wednesday we'll get the May Budget Statement, which will be around a deficit of -181 Billion... Did you all get that notes I wrote last week about the month of April and the Budget Deficit... Did it hit home with you? Maybe I should repeat it just for GP...

Here's what I said on Thursday... The Budget Deficit this April was $20.9 Billion, the first deficit in this "tax-paying" month in 26 years! Can you imagine that? In April when taxes are paid, we recorded a deficit? That's pretty amazing folks... April 2009 tax receipts dropped 44% compared with those in April 2008.

And Here's what I said on Friday... And I also believe that we will return to the underlying Weak Dollar Trend for good in the 2nd half of this year... Because... By then... the U.S. Budget Deficit, which has already breached 5% of GDP (late last year), will be heading beyond 10% of GDP this year. So... Do you want to own a truck load of dollars when the markets are staring at a Budget Deficit of greater than 10% of GDP? I don't think so!

And... Then this week we get the actual data to tie it all together in a nice bow!

I just saw a news story flash across the screen quoting the President... Hmmm, seems President Obama believes that his "stimulus package" will create 600,000 jobs... Well, that should be in the bag, right? I mean if it's not people being hired to take the census, then the BLS will just create them out of thin air, and the President will be able to say... "See! I told you I would create 600,000 jobs!"

I shake my head in disgust... I really do folks... And speaking of the President... I don't know about you... But I'm tired of him apologizing to other countries... And I really don't like him calling me names... OH! He's calling you names too!

OK, back to regular stuff... The Reserve Bank of New Zealand will meet this week, and I'm on the fence regarding what they will do... I'm leaning toward leaving rates unchanged, but jawboning for further rate cuts... Which is about the same as actually cutting them! So... Just cut the darn things! Quit beating around the bush!

And... U.S. Treasury yields continue to climb higher, and that means further losses to holders... The 10-year U.S. Treasury yield hit a seven-month high this morning... Treasuries have to deal with more supply this week. Hmmm... I have to blow my own horn here and tell you that I told you a couple of months ago that this would happen... That the deficit spending would create a monster, and that monster would be the need to issue more Treasuries than ever before, and the more you issue, the less the value of those outstanding become... So, to sell them, you have to allow the markets to let the yields rise to attract investment, and... As the yields rise, those previous issues lose value, in the secondary markets... Sure, if you hold them to maturity, there's no principal loss... But how many of those Treasuries were bought last year in the flight to safety, to hold until maturity? I don't have an answer, but my guess is... Not many!

See? Deficits Do Matter! And these days it's the Budget Deficit that's taking the hits... The Trade Deficit, which used to be the Big Kahuna, is no longer adding $700 Million to the Current Account each year. In fact, the Trade Deficit will print this week for April, and is expected to remain below $30 million... Not a Surplus, but still, much better than the $65 million figures we used to see every month! As I've explained before though this is simply, not the preferred way to reduce one's Trade Deficit... To have a recession! No, it would have been far better to have our exports be competitive...

And in the "here we go again" category... Saudi Arabia, Bahrain, Kuwait and Qatar signed an agreement to create a Persian Gulf monetary union, committing themselves to working toward a common currency despite the withdrawal of the United Arab Emirates and Oman.

These "oil states" threaten to do this about once a year... Kuwait finally go tired of waiting and dropped their peg to the dollar over a year ago! But, an oil monetary unit? Now that would really put a dent in the dollar's armor, eh? Just don't go hanging your hat on that happening any time soon!

I think that we've seen some real profit taking in the past few days... A reversal of the risk taking that was going on... And... The feeling that we went too far too fast... This move back in the euro and other currencies does give all those that were sitting on the sidelines and just couldn't pull the trigger on the rally that began in March, an opportunity to get in at cheaper levels than the past two weeks...

And with that... I'll head to the Big Finish!

Currencies today 6/8/09: A$ .7870, kiwi .62, C$ .89, euro 1.3850, sterling 1.59, Swiss .9130, rand 8.1850, krone 6.4470, SEK 7.8645, forint 207.35, zloty 3.2810, koruna 19.50, yen 98.55, sing 1.4585, HKD 7.7520, INR 47.57, China 6.8372, pesos 13.40, BRL 1.9615, dollar index 81.30, Oil $67.45, Silver $14.96, and Gold... $951.02

That's it for today... Another year at the ball game for the crowd here and another loss! I don't believe we've ever seen a winner when we go as a group! UGH! But a good time was had by all any way! Jazz camp begins this morning for my little buddy Alex. He's not just a rock-n-roller! He's one heck of a guitar player that's for sure! Better than I EVER was! My beloved Cardinals couldn't hit their way out of a wet paper bag right now, but that will change, hopefully this afternoon! Another full week on the desk... I can tell the folks here are growing tired of me being around every day! But, I'm here until I go to Vancouver for the Agora Financial Investment Symposium... It's the 10th anniversary of the Symposium... And Vancouver in July is awesome! Any way, I've got to get to work, it's a Monday, and I'm running late! I hope your Monday is Marvelous... And you have a Wonderful Week!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837

He Said What?

Chuck Butler — Wed, 13 May 2009 15:58:37 GMT

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In This Issue..

* Foreclosures rise...
* Green Shoots, no so green!
* getting on a bus...
* Losing a triple A rating?

And Now... Today's Pfennig!

He Said What?

Good day... And a Wonderful Wednesday to you! Not wanting to start the day off with bad news... But I just saw a flash on the TV that said, "foreclosures jumped 32% last month"... More Blood in the Streets, eh? That just happens to be the title of my presentation today... Blood in the Street: Bargain time or just a cease fire? Hey! I don't make these things up...

OK... Another day here in Sin City... This city is packed with people, everywhere we go, it's simply amazing... There's been no sign of a recession here... Of course, if you got out of the casinos, and shows, you would see some of the greatest devastation any where in the housing market here... So.. It's not a seashells and balloons in Vegas... I guess with the economy so rotten, people are hoping to strike it rich in the casinos though... Hmmm, have they not figured out that these ginormous buildings are here to make money?

The Currencies lost ground yesterday, most of the day, and then overnight too... Not major ground, but ground that had been previously won VS the dollar, not something a dollar bear wants to see. There's more rot on the economy's vine, this morning with Retail Sales, and all that euphoria that was in the markets last week, is dissipating, quickly... So, let's go to the tape on Retail Sales...

Retail Sales for April were down again (the BHI was wrong! YIKES). The .4% fall in April added to the .9% fall in March (revised to -1.1% today) tells me that after signs of consumers picking up spending again in the fist two months of the year, this is turning out to be an absolutely dreadful quarter for Retail Sales... Oh, and let's go back to the GDP print of about 2 weeks ago... There was hope in the GDP figure that "consumption" may pull the economy out of the recession, for consumption was up 2.2%... But with these Retail Sales figures so far in the 2nd QTR, you can kiss that hope good-bye!

This is the kind of stuff I was all worried about the other day in the Pfennig... Recessions are like that... You get a pop, but it has no legs, and then leads the economy right back to the depths of the recession... This is why I wanted to get the currencies back on the fundamentals of having different pricing mechanisms and low correlations to stocks... The diversification fundamentals that have been forgotten in the past 6 months....

And... Here's a good one for you... OK... Who said this... "Even though we have been having some fairly strong gains in home prices, it is our conclusion that it is UNLIKELY that we are confronting a housing bubble."

Give up? It was a quote in the 2002 Fannie Mae Annual Report... By our esteemed (NOT!) former Fed Chairman Big Al Greenspan! This guy's track record of forecasting going all the way back to his days as a consultant before he was brought on at the Fed, is absolutely horrible! Now... Why do I bring this up now? Well... Yesterday, Big Al Greenspan decided to give us a forecast that allowed stocks to recover on the day... What did he say this time? Greenspan said in an interview that "Housing May Have Bottomed and be a the verge of a recovery."

Oh boy, now that's something to hang your hat on, eh? I shake my head in total disgust... This man was at the root of the whole problem, and people still listen to him?

OK... Enough on that exercise... I could write for days about all the things he has done... But, better yet... Go to Amazon and buy Bill Fleckenstein's book on the Fed and Greenspan...

