Gold Hits Record High; Chevron (CVX), ExxonMobil (XOM) Earnings Reports Dull; Trump Capable of Moving Market By Moving Lips

Yesterday, Thursday, this blog was extolling the virtues of the stock market not having to kneel before the almighty Federal Reserve following Wednesday's rate decision to stand pat and Jerome Powell's refusal to speculate on what the Trump administration may or may not do. That was a positive, but, what occurred in the final half hour of trading yesterday was a real turn-off.

Late in the session, President Trump - and, mind you, Money Daily is of the opinion that he's great - was making his case for tariffs on China, Canada, and Mexico, reiterating that the tariffs will begin on February 1st (Saturday). Well, the computers that run 85-90% of the trading on the various indices, didn't like it very much, and, about 3:30 pm ET, the whole market began selling off, severely. The Dow, shown at right, was up about 250 points. 15 minutes later it was actually in the red. The NASDAQ and S&P did the same.

Then, at 3:45 pm, either the President said something the computers liked or somebody manually turned them off, or, an even worse possibility, some programmatic AI made them reverse course and head back up. No matter what, the idea that one person, regardless that he's the POTUS, shouldn't have that much influence on the entire stock market. It wasn't good that markets reacted wildly to pronouncements from the Fed. It's worse if they're going to go all goofy when Mr. Trump speaks, for a couple of reasons: 1) While the Fed makes its interest rate policy announcements at well-advertised, set times, the Trump pretty much sets his own schedule, and speaks about anything whenever he feels like it (he also tweets, truths, etc.); 2) Sometimes, Trump is making jokes or being sarcastic for dramatic effect. Computers aren't very good at picking up sarcasm (kind of like Sheldon Cooper on "The Big Bang Theory").

Can you see how things could go very wrong, very fast? Anyhow, markets, if they react like that - and they do - don't seem to be very safe places to put your retirement funds or savings, but, that's for everybody to decide on their own.

ExxonMobil reported earnings this morning. They returned EPS of $1.67, beating estimates, which is all well and good, but, ultimately, bad, because in the same period a year ago, they posted EPS of $1.91. Not so good.

This, however, is the most important part most people will miss:

The No. 1 U.S. oil producer reported total earnings of $33.46 billion for full-year 2024, down from $38.57 billion the year earlier.

That's a 13.25% drop. Sure, XOM is No. 1, with a bullet - to the back of the head. With oil prices declining, this company logically should be a candidate for shorting, as is any company that is experiencing profit declines year-over-year. Maybe it is. In October, shares were going for $125. As of Thursday's close, $109.57. Avoid.

Chevron (CVX) also reported Friday morning, posting adjusted EPS at $2.06 for the quarter, down from $3.45 a year. Consensus estimate was for $2.11. Chevron increased its quarterly dividend by 5%, hoping to keep some shareholders a while longer.

Many IRAs, 401k plans, etc. have this kind of dung as key holdings, which is why people shouldn't trust fund managers. They don't represent YOUR best interests.

Heading toward the open, stocks are looking at mixed week. Through Thursday's close, the Dow is up 457, but the NASDAQ is down 272, and the S&P is off 30 points. The January Effect, which posits that as goes January, so goes the remainder of the year, looks to be signaling plus signs.

Futures, as usual, are soaring. Gold hit another all-time high Thursday, with an ounce of shiny hitting $2,834.40. Silver topped out at $32.83. Oil pacing lower, with WTI hitting $72.40, a one-month low.

The Financial Times reported on Thursday that gold withdrawals from the Bank of England, which usually take a few days, are at four to eight-week backlogs. That's not a good sign for arbitrageurs, but great for stackers who already have a horde.

At the Close, Thursday, January 30, 2025:
Dow: 44,882.13, +168.61 (+0.38%)
NASDAQ: 19,681.75, +49.43 (+0.25%)
S&P 500: 6,071.17, +31.86 (+0.53%)
NYSE Composite: 20,166.22, +238.75 (+1.20%)

Fed Keeps Interest Rates on Hold at 4.25-4.50%; Rate Cuts Now Questionable; 4Q GDP 2.3% Disappoints; Gold Hits New High Above $2,800

As expected, the FOMC announced on Wednesday that they would keep the federal funds target rate at 4.25-4.50%.

Stocks, which were lower prior to the 2:00 pm ET announcement, slipped, rallied, then fell into a midpoint between the lows of the day and the highs reached during Powell's press conference (which were still negative, though less so).

Confused? Confounded?

The market was absolutely non-committal, vacillating every which way on Powell's every lip movement, ultimately deciding nothing. For his part, Powell refrained from commenting on anything proffered by President Trump, who expressed a desire for lower rates. The Chairman repeatedly declined to comment on questions that were concerned with the Trump administration and was less-than-forthcoming in regard to the Fed's overall direction for rates.

By the end of the session, markets had reached no consensus, leaving traders to make their own determinations on stocks based entirely their own intuitions or preferences. In many ways, the FOMC policy rate presentation and the Chairman's press conference was refreshing, in that they influenced nothing in particular, somewhat the way things used to be before stocks would rise and fall on any indications from the Fed.

Looking ahead, expect FOMC rate policy announcements to be less consequential, a condition that should be palatable to the majority of market participants. Over the past 20 years or so, markets have been overly sensitive to Federal Reserve policies and often unjustifiablly so. A new paradigm, thanks to President Trump and Chairman Powell each making their own decisions without consultation with each other, is emerging, one that will ultimately result in markets that might return to fundamental analysis of individual stocks rather than the passive, macro-dependent paradigm that's been stock in trade since the days of Alan Greenspan and his "irrational exuberance" pronouncement.

With any luck, market participants will begin making stock recommendations based on price/earnings, year-over-year comparisons, and the wisdom of chartists as opposed to stock buybacks, quantitative easing, and interlocution by the Federal Reserve.

Chairman Powell seemed completely at ease in his new role as an innocent bystander, another good sign for markets in general. Who knows? Some day soon, actual price discovery mechanisms might become normative again.

On that joyous note, earnings from Tesla (TSLA), Meta Platforms (META), Lam Research (LRCX), Microsoft (MSFT) were released late Wednesday, followed by those of Caterpillar (CAT), Dow (DOW), MasterCard (MA), Comcast (CMCSA), Nokia (NOK), Southwest Airlines (LUV), UPS (UPS).

It was a mixed bag, with Microsoft taking some heat for failing to meet or substantially exceed expectations in certain areas, particularly concerning AI and cloud metrics, shares dropping by more than four percent prior to the open. Tesla reported a drop in profit, yet the stock is higher pre-market.

Briefly, Lam Research (LRCX) topped earnings and revenue projections, sending share up by more than eight percent initially. Caterpillar (CAT) beat and warned, sending shares down five percent. Dow (DOW) missed, stock losing more than two percent. MasterCard (MA) reported strong earnings, ahead of expectations and is up a little more than one percent, though the stock is richly valued with a P/E over 40. Comcast (CMCSA) beat, but investors aren't happy with Peacock subscription growth, sending shares down seven percent.

Southwest Airlines (LUV) missed on top line, covered bottom line, losing about one percent pre-market. UPS (UPS) failed to deliver, blames Amazon, investors are shredding it, down 15% before the bell. Ouch!

Gold reached a new high earlier in the morning, topping just above $2,804 per ounce. Silver is up nearly three percent, hitting $32.25. Crude oil's slide continues, WTI quoted as low as $72.08 Thursday morning.

Fourth quarter 2024 GDP came in at a lower-than-expected 2.3%, as reported by the Census Bureau. Stock futures, however, remain positive, which, translated, it's going to get ugly, and soon.

Nothing shocking about these developments other than the markets actually beginning to behave like actual markets.

Overall, whether stocks move up, down, or sideways, this new sense of being alone in the wilderness without the guiding hand of the Federal Reserve is generally refreshing.

At the Close, Wednesday, January 29, 2025:
Dow: 44,713.52, -136.83 (-0.31%)
NASDAQ: 19,632.32, -101.26 (-0.51%)
S&P 500: 6,039.31, -28.39 (-0.47%)
NYSE Composite: 19,927.47, -43.15 (-0.22%)

Stocks Regain Footing After DeepSeek Shock; Markets Awaiting FOMC Decision Later Wednesday; Trump Offers Buyouts to 2 Million Federal Employees

Stocks rallied Tuesday, clawing back some of the losses suffered Monday, as analysts weighed the effects China's DeepSeek AI model would have on business plans.

While DeepSeek didn't completely implode the subscription-based models of Microsoft, Google, and others, it certainly caused some thoughts of downsizing, especially in the power consuption area. What may be more affected than tech stocks are energy and nuclear-related issues, as the DeepSeek model may be adopted and adapted by American firms, requiring less energy than previously considered.

There's no doubt that China and the U.S. are going to lock in on an AI arms race, with the end result likley to be somewhat of a tie.

Stocks may be taking a breather in advance of today's FOMC rate policy announcement, though expectations are for the Fed to stand pat at 4.35-4.50% on the federal funds rate.

Late Tuesday, the White House stunned again by offering all two million federal employees early retirement buyouts with eight months severace as the main driver. While government unions, especially AFGE, have already voiced opposition, rank and file workers may be considering the president's offer as the alternative could be being fired for cause or having entire departments shuttered and employees furloughed with no severance in a Reduction in Force (RIF) operation, over which federal unions have little bargaining power.

