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Comfortably Numb...

ChuckButler — Fri, 17 Oct 2008 14:10:38 GMT

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In This Issue..

* Comfortably numb...

* Data confirms the US slowdown...

* NZD and AUD end the week with gains...

* Hungarian forint stabilizes...

And Now... Today's Pfennig!

Comfortably numb...

Good day...These dramatic swings in the markets are becoming so common place that a move of 400 pts by the Dow doesn't really garner much notice. After all, in the past five days, the Dow Jones average has had a trading range of almost 2,000 points, but after five dramatic days the stock market is trading almost exactly where it was a week ago. And the volatility in the equity markets has carried over to the currency markets, where we continued the roller coaster ride which began a few weeks ago.

Yesterday, the dollar began the day with a strong move up in early European trading. But a plethora of bad data released here in the US caused the greenback to reverse course, and it wiped out all of its earlier gains. But the bargain hunting rally in the stock market during the afternoon pulled the dollar along with it, and we ended the day with a dollar index which was slightly higher than the day before. Today is shaping up to be a similar trading pattern, as Europe has begun the day buying dollars vs. most of the major currencies.

The numbers which forced the dollar lower yesterday included US industrial output which fell 6 percent in the third quarter, the largest fall in output since 1991. The September Industrial Production number was expected to fall .8%, but shocked the markets with a drop of 2.8%. Capacity Utilization, one of Chuck's favorite gauges of the health of the US industry, fell over 2% from last months number and sits at just 76.4%. This is an important piece of data, as it shows companies are pulling back production, and output here in the US is currently nowhere near our full capacity. The collapse of US manufacturing was further illustrated by a factory index for the Philadelphia region which hit an 18-year low this month. The slowdown in the manufacturing sector has been well documented in the past few years, but what many thought was a bottom apparently was just a pause in a further move down.

The only bright spot in the data released yesterday was consumer prices, which rose less than expected on the back of falling oil prices. The government reported that annual CPI Ex Food & Energy climbed just 2.5% during the month of September. The faltering economy seems to be keeping a cap on inflation for now. But with the government printing presses working overtime to flood the markets with US$, expect inflation to take a dramatic jump up sometime in the not so distant future.

Initial jobless claims for the past week were actually slightly less than projected with 'only' 461,000 filing first time claims instead of 470,000. But continuing claims jumped to over 3.7 million, nearly surpassing the previous peak back in May 2003. The job market continues to slide, which will continue to dampen any hope of a quick turnaround for the US economy. Today's data isn't expected to do anything to alleviate fears of a prolonged recession here in the US, as housing starts are expected to be at a 17 year low and consumer confidence will likely show another drop.

The increase in volatility in the equity markets caused the Japanese yen to advance against both the dollar and the euro yesterday. The yen gained against 15 of the 16 most-active currencies yesterday as investors took a more defensive position following the poor US data releases. Investors have again started to reverse their 'carry trades', causing the yen to drop below 100 before moving back up. The Swiss franc also benefited from the carry trade reversal. This pattern of buying and selling Japanese yen and Swiss francs according to the perceived risk in the markets will likely continue, taking currency investors along for the ride.

The high yielding currencies sold off a bit yesterday, but will end the week as the best performers. Brazilian real is up 8.41% in the past five days, and the Australian dollar is up 5.25%. Now we just need about 4 more weeks like this one to gain back the losses which have occurred over the past 3 months. But I question if we will see the past week's gains continue, as most of them occurred as bargain hunters snatched up these currencies after dramatic drops. The performance of these two currencies in particular is going to depend on global demand for commodities. If the global recession deepens, the demand for raw materials could fall further, dragging these currencies down. But the Asian economies should at be at least partially insulated from the global slowdown, and their demand for raw materials should at least put a floor under these currencies.

Yesterday I informed readers about events in Hungary which had caused a dramatic fall in the forint. As I reported, the ECB stepped in yesterday and said it would support Hungary's money-market operations with a loan of as much as 5 billion euros. This, along with other emergency measures enacted by the National Bank of Hungary over the past few days have apparently assuaged the foreign exchange market. The Hungarian forint ended the NY trading day flat vs. the US$, indicating the worst may be over. Hungary has a 'near zero' chance of defaulting on its debt, central bank President Andras Simor said on state television yesterday. But the ratings agencies are still downgrading the currency. Fitch today cut its outlook on the nations debt rating to negative from stable.

