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  • Central Banks Diversify...

    In This Issue..

    * Currencies soften VS the dollar...
    * Another look at Canadian job data...
    * China has Super month of exports!
    * Yen gets rocked by Upper House election...

    Good day... And a Marvelous Monday to you! Congratulations to Spain... The fiesta is on in Spain, as their football (soccer to us) team won the World Cup yesterday. Personally, I think Holland, got the bad end of the stick on two calls that would have turned that game their way. But, it was not to be, and Spain hoisted the cup!

    OK... Well, thanks to Chris for taking over the Pfennig on Friday. I was busy with other things for the day. I sent a note to Chris Friday morning about the Canadian Job report, and he replied that he had already written about it! WOW! Quick on the draw! He beat me to the punch... But, the report was so good it's worth talking about some more! Canadian employment skyrocketed again in June rising by 93,200, almost four times the amount expected by forecasters (+20,000). Add this to the 133,000 jobs created in April/May And you've got the ingredients for a strong quarter of job creation! The unemployment rate fell back to 7.9%, lower than forecasts for an 8.1% print.

    ...
  • Jobs Losses Continue...

    In This Issue..

    * The dollar gets sold...
    * China posts strong data...
    * Commodity Currencies & Commodities soar!
    * Dealing with reality...

    Good day... And a Marvelous Monday to you! Are you staying warm? I know it's difficult to do, given the fact that most of the country is in a deep freeze! I checked the weather at my 'fave' spring location, Jupiter Florida, and it was even 'cold' (FOR THEM) there! We're supposed to see some thawing this week, so let's hope that holds true...

    There's some thawing already going on in the currencies and commodities, thanks to a report from China yesterday... So, let's go to the tape and see what's happening this morning!

    The non-dollar currencies and commodities are flying high this morning, hammering the dollar... The Aussie & Canadian dollars are heading to parity once again, the euro is back over the 1.45 handle, and Gold is up $20! It's all good, for non-dollar investors this morning... I don't want to sound like a cheerleader, like I've been accused of being in the past, but, this is a currency / economy letter, and it's geared to non-dollar currency investors... So, take that as it may come......
  • It's A Risk Off Friday...

    In This Issue..

    * It's a Risk Off day!

    * Commodity Currencies get rocked...

    * Audit the Fed Bill moves along...

    * Just keep spending money we don't have!

    Good day... And a Happy Friday to one and all! A Fantastico Friday in my books, as the people at the Retina Institute told me yesterday that the fluid on my eye was drying up, and almost completely gone. I told them I had not noticed any improvement in vision, and they said, 'at least it hasn't gotten worse!' And for that, I am quite thankful! So... With that news, I head into today, and believe it to be a Fantastico Friday!

    Well... In my hours on hours of waiting for the next person to look at my eye yesterday, (I think it was "train the eye doctor day" on Chuck's eye) I kept checking the currencies, and noticed that as the day went on, the non-dollar currencies were stronger, led by the Big Dog, euro... But then late last night, and I mean late last night, I checked them, and those gains had been wiped out...

    ...
  • Silence Is Golden...

    In This Issue..

    * A HUGE dollar sell off overnight...
    * BLS admits the Birth/Death model was wrong...
    * The 20th anniversary of the fall of the Berlin Wall...
    * Kiwi is best performer overnight...

    Good day... And a Marvelous Monday to you! A Spectacular weekend, weather wise, here in the Midwest... And Indian Summer, is what my dad would have called it. The news from the Sports teams wasn't so spectacular, but we had the weather going for us!

    Welcome to Monday's edition of A Pfennig For Your Thoughts... I'll start off today with a note about the currencies, then do a recap of Friday, and then a look ahead to the rest of the week... So... Strap yourself in, and make sure to keep your arms and legs inside at all times during the ride!...
  • A Jobs Jamboree for Friday 10/02/2009!

    In This Issue..

    * The dollar remains well bid...
    * G-7 to hand currencies off to G-20?
    * Car Sales collapse...
    * Auditing the Lehman cash movements...

    Good day... And a Happy Friday to one and all! Yesterday, I welcomed you to October. I had been prepared to tell you about a famous radio station here in St. Louis, that has long called October... Rocktober... But forgot, as usual! But anyway... It's the first Fantastico Friday of Rocktober!