Money Daily believes that 10-20% of the federal workforce will take the deal and move on, resulting in an immediate increase in the unemployment rate of maybe as much as two percent, but also a quick infusion of cash to the economy, as early retirees will recieve lump-sum payments from the government.

With the opening bell just moments away, stock futures have been declining for the better part of the last hour, sending Dow futures down by 90 points, S&P futures off 20, and NASDAQ futures essentially flat.

Earnings reports from Logitech (LOGI), SAP (SAP), Chubb (CB), and LendingClub (LC) after Tuesday's close, and Teva Pharmaceuticals (TEVA), Progressive Insurance (PGR), General Dynamics (GD), ADP (ADP), T-Mobile (TMUS), ASML (ASML) this morning have failed to impress.

Gold and silver are pricing higher, crude oil continues to slide, holding around $73.25 currently, but more activity will be after the Fed's 2:00 pm ET announcement.

At the Close, Tuesday, January 28, 2025:
Dow: 44,850.35, +136.77 (+0.31%)
NASDAQ: 19,733.59, +391.75 (+2.03%)
S&P 500: 6,067.70, +55.42 (+0.92%)
NYSE Composite: 19,970.63, -9.37 (-0.05%)

THE BLACK SWAN HAS LANDED; China's DeepSeek Blows AI Investments to Smithereens, Crushes NASDAQ, Deflates Tech Bubble

Thanks to Nassim Nicholas Taleb's first - and most famous - book, The Black Swan, most people who are invested in the future, or stocks, or like money from a practical standpoint understand that...

A black swan is a highly improbable event with three principal characteristics: It is unpredictable; it carries a massive impact; and, after the fact, we concoct an explanation that makes it appear less random, and more predictable, than it was.

Taleb doesn't put much faith in the accuracy of the top market predictors, as noted in the first chapter of The Black Swan:

Our inability to predict in environments subjected to the Black Swan, coupled with a general lack of the awareness of this state of affairs, means that certain professionals, while believing they are experts, are in fact not. Based on their empirical record, they do not know more about their subject matter than the general population, but they are much better at narrating - or, worse, at smoking you with complicated mathematical models. They are also more likely to wear a tie.

[Here's a free download of The Black Swan PDF courtesy of idleguy.com] You're welcome!

Coming from China, last week's release of benchmarks for their AI LLM (Large Language Model) DeepSeek, in terms of cost and ability, is the ultimate irony and pie in the face for the proposed $500 billion Stargate project launched last week (sorry, President Trump, this one is just wrong) by Sam Altman and his OpenAI, SoftBank, Larry Ellison's Oracle (whose extemporaneous pronouncements about instant, personalized vaccines and full spectrum surveillance were the height in cringeworthiness) and investment firm MGX (UAE) and yet another black eye for the U.S. investment community in general.

China's DeepSeek hits all the important benchmarks of the highly-touted, expensive, and energy-intensive U.S. models at a fraction of the cost, and, it's open source, threatening a $16 trillion hole into the stock market. Companies from Google to Microsoft to Meta Platforms have committed billions of dollars in CapEx to developing AI and subscription models to ultimately reap huge revenues from consumers, i.e., muppets devoid of original thought.

Now, all that money might as well go to buying drinks for the Chinese developers at their Nobel Prize afterparty. The weight of this development on U.S. stocks cannot be understated.

Take a good long look at the Shiller PE chart, paying particular attention to the symmetry of the dot-com boom and bust from 1990 to the peak in 1999 back to the bottom in 2009. Then look to the right, where we are now, and the peak in 2021, at the end of the "scamdemic" with another completely fake (thanks to thieves in the White House and on Wall Street) gains since October 2022 to the present and just erase them, because they're completely fake, based on nothing other than the "promise of AI", which has now been completely obliterated, promises shattered along with the less-than-virtuous lives of thousands of speculators.

Yet another tech bubble has grown and festered like a boil, popped like a zit by some crafty Chinese tinkerers.

It took about 12 years to get from the lows in 2009 to the highs in 2021, taking out the last roughly 3 1/2 as a figment of twisted imaginations - along the lines of wiping out Russia via Ukraine - American investors should brace for another eight or nine years of less-than-favorable returns on U.S. stocks. Thankfully, Americans have President Trump to help ease the pain, the worst of it possibly over by mid-2026 and recovery begun just in time for midterm elections where the dim-bulb Democrats will take another swipe at the reigns of power. Hopefully, the electorate will remember the four years of suffering under Biff Biden, and not buy into their rhetoric.

Strange as it may seem, while the NASDAQ was suffering its 8th-largest point loss ever (didn't even make the top 25 in percentage losses, however), the Dow was motoring to the upside, as money flowed into dividend-earning blue chips. The day offered an inverted look back at the late 1990's "old economy, new economy" paradigm. For Monday, at least, the old economy was a winner; the new economy looking more like re-runs of Pets.com sock puppet commercials.

With Tuesday's session less than an hour ahead, futures haven't fully recovered from Monday's rout with NASDAQ futures up just 64 points and S&P futures ahead by 12. Dow futures are 37 points in the red.

Prospects for a bounce-back weren't aided much by earnings reports for Lockheed Martin (LMT), Synchrony Financial (SYF), JetBlue (JBLU), Boeing (BA), General Motors (GM), Royal Caribbean (RCL), Sysco (SYY), Kimberly-Clark ((KMB) released prior to the open.

Synchrony Financial (SYF) was down about four percent in pre-market trading, while Dow component Boeing (BA) missed EPS expectations by a mile, generating a loss of 5.90 per share for the fourth quarter as part of its largest annual loss since 2020. General Motors beat with an EPS for the quarter of 1.92. Shares are down nearly four percent pre-market.

Gold, silver and WTI crude oil were moving higher, after taking losses on Monday. WTI is currently pricing at $74 per barrel, but is in the midst of a sell-off which began last Monday.

The damage from DeepSeek isn't likely to be permanent, though it will reverberate through some of the biggest corporate board rooms, C-suites, and managed funds. When a black swan arrives it usually deposits detrius all over advance revenue plans.

There's going to be some re-thinking about AI, some of which will be done with the assistance of AI. The world's accumulated knowledge simply can't account for unknown unknowns. Somewhere, Donald Rumsfeld is short Nvidia and smiling.

At the Close, Monday, January, 27, 2025:
Dow: 44,713.58, +289.33 (+0.65%)
NASDAQ: 19,341.83, -612.47 (-3.07%)
S&P 500: 6,012.28, -88.96 (-1.46%)
19,980.00, -17.50 (-0.09%)

WEEKEND WRAP: Trump Floods the Zone; America's Golden Age Begins with a Flurry of Executive Orders, Policies, Directives

What a week!

As expected, the inauguration of Donald J. Trump and J.D. Vance as President and Vice President of the Unitd States and their immediate and decisive actions took precedence over anything and everything related to stocks, bonds, money flows, economic data, and even football.

In a wave of executive orders, proclamations and policy directives, Trump and his troops had obviously prepared to "flood the zone", leaving officials in Washington, DC gaping in awe over the swiftness of change brought by the new administration.

Among the more prominent and profound changes effected in just the first six days of Trump's presidency, were:

An end to all DEI and "woke" ideologies
Ordering all federal employees back to office work five days a week
Declared a national emergency at the U.S. southern border and began sending Military troops there
Declared a national energy emergency
Rounding up of illegal immigrants and mass deportations
Renaming the Gulf of Mexico, Gulf of America
Federal hiring freeze
Federal regulation freeze
Issued pardons to January 6 prisoners
Made two genders - male and female - official U.S. policy
Revoked security clearances of 51 former intelligence officials
Removed security details from Anthony Fauci, John Bolton, and others
Overturned many of Biden's EOs and froze or recaptured funds from the Infrastructure Act and Inflation Reduction Act
Put an end to "Green New Deal" policies and subsidies
Extended Tik-Toc negotiations
Released hostages in GAZA

There was more, a lot more, and, honestly, Mr. Trump is just getting started. By the end of the week, Democrats and their RINO brothers and sisters-in-arms in congress were left trying to put out so many fires they didn't know where to aim their hoses. Meanwhile, Trump was lighting up new ones.

Trump appeared virtually to the assembled movers and shakers at the WEF in Davos. He flew out to California to set guidelines for federal aid to victims of fires in and around Los Angeles, pissing off Governor Newsome and the LA mayor.

He sent the Army Corps of Engineers down to western North Carolina to assist in disaster aid.

He wants to dismantle FEMA.

Pete Hesgeth was confirmed as Secretary of Defense with JD Vance casting the deciding vote.

Trump intimated that the 88,000 new IRS hires authorized by congress and Biden would be fired or reassigned (only half-jokingly, "to the border," said Trump)

Depending on sources, Trump fired anywhere from 12 to 18 inspectors general on Friday.

Still on the agenda are, in no particular order, Ukraine, taxes, tariffs, schools, Space Force, Mars, etc. It's going to be an interesting four years.

In an interesting, but decidedly different direction from where Trump was/is taking the country, the Supreme Court voted 8-1 to lift an injunction halting Beneficial Ownership Interest reporting requirements for the Corporate Transparency Act (CTA). The only dissent came from Justice Ketanji Brown (you cannot make this stuff up).

On Thursday, Jan. 23, Supreme Court Justice Samuel Alito granted the federal government its application to lift a Dec. 5 Texas federal district court order that blocked the Corporate Transparency Act. However, Alito’s order does not apply to a Jan. 7 injunction in a separate case.