Mexico's central bank will probably leave its benchmark interest rate unchanged today on concerns that a reduction to help a sagging economy would further depreciate the currency and fuel inflation. While a rate cut would help the economy resist a worldwide slowdown and credit crunch, it would work against the bank's efforts to prop up the weakening peso. The Mexican central bank has sold $11.2 billion worth of US$ since last week and purchased pesos in a bid to stem a rout in the currency. The peso tumbled to a record low last week and the central bank is scrambling to stop the slide. Both Mexico and Canada are exposed to the US recession, and each country is trying to shield their economies from further slowdowns in the US. The tumble in oil from its record highs in July have also impacted the Peso and Canadian dollar. The effects are more pronounced for Mexico, where oil accounts for more than a third of fiscal revenue.

Currencies today 10/17/08: A$ .6783, kiwi .6127, C$ .8385, euro 1.3407, sterling 1.7290, Swiss .8805, ISK 260.0, rand 10.4099, krone 6.6635, SEK 7.5087, forint 202.10, zloty 2.6878, koruna 18.824, yen 100.83, baht 34.26, sing 1.4821, HKD 7.7576, INR 48.89, China 6.8332, pesos 13.0449, BRL 2.1335, dollar index 82.59, Oil $71.03, Silver $9.66, and Gold... $794.28

That's it for today...I took my son along with a few others on the desk to a fantastic Blues game last night. The Blues won 6-1, and my son, Brendan, ended up getting a game puck which dropped right into our seats after flying over the boards. This could be the Blues season, as the youngsters which they recently added to the roster seem to have sparked some life into the old veterans. It is finally starting to feel like fall here in St. Louis, we could actually have a light frost overnight. Hopefully the market volatility will cool down a bit too! Hope everyone has a Fantastic Friday, and a wonderful weekend.

Chris Gaffney, CFA

Vice President

EverBank World Markets

1-800-926-4922

1-314-647-3837

More Dollar Strength!

ChuckButler — Fri, 05 Sep 2008 16:54:45 GMT

.........But First, A Word From Our Sponsor..........

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In This Issue..

* Trichet's words sink the euro rally...
* A New Conspiracy theory...
* Japanese yen continues to rally!
* An Announcement...

And Now... Today's Pfennig!

More Dollar Strength!

Good day... And a Happy Friday to one and all! It has not started out as a Fantastico Friday, just a Fun Friday... No wait! Just because the dollar is running around the end with the ball, and the currencies can't catch up with the greenback, is no reason to allow it to filter through to my feelings about each and every day! That's right! I'm feeling like there's a ton of weight on my shoulders right now, with this dollar strength, and everyone jumping ship... But, I promised myself over a year ago that if I was able to fight cancer and come out on top, that I would celebrate each day... And that's what I try to do! So... I'll make it a Fantastico Friday after all!

The euro's two-day rally VS the dollar got stuffed in a box and shipped to sea yesterday. The single unit looked as though it would add to the rally that took it above 1.45 but as I was signing off yesterday the euro was giving back its gains VS the dollar... And soon, it would give back more than the two-day rally's gains.

The European Central Bank (ECB) did leave rates unchanged as I expected them to do, and ECB President, Trichet, sounded hawkish as usual in his press conference following the rate announcement. But, here's the bomb that was dropped on the euro by Trichet... You see, the markets don't care about inflation fighting any longer, that's so old school! They only care about economic growth... And according to the 2nd QTR GDP, the U.S. has growth, and the Eurozone does not!

Well... Trichet talked about slowing growth expectations for the Eurozone, and that's all it took to get the juices flowing for dollar buying, and euro selling... Never mind the fact that the U.S. 2nd QTR growth was fueled almost in full by exports, because the dollar was weak in the 2nd QTR! I can't understand why the markets with their multi-million dollar research teams can't see this staring them right in the face!

But... That's the lot we've been thrown by the markets... The dollar is strong, and getting stronger everyday... And no, I'm not singing the great song by Chicago! This dollar strength has all been orchestrated by the U.S. Gov't... And that's fine... It's legal... Too bad they didn't let us all in on it so we could book profits and look to buy at cheaper levels, eh?

