Good morning,
As we approach the Passover and Easter Holidays, I have developed a kink in my neck from all the distractions occurring daily. If it isn’t a railway derailment, another food production facility mysteriously blowing up or a Bank failure, I am just scrambling to figure out where to turn next and what to do. Maybe everyone should be walking around with a neck brace so that we can look forward and never look behind. As the Italian Race Car Driver from the movie Gumball Rally, so eloquently expressed, “Solo adiamo avanti”.
Nonetheless, it has been a volatile week that began with a surge in the price of Oil. Basically, it rose nearly $10/barrel within a two-week period, from the low $70/ Barrel toward $82/B. At the same time, the USD Index plummeted below the 101.50 level causing the USD to decline significantly and currencies to rise in unison. Meanwhile, Precious Metals, (BOOM!) on USD weakness as Gold surpasses the $2030/oz level and Silver rises above the $25/oz mark. Remarkable moves were initiated out of fear and even more concern about global banking failures.
It was mentioned, that if UBS, the Swiss Bank, did not absorb Credit Swiss, there would have been a massive run on the banks, especially from the wealthy clients whose money is kept in what is referred to as a ‘safe haven’, Switzerland. In reality, nothing is safe, only trust your Mother!
Once the Central Bankers were given free rein to police themselves, the pigs at the trough grew unabated with concern only for their well-being at the expense of their depositors. The question is, how much money can be printed to save these entities without serious ramifications to societies existing standard of living? It is ‘Change’, that will be the greatest detriment to overcome with much reluctance to accept.
Meanwhile, the rich get richer as they buy the failed entities for nickels and dimes on the dollar, the investor literally gets screwed and the depositor will be reimbursed for $250k in the States, $100k in Canada and I am not sure what arrangement Europeans have. Sounds to me, if they destroy the monetary system as we know it, they can proceed to administer a digital currency system that has been engineered to monitor every expense and transaction people make, ultimately causing individuals to lose their autonomy. Vive la resistance!
Employment numbers upcoming on Friday for both Canada and USA, might not be as robust this time around. A prelude to this number is the ADP report which measures Private Sector employment. It dropped to 145k vs expecting (200k) jobs. A slowing down is occurring as the actions implemented by monetary policy usually have a 3-6 month lag. This could send the USD significantly lower and keep in mind that it’s a banking holiday on Good Friday. Consequently, Canadian Merchandise Trade Surplus narrows to $0.42 Billion in February, and USA Factory Orders declined <0.7%> versus expected <0.5%>, setting the stage for what could be disappointing news for the USD.
Despite the gloom and doom around the USD, it still is the main currency for global settlements. Therefore it will take time for a transition to occur. A former Bond Trader gives a very good perspective in the attached clip. I strongly suggest you watch and listen as it is a sensible perspective ( fast forward to the part discussing digital currency and the USD)
https://twitter.com/theredactedinc/status/1641522958320451585?s=48&t=bHFBg8Dxe67-sUi7mbU-5A
Further, a major concern just happened in Canada with the Toronto Dominion Bank. They seem to be embroiled in part of an American investment crisis exposed to the tune of $3.7 Billion. The TD Bank stock has now become the world’s largest short. Meaning, investors are selling the stock to buy at lower levels and profit on their demise. Troubling times for sure but thankfully we are entering the most religious period of the year whereby all the world’s religions celebrate in their own customs. All we can do is pray and hope the evil amongst us gets wiped off the face of the earth, sooner than later. Look forward to those lamb chops I can only dream about, have you seen the price lately? Send me your bones, I will make broth.
https://www.bnnbloomberg.ca/toronto-dominion-becomes-biggest-bank-short-with-us-3-7-billion-on-the-line-1.1904455
I think I love you!