My friend, John Mauldin, wrote a great piece last Friday for his weekly newsletter regarding all the talk about Green Shoots... The Green Shoots were the thoughts that data prints were getting better (so they thought) and that the economy was getting better... John pointed out that he didn't believe the green shoots were for real, and said they probably were more like dandelions... I totally agree... Both he and I took the Jobs Jamboree data that was considered a Green Shoot, and tore it apart to expose it as the fraud it was... No Green Shoot here!

Here's another one... Import prices in the U.S. rose by 1.6%... That's HUGE folks! I saw something that said that in the last 100 prints of this data there have been only 12 larger prints! YIKES... Here's the skinny... Recall, that I've told you that China's stimulus was working and that they would be the first country to come out of the economic doldrums... Well, with their stimulus working, that means commodity prices will be rising, and if commodity prices rise, that means inflation will rise... No Green Shoot here!

OK, enough of that! Did you see where the Obama The Obama administration has begun serious talks about how it can change compensation practices across the financial-services industry, including at companies that did not receive federal bailout money?

See? I told you that you give the Gov't a foot in the door, and they will begin to push their way completely through the door... And with banks that's exactly what's happening... Isn't that sad? The Gov't wants to dictate how banks pay their employees, even if they didn't accept TARP money! How do you like being put on the train to socialism? And you can't get off?

I had better stop there, I might say something that would get me into trouble!

Well... There was another thing that showed up yesterday that could mean very bad things for the U.S. and their ability to attract financing... The Financial Times ran a story regarding the U.S.'s Triple A rating... Let's see what The FT had to say...

"Long before the current financial crisis, nearly two years ago, a little-noticed cloud darkened the horizon for the US government. It was ignored. But now that shadow, in the form of a warning from a top credit rating agency that the nation risked losing its triple A rating if it did not start putting its finances in order, is coming back to haunt us.

That warning from Moody's focused on the exploding healthcare and Social Security costs that threaten to engulf the federal government in debt over coming decades. The facts show we're in even worse shape now, and there are signs that confidence in America's ability to control its finances is eroding."

Hmmm... That's scary folks... And... To add to that, an attendee came up to me yesterday after my first presentation, and said, "Chuck, great talk, but you didn't mention the debt that the U.S. will have to deal with in the future." Yes, he's right... I don't do that very often because I don't want people going outside and throwing up, or even worse things. What I'm talking about here is the debt that the U.S. will be under when all the Baby Boomers are drawing Social Security and Medicare... If you are not aware of these figures, and how bad they will become... Go to Amazon and buy the I.O.U.S.A. book by Addison Wiggin and Kate Incontrerra...

OK... Time to go to the Big Finish, I've got to go through my presentation once more before I head down to the Show...

Currencies today 5/13/09: A$ .76, kiwi .5970, C$ .8590, euro 1.3610, sterling 1.5165, Swiss .9045, rand 8.4950, krone 6.5150, SEK 7.8710, forint 208.15, zloty 3.2575, koruna 19.7090, yen 96.17, sing 1.4630, HKD 7.75, INR 49.71, China 6.8230, pesos 13.34, BRL 2.0960, dollar index 82.61, Oil $59.09, Silver $14.09, and Gold... $926.90

That's it for today... A very long day for yours truly yesterday... Hopefully today will be a bit shorter! An old friend stopped by my morning presentation to say hi yesterday... Thom Calandra, who started CBS MarketWatch stopped by... I hadn't seen Thom in years! He was huge for us years ago, when we were trying to get the word out about our products... I get a lot of people stopping by the booth each day just to see if I'm doing OK... They want to know if I'm feeling well, and to let me know that they are still praying for me... WOW! Pretty amazing, I'm so blessed! And Thanks to a real "star" my travel organizer supreme... Gena, you are a star! And... Today, we have two birthdays to celebrate... Our newest person on the trade desk Aaron Stevenson... And the young lady that is the engineer for my video projects, Lori Mucho... Happy Birthday! Time to go... I hope your Wednesday is Wonderful!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837

Today is Tax Day!

Chuck Butler — Wed, 15 Apr 2009 13:50:40 GMT

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In This Issue..

* Currencies trade in a tight range...
* All Risk takers... Out of the pool!
* Retail Sales really disappoint!
* A plethora of data reports today...

And Now... Today's Pfennig!

Tax Day!

Good day... And a Wonderful Wednesday to you! Well... It's Tax Day, and to keep with tradition in the Pfennig... Here are the Beatles...

(if you drive a car, car;) - I'll tax the street;
(if you try to sit, sit;) - I'll tax your seat;
(if you get too cold, cold;) - I'll tax the heat;
(if you take a walk, walk;) - I'll tax your feet.

Taxman!

'Cause I'm the taxman,
Yeah, I'm the taxman.

OK... Every year, I bring you a different part of that song, which was so prevalent in my mind as I wrote out my check last night to mail my taxes...

So... The currencies remained in a very tight range yesterday, inching down VS the dollar slightly. While the high yielders like Aussie, real, and rand, all sit on the sidelines the past two days, Japanese yen moves higher VS the dollar, moving back below 100.

The break of currencies and stocks only lasted one day folks... So, no return to fundamentals... Instead, what we have is this all-or-none Risk or no Risk... It's almost like watching a poker game, which on a sidebar, I still don't understand why poker games are on a Sports Station! OK, back to the poker game... It's like when the guy goes "all-in"... It's either take risk, which then means "all risk assets", or don't take risk, which means "don't take all risk assets"... Or... More like saying... "All Risk Takers... Out of the pool!) Strange days indeed, so peculiar momma...

When risk assets are off the table... The high yielders, commodities, and stocks gets sacked... And the low yielders like dollars and yen bask in the sun. I recall last week mentioning that I hoped this link between stocks and currencies would soon be over, as stocks were entering their quarterly earnings period, and I certainly didn't think they would have good earnings, which would mean a stock sell-off... And if stocks are getting sold... The other risk assets, during these strange days, are getting sold...

The best performing currency overnight? The British pound sterling! It seems that pound bulls have had enough and they weren't going to take the selling of their currency any more! There's a report out this morning that says pound traders are the most bullish they've been in years... Hmmmm... Doesn't make sense to me that this currency would rally, or that there would be reason to be bullish on it, given the economy, low interest rates, and the fact the Central Bank has taken on Quantitative Easing!

Well... The Big News / Data yesterday was Retail Sales, and all the forecasters got it completely wrong! The consensus for Retail Sales in March was for a .3% gain... Retail Sales actually printed a negative 1.1%... Most of that loss was at gasoline stations... But, hey! That's part of the deal! This negative report however, was tempered by the upward revision of the previous month's negative .3% figure. The upward revision was +.3%, which makes February's figure flat...

I have to say that while we keep seeing 600K job losses each month, and Retail Sales in the negative, the physical evidence of a major slowdown is difficult to find. Every plane that I've been on recently is still packed with people... Restaurants I go to, are crowded... I don't go to malls, so I have no idea what's going on there.

I saw a report the other day that quoted a group of economists that had been surveyed and the economists said that they believed the recession would end in the 2nd half of this year, but job losses would continue on for several more months. Hmmmm.... Now I know that these guys are far better educated than yours truly. But, I would ask them, just what is going to happen to reverse the economy, without job growth? We need a hoola-hoop!

Did you see that North Korea ordered International Atomic Energy Agency inspectors out of the country Tuesday? Talk about uncertainty in the world! And what can you look to in these uncertain times... Gold! It's the Uncertainty Hedge! And looky there! Gold is still trading in the spot market below $900!

The data cupboard today will print a plethora of reports, beginning with the stupid CPI (consumer inflation)... Right now, the forecasters are calling for a decline in consumer inflation for March... The Gov't accountants want us to believe that inflation is only running at 1.7% annualized... HOGWASH! See, now why I say it's stupid!

OK... We'll also get the TIC-net flows, which is usually a good show... Feb.'s showing was a negative $43 Billion in net security purchases by foreigners... March is supposed to show a gain of $14 Billion... Even with the recover, if it prints as such, $14 Billion is NOT enough to cover our Current Account Deficit, which means the deficit gets carried forward... Eventually, we'll be so far in the future with these deficits, that we'll have to get that famous Delorean from Back to the Future, to bring us back here!

Then finally, Industrial Production and Capacity Utilization... For new readers... Capacity Utilization is one of my fave data prints, in that it is one of the few that is forward looking. Most data is old, stale, and backwards looking... But Capacity Utilization is forward looking. The Capacity Utilization rate reflects the limits to operating the nation's factories, mines and utilities. In the past, supply bottlenecks created inflationary pressures as the utilization rate hit 84 to 85 percent. March's CAP Utilization rate is forecast to be 69.6%... Far below the numbers hit in the glory days of the economy!