OK... As I said when the 2nd QTR GDP report printed... "It looks like the markets "believe" in the miracle of 2nd QTR growth... And... If that's the case, then why is everyone still of the belief that there will be a global slowdown? If the U.S. is hitting on all 8, why would we see a global slowdown? And if there's no global slowdown, then commodities should be the belle of the ball once again, Gold would be back to $1,000, and the dollar circling the bowl once again."

You can't have it both ways... You can't say, the U.S. is outperforming the rest of the world, and there won't be an collateral global growth because of it.

But, I don't believe it... Which would mean the dollar buying is all being done with smoke and mirrors... And that leads me to my latest conspiracy theory... If you don't like it when I go into these conspiracy theories, just skip ahead to the paragraph that starts with a *...

Let's go back to mid-July... The euro has hit $1.60 again and there's just not a lot of love going around for the dollar. And the reasons for that lack of love are numerous. One, BIG reason, is the debt problem... But that's one that a lot of people feel we can deal with (yeah, right, and I'm a young Bruce Willis!) So, let's put the debt on the back burner for this one... What the markets are feeling (in July) is the weight of the world on their shoulders, because of the rot on the vine with financial institutions...

Then, almost miraculously the dollar got up from its death bed... And the weight was lifted, but by whom, and why? Well... We found out just last week that it was a coordinated intervention by the Central Banks of the U.S., Japan, and Eurozone to prop up the dollar. And once the dollar buying got up some momentum, the Big Boy Brokerages were all touting the return of the greenback! But why did the U.S. feel it needed to intervene? OK, here's what I think...

"The Boys" saw the list of banks and brokerages on the "dead man walking" roster... And they saw the dollar circling the bowl... If the you know what hit the fan with financial institutions, it could have, no wait, it would have, sent the dollar down the drain, and who knows, it could have been the end of the greenback as we know it. So, they intervened to prop up the dollar in "preparation" of what was to come, which would allow it to begin its decline from a higher level.

That's my story and I'm sticking to it! It's like last fall when the Fed started cutting interest rates... They knew there was going to be hell to pay, and they wanted as much liquidity in the markets as possible... Did interest rates really need to be cut at that time other than to provide breathing room for the Fed's buddies on Wall Street? I don't think so, Tim! But, I knew the Fed's thinking on that, and I immediately called for a series of rate cuts, that the media or the markets didn't see coming... But I did... And I think I see the conspiracy thought here clear as day....

* OK, welcome back! Ty handed me an article that was in the Barron's he was reading on his plane ride home the other day that plays well with my Conspiracy Theory... The writer's name is, Stephanie Pomboy, and in the article she talks about how the markets have taken the Fed's messages about future rate hikes, because the economy is soon to be in ship-shape... And... She agrees with me that the Fed will lower rates before they hike them again... And then she says this, that really caught my eye... "Far from support(ing) the buck, the Fed's comments suggest they're packing away their conventional tools and that the real debasement (for the dollar) is about to begin.!"

Well... The Japanese yen, has taken the seat in the front of the class, and doesn't look as though it wants to give it up! As I've told you all week, the yen has not been part of the selling back to dollars... In fact, as I said the other day, it has all the makings of a Japanese repatriation back to yen from the Commodity currencies of Aussie and kiwi. Japanese yen is trading with a 106 handle this morning... All this in the face of the strongest dollar rally we've seen in years! In addition, this is all in the face of the fact that the Japanese PM position is empty... Chris Gaffney mentioned yesterday that "it doesn't look like anyone wants to be the Japanese PM!"

Well, that may be... But, it sure looks like investors are lining up to buy yen... Has the call for stronger Asian currencies finally going to come to reality? Or will reality bite? This flag waving for yen must be tempered due to the dollar's strength right now... In other words, I'm surprised at every move higher the yen makes each day... And I'm not a fan of surprises... So, I'm leery of this move... But, I'll play ball, and wave the yen flag... No worries!

OK, all of this writing, and I haven't even mentioned that today is a Jobs Jamboree Friday! Could this number provide a road block for the dollar? One would think so, given the fact that the "experts" believe that we'll see a -75K job loss report... I'm going to go even higher and say I think it will reach -100K in job losses! The Average Hourly Earnings and Weekly Hours are what I usually hang my hat on... And here's where we could see some wage spiral inflation, as the Avg. Hourly Earnings are expected to have risen .3% in August, and annually at 3.4%...