    Today is a Jobs Jamboree Friday too! And... I'm not getting a good feeling about today's labor report at the Jobs Jamboree. The forecast is for jobs losses to fall from -216,000 to -175,000, but the unemployment rate to tick up to 9.8% from 9.7%... I got the feeling, baby, baby, I got the feeling... Oops, a little James Brown on Fantastico Friday never hurts! But what I was saying was I'm getting the feeling that there are risks to this forecast... And that the job losses could come in higher, which would really be a BAD thing for the recovery flag wavers and risk takers, I'm sorry to say...

    ...
  • A Rout On The Dollar!

    In This Issue..

    * Currencies rally strong!
    * China is upset with printing of dollars...
    * The UN talks of a new currency...
    * Unemployment rate rises to 9.7%

    Good day... And a Terrific Tuesday to you! A long Holiday Weekend, that was quite good for yours truly! A great tailgate, a great Missouri Tigers victory, 3 of 4 for the Cardinals, a great end of summer bar-b-que at the Butler House, and a day to recharge the batteries... Really couldn't ask for much more... Yes, the weather could have cooperated a bit better, but, hey, that's nitpicking!

    Well... Last night I was checking the markets to see what was going on, since I had walked away from the desk on Friday afternoon... And much to my surprise, the currencies, led by the euro, seemed to be breaking out of their recent trading ranges. The euro was trading 1.4335, when I checked then... And when I turned on the currency screens here at the office this morning, the euro has stretched that move to the 1.4480 level! WOW! Looks to me as though the deficits that the dollar drags around are not looking to sharp to investors... But then, what took them so long to dump that fashion faux pas? Ahhh, grasshopper... As I've said many times before... The markets will do what they are supposed to do... Just not when... Which means, sometimes you have to wait... And wait... And think that they guy ranting each day in the Pfennig is barking up the wrong tree!...
  • The Boy Who Cried Wolf? NOT!

    In This Issue..

    * Currencies rally in early morning Wednesday
    * But see selling the rest of the day.
    * German Consumer Confidence surprises...
    * GDP to be revised downward?

    Good day... And a Tub Thumpin' Thursday to you! I get knocked down, but I get up again, you're never gonna keep me down... Yes, a little Tub Thumpin' this morning... I'm all geeked up because I'm sneaking out to go watch Chris Carpenter pitch for the Cardinals this afternoon! A day game... YAHOO!

    OK... Enough of that! Well, another day where the currencies bumped higher early morning, but then were sold the rest of the day. I know the currency guys (and gals) are all wonder where do they go from here... Which is the way that's clear? Well... Short term currency forecasts are proven to be wrong, most of the time... Long term? Well, that can't be argued... The deficit spending, the money creation, and the monetizing of debt will all come back to haunt the dollar... And as Aaron said yesterday, "we've only just begun"... (he was telling a joke), it holds true for the U.S. deficit spending picture......
  • Risk Returns... Slowly...

    In This Issue..

    * Currencies rebound...
    * G-8 has no fireworks...
    * Aussie / China and coal...
    * Entitlements...

    Good day... And a Tub Thumpin' Thursday to you! I'm late, I'm late! I don't believe I ever heard the alarm go off this morning! I overslept by more than an hour, and will still be here more than an hour before any sign of someone else! But! That puts me behind by more than an hour today... I've got to play catch-up! So, let's get this Tub Thumpin' Thursday going!

    Well... Let's see... G-8 never had the opportunity to shoot fireworks because China's leader had to return home to deal with the street riots going on in his country. So... The call for a replacement for the dollar as the reserve currency will have to wait for another day! And, with that news, the dollar got to remain in the sunlight, and bask in the glory of being the reserve currency and so-called 'safe haven' another day......
  • A Sustainable Economic Recovery?

    In This Issue..

    * More range trading...
    * Eurozone doesn't need more stimulus...
    * A$'s outperform on rate outlook...
    * A double whammy for the dollar...

    Good day... And a Happy Friday to one and all! The end of another week... I was out on Monday, and it still seems to have been another long week! UGH! Oh well... It's Friday, and this weekend is Father's Day... So, we've got that going for us, eh?

    More range trading in the currencies yesterday, with the euro leading the currencies higher for most of the day, only to see their gains slip, sliding away by the late afternoon. In the overnight markets, the currencies, once again, have moved higher, but nothing to get all lathered up about......
  • Happy Friday, Here We Go Again!