So... As I was writing this morning, I watched the euro rise to 1.33 from 1.3245 when I turned on the screens, but now that I'm getting ready to head to the Big Finish, it's right back at 1.3245... So... Range trading still...

Currencies today 4/15/09: A$ .7280, kiwi .5815, C$ .8255, euro 1.3245, sterling 1.50, Swiss .8755, rand 9.1720, krone 6.6775, SEK 8.1810, forint 218.80, zloty 3.2280, koruna 20.2575, yen 99.25, sing 1.5025, HKD 7.75, INR 49.65, China 6.8325, pesos 13.21, BRL 2.2075, dollar index 84.79, Oil $50.50, Silver $12.92, and Gold... $894.20

That's it for today... A tough loss for my beloved Cardinals last night, as our ACE pitcher, Chris Carpenter, is hurt yet again... UGH! Good luck to our Blues who begin their playoff series with Vancouver tonight. Speaking of Vancouver, I was talking to Bruce at Agora Publishing last week at the Richard Russell diner, and he invited me to come back to Vancouver for the Agora / Daily Reckoning Conference in July. They'll have a fancy name for it, and I'll pass along additional information when they give it to me. They will be celebrating 10 years of the Daily Reckoning. And Vancouver in July? Simply wonderful to be there! We had a visitor in the office here yesterday! My granddaughter, Little Delaney Grace came to visit us! She's so darn cute! OK... Time to go... I hope your Wednesday is Wonderful and not too tax-man related painful!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837

All Eyes On Retail Sales...

Chuck Butler — Tue, 14 Apr 2009 13:27:38 GMT

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In This Issue..

* Currencies rebound
* Singapore's big announcement...
* China's currency gets back on rally tracks...
* BHI says to expect a rebound in sales...

And Now... Today's Pfennig!

All Eyes On Retail Sales...

Good day... And a Terrific Tuesday to you! I'm feeling marginally better today, so I've got that going for me! You should have seen the currency screens lighting up yesterday... WOW! A lot of pent up trading from a Friday that saw thin volume due to the Holiday. This type of volume, even with a few countries still on Holiday too!

The volume... Was all good for the currencies, as that bias to sell dollars I talked about really came shining through on the day. As I signed off yesterday, I told you that the euro had rallied since I had come in, and that rally took off in the early morning trading. The single unit climbed to near 1.34 before giving back ground in the afternoon.

The euro euphoria was interrupted by a report in a newspaper that talked about how the European Central Bank (ECB) will probably have to cut rates further, due to the depth of the recession in the Eurozone. Nothing like a party pooper to ruin a rally, eh? But, that's what happened! The euro in the overnight market gave up more ground, and has now fallen back below 1.33...

Instead, the low yielders took the conn and rallied overnight, with yen leading the way... Strange... But true... 5 days of high yielders rallying, and then yen comes back... Strange... Very strange...

At one point yesterday, with the euro rallying to near 1.34 and the Aussie trading at 73-cents, I said to Jennifer, "I bet stocks are soaring" ( I said that because of what I've explained recently that stocks and currencies had been tied together with the Risk bow), a quick check of stocks showed that stocks were off... Selling was the order of the day... I then said, "Maybe, just maybe, because you never know... Stocks and currencies are breaking the link."

Boy, wouldn't that be sweet, to get this back to fundamentals! Especially during the stocks earnings period! But, as I told the Big Boss, Frank Trotter, when he called in to get an update, "as I always say, one day of trading doesn't make a trend." We'll have to keep our eyes out for this pattern to see if it really gets back to fundamentals, where stocks and currencies have a low correlation to each other!

A couple of weeks ago, when Chris was writing the Pfennig for me, he wrote about Singapore, and how the Monetary Authority of Singapore (MAS) had indicated it might push the Sing dollar lower. In fact, here's what he had to say in the Pfennig, March 30th, "Another currency you may want to consider exiting is the Singapore dollar. According to a story I read on Bloomberg this morning, the Monetary Authority of Singapore may devalue their currency and allow it to drop 4 percent against the US dollar in the next few months."

Well... Last night, the MAS announced a downward re-centering of the Sing dollar trading band while maintaining the width of the trading band and the policy of zero appreciation. OK... There it is... Forget all the trade widening and so on, and center on the "policy of zero appreciation"... That does not bode well for the Sing dollar... And for Chris' statement on March 30th? Bang On! Timely!

The thing I can't get out of head, is the fact that Singapore needs to keep its currency in line (value VS the dollar and euro) with the other currencies in Asia in order to keep its exports competitive... I guess, the MAS is thinking there aren't going to be any exports! And the ones that are there, they (Singapore) will have a "cheaper currency" and an advantage!

At least the MAS didn't devalue the currency, as these types of small countries tend to do to tilt the playing field toward them! And believe or don't... The Sing dollar rallied on the news that the MAS didn't devalue the currency... So... This is like manna from heaven for anyone trying to switch out of Sing dollars and into something else... The currency rallied overnight!

Of course... What to go to, is the question... But I think I've told you enough about how Norway was named the safest currency in the world by Time... And that I've always been a fan of Surplus countries... And that I've recently told you we should be looking only to the countries that have not entered into Quantitative Easing... There! That should narrow it down for you!

Speaking of the other Asian currencies... I already told you that Japanese yen rallied overnight... But so did the Chinese renminbi, which posted its best move VS the dollar in almost 3 weeks!

So... Did you see that Goldman Sachs is going to raise $5 Billion to repay the U.S.? Rumor has it that Goldman Sachs, wants to repay the Gov't, to shed the Gov't's pay limits... I think we'll see more and more of this... As, these financial institutions took the funds as a way to raise cheap capital, and did not have strings attached... Once the strings were attached, the capital didn't look so good any more, and therefore I believe we'll begin to see quite a few give back the money the Gov't gave them to begin loaning out to consumers...

We, as taxpayers are happy to see these guys give the money back!

Speaking of taxpayers... Tomorrow is the dreadful day! You have one day to get your taxes all done, if not already done... Mine have been done for a while, and just sitting there, as if they might go away if I don't sign them and mail them away! HA!

OK... Back to the task at hand!

Today, all eyes are on the U.S. Retail Sales report for March, which will print. The forecasters are looking for an improved Retail Sales report in March VS the negative result for Feb. As I said yesterday, the BHI (Butler household index) indicates to me that I should agree with the forecasters. The "experts" believe Retail Sales will be better because of the auto industry's incentives that began last month.

I also hear that the Gov't's turn-around on tax returns is stepped up this year, which gets money back into the hands of consumers at a faster pace than previous years... And we all know what happens when consumers get money in their hands! They spend it!

Gold rebounded nicely for most of the day yesterday, climbing to within spittin' distance of $900 once again... But lost ground, along with the euro and the high yielders at the end of the day. I have to say that I like the fact that Gold has stuck around this level for about 10 days, in that it allows more and more people to buy it at this sub $900 price.

Obama gives us "his view", which probably won't coincide with reality, of the economy today... This should be interesting at least!

Big Ben Bernanke speaks today... Some of you will say, whoop-de-do! He doesn't do anything for me! And some of you will say, I don't believe a word he says! And then some will say, I can't wait to hear what this windbag says next! And I could go on, but won't... You get my drift, that everyone is across the board on this guy... Me? You needn't ask! You know where I stand on this guy... Borrowing a few lines from Charlie Daniels...
He's a snake in the grass, I tell ya guys.
He may look dumb but that's just a disguise,
He's a mastermind in the ways of espionage...

OK, enough fun... Time to head to the Big Finish!

Currencies today 4/14/09: A$ .73, kiwi .59, C$ .8240, euro 1.3285, sterling 1.4920, Swiss .8760, rand 9.0275, krone 6.6240, SEK 8.17, forint 218, zloty 3.29, koruna 19.99, yen 99.80, sing 1.4975, HKD 7.75, INR 49.89, China 6.8323, pesos 13.07, BRL 2.1720, dollar index 84.81, Oil $50.48, Silver $12.70, and Gold... $896.45

That's it for today... Yesterday was a blur for me... I worked here until about 3, went home took some cough medicine, sat in my recliner and fell asleep immediately... Woke up in time to see the last 15 minutes of 24, and went back to sleep... Nice win by the Cardinals last night in the desert. Well... Today is the day... I go for my quarterly scans this afternoon. I think that after this quarterly scan, I'll have one more on a quarterly basis, before I go to 6-month intervals... That is as long as they remain clean! Which I don't have any reason to believe they won't be clean. Of course I never knew in the first place I had cancer until they scanned me for something else! Talk about the luck of the Irish! OK... Let's get ready for Retail Sales, and have a Terrific Tuesday!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837

On the turning?