We'll also see the Mortgage Delinquencies for the 2nd QTR this morning... In the 1st QTR Mortgage Delinquencies rose 6.35%... I would fully expect the 2nd QTR's report to be in worse shape, wouldn't you?

So... We head into the weekend, and by the way, don't you just love 4-day work weeks when we get them?... Oh, as we head into the weekend, the dollar is on a tear, with the euro taking the brunt of the weakness, just the opposite as when the dollar was going down daily... The 1.43 handle for the euro lasted about as long as it takes to read the book on what men know about women... And now the dollar is going through the euro's 1.42 handle like a hot knife going through butter... I don't know where this will all end folks... And trust me, I just feel awful about it! I feel like walking away from all of this... I had a woman write me yesterday, accusing me of causing her to lose thousands of dollars... I'm not without a conscience and I don't think "I caused her to lose thousands" but still, I feel the heat...

I'll just stick to my fundamentals training and try to enjoy each day...

Currencies today 9/5/08: A$ .8070, kiwi .6645, C$ .9380, euro 1.4210, sterling 1.7590, Swiss .9410, ISK 88.25, rand 8.0650, krone 5.6550, SEK 6.68, forint 170.65, zloty 2.4160, koruna 17.46, yen 106.20, baht 34.60, sing 1.4385, HKD 7.8060, INR 44.65, China 6.8390, pesos 10.55, BRL 1.7175, dollar index 79, Oil $106.50, Silver $12.70, and Gold... $794.20

That's it for today... It's stand up to Cancer day / night. All the networks will air a special tonight in an attempt to raise funds to accelerate cancer research. One of my faves, Katie Couric, will be on the hosts. This will be the first time in history that this is done on TV... And what a worthy reason to do so! 1,500 Americans die from cancer every day. That's more than 1 per minute! I would think, unfortunately, that every American has had cancer touch their family or friends. I lost my mom, dad, and oldest sister to cancer... I have been fortunate enough to be given the opportunity to fight it, mostly because the treatments have improved. But I don't think for a minute I could have fought this fight without the facts that I was a strong individual, I remained positive, and had the thoughts and prayers of thousands of people. Not everyone has that opportunity, and for that we need to research and actually find a way to deal with this deadly disease. Yes, I'm fully aware of all the alternative methods, I've read book after book on this subject... We just need to revolutionalize the way we approach this disease.

OK... A couple of weeks ago, I hinted that I had some news to share with you about a new endeavor that I'm working on, in the future. Well.. It's now the future, and I'm glad to announce that I have signed on to be one of the Senior writers for a new "paid for" publication called: "The Currency Capitalist" I'll be sharing the writing load with well respected currency trader, Jack Crooks... It will be an educational tool, along with trading tools, and ideas. If you have any interest in this publication that will have it's first printing this month, don't call me or the Trading Desk here, this is NOT an EverBank publication. You can send an email for info on the publication to: info@sovereignsociety.com

And finally... I'll be on the radio again this morning, on the Rocky Mountain Radio Network at 9:05 Central Time... And tomorrow is my little buddy's (Alex) first football game of the year (last week were scrimmages) and he's looking forward to playing a game again! (games are easier than practices, even I remember that!) So, good luck to Alex, and my beloved Missouri Tigers tomorrow! Time to hit the send button... Have a Fantastico Friday!

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

RBNZ Cuts Rates...

ChuckButler — Thu, 24 Jul 2008 15:43:26 GMT

.........But First, A Word From Our Sponsor..........

No other bank is as committed to you and your global portfolio success as EverBank. And we've proven it again with the launch of the NEW currency resource pages at Everbank.com. We encourage you to visit Everbank.com and see for yourself. You'll discover:

- Over 30 new web pages dedicated to foreign economies and currencies, including tips and insights from Chuck Butler, President of EverBank World Markets
- Condensed, relevant and timely economic information from around the globe
- Tools, charts and tables you need to compare and evaluate currencies
This is another groundbreaking step from EverBank. And further proof why we're worlds apart from ordinary banks.

......................................................

In This Issue....

* The dollar swings it mighty hammer!
* Weekly Jobless Claims spike!
* Exposing the debt in N.Z....
* The Fed's Beige Book is grim...

