Good morning,
Do you ever wake up from a nightmare, breathe deeply to try and catch your breath, and reach for some water because what you just witnessed was horrific? It happened to me when I dreamt of women with tattooed faces and nose rings, thinking to myself could one of them be my daughter? With all the negativity, let me brighten your day for a change:
Click below before reading the rest you will need to laugh before you cry;
https://youtube.com/watch?v=roY-xOQaCEY&feature=share
There was a lot happening this week and the day started with another dip in the USD Index toward the 101.50 level reflecting in currencies rising vs the USD. Once GDP figures were released, showing that the economy grew at an annual rate of 2.9% in Q4 vs expected (2.6%), the USD Index recaptured the 102.0 level once again. Further, Jobless Claims come in lower at 186k vs (205k) expected.
Meanwhile, the Federal Reserve is manufacturing a homegrown recession by increasing rates exponentially, so why do the numbers appear to be rosy? Are they genuinely reflecting the reality of life people are experiencing? Many might have to be taking on menial work to pay for medications or treatments thus amplifying job figures. Unfortunately, many could simply be discarded from the statistics because they just gave up on their job search.
In Canada, the big news came from the Bank of Canada(BOC) as it increased interest rates by 0.25%, as expected. Of course, this slowing is due to the direct impact on families. The mirage of inflation slowing down is simply that, a mirage. The variables are manipulated to give us the illusion that their policies are working. In fact, we had the Deputy PM, Freeland basically saying that the Middle Class will need to take a pay cut. Really how about starting with their 20% plus pay raises?
Consequently, there might be a divergence in the spread between countries as The Federal Reserve and Europeans will continue to raise rates by greater increments. This could result in massive outflows of money into higher-yielding instruments in other parts of the world. Keep in mind, that heavily indebted nations need cash flow to keep the ball rolling or the House of Cards from crumbling. The consequences could be disastrous and more printing of money will only dilute the value of the currency. The Canadian Dollar could come under pressure as this divergence occurs.
Meanwhile, Oil is approaching $82/B and Precious Metals explode higher and then retract. Gold was headed toward $1950/oz while Silver catapulted above $24/oz vs the USD.
Regardless, of the BOC reducing the incremental increases in interest rates, the results in reality reflect USD weakness providing the perceived currency strength for now. Everything will eventually catch up to reality because every dog has its day. Therefore laugh while you can and take things as they come, everyone will deal with their circumstances as life unfolds, one day at a time until JUSTICE prevails!
I think I love you!