Chuck Butler — Fri, 13 Mar 2009 12:57:34 GMT

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In This Issue..

* SNB surprise...
* Currencies continue...
* Retail Sales...
* Recipe for inflation...

And Now... Today's Pfennig!

On the turning?

Good day...And a Fantastic Friday to you. It would be nice to have some of that warm weather they have in Jacksonville make its way north, but hopefully its right around the corner...patience. Yesterday was a wild ride so hopefully you had that seat belt fastened tight and both hands on the wheel. I have a lot to talk about so I'll get right to it...

We were greeted yesterday morning with some big news out of Switzerland where they not only cut rates to .25% from .50% but also decided to take matters into their own hands. Chuck sent me some thoughts before he left for vacation, so here you go. "The Swiss National Bank (SNB) intervened in the markets yesterday with a bang! The SNB sold francs for euros and dollars to further reduce the price of money (since they've already cut interest rates to the bone). Francs went from 86-cents to 84-cents in one day! UGH!"

We don't know exactly how much the SNB sold off but I saw a report that estimates 2 billion euros were purchased and that doesn't take into consideration other currencies that may have been bought. This was their first intervention in the foreign exchange market since 1992 spurred not only by internal economic pressures but also its appreciation against the euro and pound by 10% and 30% respectively since the end of July.

As these central banks paint themselves into a corner by dropping rates to virtually zero, there really isn't any other choice but to use "creative" or "alternative" measures in order to provide pressure relief. Since 80% of Switzerland's trade is within the European Union, this imbalance in exchange rates basically offset the rate cuts we have seen thus far. The franc traded as low as .8356 but recovered a bit to .8440 before I left for the night as the currency market actually finished higher after that surprise. If the other European currencies begin to appreciate, I would think the chances of another intervention would become lower.

As I just mentioned, the markets seem to have just shrugged that off and went on with business. Now all of the sudden we had euros trading well into the 1.29 handle (which was, in part, supported by the SNB buys) and the emerging markets posting gains. The Mexican peso and South African rand were the top two currencies, which would seem counter intuitive given the intervention and market turmoil. Risk was up but the dollar index was down, is this pattern setting a stage...lets see what Chuck thinks...

"Does this all begin to look like the peak in the dollar's rise? Could be folks, for all this week, even with the profit taking, the currencies have moved higher VS the dollar led by the euro... (except of course francs which were sold by the SNB!) The failure of the dollar to launch is beginning to look like it could weigh on the green/peachback. Just like at the beginning of December, when I gave you the wink and nod that we could see a Santa rally in euros, and dadgummit we did, this is beginning to look a lot like Christmas.... Every where I go... The dollar's can't rise here, and the euro is gaining there, but do we really know for sure this is the end of the dollar's run? NO! we don't know for sure, but... If you were looking to get in on the ground floor, the bottom if you will, this could be it! But then, it could be a false dawn too... Which means you won't have gotten in on the ground floor... But, at least it will be a cheaper level than in December!"

Well, you heard it here folks. Maybe, just maybe this is a sign the roadies are finishing their mic checks and the stage is ready for the opening act. I don't know about you but I found my seat and am sticking around to see what kind of show this will bring. The currencies held their own in the overnight session and are right where I left them last night, so lets see which way the US markets decide to take the ball today.

February retail sales did fall, as indicated by the Butler Household Index (BHI), by .1% but January's number was revised up to 1.8% from 1.0% so the media ran with that story claiming the pullback in consumer spending may be nearing an end. I would think its difficult to make that call right now given that unemployment remains on the rise. Initial jobless claims remained above 600,000 last week for the 6th straight time, coming in at 654k and the week before that was revised up to 645k.

Where is the money going to come from to support sales if more people are losing jobs. Not only that, Americans' net worth fell in 2008, erasing 4 years of gains, as the value of their homes and investment portfolios declined. According to the Federal Reserve, household net worth was $51.5 trillion, down $11.2 trillion or 18%, from 2007 and marks the first decline since 2002.

We have the January trade balance due out today and is expected to narrow by $1.9 billion from December's figure to $38 billion. True, the number is moving in the right direction but not because we are taking steps to correct it but because trade flows are falling...not exactly what you're looking for. The University of Michigan Confidence measurement comes out today as well and is expected to fall from last month. Until the jobs and housing markets show signs of stabilizing, I really don't see much that would provide support for consumer confidence.

Chuck spent quite a bit of time yesterday on business inventories explaining how a decrease points toward inflation once things do turn around, so here are the results. We saw a 1.1% drop for January and then a revision down to -1.6% from -1.3% in the December figure. I guess the point about this data is that its reactionary so as demand rises, there won't be enough supply on hand at first causing the inflation he so eloquently described. I hope I brought that full circle for you.

Gold, the uncertainty hedge, had a nice showing yesterday climbing all of the way to $930 and has held around $920 so far today. There was enough uncertainty flying around so it provided a nice place to roost for the moment. That sub $900 level from a couple of days ago doesn't look so bad now. Anyway, before I head to the big finish, here are some final words from Chuck before he heads out: "There are a lot of questions in the box regarding my statement yesterday about the IMF and Gold... Here's the skinny... First of all, if the IMF sells large quantities of Gold, I believe Gold will take a temporary hit, maybe providing some good buying levels... If the IMF does sell though... I Believe that it means the Obama campers are scared about liquidity and cash, and they need to have some on hand... That's the whole gist of my statement, sorry I was a bit confusing to some, and probably all, but shoot Rudy! Now I get to talk to you all another day, when I thought I was finished!

BTW... I forgot to mention yesterday that this is it for me! I'm officially on vacation right after breakfast this morning... You're in good hands with Mike, he's wanted to do this for so long! I'll be speaking at the Oxford Club Investment U Conference March 26th, and then I go back on vacation! So... See you in April!"

Currencies today 3/13/09: A$ ..6585, kiwi .5235, C$ .7822, euro 1.2901, sterling 1.4047, Swiss .8435, rand 9.9552, krone 6.8445, SEK 8.5804, forint 229.09, zloty 3.4718, koruna 20.5138, yen 98.30, sing 1.5416, HKD 7.7537, INR 51.6525, China 6.8381, pesos 14.7097, BRL 2.2957, dollar index 87.37, Oil $46.69, Silver $12.98, and Gold... 921.35

That's it for today...the Asian and European equity markets were all up so we'll see if that feeds into another rally today in the US. Other than that, not much to report from overnight. Its going to be a busy weekend for me but I'm looking forward to relaxing a bit at some point. We had our St. Louis Blues win a big one last night as they are still fighting for a playoff spot and the Missouri Tigers had a win the in Big 12 Tournament. Speaking of that, I saw where Syracuse and UConn went into 6 Ots...talk about a long day at the office. Well, its time to get Friday started so have a great weekend and a Fantastic Friday.

Mike Meyer
Assistant Vice President
EverBank World Markets
1-800-926-4922
1-314-647-3837

A Day Of Healing...

Chuck Butler — Thu, 12 Mar 2009 14:54:08 GMT

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In This Issue..

* Currencies have a mini-rally...
* Only to see profit taking overnight...
* Gold rebounds too!
* Retail Sales on board today...

And Now... Today's Pfennig!

A Day Of Healing...

Good day... And a Thunderin' Thursday to you! It was a Tub Thumpin' Wednesday yesterday for the currencies and Gold, after seeing them back off earlier this week! I'm in Jacksonville for a company event, and then on Friday morning, I head south to start my spring vacation! But first, some work to do here, and then on to the south!

It was 29 degrees when I got in the car to leave for the airport yesterday morning... And it was 77 degrees when I finally arrived in Jacksonville! YAHOO! But even as loud as I can say YAHOO for the warm weather, which I've said over and over again, I've got to go where it's warm, it wasn't as loud as a the YAHOO yelped by currency owners as the euro led the currencies higher and higher all day long!