Effectively, nothing changed. The FinCEN website issued another in a series of alerts:

In light of a recent federal court order, reporting companies are not currently required to file beneficial ownership information with FinCEN and are not subject to liability if they fail to do so while the order remains in force. However, reporting companies may continue to voluntarily submit beneficial ownership information reports.

The "regulation" requires small business owners of LLCs, C-Corps and S-Corps with fewer than 20 employees and $5 million in sales to report owners with a beneficial interest of 25% or more in a company. Besides being selective legislation targeting a specific group (small business) and exemptions for accountants, banks, brokerages, and other financial institutions, the "rule" (it's not a law) violates the 4th, 5th and 10th amendments, according to opponents.

Going forward, with Trump's ban on new regulations, there's a very good likelihood that he'd issue an executive order nullifying the rule and its requirements, or, once Pam Bondi is confirmed as Attorney General, she could just shut down the governments appeals and defenses, or, congress could pass the "Repealing Big Brother Overreach Act", reintroduced Wednesday, January 15, by Senator Tommy Tuberville, R-Ala., and Rep. Warren Davidson, R-Ohio.

One way or another, it appears the dystopian, Orwellian-style attempt to further cripple small businesses in the name of national security is DOA.

Stocks

Stocks went up quite a bit. There wasn't any data to support rising equity prices and only a few choice earnings announcements, some good, some bad. Everybody, especially the money folks on Wall Street, were happy just to have an actual living, breathing president rather than wonder who was running the country.

Financial types were all so caught up in the whirlwind of Trump and the excitement of the week they couldn't resist hitting the BUY button over and over and over again. When things calm down - if ever - there may be some pullback in stocks, but it will most likely be only temporary. Trump's agenda for American businesses and the economy are clearly headed for more fertile ground, with fewer regulations and government impediments and red tape, which should translate into record after record on the Dow, NASDAQ, S&P, Russell, and NYSE Composite.

That may appear to be a simplistic attitude toward equity investments, but there's little doubt that Trump's policies will be beneficial to almost all businesses, from small farmers to mega-corporations. He's promised a "golden age" and Wall Street will be more than happy to comply.

The week ahead is a very busy week for fourth quarter and full year 2024 earnings reports:

Monday: (before open) SoFi (SOFI), AT&T (T), Ryanair (RYAAY); (after close) Sanmina (SANM), Nucor (NUE), Crane (CR).

Tuesday: (before open) Lockheed Martin (LMT), Synchrony Financial (SYF), JetBlue (JBLU), Boeing (BA), General Motors (GM), Royal Caribbean (RCL), Sysco (SYY), Kimberly-Clark ((KMB); (after close) Logitech (LOGI), SAP (SAP), Chubb (CB), LendingClub (LC).

Wednesday: (before open) Teva Pharmaceuticals (TEVA), Progressive Insurance (PGR), General Dynamics (GD), ADP (ADP), T-Mobile (TMUS), ASML (ASML); (after close) Tesla (TSLA), Meta Platforms (META), Lam Research (LRCX), Microsoft (MSFT).

Thursday: (before open) Caterpillar (CAT), Dow (DOW), MasterCard (MA), Comcast (CMCSA), Nokia (NOK), Southwest Airlines (LUV), UPS (UPS); (after close) Intel (INTC), Apple (AAPL), Visa (V), US Steel (X), Baker Hughes (BKR).

Friday: (before open) Abbvie (ABBV), Chevron (CVX), ExxonMoil (XOM), Colgate-Palmolive (CL), Phillips 66 (PSX), Novartis (NVS), Booze Allen Hamilton (BAH).

The data calendar will be focused on the Fed's FOMC meeting Tuesday, with the policy announcement, press conference and economic projections Wednesday, initial reading on U.S. GDP on Thursday, and the Fed's favorite inflation gauge, core personal consumption expenditures (PCE) price index Friday. Trump's Executive Orders and proclamations from the Oval Office will continue to draw attention away from the usual suspects, though it isn't likely to be at as frenetic a pace as the first week of his presidency. Well, maybe.

Treasury Yield Curve Rates

Date	1 Mo	2 Mo	3 Mo	4 Mo	6 Mo	1 Yr
12/20/2024	4.43	4.42	4.34	4.35	4.29	4.27
12/27/2024	4.44	4.43	4.31	4.35	4.29	4.20
01/03/2025	4.44	4.35	4.34	4.31	4.25	4.18
01/10/2025	4.42	4.35	4.36	4.33	4.27	4.25
01/17/2025	4.43	4.35	4.34	4.32	4.28	4.21
01/24/2025	4.45	4.36	4.35	4.32	4.25	4.17

Date	2 Yr	3 Yr	5 Yr	7 Yr	10 Yr	20 Yr	30 Yr
12/20/2024	4.30	4.32	4.37	4.45	4.52	4.79	4.72
12/27/2024	4.31	4.36	4.45	4.53	4.62	4.89	4.82
01/03/2025	4.28	4.32	4.41	4.51	4.60	4.88	4.82
01/10/2025	4.40	4.46	4.59	4.70	4.77	5.04	4.96
01/17/2025	4.27	4.33	4.42	4.52	4.61	4.91	4.84
01/24/2025	4.27	4.33	4.43	4.53	4.63	4.91	4.85

While President Trump was busy re-shaping America into a form more in line with the intents of the Founding Fathers, bond holders and the Fed were left holding their belts (to put it kindly).

Interest rates hardly budged. The largest move, in fact, was a mere four basis points lower on 1-year notes. The Federal Reserve, whether by presidential design or the mere suggestion that it has outlived its purpose, is going to become increasingly irrelevant as President Trump moves forward with his far-reaching agenda. Already, Trump has publicly implored the Fed to lower rates. Whether they're listening or not will be evidenced by their policy decision this week, on Wednesday, January 29.

Odds are that the Fed stands pat at 4.25-4.50% on the federal funds target rate, though, if Trump's impact hits home, a lowering by 25 basis points may be on the table.

The Fed has to weigh many diverse variables in making their decision. Trump throws a spanner into their wheelhouse. He's unpredictable, though ostensibly, pragmatic. What may unfold, through fiscal austerity on the government's part (yes, it could, and, in fact, is likely to happen) is what looks, smells and feels like a recession, with government workers out on the streets in big numbers.

However, given the mass deportations of illegals, there will be plenty of job openings. Whether laid-off or fired government lazy-bodies can handle dishwashing, crop harvesting, floor mopping, roofing, lawn care, or toilet cleaning remains to be seen. Immigrants, according to reliable sources, took jobs Americans wouldn't do. When unemployment benefits and severance pay begins running out, the former federal paper-pushers may think have to swallow whatever is left of their pride and do menial labor at what would amount to reasonable wages.

Another area that's yet to be explored is what Trump (and, by extension, the Republican-led congress) may do concerning high debt levels, particularly on high-interest credit cards. Could Americans find relief through a re-imposition of usury laws? It's not something the President could do with the stroke of a pen or an Executive Order, though he might try it. A little rollback and pushback against the entrenched financial pirates and their outsized profit centers might just be a further good for the country overall and there's little doubt Trump has it on his radar.

There is also the consideration of mortgage rates falling in the face of what would amount to not necessarily a recession, but a re-ordering of priorities, one of which would clearly be affordability in housing. Whether interest rates decline of their own accord dynamically or by fiat, they're coming down along with food prices, gas prices, taxes, regulations, and just about everything else, except, maybe, wages.

Spreads:

2s-10s
9/15/2023: -69
9/22/2023: -66
9/29/2023: -44
10/06/2023: -30
10/13/2023: -41
10/20/2023: -14
10/27/2023: -15
11/03/2023: -26
11/10/2023: -43
11/17/2023: -44
11/24/2023: -45
12/01/2023: -34
12/08/2023: -48
12/15/2023: -53
12/22/2023: -41
12/29/2023: -35
1/5/2024: -35
1/12/2024: -18
1/19/2024: -24
1/26/2024: -19
2/2/2024: -33
2/9: -31
2/16: -34
2/23: -41
3/1: -35
3/8: -39
3/15: -41
3/22: -37
3/28: -39
4/5: -34
4/12: -38
4/19: -35
4/26: -29
5/3: -31
5/10: -37
5/17: -39
5/24: -47
5/31: -38
6/7: -44
6/14: -47
6/21: -45
6/28: -35
7/5: -32
7/12: -27
7/19: -24
7/26: -16
8/2: -08
8/9: -11
8/16: -17
8/23: -09
8/30: 00
9/6: +06
9/13: +09
9/20: +18
9/27: +20
10/4: +5
10/11: +13
10/18: +13
10/25: +14
11/1: +16
11/8: +5
11/15: +12
11/22: +4
11/29: +5
12/6: +5
12/13: +15
12/20: +22
12/27: +31
1/3: +32
1/10: +37
1/17: +34
1/24: +36

Full Spectrum (30-days - 30-years)
9/15/2023: -109
9/22/2023: -99
9/29/2023: -82
10/06/2023: -64
10/13/2023: -82
10/20/2023: -47
10/27/2023: -54
11/03/2023: -76
11/10/2023: -80
11/17/2023: -93
11/24/2023: -95
12/01/2023: -105
12/08/2023: -123
12/15/2023: -154
12/22/2023: -149
12/29/2023: -157
1/5/2024: -133
1/12/2024: -135
1/19/2024: -118
1/26/2024: -116
2/2/2024: -127
2/9: -117
2/16: -103
2/23: -112
3/1: -121
3/8: -125
3/15: -109
3/22: -112
3/28: -115
4/5: -93
4/12: -87
4/19: -77
4/26: -70
5/3: -85
5/10: -87
5/17: -94
5/24: -99
5/31: -83
6/7: -92
6/14: -113
6/21: -103
6/28: -96
7/5: -101
7/12: -108
7/19: -103
7/26: -104
8/2: -143
8/9: -131
8/16: -138
8/23: -141
8/30: -121
9/6: -125
9/13: -117
9/20: -80
9/27: -80
10/4: -75
10/11: -58
10/18: -54
10/25: -38
11/1: -18
11/8: -23
11/15: -10
11/22: -12
11/29: -40
12/6: -23
12/13: +18
12/20: +29
12/27: +38
1/3: +38
1/10: +54
1/17: +41
1/24: +40

Oil/Gas

WTI crude oil prices backed off during the week, from $77.37 at the New York close on January 17, to $74.60 on Friday, abruptly ending four straight weeks of rising price action. As expected, recent oil prices were a reflection of wild speculation and not based on fundamentals. With President Trump pushing for lower oil and gas prices, and imploring energy companies to "drill, baby, drill", prices began to head immediately lower upon inauguration.