    In This Issue..

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

    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....
  • OMB Makes New Deficit Forecast...

    In This Issue..

    * The BLS adds jobs...

    * Growing Deficits again...

    * Jim Rogers....

    * A Trade Surplus for Canada...

    Good day... And a Terrific Tuesday to you! Well... I'm here! Lost Wages... No I mean, Las Vegas! It's such a long flight here! UGH! And the plane was packed... Like I said about a month ago, when you take a flight, it sure doesn't seem like people have cut back on spending!

    OK... Well, the currencies took a breather VS the dollar yesterday, and basically traded right around the currency round-up levels most of the day. Overnight, things were pretty quiet too... The markets are trying to figure out which way they are going to go with the dollar... The Deficit is growing, which SHOULD be bad for the dollar, but in recent times, fundamentals get a little hazy at times. So... Let's go to the tape on the Office of Budget Management (OMB)...
  • Geithner tanks the dollar, but then pushes it back up...

    In This Issue..

    * Geithner sends the dollar on a thrill ride...
    * A failed UK gilt auction...
    * China set to recover first...
    * AUD and NZD rally again...

    Good day... The currency markets took back what little strength the dollar mustered over the past two days with the Euro moving back above popping back above 1.36 and the Australian dollar moving back up over .70. The cause for this dollar weakness? Data released in the US yesterday was surprisingly strong again, so investors dumped the 'safe haven' holdings of Treasuries and moved money back into higher yielding investments.

    At one point yesterday the dollar index dropped precipitously (more than 1.5% in less than 10 minutes), and then bounced back up within a half hour. Jennifer McLean, who takes care of our currency trading while Chuck is away from the desk, said the sudden moves were due to Treasury Secretary Geithner's comments. Apparently Geithner was asked about China's call for a new international reserve currency yesterday at a NY event. He said that while he hadn't read the proposal, he understood it as a plan 'designed to increase the use of the IMF's special drawing rights. And we're actually quite open to that.' After hearing those words, currency traders immediately starting selling off the dollar. After all, if the Treasury Secretary of the US says the administration is open to a new international reserve currency, why do you want to hold dollars? I guess Geithner got wind of what he had done to the currency markets pretty quickly (the power of Blackberries!) and 15 minutes later he clarified his comments to say the US dollar should remain as the world's reserve currency....
  • A change in the Trading Theme?

    * A change in the Trading Theme? * Gold rebounds Big time! * ECB cuts 50 BPS, as expected... * Lots of lessons today... ** Jobs Jamboree Friday! Good day... And a Happy Friday to one and all! It supposed to be 70 degrees here today, so in my book that makes it a Fantastico Friday! It's also a Jobs Jamboree Friday, and while this report is probably not going to be anything good, it will be Fantastico BAD! The experts have forecast a job loss in February to be 650K!!!!!! Six Hundred and Fifty Thousand did I say? Yes, sir, may I have another, sir? Well, shiver me timbers, this is just downright awful! And if it prints this bad, it will be the most jobs lost in a month since 1949! This is horrific, just plain horrific folks... And in my opinion, will NOT signal the bottom of the barrel for labor just yet... This thing has momentum and I don't think you'd want to step in front of this run-away bus!...
  • It's Not My Fault, It Must Be Yours!

    * What's $78 Billion among friends? * Currencies fade with bias to buy Gold... * Could the Carry Trade Unwind be done? * U.S. soccer beats Mexico... ** It's Not My Fault, It Must Be Yours! Good day... And a Thunderin' Thursday to you! Well... Front and center this morning, I'm going to tell you something that will surprise a few and make a few happy. I've had my say on the Bailouts, TARP, Stimulus, and spending. I've beaten them to a pulp, and some readers have expressed their contempt with me carrying on with this beating. So... Unless something cracks, I'll just leave it all as it stands, and go on with life. This all has been too much for my blood pressure to take! I'll report the facts on this stuff, and leave the commentary for people that think they "know better"... For instance, it was reported the other day that the Treasury Dept. has overpaid for stock received from TARP recipients by $78 Billion. You see, for every $100 given in TARP, the Treasury was to receive $100 in stock / assets, but when all the beans are counted, the Treasury is $78 Billion short on stock /assets... But, what the heck, what's $78 Billion among friends?...