And the Gold holders weren't far behind, as the shiny metal got back to $900, after seeing 3 days of selling in a row! A lot of the people here asked me about Gold, and I had to tell them the same thing I've told you dear readers for some time... These are uncertain times, and in uncertain times, it calls for the "uncertainty hedge"! And that's what happened today... Stocks, which had rallied on the Citicorp news the day before, failed to follow that up... So, what's a stock jockey to think? I'll give you my two cents here, which I told the Vice-Chairman last night... And that is... Do you believe that Citicorp really had a profitable first two months? I mean, just a couple of weeks ago they were begging for more TARP money! Keep this in mind... Liars figure, and figures lie... Not that it wasn't true, but come on! They were begging for money just a couple of weeks ago when they supposedly were booking profits? OR... Maybe they DID book the profits, good for them! But if they were booking profits, why were they knocking on TARP's door looking for more handouts?

I had better go on record and say that's just my opinion and not that of EverBank's... Even though the disclosures all spell that out!

So... For once in the past few months, the currencies broke from the stocks... Yes, I know they gained a tiny bit on the day, but not the kind of gain that would match the rally in the currencies! But... And here's where things get unwound... But, in the overnight markets, traders and investors just couldn't stand to see the euro at 1.2850, so they took the profits they had, and brought the single unit back below 1.28. It's trading about at the same level as yesterday morning... So... All that hoopla yesterday, gone down the drain overnight... The Spinners had a great song titled... It's A Shame... Appropriate here...

China's Trade Surplus for February came in at $4.84 Billion down from January's $39.1 Billion... That's a HUGE decrease, eh? But still a surplus, and in today's economic environment that's something to be proud of, eh?

German manufacturing orders fell 8% from a year earlier, so face it folks... Everything around the world is slowing down!

And in something you may have missed, because it certainly wasn't covered in the mass media... U.S. Treasury Sec. Geithner, said that the Obama administration will press Congress for legislation to allow the IMF to sell part of its stockpile of Gold... UH-OH! If the IMF is going to resort to selling Gold... Then the you know what is about to hit the fan!

Speaking of Geithner, and those that threatened me with physical harm if I kept calling him "the cheater" won, since I stopped... But trust me, I'm an old crippled, cancer fighting man now, but if someone had threatened me in my earlier life, I don't know anyone that would want to deal with me, because I didn't know the word, "give up" / or "stop"... But, I'm a big, declawed pussy cat now, so threats do get to me!

But, I digress... What I wanted to say was Speaking of Geithner... Here's what the Wall Street Journal had to report yesterday...

"Obama and Geithner are failing in their efforts to revive the economy, according to participants in the latest Wall Street Journal forecasting survey.

A majority of the 49 economists polled is dissatisfied with the administration's economic policies. On average, they gave the president a mark of 59 out of 100, and although there was a broad range of marks, 42% of respondents graded Mr. Obama below 60."

The Reserve Bank of New Zealand (RBNZ), reduced their Official Cash Rate (OCR) by 50 BPS the other day... RBNZ Gov. Bollard had this to say.... "The world economy deteriorated very rapidly late last year, amid ongoing losses and extreme volatility in international financial markets. While monetary and fiscal policy responses in many countries have been substantial we still expect the adverse economic forces generated by the crisis to remain dominant throughout 2009. The timing and extent of global recovery remain highly uncertain."

I've had my differences with Gov. Bollard in the past, as he was once who openly talked about the need for currency weakness... So, different from my one time acquaintance, and a "hero" of mine when he was Gov. of the RBNZ, Don Brash! But at least this time Bollard is bang on with his observance!

The Japanese yen, which a few days ago, looked like it was on shaky ground, has put in two days of stellar performances, which makes one wonder if what "Mr. Yen" had to say the other day is working its magic with yen... Recall, I told you that the former currency guru of Japan, Sakakibara, who is known as "Mr. Yen" said yen could rise to 70 VS the dollar, and trade in a range between 70 and 100... I disagreed with the 70, but thought 100 might hold...

But I didn't wonder too long here on this subject, because I know in my heart of hearts that yen does not have the intestinal fortitude to climb past 85... (remember, yen is a European priced currency, so as the price goes down, the more value it returns in dollars)

On Data-Watch today, we have the usual Weekly Initial Jobless Claims, which continue to be horrific week after week, and Retail Sales for February... Retail sales unexpectedly rebounded in January with a 1.0% gain, after a 3.0% drop in December. But the stronger number, which came off a low baseline in December, was likely due to heavy discounting to move inventories sitting on store shelves. The Chain stores seem to be reporting decent sales, but everyone else's sales are in the dumpster. And then I do the quick check of the Butler Household Index (BHI), and I'm convinced that today's printing of Retail Sales for Feb. are going to be disappointing!

And finally, we'll see the Business Inventories data for Feb. Last month when I reported the Business Inventories data, a reader asked me what was up with reporting this data, as they didn't know what it was about... So, I promised them that this month, I would hold class on Business Inventories, so get out your pads of paper, and a sharpened # 2 pencil, to take notes...

Business inventories are the dollar amount of inventories held by manufacturers, wholesalers, and retailers. The level of inventories in relation to sales is an important indicator of the near-term direction of production activity. This is called the "Inventory to Sales Ratio" or I-S...

Business Inventories tend to rise when economic conditions are strong; since sales are rising at the same time, the inventory-to-sales ratio may remain stable, or rise at a very slow pace. Inventories tend to drop when economic conditions are weak; since sales are falling at the same time, the inventory-to-sales ratio may remain relatively stable. The I-S ratio then begins to rise as sales fall more quickly than inventory growth.

So... If things play out the way I think they will, recall that I've said over and over again, that this dance is gonna be a drag, no, I've said over and over again that soaring inflation is going to be on the other side of this current asset price deflation... And one of the reasons will be buyers wanting to buy and spend again, and businesses that don't have the products on their shelves because of the depression... Money chasing too few goods... And we'll see the proof in the pudding right here in Business Inventories and the I-S Ratio!

OK, that's enough, put your pads of paper and #2 pencils away, as we're finished for the day! Let's go to the Big Finish!

Currencies today 3/12/09: A$.6455, kiwi .5130, C$ .7760, euro 1.2780, sterling 1.3770, Swiss .8650, rand 10.26, krone 6.9620, SEK 8.8320, forint 239.80, zloty 3.6225, koruna 21.21, yen 96.30, sing 1.53, HKD 7.7545, INR 51.80, China 6.8388, pesos 15.16, BRL 2.35, dollar index 87.93, Oil $42.79, Silver $12.86, and Gold.... $912.80

That's it for today... Thanks to Mike for Pfilling in on the Pfennig yesterday, great job! He doesn't know it, but I'm going to back out of writing from my hotel room tomorrow... Mike, you did such a great job, you get to do more! Yeah for you! Our little Christine, loves to say, "yeah for whomever" so... We have that going for us! The trip here was somewhat uneventful, I didn't have anyone drop their hard case luggage on my head or anything! The plane out of St. Louis was delayed as there was a "maintenance issue"... I told Kristin, when I got here, that I wish they wouldn't tell me these things! Just say, "we're waiting for a passenger to board, or something" One time, years ago, the Big Boss, Frank Trotter, and I were looking out the window of a plane, and saw what appeared to be oil pouring out of the plane's wing... We were just about to get up and get off the plane, when a maintenance truck pulled up to stop the bleeding... Things you wish you didn't know about, for sure! OK, I give a presentation on World Markets this morning, so I have to look sharp, no wait, that won't happen, I have to feel sharp, no wait, that won't happen, OK, I just have to get up there and do it! HAHAHA! Time go... I hope you have a Thunderin' Thursday!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837

A Retail Sales Surprise!

Chuck Butler — Fri, 13 Feb 2009 15:13:25 GMT

In This Issue….

* 623K new unemployment claims filed...
* G-7 begins today...
* Dealing from a position of strength...
* Valentine's Day tomorrow!

And Now... Today's Pfennig!

A Retail Sales Surprise!

Good day... And a Happy Friday to one and all! Front and center this morning, a Continental regional plane crashed near the Buffalo airport overnight, and all 48 on the plane were killed, along with 1 person in a home. Not Happy news for a Friday morning, for sure... Our thoughts should be with the familes of these people today...