With energy independence Trump's stated goal, the other side of that coin makes the U.S. an oil exporter, competing with the Saudis, Russia, and OPEC in world markets. That dynamic alone is eventually going to cause a glut in available product and result in lower prices worldwide. While that may not make the holders of stocks like ExxonMobil or Occidental Petroleum happy, it will produce savings for the mobile consumer, who will be able to put their discretionary funds to work elsewhere and eventually lower the costs for most consumer goods, including food.

The likely ground zero for oil prices is probably around $45-50 per barrel, which, in a relatively stable inflationary (or deflationary) environment should allow producers enough profit margin to remain viable. Even more cost-intensive efforts like fracking, shale, or oil sands will be profitable, if only marginally, due to existing operations, lower input costs, and advancements in technology.

As the Alaskan frontier and offshore platforms are opened up and Green New Deal policies are abandoned, there will be more oil and natural gas, especially when coal mines re-open and coal-fired plants begin to make a comeback. Trump didn't mention "beautiful, clean coal" for nothing. America has an abundance of coal, and Trump plans on using it in his push to re-industrialize the nation.

Gasbuddy.com is reporting the national average for a gallon of unleaded regular gas at the pump down a penny from last week, at $3.12 a gallon Sunday morning. It's about the only thing that hasn't changed radically over the past week, but, considering ongoing policies and oil prices, down, down, down seems to be the direction of prices at the pump.

California continues at the top of the heap, unchanged, at $4.41 a gallon.

Pennsylvania prices jumped three cents, at $3.37, with the Keystone State the price leader in the Northeast. New York saw a slightly smaller change, at $3.16. Connecticut ($3.08) was up slightly while Massachusetts ($3.02) was higher by only a penny. Maryland prices were lower by two cents, at $3.30.

Illinois fell, but only one cent, to $3.25. Ohio ($2.96) and Indiana ($3.01) were both lower and likely headed down further.

Mississippi ($2.64) gave back low price leadership to Oklahoma ($2.62). Following are Texas ($2.68), Louisiana ($2.70), Tennessee ($2.74), Arkansas ($2.76), and Alabama ($2.77). Following those are Kansas ($2.80), South Carolina ($2.84), and Missouri ($2.85). Florida's was up another three cents, at $3.21, Georgia continues to flirt with $3, remaining at $2.95 this weekend.

Sub-$3.00 gas can now be found in only 26 U.S. states, though that number will probably be closer to 40 a month down the road. The Northeast and West coast remain the over-$3.00 holdouts.

Arizona ($3.14) is up eleven cents from two weeks out. Oregon showed prices higher, at $3.51, Nevada at $3.61, and Washington at $3.92, leaving only California above $4.00. Utah ($2.96) and Idaho ($3.01) were stable.

Bitcoin

This week: $105,019.30
Last week: $105,074.80
2 weeks ago: $94,640.44
6 months ago: $67,845.70
One year ago: $43,032.22
Five years ago: $9,903.90

Even as President Trump issued an executive order advancing the interests of crypto-currencies, alt-coins, stable-coins, and everything that goes with it, the order failed to recommend establishment of a cyrpto or bitcoin reserve, as many embracing the crypto universe had been hoping.

Instead, days before Trump officially became president, $TRUMP and $melania tokens were released, much to the dismay of no-coiners Trump enthusiasts. Speculators pounced on both initially before selling off, the subtle message - probably not well-received by the investment community or the diamond-hand hodlers hoping to make millions on their vaporwares - along with an X coin from Elon Musk, that crypto is about as fake as your average three-dollar bill.

Sure, you can cash them in at some places and get a nine-dollar bill for three 3s, but it's still useless. The point being made is that crypto is essentially crap-to, a major worldwide scam, a honey pot for illegal activity, and definitely not a store of value nor medium of exchange.

Did Trump make money off his new coin? Probably. Was it legal? Probably. Was it ethical? Depends on who's almond buttering your avocado toast. Crypto is more likely to be dismantled by the Trump administration as it is to be embraced as a viable alternative to good old cash in U.S. greenbacks.

Time to get over it.

Precious Metals

Gold:Silver Ratio: 89.48; last week: 88.24

Per COMEX continuous contracts:

Gold price 12/27: $2,636.50
Gold price 1/5: $2,652.70
Gold price 1/12: $2,717.40
Gold price 1/19: $2,740.00
Gold price 1/26: $2,777.40

Silver price 12/27: $29.98
Silver price 1/5: $30.10
Silver price 1/12: $31.30
Silver price 1/19: $31.05
Silver price 1/26: $31.04

Gold continued it's upside momentum, while silver made some gains during the week, only to give the bulk of them back as the week drew to a close.

How precious metals will perform with Trump in the White House is probably not going to be as pleasant an experience as under Joe Biden, when Western nations suffered through first a pandemic and then extraodinarily-high rates of inflation. Under Trump, inflation will be tempered by an economy that is growing in different directions, with on-shoring of industrial capacity creating jobs and prosperity. The safety mechanism provided by precious metal investments will not be as pronounced, despite America embarking upon a "golden" age.

Silver, due to its industrial demand, may find better footing overall. Judging by the ridiculous gold-silver ratio reaching close to 90 this week, prospects for silver price appreciation seem good, though market manipulation is likely to continue until regulations are either eased, enforced, or altogether abandoned in favor of price discovery via open markets overseas, not in London, Chicago, or New York, but in places like Dubai, Shanghai, Singapore, Hong Kong, Moscow, Istanbul, and other international money centers.

Fiat currencies remain in a death spiral, though a complete unwinding of a monetary regime can last for decades or even centuries. Gold and silver remain worthwhile long-term holds for safety net purposes and generational wealth, though price appreciation may not be as generous as has been previously afforded. There also exists the possibility of price easing in a dis-inflationary or outright deflationary environment.

Here are the most recent prices for common one ounce gold and silver items sold on eBay (numismatics excluded, free shipping):

Item/Price	Low	High	Average	Median
1 oz silver coin:	36.78	47.90	41.11	40.50
1 oz silver bar:	36.00	49.95	41.40	40.64
1 oz gold coin:	2,851.00	2,998.51	2,911.94	2,908.10
1 oz gold bar:	2,865.00	2,953.97	2,911.19	2,903.39

The Single Ounce Silver Market Price Benchmark (SOSMPB) fell moderately, to $40.91, a drop of $1.00 from the January 19 price of $41.91 per troy ounce.

WEEKEND WRAP

Well, that was a fun week, and, those who are still trying to digest all that happened in the first week of Trump's second presidential term, better get your thinking caps on, because it's not going to slow down much. All of the declarations and proclamations are moving forward at a rapid pace, the deployment and development of policies are going to make everybody dizzy for while.

In the most general sense, America is going to be a better place overall and some trends are going to accelerate. It's worth celebrating the destruction of the mainstream media lying propaganda project, with CBS anchor. Norah O'Donnell calling it quits this week (with cringe-worthy endorsement from Oprah, another person of disinterest and potential disappearance).

Censorship, doxxing, de-monetizing, demonizing, and de-platforming cannot end soon enough. Here's hoping President Trump will have a major impact on the social media front. America needs healing following four years of deep cuts and wounds.

At the Close, Friday, January 24, 2025:
Dow: 44,424.25, -140.82 (-0.32%)
NASDAQ: 19,954.30, -99.38 (-0.50%)
S&P 500: 6,101.24, -17.47 (-0.29%)
NYSE Composite: 19,997.47, +18.69 (+0.09%)

For the Week:
Dow: +936.42 (+2.15%)
NASDAQ: +324.10 (+1.65%)
S&P 500: +104.58 (+1.74%)
NYSE Composite: +390.10 (+1.99%)
Dow Transports: +174.69 (+1.06%)

First Week of Trump's Second Term Appears Positive as He Appears Virtually at World Economic Forum; Stocks Rock; S&P Makes Record

It's been a solid week for stocks, as markets navigated the first week of the second Trump presidency.

Largely devoid of economic data releases, the four-day week, shortened by Martin Luther King Jr. Day on Monday, was devoted to speculating on how Trump and his economic policies would pan out over the coming months and years. The decision was largely a positive one, the major indices posting sizable gains Tuesday through Thursday.