And Now... Today's Pfennig!

RBNZ Cuts Rates...

Good day... And a Thunderin' Thursday to you! It's not so Thunderin' for me this morning, as I must have eaten something that didn't agree with me last night... Therefore I was up most the night sick... This will be ever so short-n-sweet, and then I'm going back to bed, I've got a presentation this afternoon with Addison Wiggin, I've got to be in tip-top shape for that!

The dollar swung its mighty hammer again yesterday, bringing the euro to the 1.56 handle, with all the other usual suspects falling in line behind the euro. The markets are ga-ga with news that leads them to believe the "worst is over" in the credit crunch... I beg to differ on that, but then, I'm just one guy, one voice, one letter...

The Reserve Bank of New Zealand (RBNZ) did indeed lower their Official Cash Rate (OCR) yesterday afternoon, dropping it 25 BPS... UH-OH! Remember what I told you about what would happen when rates went lower in N.Z.... It's all happening at the zoo... I do believe it... I do believe it's true... In case you don't recall, what I said at least a dozen times, or missed class those dozen times (shame on you!) New Zealand has a debt problem that in percentage terms is larger than the U.S. (of course the state of Texas would be larger GDP than N.Z. I think) But in percentage terms, it's horrible, but the markets all swept this under the rug, because of the sensuous allure of higher interest rates here... Well, when the interest rate differential begins to go away, the ugly stepsister gets brought out to the front of the house for everyone to see, and gasp at! That's what will happen here, and is already happening, as kiwi gets hammered after the announcement yesterday.

House of Representatives passed the GSE bailout bill yesterday, and the bill now moves to the Senate and then the President for approval. I've got a lot of bad thoughts about this, but in an attempt to not be so negative all the time, I'll pass! But doesn't this scare you as a taxpayer?

This morning, the Weekly Jobless Claims printed for last week, and recall how I said the report that showed everything was beautiful, was "distorted"? Well... This week's report spiked to 406K for the week.. This isn't seasonal stuff folks... This is really negative news for the U.S. economy... But still the dollar bulls swing the dollar's might hammer... Makes you want to scratch your head and wonder why, eh?

We're expecting to see the color of the latest Existing Home Sales data this morning still... Even counting the foreclosure sales, I expect this data to show significant weakness and that the Housing meltdown continues, well into the night!

The Fed's Beige Book also was released to the public yesterday, and it was very Grim... But, still the dollar swings it's mighty hammer... It's just all the dollar bulls getting to dance in the streets folks, they'll soon go back to the wall boards from which they came!

The price of Oil is way down, as it was reported yesterday that gasoline consumption is way down... Good! But, when will we see Oil's lower price reflected at the gas pumps?

Today, we'll get NY Fed's Geithner and SEC's Cox to testifying before the House. I have to tell you that if we really have "fee markets" then the SEC's Cox really threw a spanner in that process, with his no naked shorts rule... It's never been a problem before right? These speculators and hedge funds have done this to good companies for years... But when it becomes a quasi-Gov't agency corporation, now that's the horse of a different color! But that's all I'm have to say about that!

Also today... Ford reported an $8.67 Billion loss in the 2nd QTR... But not to worry, my friends over at Ford... You never know! Wachovia posted a nearly $9 Billion loss the other day, and their stock went up! So, don't you fret, cause you ain't seen nothing yet!

I have to get back to sleep, so here we go to the Big Finish....

Currencies today 7/24/08: A$ .9605, kiwi .7410, C$ .9915, euro 1.5680, sterling 1.9850, Swiss .9640, ISK 80.35, rand 7.6110, krone 5.1675, SEK 6.0310, forint 148.20, zloty 2.0580, koruna 15.06, yen 107.65, baht 33.45, sing 1.3610, HKD 7.9660, INR 42.05, China 6.8290, pesos 10.03, BRL 1.5760, dollar index 72.86, Oil $125.55, Silver 17.53, and Gold... $925.80

That's it for today... Haven't heard from my beautiful bride, as how my little buddy Alex, did at his Swimming conference finals last night... We had the most wonderful time last night, as we hosted an event at the Boathouse on the water here, and then were allowed to sit in the grandstands to watch the fireworks display, which was truly awesome! Every year, Vancouver hosts this fireworks tournament, if you will, between countries that come and do their fireworks display... Very cool! And I was able to have dinner with people like Dan Denning. What a super nice guy Dan is, truly a gem! There far too many others there to name them all, but it was quite a crowd! Kudos to the big boss, Frank Trotter, for putting that all together! OK... I hear the bed calling me... The do not disturb sign is hung on the doorknob... Hopefully, I'll feel better when I awake! Thanks and have a Thunderin' Thursday!