I want to say thank you to all who responded yesterday to me regarding my hissy fit I had yesterday morning regarding the minority objections to my opinions... The vote is in... It was a landslide in favor of me being me, and not what the few objectors want me to be. So, I will continue writing the Pfennig in the manner the majority expect... I don't want this to sound cold, but those that feel the need to send me nasty emails, could you please just unsubscribe instead?

OK... I had to get that off my chest! Yesterday, Retail Sales surprised quite a few on the upside, halting a multi-month slide on the negative side of Sales. Jen brought it to my attention, that this happens just about every year. The January Retail Sales are spurred by after Christmas sales, gift cards, and other "stuff"... So, let's not get all excited about this one month's data... Remember what I always say... "One swallow does not make a summer"

The Weekly Initial Jobless Claims didn't fail to disappoint us though... 623K new unemployment claims were filed last week, and the previous week's total of 626K was revised up to 631K... That's over 1.2 million unemployment claims filed in the past two weeks! UGH! But, as I said above, the dollar rallied on the day... To me, this data is more important than the trumped up .1% rise in Retail Sales, as these people are going to be unemployed, and what will that do to future Retail Sales? That's right... They circle the bowl...

Today, the data cupboard only yields one piece of data... The U. of Michigan Consumer Confidence Index, which is expected to remain very low... In fact, I'm surprised it remains as high (at 61) as it does!

Well... The G-7 meeting started this morning... The markets are holding their collective breath waiting to see what G-7 says... But why? This is nothing more than a boondoggle! And now it's even more so, as G-7's power, has been handed over to individual governments to deal with their problems... Bloomberg had this to say... "The shift in influence to the group, whose membership ranges from the U.S. to China to Saudi Arabia, reflects the fact that industrial nations lack the resources to fix the world’s economic woes alone. That curbs the G-7’s scope to deliver new initiatives this week, say economists and former officials."

Any way, the markets do pay attention, so I have to! They have plenty they could talk about... Dollar strength when it shouldn't be getting any love... The strong Japanese yen in the face of Japan's problems... And the rise in Gold...

I think Gold traders are running scared of what G-7 might say, and Gold has sold off for the first time this week, losing $8 this morning. As Arnold would say about these Gold traders... "what a bunch of weak men!" (Ok, you have to do it Arnold voice)

In October 2008, G-7 said they were concerned with the Japanese yen's strength... Well, actually it was the Japanese that were concerned... And until yesterday, yen had remained quite strong... But the close we got to the start of the G-7 meeting, yen began to weaken... I bet some yen traders got scared of what G-7 might say, and unloaded their positions ahead of the meeting... Scaredy cats!

OK, enough with the G-7, Schmee 7 today! The dollar held the hammer yesterday, and has received permission to continue holding it this morning as Eurozone economic data has really weighed heavily on the euro. Here's the skinny on the Eurozone economy as reported by the Wall Street Journal... "The euro-zone economy contracted by a record amount in the last three months of 2008 as industrial output was hit hard by the sharp slowdown in global demand. The decline was led by the biggest quarterly fall in German gross domestic product for more than two decades. Data from the European Union's Eurostat statistics agency showed euro-zone GDP contracted 1.5% on a quarter-to-quarter basis and was 1.2% weaker on an annual basis, the biggest falls by both measures on record."

I know that there are those people out there that are pointing a finger at European Central Bank (ECB) President, Trichet, and blaming him for this recession in the Eurozone, for it was Trichet who kept rates from falling as fast as they did in the U.S. Look, the Eurozone was going to have a recession any old way, whether Trichet cut rates to zero like his counter part Big Ben Bernanke, or not! To me, it was the better part of discretion than valor... He squashed inflation, which is the most important thing to the ECB, and he still has some rate cut arrows in his quiver to use, where Big Ben is out of rate cut arrows.

Now, I've read where some pundits believe that the euro will lag the U.S. in a recovery, as the U.S. cut rates faster than the ECB... Well, the U.S. isn't going to see a recovery as long as over 600K workers are filing unemployment claims each and every week! The banks in Europe are not in as good of shape as we were led to believe a few months ago... But, always, always, I tell you, be yourself, Help Mr. Wizard! No wait! That's not what I say... I always say that at least the ECB / Eurozone is dealing with their problems from a position of strength...

On this side of the "pond" I heard that the new administration was working on a new plan for mortgages... There are reports suggesting the Obama administration is hammering out a program to subsidize mortgages. In a major break from existing aid programs, the plan under consideration would seek to help homeowners before they fall into arrears on their loans.

That's nice... You know, years ago, when my beautiful bride and I didn't have two nickels to rub together, we paid our mortgage no matter what, and at no time, EVER, did I think someone, would bail me out! And I know I'm not unlike the majority of people in this country... So, you have to wonder what happened here? The Gov't is stepping in to "help" you... I've told you before that Ronald Regan used to say that the scariest thing you can hear is "Hello, I'm from the Government, and I'm here to help"

OK... The Canadian Trade Surplus is no more... Canada's Trade Balance turned negative last month... The Trade Deficit is small at this time, so nothing to get all up in arms about... We'll have to keep an eye (that's easy for me these days!), on Canada's Trade Balance to see if more harm is done here...

You know, I was talking to someone the other day, and don't recall who, but I was talking about how Norway has come Ollie, Ollie Oxen free on all this "bad bank", "large write downs" and bailout stuff... I always talk about how a large surplus allows a country to deal with problems in an orderly manner, and not have to be at the mercy of the foreigners that finance a country's debt... Norway has been the poster child for this... Canada comes in second... You just don't hear about Canadian Banks in trouble, which is pretty strange, considering their relationship to the U.S. market...

Coming in third is China... China with all their trillions of dollars sitting around losing their value, and set to lose their value even more in the future, looks to have possibly turned around their recession in a heartbeat... You may recall that China put into place a 4 Trillion renminbi Stimulus Package a few months ago... And when you deal from a position of strength, you can do these things quickly and with force. So, according to an economist at Merrill Lynch, "China looks set to be the first major economy to recover from the current global meltdown. China is the only economy in the world to see significant growth in credit to corporate and household sectors since September 2008, when the financial crisis worsened to a near collapse."

Australia is doing better all the time with regard to their problems, and I think once we get past the credit crisis in the U.S. and the inflation wolf returns, that Australia will be positioned to take off! Australia just approved a A$ 42 Billion Stimulus package of their own... Of course, the credit crisis in the U.S. isn't going to end next week, or next month, and maybe not for a few months...

I told one of the crowds in Orlando last week at the Money Show, that I have a track record of calling things that don't happen for 6-12 months... But "usually, the markets come around to seeing things the way I see them!"

Did you hear about this? Goldman Sachs held an emergency meeting of hedge fund executives...

Here's the skinny as reported on Bloomberg...

"By Dan Hart
Feb. 12 (Bloomberg) -- Goldman Sachs Group hosted an emergency meeting of hedge fund executives and financial executives shortly after U.S. Treasury Secretary Timothy Geithner’s presentation on Feb. 10, CNBC’s Charlie Gasparino reported.
Gasparino said the meeting was co-hosted by Goldman’s Gary Cohn and Jon Winkelreid and included Kenneth Griffin of Citadel Investment Group LLC. Griffin said that the mortgages underlying the so-called toxic assets held by banks and other institutions need to be dealt with, Gasparino said, citing unidentified people familiar with the meeting."

Hmmm... That's scary, eh? I'm sure that Goldman didn't have the Hedge Fund executives in for tea and scones! And... Any time the word "emergency" is used, a sense of urgency follows it...

Here's something to take us to the Big Finish... Not good news... But, at least these guys are beginning to see things "the way I seem them"! This was reported in the Wall Street Journal...

"Economists in the latest Wall Street Journal forecasting survey, while still mostly projecting growth in U.S. gross domestic product by the third quarter, largely agree that a second-half recovery is looking much less likely now than it did a few months ago. Recent data showing just how sharply growth in the U.S. and abroad has declined in the final months of 2008 have cast a deepening shadow over 2009."