As of Thursday's close, the Dow was up some 1,077 points on the week, the NASDAQ ahead by 423, and the S&P broke through to a new record close, up by 122 points over the three-day span.

Stock market gains the past two weeks broke out of a downtrend that began in December. All of the majors are up on the year, putting a positive spin on future developments, though it's still too early to call the movement a long-term trend. It appears likely that stocks will continue to bound higher despite lofty valuations. The major U.S. stock indices have been in rally mode since late October of 2023, an uptrend that's been in place for more than 14 months.

Unless there's some dramatic shift or world-altering event occurring on Friday, stocks are poised to close out the week giddy over prospects for the U.S. economy.

In a 46-minute presentation Thursday, U.S. President Donald Trump addressed an audience at the World Economic Forum (WEF) and fielded a number of questions from selected panelists.

The tone was extremely cordial, as opposed to the damning, vitriolic rhetoric used to describe Mr. Trump prior to his re-election as president. Apparently, now that Trump has control over the reigns of power, everybody wants to be his friend. It's actually a welcome change, but also somewhat sickening to see the groveling by Euro-centrist promoters who just months ago were pushing climate change, gay and transsexual lifestyles and comparing Trump to Hitler.

What's happened since Trump won the election in November and officially took office on Monday, January 20, is a superficial softening of tones, a rush by elites, billionaires, and leaders of nations to align themselves with the president in hopes that some of his irresistible charisma will rub off on them. It's superficial and disingenuous at best because these same people have been proven over the years to be largely untrustworthy promoters of their own twisted, destructive agendas.

One sees the heads of Google, Amazon, Apple, and Facebook all in attendance at Trump's inauguration. Are people supposed to just forget that these same folks used every technology available to smear, , mislabel, censor, and deride President Trump from the time he began his first campaign in 2015 until he won re-election last year, a decade of underhanded, deceitful, and one may say deplorable misdeeds and dirty politics?

All of a sudden, they're all playing nice. It would be foolish to trust them to do what's right, having done wrong so often, so completely, and so consistently in the past. As with the oligarch class of technocrats, so too the leadership of the EU and most of its nations. It's possible Trump trusts Russia's Vladimir Putin and China's Xi Jinping more completely than he does the likes of Ursula von der Leyen, Emmanuel Macron, or Justin Trudeau.

The unfinished business in Ukraine still needs to be addressed. Trump has intimated that prospects for peace are firmly in Putin's hands, though there's been little to suggest that a ceasefire or peace negotiations are imminent. Russian forces continue to press forward toward the Dnieper river south of Kiev. Control of the Dnieper is paramount as it is the major artery running north to south through the entirety of Ukraine as well as a physical demarkation separating Eastern and Western Ukraine.

Commerce and transit on and around the Dnieper are vital to Ukraine's economy. Russia's intention to control the river and cities adjacent to it is a defining factor in any kind of negotiated settlement to the conflict now approaching three years. Trump has expressed a desire to see the conflict come to an end, but it is a complex matter that will require all sides to make concessions, though Russia holds what amounts to a winning hand.

How the situation in Ukraine is eventually resolved will have long-term effects on world politics for years to come. Leaders in Europe and the UK still have not conceded defeat to the Russians, though it is obvious that they have an upper hand from a military perspective. As events unfold, it's very likely that the desires of European and UK leaders will be swept aside by a peace negotiated between Russia and the United States, mostly on Russian terms.

Trump, a hardened negotiator with decades of experience, knows his position is weak and may possibly concede to Russian demands in order to end the conflict and begin to heal relations between the U.S. and Russia without any input from NATO allies.

With U.S. markets set to open within an hour, Dow futures are down 107 points. NASDAQ and S&P futures are essentially flat. Precious metals bounced higher late Thursday into Friday, with gold reaching within $12 of its all-time high at $2,788. Silver is making up for lost time, currently testing $31.50. The high for the week in silver was $31.68 on Wednesday, so it appears that silver, should it follow gold's move, may end the week at what would amount to the strongest weekend close in more than two months.

Crude oil continues to stubbornly resist tendencies to price lower. After last Friday's close at $77.39, WTI crude dropped to as low as $74.20 late Thursday, but has rebounded Friday morning to just above $75.00. There's good reason to believe that Trump's directive to "drill, baby, drill" will eventually result in lower prices for crude oil, and all refined products, including jet fuels, unleaded gas at the pump, and diesel.

It's been an eventful week, but the lasting effects of new policies and programs coming out of the White House will need time to develop and be digested.

At the Close, Thursday, January 23, 2025:
Dow: 44,565.07, +408.34 (+0.92%)
NASDAQ: 20,053.68, +44.34 (+0.22%)
S&P 500: 6,118.71, +32.34 (+0.53%)
NYSE Composite: 19,978.78, +151.16 (+0.76%)

President Trump to Address WEF Crowd at Davos; American Airlines Projects First Quarter Loss; Beware Stock Hucksters

Stocks kept the momentum going on Wednesday, the S&P posting a third straight day on the uptick.

However, the S&P fell just short of making a new record close. While it traded above 6,090 much of the day, the last half hour of the session saw serious selling. Thursday morning's stock futures aren't holding out much hope for a rebound. The post-inauguration high seems to be fading, which would make sense. Not a lot of what President Trump has done in his first three days in office have been particularly stock market favorable. If anything, Trump's first few days might be best characterized as "stock market neutral."

Markets are still unaware of what Trump's trade and economic policies will encompass. He's been fairly tight-lipped this first week of his presidency about China, Canada, tariffs, and a host of other issues. Perhaps today's speech to the assembled liberal hangovers at the WEF in Davos will provide some clues.

According to Axios and other sources, President Trump will address the World Economic Forum via a virtual broadcast today, Thursday, January 23rd, at 5:00 pm Davos time.

Since Davos, Switzerland is six hours ahead of the U.S. in terms of time zones, Trump's address should begin at 11:00 am ET. That's likely to cause markets to slow roll the morning and react to anything the President might say that has impact, but it's more likely that Trump's speech will be mostly rhetorical and devoid of actionable detail. It would be nice if he chided the globe-trotting snobs at WEF over some of their policies concerning Ukraine, the climate change scam, high taxes, and disregard for the rule of law, especially concerning elections. Should be interesting.

Outside of President Trump making headlines, a few companies have reported earnings this morning. Maybe the most notable was American Airlines (AAL), which, reported adjusted earnings per share of 86 cents, excluding nonrecurring items, up from 29 cents a share from a year ago. Analysts surveyed by FactSet were looking for earnings of 66 cents a share.

Revenue grew to $13.7 billion from $13.06 billion in the same period last year, but the stock is getting slaughtered in pre-market trading, down more than five percent after the company projected a first quarter loss of 20 to 40 cents per share.

A half hour before the open, stock futures are trending lower, with NASDAQ futures holding below -100 points, though Dow futures are sporting a modest gain. Gold and silver are down (big surprise!), oil continues to slowly leak lower, and bitcoin has also lost momentum, trading between $101,000 and $102,500.

At the Close, Wednesday, January 22, 2024:
Dow: 44,156.73, +130.92 (+0.30%)
NASDAQ: 20,009.34, +252.56 (+1.28%)
S&P 500: 6,086.37, +37.13 (+0.61%)
NYSE Composite: 19,827.62, -65.97 (-0.33%)

Today's note to the wise: Beware of bubble-era stock touters, because, in bubbles, practically anybody can find stocks that are going to go up, even crackpots like Nick Giambruno.

Here are some specific stock recommendations made by Nick Giambruno over the past few years:

One of his top picks in the Bitcoin mining sector is Hive Blockchain Technologies Ltd. (HIVE). He has highlighted this stock for its potential to outperform Bitcoin itself. Well, it hasn't. In 2021, HIVE hit a high over $26 per share. It's currently trading under $4.00.

Uranium Stocks: Giambruno recommended Ur-Energy Inc. (URG) as a potential investment in the uranium sector, anticipating a new bull market. URG is a penny stock. It peaked at $2.00 in February, 2024 and is currently trading at $1.23.

Marijuana Stocks: In 2018, Giambruno suggested investing in Canopy Growth Corporation (CGC), which he referred to as the "Amazon of Pot." It's not. Giambruno must have been smoking some good stuff. CGC rocketed to $429 in February, 2021. Today it's trading for $2.23.

Defense Supplier Stocks: In 2019, he recommended Kratos Defense & Security Solutions Inc. (KTOS), predicting significant growth due to trade war tensions. In 2019, KTOS traded between $14 and $22 per share. In 2020, it fell to as low as $10, and today is above $34. Giambruno actually did OK with this one, but what stocks haven't doubled since 2020?

Nick expects people to shell out a lot of money for monthly picks. He probably gets a few suckers a month to pony up, whch pays the bills and keeps his name out there. Overall, however, he's got no more insight on stocks than the average sixth-grader. Essentially, he's a fraud, and there are many others out there, just itching to get at your money. Don't do it. Educated yourself and make your own choices.

Here's a bit of Giambruno's pitch:

Financial Underground: SPECULATOR

$2,499.00 / year

Financial Underground: SPECULATOR is our premium investment research publication.

At Financial Underground: SPECULATOR, we find lucrative investment opportunities in overlooked and misunderstood markets. We specialize in uncovering unstoppable trends ahead of the crowd and getting positioned for outsized profits.