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

A Fantastico Friday!

ChuckButler — Fri, 23 May 2008 17:51:00 GMT

.........But First, A Word From Our Sponsor..........

No other bank is as committed to you and your global portfolio success as EverBank. And we’ve proven it again with the launch of the NEW currency resource pages at EverBank.com. We encourage you to visit EverBank.com and see for yourself. You’ll discover:

- Over 30 new web pages dedicated to foreign economies and currencies, including tips and insights from Chuck Butler, President of EverBank World Markets
- Condensed, relevant and timely economic information from around the globe
- Tools, charts and tables you need to compare and evaluate currencies
This is another groundbreaking step from EverBank. And further proof why we’re worlds apart from ordinary banks.

......................................................

In This Issue….

* Exiting Home Sales...
* Chart talks...
* A good week for Aussie!
* Inflation talk...

And Now... Today's Pfennig!

A Fantastico Friday!

Good day... And a Happy Friday to one and all! Let's make this a Fantastico Friday, eh? And why not? It's the Friday before the Memorial Day Holiday weekend! Fire up those barbeque pits, fill up the pool, squeeze into those swim suits again, and we're on our way!

Well... As I left you yesterday, the dollar was fighting back after being beaten around the head and shoulders all week. The "save the dollar from the free fall" work did its job yesterday... But that should be short-lived, in my opinion... As the U.S. fundamentals continue to show rot on the dollar's vine.

On Monday, I talked about the Existing Home Sales data that would print today... I know at this point Monday seems like a month of Sundays ago, but the data will finally print today. Existing Home Sales for April is expected to fall another 1.6% for the month. This would bring the total of Existing Homes sold annually to 485 million, which would be the lowest level since they began keeping records like this in 1999... And... If Existing Home Sales fall, that tells me that the meat of the problem, inventories, will probably grow... The amount of housing glut, the overbuilt, situation in the U.S. is the main problem right now with housing... And we all know that when you have a glut of something, and you can't sell at the going price, what happens... The price has to come down... It's that simple.

So... The "make us feel good" dynamic duo of Bernanke and Paulson can tell us all they want that the housing meltdown has bottomed (they're on record as saying this as long ago as last August), they're dead wrong!

Yesterday, I actually heard on the TV, some dolt talking about how the Weekly Jobless Claims were stronger than forecast... Geez Louise! The weekly job losses totaled 365K, VS the forecast of 373K... GIVE ME A BREAK! The data was BAD! Don't try to put lipstick on this pig, it's still a pig!

I received an email from a Chartist that said the recent reversal in Gold, spelled bad things for the dollar... His charts show that Gold should return to around $950, and that will push the dollar down again. This would play well with my thought that the euro is looking like it wants to go back to 1.60 in the short term... But that's the charts... And you know me, I'm not a chart person... But I like it when the charts agree with the fundamentals... That's a "perfect storm" brewing right there, folks!

Hey! Somebody finally has the intestinal fortitude to stand up and say... ENOUGH! OK, what's Chuck talking about now, I can hear you saying... Well, I'm talking about the price of Oil... After hitting $135 yesterday, the price of Oil fell to $131.98... This has gone too far too fast... I'm not saying that Oil can't go higher... I'm just saying that the fundamental data this week wasn't THAT BAD!

I met an "insider" to the oil business last week in Las Vegas, and I asked him what the economic price of oil was... You know, what does it cost to get the oil out of the ground... The equipment, the studies, and everything that goes into it... He said, that he thought it would be around $90 per barrel... So... Then on top of that you get the refining costs, and the speculation and you get $132 Oil... Obviously, those calling for $40 per barrel Oil again, are dreaming... All the leaves are brown, and the sky is gray, I can't go out on a winter's day... I'd be safe and warm, if I was in L.A. California Dreamin' on such a winter's day...

That's a fave song of mine... And over the years, if someone makes me play the guitar for them, that's the song I play and sing... So, it's always on my mind...