Currencies today 2/13/09: A$ .6610, kiwi .5265, C$ .8105, euro 1.2875, sterling 1.4525, Swiss .8620, rand 9.9610, krone 6.8070, SEK 8.3675, forint 232, zloty 3.6170, koruna 22.27, yen 91.50, sing 1.5060, HKD 7.7525, INR 48.68, China 6.8335, pesos 14.41, BRL 2.2730, dollar index 85.94, Oil $33.96, Silver $13.40, and Gold... $938.80

That's it for today... When you travel as much as I do, or even like the Big Boss, Frank Trotter who travels 3 times what I travel, the news of a plane crash hits you a little harder... OK... Quite a few of you brought it to my attention yesterday that it was Lincoln's birthday... Well... I had mentioned that the day before, that Thursday would be his 200th birthday, didn't think I needed to say it again... Well... Tomorrow is Valentine's Day, are you ready? I stopped this morning and got heart doughnuts from Krispy Kreme for all the ladies in the office, they are on their respective desks, waiting for their arrival... See? I'm a real sweetheart, right? HAHAHAHAHAHAHAHA! My little buddy, Alex, was all dressed up with a tie on (I had to tie it for him of course!) last night, as he goes once a week to cotillion. We're trying to help society! Alex has two basketball games this weekend, so I have that going for me! He wears a plastic mask to protect his nose these days... Looks weird, but he gets to play, and that's all he cares about! Well, it's a three day weekend, as we all celebrate mattress sales, no wait! We celebrate President's Day... I sure hope your weekend is grand, and your Friday is fabulous!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837

Retail sales disappoint even more…

Chuck Butler — Thu, 15 Jan 2009 16:16:31 GMT

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In This Issue..

* Retail sales disappoint....
* Chuck's views on the Lone Prop...
* Waiting on the ECB...
* Emerging market currencies sell off...

And Now... Today's Pfennig!

Retail sales disappoint..

Good day... The big news yesterday was the retail sales numbers, which fell twice as much as expected. Chuck predicted a tough Christmas season, and the BHI was right again. Sales dropped 2.7 percent according to yesterday's report from the Commerce Department. The falling home prices, rising job losses, and tighter credit have all combined to finally force US consumers to adjust their spending habits. No matter how low retailers slashed prices during the recent Christmas season, US consumers just weren't buying. The economy is forcing consumers to wean themselves off of the dangerous drug of easy credit. In spite of Bernanke and Paulson's attempts to get consumers borrowing and spending again, the economic slowdown is forcing the US consumers to reign in their spending. But while this change in consumer habits is good for the longer term economic health of the US, it only serves to drive the economy even further into recession over the short term.

And the bad economic data just keeps rolling in. U.S. foreclosure filings spiked by more than 81% in 2008, a record, according to a report released Thursday, and they're up 225% compared with 2006. The total foreclosure filings in 2008 topped 3 million and showed no signs of slowing down in spite of the efforts of both the government and banking industry to slow them down. Foreclosure filings actually accelerated in the 2nd half of the year, increasing 17% in December over November of 2008.

The Fed gave us a glimpse of their view on the markets yesterday with the release of their Beige Book. Nothing in the report was a surprise, as respondents from the 12 Fed districts portrayed a gloomy economic scene. The report suggests the Fed may need to implement further measures to restore credit markets. The Fed districts reported more job losses, hiring freezes, and reduced hours. The New York district reported that 'substantial' job reductions have yet to show up in payrolls data. Doesn't sound good for the US economy in 2009.

Today we will continue to get negative news on the US economy with the release of Producer Prices and the weekly jobs numbers. Producer prices will bbe down and initial jobless claims will probably top 500k. We will also get the very volatile Empire Manufacturing and Philadelphia Fed numbers showing further rot on the manufacturing vine.

The dollar actually rallied with these numbers, as investors turned back to it as a 'safe haven'. This move is similar to the moves we saw in the latter half of 2008 as the dollar rallied in the face of poor US economic data. Chuck sent me his thoughts on this latest 'safe haven rally' and wanted me to share them with you all:

"Reuters reported Wednesday night that the U.S. is close to extending Billions of more aid to Bank of America... Citigroup, as reported yesterday, is selling off units to raise capital... I wonder if Big Ben Bernanke and Hank Paulson drink more than 7 cups of coffee a day... Researchers show that drinking more than 7 cups of coffee a day may trigger delusions...

What does the rot on the vine at BOA and Citi have in common with delusions? Well... I think that Big Ben and King Henry are drinking more than 7 cups of coffee a day, if they believe their "stimulus" / TARP is going to get these two ginormous banks back on terra firma!

Remember the Lone Ranger? Remember a couple of years ago, when the dollar was propped up by Fed rate increases, and the tax amnesty for U.S. Corporations doing business overseas? Those props were pulled away one at a time, and for the next 2 1/2 years the green/peachback fell flat on its face... Well, it came up with another prop this summer... However, this time... There's only one prop... The Lone Prop, I'm going to call it from here on out... It's called the "Safe Haven" prop... And it has done the dollar well since July...

But just like in early December when I smelled a Santa rally to year end, and it happened... I'm seeing chinks in the dollar's Lone Prop's armor... The Fed has just about run the course of things it can do to get this economic engine revved up again, to no avail... And just like I said a couple of weeks ago, Paulson and Bernanke are like the King's men, who tried to put Humpty Dumpty back together again! Their stimulus plans, their money supply injections, their guarantees on debt, their taking over the Commercial Paper biz, to their putting their hands in bank's cookie jars... Nothing has worked... And why? Because, it's not nature's way to interfere! One of my all time fave songs, by Spirit (Randy California) called, "It's Nature's Way"... It's nature's way of telling, something's wrong... It's nature's way of telling you in a song.... It's nature's way of receiving you... It's nature's way of retrieving you... It's nature's way of telling something's wrong...

It's obvious they were singing about something else... But I would say if sung today, it would be sung to the economy... One of these days, these mental giants will figure out to leave well enough alone, and let markets take their course... But that's not happening now, and I'm sure it's not going to happen any time soon, given the news that President-elect Obama wants control of the remaining $250 Billion in TARP money, and then wants to push through a stimulus package that will be anywhere between $800 Billion and $1 Trillion as soon as he takes office!"

Chuck is pretty amazing, he had another tough day at the doctor's office yesterday, but still found the time to send me his thoughts on this recent move by the dollar.

The Euro sold off a bit yesterday as currency traders were waiting on the ECB which will likely cut 50 basis points this morning. Some actually began predicting a 75 basis point cut, but the noise on the street is confirming a 1/2% cut. But the markets will focus more closely on the press conference following the rate announcement. Many are expecting the ECB to signal more cuts are on the horizon, but I disagree. The leaders of the ECB have a hawkish tilt, and Trichet has continued to illustrate his desire to not follow the US Fed's ZIRP (Zero Interest Rate Policy). A 50 basis point move would put interest rates at the lowest levels since 1999, and a further move would be unprecedented. Trichet said last month that there is a limit on how far the ECB can cut rates and will likely push for a pause after today's cut.

But recent data out of Europe shows their economy continues to contract, and inflation is being held down so Trichet will face mounting pressure to drop rates further. If Trichet can hold the line, the euro will likely benefit vs. the US$. The euro rose 10 percent vs. the dollar in December, after Trichet said he wouldn't be trapped with borrowing costs too low. The European economy is slowing, but will likely be able to weather the financial tsunami better than the US.

The emerging market currencies of Brazil and South Africa slid yesterday with 'risk aversion' back in vogue. The Brazilian real sold off to a two week low on concern over a further deterioration of the US economy. The South African rand sold off in concert with a drop in the price of gold and commodities. The higher yielding currencies of New Zealand and Australia also fell vs. the US$ as investors turned back toward the 'safe haven' of the US$. But don't expect this dollar strength to last, as this lone prop of 'safe haven' will be kicked out from under the dollar.

On to the currency wrap up:

Currencies today 1/15/09: A$ .6632, kiwi .5379, C$ .8033, euro 1.3170, sterling 1.4602, Swiss .8928, rand 10.1408, krone 7.2099, SEK 8.3956, forint 212.64, zloty 3.2109, koruna 20.6965, yen 89.11, sing 1.4957, HKD 7.7598, INR 49.0175, China 6.8365, pesos 14.1862, BRL 2.3841, dollar index 84.253, Oil $37.80, Silver $10.50, and Gold... 812.35

That's it for today... I see where the ECB did cut 50 basis points, which was widely expected. I can look forward to another full day of meetings on the new computer system we are looking to install later this year. I'll be heading out to Colorado tomorrow for a 'guy's weekend' of skiing. Hope everyone has a Terrific Thursday!!