Every month, renowned speculator and international investor Nick Giambruno will send you a new issue delivered to your email inbox.

It’s a perspective you won’t find anywhere else - certainly not in the mainstream financial media nor any other financial newsletter or research publication.

In short, we are more interested in getting the Big Picture right than gambling with short-term trades in rigged markets.

What a crock.

Stocks Boom on Trump Inauguration, 3M, Charles Schwab Earnings; Netflix Earnings Blow Away Estimates; UAL, COF In Play

With markets closed Monday for Martin Luther King Jr. Day, stock pickers were able to get an in-depth look at the inauguration and first day of Donald Trump's presidency, which included signing of fifty executive orders, various firings and the beginning of mass arrests and eventual deportations of illegal aliens in the U.S.

Having a full day to digest the proceedings in the nation's capital provided Wall Street with a solid understanding of what Trump dubbed, "America's Golden Age", and took little time to capitalize on the good vibes coming out of Washington, D.C.

Helping fuel the rally were earnings reports from a number of important companies, key among them 3M (MMM), which posted adjusted earnings per share of $1.68, beating estimates. The company also announced that it's restructuring plan was nearly complete. Shares were up more than four percent on the day, hitting its highest level in three years.

Capital One (COF) showed profits rising by 55% in the fourth quarter from a year ago. Their interest income growing as more consumers use credit cards issued by the company at nose-bleed interest rates, some as high as 30% or more.

Stock brokerage Charles Schwab (SCHW) posted better-than-expected results on higher asset management fees and a surge in trading volume. The company's stock was up sharply from Friday's close.

Adding to the excitement Wednesday morning were spectacular earnings reports from Netflix (NFLX), which announced Tuesday morning EPS of $4.27 for the fourth quarter, above consensus expectations of $4.18 and more than double the $2.11 EPS figure it reported in the year-ago period. Shares of the streaming service are up 14% in pre-market trading.

United Airlines (UAL) and CapitalOne (COF) also posted strong fourth quarter and full year results prior to the open, sending stock futures skyward. Dow futures are trending up about 160 points, NASDAQ futures sporting a gain of more than 200 points. S&P futures are ahead by 32 points. The S&P is at its highest level in a month, closing in on its all-time record close of 6,090.27 from December 6, 2024.

Bitcoin hit above $108,000 on Tuesday before pulling back to above $104,000. Gold is approaching its own record level, hovering around $2,770. Silver continues a laggard, though it is trending above $31/ounce. WTI crude oil ($75.69) got smacked down on Trump's enthusiastic massaging to "Drill, baby, drill."

Golden Age, indeed.

At the Close, Tuesday, January 21, 2025:
Dow: 44,025.81, +537.98 (+1.24%)
NASDAQ: 19,756.78, +126.58 (+0.64%)
S&P 500: 6,049.24, +52.58 (+0.88%)
NYSE Composite: 19,893.59, +286.22 (+1.46%)

WEEKEND WRAP: Bank Earnings, CPI Tea Leaves Lead Stock Rally; Oil Continues to Climb as Trump Inauguration Approaches

Stocks jumped the gun on the inauguration with a big week highlighted by CPI from December and bank earnings from the likes of Bank of America, Goldman Sachs, JP Morgan Chase, Morgan Stanley, and Citigroup.

Big banks appear to be on solid footing with deposits growing and increased M&A activity. Wall Street cheered itself for undercutting inflation forecasts, spurring a wild Wednesday romp with more carryover effects Friday.

Stocks

Stocks turned in their best week since November, putting January solidly back in positive territory after some early new year jitters. The Dow and NYSE Composite out-performed the S&P and NASDAQ, though all the majors were markedly higher with Wednesday's big rally taking a day off Thursday before returning with gusto on Friday.

After two straight years of gains and a new sheriff in town (Trump), Wall Street is desperate to keep the punch bowl filled at all costs. There are uncertainties aplenty, which brings into question the wisdom of big gains just prior to expectations for big changes. Normally, as was demonstrable earlier in January, the stock market hates uncertainty. This week's rally may have been something on the order of a bull trap or a condition of "buy the rumor, sell the news." The coming week will provide more clues to the general direction of stocks, both near and long term.

Earnings will be highlighted in the coming week. After the nation's largest banks turned in solid fourth quarters, traders are expected good things through first quarter earnings season, with the bulk of publicly-owned companies reporting over the next three weeks. With Monday a national holiday (Martin Luther King Day), markets will be shuttered Monday. The big names to watch for earnings releases this week are the following:

Tuesday: CapitalOne (COF), 3M (MMM), Zions Bancorporation (ZION), DR Horton (DHI), Charles Schwab (SCHW), Interactive Brokers (IBKR), Netflix (NFLX), United Airlines (UAL)

Wednesday: Discover (DFS), Alcoa (AA), Kinder Morgan (KMI), Abbot Labs (ABT), Halliburton (HAL), Ally Bank (ALLY), Proctor & Gamble (PG), Johnson & Johnson (JNJ), Travelers (TRV), Comerica (CMA)

Thursday: American Airlines (AAL), CSX (CXS), McCormick (MKC), Union Pacific (UNP), Covenant Health (CVLG), Intuitive Surgical (ISRG)

Friday: Ericsson (ERIC), Verizon (VZ), American Express (AXP)

The data calendar is light. Trump's Executive Orders and proclamations from the Oval Office will be the huge focus for the week and probably for many more weeks ahead.

Treasury Yield Curve Rates

Date	1 Mo	2 Mo	3 Mo	4 Mo	6 Mo	1 Yr
12/13/2024	4.43	4.43	4.34	4.36	4.32	4.24
12/20/2024	4.43	4.42	4.34	4.35	4.29	4.27
12/27/2024	4.44	4.43	4.31	4.35	4.29	4.20
01/03/2025	4.44	4.35	4.34	4.31	4.25	4.18
01/10/2025	4.42	4.35	4.36	4.33	4.27	4.25
01/17/2025	4.43	4.35	4.34	4.32	4.28	4.21

Date	2 Yr	3 Yr	5 Yr	7 Yr	10 Yr	20 Yr	30 Yr
12/13/2024	4.25	4.21	4.25	4.33	4.40	4.69	4.61
12/20/2024	4.30	4.32	4.37	4.45	4.52	4.79	4.72
12/27/2024	4.31	4.36	4.45	4.53	4.62	4.89	4.82
01/03/2025	4.28	4.32	4.41	4.51	4.60	4.88	4.82
01/10/2025	4.40	4.46	4.59	4.70	4.77	5.04	4.96
01/17/2025	4.27	4.33	4.42	4.52	4.61	4.91	4.84

After rising by roughly one percent from when the Fed began lowering the federal funds target rate in September, 2024, longer maturities (2 years out to 30 years) began to backtrack after December CPI showed the core falling short of expectations, even though headline year-over-year CPI has risen the last three months, from 2.4% in September, to 2.6% in October, 2.7% in November, and the latest, 2.9% for December.

Wall Street sorely needs January to come in positive, bolstering the concept that January presages the market for the rest of the year. Thus, analysts and stock-pumpers cherry-picked the CPI number, finding one that they liked, ignoring the undeniable fact - provided by their very own number-fudgers at the BLS - that inflation continues to rise overall. Prices are not coming down; they're only rising at a slower pace than recently.

It needs to be pointed out that the Fed's ill-advised 100 basis points worth of cuts in September, November, and December, had the expected effect of causing price increases on most goods and services. The Fed, trapped as it is, continues to try to walk the tightrope between keeping the economy chugging along and keeping prices under control. They're actually failing at both.

With Trump readying tariffs on almost anything that is imported into the U.S., the Fed and their Wall Street banking cohorts continue to pedal the lie that inflation is under control and the economy is strong. The next three to six months will provide evidence as to whether they are right or lying through clenched teeth.

Spreads contracted, with 2s-10s dropping three basis points, and full spectrum (30 days out to 30 years) flattening by 13 basis points, from +54 to +41 over the course of the week.

As with stocks, there was some racing to get ahead of the pack prior to the completion of presidential transition on Monday. Whether they were prescient or just plucky will begin to become clear within the first 10 days of Trump's administration.