OK, now that was interesting... I was talking about the price of Oil, and started singing California Dreamin'... Well, it's all tied together folks... You just have to search for the tie...

Before I leave Oil... There's a great article this week in the Economist on the weak dollar and the price of Oil... One camp says that the weak dollar leads to higher Oil, and the other camp says that Higher Oil leads to a weaker dollar... You should check it out!

The Aussie dollar has had quite a week... I find this to be very exciting in that the Aussie dollar played second fiddle to New Zealand kiwi for 6 years... But the tables are turned now, as Australia's ability to fill the raw materials needs of China, which gives them the ability to reduce their Deficit situation. Interest rates are high here, and aren't going anywhere, and maybe up if anything... The markets are waking up and smelling the coffee on this one too, as I said yesterday some LARGE BANKS had talked up Aussie... We'll see more of this, as we go along, as they all want to jump on my bandwagon now!

All the euphoria in the markets yesterday, for the New Zealand Budget, got water thrown on it last night by the Finance Minister, who claims the markets have "over reacted to the Budget"... Unfortunately, for the Finance Minister, the cow is out of the barn already on this one, and kiwi is getting marked up...

The Brazilian real has seen a nice jump higher this week too... And why not? Brazil has strong economic growth (+5.7% in 2007, the highest in 3 years), and controlled inflation...

It's also been a strong week for the two Carry Trade currencies, Swiss francs and Japanese yen, as U.S. stocks saw some strong selling. I highlighted this thought early in the week, saying that if stocks sold off, and I thought they would given the earnings reports of Home Depot, etc., it would help these two rebound... Yen has gone from 105 to 103.50, and Swiss francs have gone from 95-cents to 97-cents...

Swiss National Bank (SNB) President Roth, is high on my Hit Parade today, as he just told the markets that "fighting inflation ensures financial stability"... WOW! Now, there's a Central Banker!

I did a long winded explanation of the changes that were made to CPI in the 90's at the request of Big Al Greenspan, in June's Review & Focus. So, if you're an EverBank World Markets customer, you should see that in your mailbox the first week of June... I think you'll be very interested in these changes... Which is why I pin my colors to the mast of John William's Shadow Stats figures, who uses 1990 methodology to calculate inflation, before these changes were made... His figures show inflation is 11%, and moving higher!

So... Our Central Bank hasn't done a very good job of providing price stability / fighting inflation, have they?

I could go on here... But I don't think I will do that today... This is going to be a Fantastico Friday, so no use in getting my blood pressure rising! Instead, I think I'll just go to the Big Finish, and work toward getting out of here today and get my Holiday weekend going!

Currencies today 5/23/08: A$ .9615, kiwi .7865, C$ 1.0140, euro 1.5730, sterling 1.9820, Swiss .9725, ISK 72.10, rand 7.65, krone 5.03, SEK 5.9125, forint 155.80, zloty 2.1650, koruna 15.97, yen 103.50, baht 32, sing 1.36, HKD 7.80, INR 42.80, China 6.9410, pesos 10.37, BRL 1.6570, dollar index 72.13, Oil $131.98, Silver $18.09, and Gold... $924.50

That's it for today... Well... I hope you get to spend some time this week with family and friends... I still haven't decided what I'm going to cook tomorrow for our big shin-dig at the Butler House... I love to cook on a grill, shoot, I've even made a peach cobbler on the grill before! My beloved Cardinals are in L.A. so the games will be late this weekend, UGH! So, that means my IPOD will be hooked up to the stereo. The sun is supposed to shine, I'm getting all psyched up just typing this! On a serious note though, please be careful this weekend, there will be a ton of cars on the road... My darling daughter Dawn, and my delightful granddaughter, Delaney will be on the road with Husband / dad Jerry this weekend, that always worries me... Son, Andrew will also be on the road Saturday, so worries all around... I have received a ton of emails from readers this week congratulating me on finishing my 4 weeks... Thanks folks... You are amazing! I'm already actually feeling almost normal again! YAHOO!

So... Be careful, fire up that grill, get the family and friends around you, and bask in the warm feeling of having loved ones around you... So, let's get this Fantastico Friday going!

Chuck Butler
President
EverBank World Markets
1-800-926-4922
1-314-647-3837
www.everbank.com