Chris Gaffney, CFA
Vice President
EverBank World Markets
1-800-926-4922
1-314-647-3837

The Dollar Swings A Mighty Big Hammer!

Chuck Butler — Wed, 14 Jan 2009 17:01:53 GMT

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In This Issue..

* Another dollar rally....
* Rumors in Ireland...
* Trade Deficit narrows...
* Retail Sales to disappoint?

And Now... Today's Pfennig!

The Dollar Swings A Mighty Hammer!

Good day... And a Wonderful Wednesday to you! I'm writing from home today, as I will not be in the office on this wonderful Wednesday. Writing from home, or the road, always presents problems for me, as I'm so used to being in the "saddle" at my desk, and having information all around me. But, my little work desk at home has some of those amenities... So, what the heck, quit your grumpiness, and get to writing, Chuck!

The dollar ripped through the 1.32 handle of the euro yesterday, like a hot knife goes through butter! There was little to no resistance in that 1.32 handle, and before you could tell one of the many people on the desk here that sneeze all day, God Bless you, we were trading with a 1.31 handle in euros. The talk about a European Central Bank (ECB) rate cut has really ramped up this week, and taken its toll on the single unit. No one is mentioning that even if the ECB cuts 75 BPS this week, they'll still have a an interest rate / yield advantage over the U.S! I guess they'll sort that all out somewhere down the line, eh?

There's a rumor going round, that's someone's underground, no wait, there's a rumor going around that Ireland had requested aid from the IMF... Whoa there Partner! I know that things in Ireland have turned around on a dime from boom to bust, but I wasn't aware of a problem that would run that deep... The rumors were denied, of course, but you know me... Where there's smoke, there's fire... I'm reminded of an email I received 2 weeks ago from a reader in Ireland, that talked of a major slowdown in the economy. The writer, was very adamant about how bad things had gotten that he compared Ireland to a banana republic! I responded to him, and said, no... That can't be, because we've got a corner on being a banana republic right here in the U.S.A.!

You should have seen the sell off in euros when this rumor hit the streets! It was scary how fast a currency could lose a handle! But, after the rumors were denied, the single unit rallied back nearly as fast as it fell, and is now trading, as I write at 1.3225. The dollar is swinging a mighty hammer once again...

Talk about a flight to Risk Aversion! This rumor has the Risk Aversion campers battening down the hatches and heading to the cellars! Risk Aversion is NOT good for currencies and commodities.

Another reason for the Risk Aversion campers to batten down the hatches is the report from yesterday that Citigroup is going to sell their brokerage arm, Smith Barney, to Morgan Stanley for $2.7 Billion in cash... This to me, sounds like a fire sale, and that Citigroup is in deep dookie once again... Citigroup has already received $45 Billion from the Gov't in TARP money, much more than any other bank has received, for sure!

This news scares the bejeebers out of me, as Citigroup has always prided themselves on the fact that a customer could do "one-stop investing"... I guess, we'll have to wait-n-see if Citigroup announces a sale of another unit somewhere down the line, eh? But for now... This news is not good for any asset!

Well... Today, we'll see the color of the Retail Sales for December. We all know that December Retail Sales should be kicking rear and taking names later... But... And that's a BIG BUT... Not last month, unfortunately. As we get ready for the printing of Retail Sales, the experts say that Retail Sales will have fallen -1.2%, following a -1.8% in November. The Butler Household Index (BHI) tells me that while Christmas shopping was good, it wasn't on scale with other years, and I believe the Retail Sales will be very disappointing this morning.

OK, what do we have here? A Fed Head talking about our ZIRP (zero interest rate policy). I know, we're not quite at zero yet with the official rate, but the Fed Funds people would tell you differently! So, in my book, I say ZIRP! Well, this Fed Head, Lacker, thinks that interest rates will stay very low for some time... Say it ain't so, Joe! I don't want to see rates at zero for a long time, folks! That's part of the reason we're in this mess to begin with!

Oh, and yesterday, Big Ben Bernanke, was speaking over in London, and kind of threw some cold water on Obama's $800 Billion stimulus plan... I can hear Obama saying... "Hey! He backed all the other stimulus plans, but now he's throwing cold water on mine!" Well... I said "kind of threw" I didn't say he DID throw cold water on the plan... I'll let you decide... Here's Big Ben... Fed Chairman Ben Bernanke said the "stimulus package being crafted by Barack Obama and Congress could provide a "significant boost" to the sinking economy. But he warned that such a recovery won't last unless other steps are taken to stabilize the shaky financial system." And what is he talking about in the "other steps"?

Here's more Big Ben... "There will be no lasting recovery without further government action and funds to strengthen the financial system, with the timing of an economic recovery "highly uncertain." OH GREAT! More Government action! That's Central Bank parlance for "we're getting our hands deeper into the cookie jar"!

OK, I've gone this far, and have not mentioned the huge drop in the Trade Deficit that showed up in the print yesterday... The Trade Deficit fell from $56.8 Billion in October to $40.4 Billion in November! WOW! This fabulous! Or is it? Let's take a closer look at the numbers... U.S. exports fell $8.7 Billion and imports fell $25 Billion. Lower oil imports accounted for more than half of this drop, but ex-petroleum imports also fell $10.5 Billion.

So... Here's the problem folks... As I tried to explain yesterday... A narrowing Trade Deficit because of less spending and larger exports would be manna from heaven... But a narrowing Trade Deficit because spending was slashed, and exports also fell, is not a good thing for the economy. It simply means that 1. The U.S. consumer has dried up and with consumption at least 70% of GDP, we're in for a long recession... And 2. that the dollar is too strong, otherwise exports wouldn't be so far off too. Yes, I'm quite aware of the fact that the recession is hitting all over the globe, but come on, we still buy Chinese and Japanese and even German exports even in a recession don't we? These same countries would be doing the same with U.S. exports...

And then there's this... News of the weird... Chris Gaffney saw a story yesterday that he sent to me, that qualifies for this category... Here's a snippet of the story... "The Bank of England will be able to print extra money without having legally to declare it under new plans which will heighten fears that the Government will secretly pump extra cash into the economy." Oh boy! Just what the pound sterling needs as a stabilizer eh? NOT! This is awful news for the pound folks...

I've said for months now that the Bank of England (BOE) was following in the Fed's & Treasury's steps, which could be to ruin, but following nonetheless! This is just another step in the Fed's & Treasury's direction. The free use of a printing press... The story went so far as to say "this will spark comparisons with the Weimar Germany and Zimbabwe, were uncontrolled use of the printing press ultimately caused hyperinflation." This is where they're getting a little out of control with the sensationalism... I prefer to say that it should compare to the U.S.... Which may still see hyperinflation in the future... But not the kind of Germany and Zimbabwe! YIKES!

So... As I get ready to head to the Big Finish... It looks as though that Trading Theme is back in force again, and the dollar will benefit any time the data shows the recession to be deeper, darker and more dangerous... Makes no sense to me! But that's the work of the mental giants these days... So... If Retail Sales is as disappointing as I suspect it to be in about 15 minutes, then the dollar should be supported today...

Currencies today 1/14/09: A$ .6670, kiwi .5440, C$ .8185, euro 1.3190 (slipped back again), sterling 1.4535, Swiss .8925, rand 10.0450, krone 7.14, SEK 8.30, forint 210.20, zloty 3.1420, koruna 20.42, yen 89.45, sing 1.4920, HKD 7.7570, INR 48.83, China 6.8350, pesos 13.83, BRL 2.3140, dollar index 84.15, Oil $38.87, Silver $10.76, and Gold... 826.50

That's it for today... Thanks to all who sent along good wishes for clean reports this week... I told you yesterday that I was draggin' the line a bit... I went home and fell asleep... Woke up to take some medicine and back to bed... Feeling a bit better this morning... Rest... It's a Godsend! I got my itinerary for the Orlando Money Show next month (Feb 3thru 7) yesterday... I'm looking forward to some warm weather already! I'll be at two presentations, and one EverBank Town Hall Meeting... So, I'll be busy! My little buddy, Alex, and beautiful bride used to accompany me on this trip each year, and Alex would go to Disney World, or Universal Studios to ride roller coasters and stuff, but now that he's older, it's not good to take him out of school, so no more rock-n-rollercoaster for him. :( OH well... Time to go... I hope your Wednesday is Wonderful!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837