Spreads:

2s-10s
9/15/2023: -69
9/22/2023: -66
9/29/2023: -44
10/06/2023: -30
10/13/2023: -41
10/20/2023: -14
10/27/2023: -15
11/03/2023: -26
11/10/2023: -43
11/17/2023: -44
11/24/2023: -45
12/01/2023: -34
12/08/2023: -48
12/15/2023: -53
12/22/2023: -41
12/29/2023: -35
1/5/2024: -35
1/12/2024: -18
1/19/2024: -24
1/26/2024: -19
2/2/2024: -33
2/9: -31
2/16: -34
2/23: -41
3/1: -35
3/8: -39
3/15: -41
3/22: -37
3/28: -39
4/5: -34
4/12: -38
4/19: -35
4/26: -29
5/3: -31
5/10: -37
5/17: -39
5/24: -47
5/31: -38
6/7: -44
6/14: -47
6/21: -45
6/28: -35
7/5: -32
7/12: -27
7/19: -24
7/26: -16
8/2: -08
8/9: -11
8/16: -17
8/23: -09
8/30: 00
9/6: +06
9/13: +09
9/20: +18
9/27: +20
10/4: +5
10/11: +13
10/18: +13
10/25: +14
11/1: +16
11/8: +5
11/15: +12
11/22: +4
11/29: +5
12/6: +5
12/13: +15
12/20: +22
12/27: +31
1/3: +32
1/10: +37
1.17: +34

Full Spectrum (30-days - 30-years)
9/15/2023: -109
9/22/2023: -99
9/29/2023: -82
10/06/2023: -64
10/13/2023: -82
10/20/2023: -47
10/27/2023: -54
11/03/2023: -76
11/10/2023: -80
11/17/2023: -93
11/24/2023: -95
12/01/2023: -105
12/08/2023: -123
12/15/2023: -154
12/22/2023: -149
12/29/2023: -157
1/5/2024: -133
1/12/2024: -135
1/19/2024: -118
1/26/2024: -116
2/2/2024: -127
2/9: -117
2/16: -103
2/23: -112
3/1: -121
3/8: -125
3/15: -109
3/22: -112
3/28: -115
4/5: -93
4/12: -87
4/19: -77
4/26: -70
5/3: -85
5/10: -87
5/17: -94
5/24: -99
5/31: -83
6/7: -92
6/14: -113
6/21: -103
6/28: -96
7/5: -101
7/12: -108
7/19: -103
7/26: -104
8/2: -143
8/9: -131
8/16: -138
8/23: -141
8/30: -121
9/6: -125
9/13: -117
9/20: -80
9/27: -80
10/4: -75
10/11: -58
10/18: -54
10/25: -38
11/1: -18
11/8: -23
11/15: -10
11/22: -12
11/29: -40
12/6: -23
12/13: +18
12/20: +29
12/27: +38
1/3: +38
1/10: +54
1/17: +41

Oil/Gas

WTI crude oil continued to ride higher, finishing out the week at $77.37, up from $75.70 the prior Friday, the fourth straight week of rising price action. Wednesday's CPI reading from December produced most of the rally, hitting a high of $79.14 before backing off Thursday and Friday.

This week's jump in oil futures sent oil prices closer to summer levels that peaked above $82/barrel. How well this pric action continues to hold after Monday's inauguration of Donald J. Trump and his "drill, baby, drill" mantra is largely dependent on press attitudes and what comes off the president's desk his first week back in the Oval Office. With a heavy agenda, oil may be left to its own accord, though Trump is very likely to issue Executive Orders to reverse much of what the Biden White House destroyed of oil and capital markets the past four years.

Gasbuddy.com is reporting the national average for a gallon of unleaded regular gas at the pump up seven cents from last week, checking in at $3.12 a gallon Sunday morning.

California continues to be the national price leader, at $4.41 a gallon.

Pennsylvania prices jumped eight cents, at $3.34, with the Keystone State the price leader in the Northeast. New York saw a slightly smaller change, at $3.14. Connecticut ($3.07) was up slightly while Massachusetts ($3.01) was higher by just three cents, returning back above the $3.00 threshold. Maryland prices jacked higher by 22 cents, at $3.32.

Illinois advanced only two cents, to $3.24. Ohio (#3.11) and Indiana ($3.10) again returned back above $3.00 after just one week below.

Mississippi took over as low price leader, snatching the crown from Oklahoma with a price of $2.65, while the Sooner State came in at $2.67. Following are Texas ($2.69), Arkansas ($2.70), and Louisiana ($2.71). Those are followed by Alabama ($2.77), Tennessee ($2.78), Kansas ($2.80), and South Carolina ($2.81). Florida's was up seven cents, at $3.18, Georgia crept closer to $3, showing $2.95 this weekend.

Sub-$3.00 gas can now be found in only 28 U.S. states. The Northeast and West coast remain largely over-$3.00 holdouts.

Arizona ($3.11) was up eight cents from a week ago. Oregon showed prices higher, at $3.49, Nevada at $3.62, and Washington at $3.90, leaving only California above $4.00. Utah ($2.97) and Idaho ($3.01) were both lower for the week.

Bitcoin

This week: $105,074.80
Last week: $94,640.44
2 weeks ago: $97,453.01
6 months ago: $66,693.20
One year ago: $41,705.26
Five years ago: $9,895.13

Bitcoin moved higher again this week, promoted by some reporting that the incoming Trump administration plans on removing many of the regulations surrounding crypto ownership. With changes afoot at the SEC and Commodity Futures Trading Commission (CFTC), the idea is that with an administration's full embrace of crypto's potential, the United States will become the de facto leader of crypto adoption. In many ways, it already is, though that doesn't prevent the usual suspects from pushing their agenda to extremes, including the concept of the U.S. establishing a "bitcoin reserve". While the idea of the U.S. government becoming huge hodlers of vaporware currency appeals to the baser instincts of the crypto future crowd, it remains to be seen what the U.S. government plans on doing with its money in the face of exploding national debt and a debased currency. Establishing a new currency standard isn't something the world would take lightly. Basing one on currency that is ethereal, but also highly traceable, as bitcoin and most other cryptos are, seems to be quite the canard, an unworkable direction that leads, ultimately to anathema of the crypto universe, CBDCs. Crypto adherents had better not hope to hard, because they might get exactly what they want, with unexpected attachments and unwieldy consequences.

Precious Metals

Gold:Silver Ratio: 88.24; last week: 86.82

Per COMEX continuous contracts:

Gold price 12/20: $2,640.50
Gold price 12/27: $2,636.50
Gold price 1/5: $2,652.70
Gold price 1/12: $2,717.40
Gold price 1/19: $2,740.00

Silver price 12/20: $30.08
Silver price 12/27: $29.98
Silver price 1/5: $30.10
Silver price 1/12: $31.30
Silver price 1/19: $31.05

Gold continued it's upside momentum, while silver made impressive gains Wednesday, only to give the bulk of them back, and then some, Thursday and Friday.

Judging by activity on eBay, a silver mania is developing, with small fry (average Joes and Janes) evidencing a propensity to throw caution to the wind as they continue stacking and saving for the future and against the corrupt fiat regime they clearly see faltering on multiple fronts, not the least of which are inflation (money creation, currency debasement) and the threat from BRICS in the formation of a global financial duopoly with the U.S. dollar - and by extension, the euro, yen, and pound - taking a beating.

Even though stocks had a very good week and are tracking towards a positive bent to the important month of January, precious metals have not backed down much from autumn 2024's highs. Gold is clearly fetching over $2,800 on one-ounce pieces and much higher on a per-ounce basis on fractional coins and bars. Silver, at least near term, has avoided further price deterioration and shortages continue to mount. COMEX prices are one thing. Buying coins and bars at $10 or more over spot indicates a large and growing cohort seeking relief and better accounting for what determines wealth and value.

Here are the most recent prices for common one ounce gold and silver items sold on eBay (numismatics excluded, free shipping):

Item/Price	Low	High	Average	Median
1 oz silver coin:	34.99	49.99	43.24	42.44
1 oz silver bar:	36.96	47.95	41.37	40.58
1 oz gold coin:	2,818.10	2,912.22	2,863.58	2,869.90
1 oz gold bar:	2,812.38	2,888.37	2,835.72	2,824.61

The Single Ounce Silver Market Price Benchmark (SOSMPB) rose moderately, to $41.91, an increase of 64 cents from the January 12 price of $41.27 per troy ounce.

WEEKEND WRAP

One more day. Will the nightmare of the last four years vanish in an instant or will there be continued pushback from the open borders, DEI non-conformists as there was in Trump's first term?

Hope against hope that the former is the case, but, knowing the depth of depravity that dwells within the deep state, the latter seems more likely.

At the Close, Friday, January 10, 2025:
Dow: 43,487.83, +334.70 (+0.78%)

NASDAQ: 19,630.20, +291.91 (+1.51%)
S&P 500: 5,996.66, +59.32 (+1.00%)
NYSE Composite: 19,607.37, +58.74 (+0.30%)

For the Week:
Dow: +1549.38 (+3.69%)
NASDAQ: +468.57 (+2.45%)
S&P 500: +169.62 (+2.91%)
NYSE Composite: +644.36 (+3.40%)
Dow Transports: +507.84 (+3.19%)

Trump Inauguration Looming, Stocks Ready to Close Out Week of Big Gains; Bitcoin Moves Past $100,000 Again; Gold, Silver Lower

Stocks took a step back on Thursday, failing to extend the "inflation is defeated" rally from Wednesday on the back of sketchy CPI data which showed Y-O-Y CPI increasing from 2.7% in October, to 2.8% in November, to 2.9% in December. All Wall Street seemed to care about was core CPI, which fell slightly.

With futures soaring pre-market, the Street appears ready to resume "buy everything" mode. The morning's upside can be traced to animal spirits, an announcement by the IMF, which said it raised its growth forecast for the United States to 2.7% for 2025, and a few more earnings beats.

Stocks appear set for a banner week, with the Dow up 1214 points through Thursday's closing bell. NASDAQ is up 176, S&P 500 ahead by 110 on the week.

Bitcoin has rallied all week and is once again above $100,000, nearly hitting $103,000 early Friday. Of course, gold and silver are lower.

This market has a unique tendency to celebrate itself, no matter the economic data or real world conditions. However, Thursday saw the return of that nasty bear market chart pattern of being up early and down late. Sometimes - and on Wall Street - it's nearly all the time, the obvious signal gets lost in the noise, and this is a very noise market.

Happy Weekend! If the world survives the weekend, Donald J. Trump will be inaugurated as the 47th President of the United states on Monday. Fingers crossed.

At the Close, Thursday, Janaury 16, 2025:
Dow: 43,153.13, -68.42 (-0.16%)
NASDAQ: 19,338.29, -172.95 (-0.89%)
S&P 500: 5,937.34, -12.57 (-0.21%)
NYSE Composite: 19,548.63, +125.92 (+0.65%)

Stocks Rallied Hard Wednesday on Bank Earnings and Mild CPI; Thursday Setting Up a Bit More Calm; Gold, Silver, Oil Also Big Winners

Earnings for the biggest U.S. banks continue to roll out with positive results for the fourth quarter of 2024. Thursday morning saw reports from Bank of America (BAC), Morgan Stanley (MS), PNC (PNC), and US Bankcor (USB), all of which featured earnings beats and generally glowing quarterly results.

Despite the positive news in the financial sector, banks which reported this morning haven't quite caught fire with traders. Bank of America is flat pre-market, US Bancor actually missed EPS estimates and is down 2.5%, and PNC, despite a huge beat, is down around three percent, roughly the same as it was up during yesterday's rally. Morgan Stanley is up more than two percent prior to the open.

Taiwan Semi (TSM) is getting good vibes after another knockout quarter, setting new records with a 57% profit surge to $11.4 billion and a 39% revenue hike to $26.88 billion. Shares are boosted more than five percent an hour prior to the opening bell. United Health (UNH) beat on the earnings side, but revenues took a hit. The stock is being punished to the tune of a four percent decline.

Retail sales for December were modest, up 0.4%, and up 3.9 percent from December 2023. Total sales 2024 were up 3.0 percent from 2023 according to the U.S. Census Bureau, which supplied the report.

There might be some hangover from Wednesday's surge in stock prices. Futures have been trending down most of the morning, with Dow futures in the red by more than 100 points. S&P and NASDAQ futures are clinging to small gains after the retail sales report didn't move the needle much.

The big winners Wednesday outside of stocks were crude oil, gold, and silver. WTI crude hit a high of $79.15 just as the stock market closed and has dipped back down to $78.40. Gold advanced through the day Wednesday, starting from a low of $2,673.80 to close out in New York at $2,722.20 and is moving higher Thursday morning, at $2,742.50. That's a $69 move in just more than a day on the COMEX. Silver's move was even more pronounced, starting from a low of $30.20 at 12:30 am ET Wednesday, this morning topping out at $31.98.

Bond traders got some relief from the dovish inflation figures, sending note yields lower. The benchmark 10-year yield dropped from 4.78% to 4.66%, and the drops on shorter maturities (2-year out to 7-year) were in the same ballpark, the 7-year falling by 15 basis points.

It remains to be seen if Wednesday's big move in stocks will carry over to the rest of the week. From the looks of the futures, the rally appears to have lost some of its mojo. There's still some apprehension concerning the regime change in Washington to take place on Monday. Biden out, Trump in, seems like a no-brainer, but those with less itchy trading fingers may still be taking a wait-and-see approach.

Thursday, Friday and most of Monday remain under the inauguration cloud. With CPI out of the way and the upcoming FOMC meeting likely to produce a pause in the rate cutting rigamarole, things could calm down a bit.

Thursday's rally did manage to put the majors back on a positive footing for January, but they remain below levels from early December. There's still time to get stocks moving forward and put a positive spin on January, which would be important as many a trader believes that the first month foreshadows the rest of the year.

At the Close, Wednesday, January 15, 2025:
Dow: 43,221.55, +703.27 (+1.65%)
NASDAQ: 19,511.23, +466.84, (+2.45%)
S&P 500: 5,949.91, +107.00, (+1.83%)
NYSE Composite: 19,422.71, +246.06 (+1.28%)

December CPI at 0.4%, 2.9% Rise Year-over-Year is Cause for Celebration on Wall Street; Futures Soar; Oil at 4-Month High

With the inauguration of President Trump less than a week away, there was no lack of gamesmanship and late-day tape-painting in financial markets Tuesday.

The repetitive bearish chart pattern of the major indices opening higher and stumbling lower throughout the session prevailed again on Tuesday. The Dow was the lone survivor, ending the day with gains beyond the gap-up open. Though the S&P posted an insignificant gain, it spent much of the session in negative territory. The NASDAQ was bruised, the 41-point gain overshadowed by new intra-day lows at 18,926.60. It was off more than 150 points just 45 minutes prior to the closing bell. Market riggers furiously bought shares and covered shorts in the final minutes anticipating another boost to the futures when December CPI figures are released Wendesday morning.

Those who bought up NASDAQ and Dow shares into Tuesday's close were on the right track. Just after 8:00 am ET, NASDAQ futures were up more than 80 points, but the Dow was flying higher, adding more than 200 (+0.48%).

Following the PPI figures on Tuesday which beat expectations (lower than forecast), there seemed ot be little in the way of anxiety over the CPI. Fuel prices were sure to cause a bump, but investors appeared confident that the numbers would not upset the status quo, in the belief that the Fed had done enough to quell the inflation beast and might possibly continue lowering rates later in the year. Hopes for a fourth straight rate cut have been dashed due to last week's December Non-farm Payroll data, which came in stronger than anticipated, with 256,000 new jobs minted in the final month of 2024.

Despite the knowledge that the BLS numbers are almost always wrong and subject to revisions, Wall Street gamblers rely upon them nonetheless in making trades, just another example of mal-investment and wild speculation based on faulty assumptions. Wall Street continues to trend overwhelmingly bullish, despite recent losses on all of the major indices. Since early December, stocks have been under pressure. The vaunted Santa Claus rally never materialized, yet the lower Manhattan crowd still buys into myths like Santa, the Tooth Fairy, Easter Bunny, unicorns, non-farm payrolls, and retail sales, which will be released Thursday morning.

Wednesday's enthusiasm prior to the CPI release had much to do with bank earnings reported by BlackRock, Bank of New York Mellon (BK), JPMorgan Chase (JPM), Citigroup (C), and Goldman Sachs (GS), all of which topped estimates for the fourth quarter. Banks are just raking in profits thanks to consumers who see nothing wrong with borrowing on credit cards with interest rates as high as 24-30% in some instances. The average credit card user is paying through the nose, around 20.15% according to the latest data from bankrate.

So, at 8:30 am ET, did the BLS throw a fly into the ointment?

CONSUMER PRICE INDEX - DECEMBER 2024

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.4 percent on a seasonally adjusted basis in December, after rising 0.3 percent in November, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 2.9 percent before seasonal adjustment.

The index for energy rose 2.6 percent in December, accounting for over forty percent of the monthly all items increase. The gasoline index increased 4.4 percent over the month. The index for food also increased in December, rising 0.3 percent as both the index for food at home and the index for food away from home increased 0.3 percent each.

The index for all items less food and energy rose 0.2 percent in December, after increasing 0.3 percent in each of the previous 4 months. Indexes that increased in December include shelter, airline fares, used cars and trucks, new vehicles, motor vehicle insurance, and medical care. The indexes for personal care, communication, and alcoholic beverages were among the few major indexes that decreased over the month.

The all items index rose 2.9 percent for the 12 months ending December, after rising 2.7 percent over the 12 months ending November. The all items less food and energy index rose 3.2 percent over the last 12 months. The energy index decreased 0.5 percent for the 12 months ending December. The food index increased 2.5 percent over the last year.

Nope. Futures shot straight up, because, even though inflation is still very much untamed, the monthly figure of +0.4% was spot on Wall Street's expected number even though it was the highest monthly figure since March. Never mind that the year-over-year number of 2.9% was the highest since July.

Right after the release, Dow futures ballooned to +640, NASDAQ was giddy, up 390, and S&P futures were up 92 points, all heading higher, defying all logic. Bankers are getting fat and people are going into debt buying food. Rate cuts? Who needs them?

Gold even got a boost, up over $2,700, though that's surely going to be short-lived. WTI crude shot up to $77.16 a four-month high. Thanks, Joe, Kamala, and all you lefty lovers of wind, solar, subsidies, electric cars, alien probes.

Well, at least booze is cheaper.

Ironically, President Joe Biden will deliver a farewell speech from the Oval Office tonight that's expected to focus on key achievements of his administration. Unmentioned will be the 4-8 million illegals that crossed into the U.S. 2021-2024, the highest inflation rate in more than 50 years, millions of $$$$ sent to Ukraine in a winless war, or the promotion of drag queen story hour, LGBTQ++ immorality, high crime rates, FEMA failures, devastating fires in Los Angeles, or record homelessness.

It's all good. We got DEI!

At the Close, Tuesday, January 14, 2025:
Dow: 42,518.28, +221.16 (+0.52%)
NASDAQ: 19,044.39, -43.71 (-0.23%)
S&P 500: 5,842.91, +6.69 (+0.11%)
NYSE Composite: 19,176.65, +129.33 (+0.68%)

Bloomberg Advances Fake News Syndicate (FNS), Futures, Euro Stocks Rally; PPI Still Hot at +0.2 in December, +3.3% Y-O-Y

The fake news roll-out on a near-daily basis is becoming almost comical. It is rather disturbing, however. Last week it was CNN and the Washington Post issuing reportus bogusimus, aka, fake news. This morning, it's Bloomberg's turn.

Stocks bounce and dollar slips after tariff report

Europe’s Stoxx 600 index snapped a two-day losing streak to rise 0.5%, as Bloomberg News quoted people familiar with the matter as saying graduated tariff hikes of about 2% to 5% a month are under discussion, rather than aggressive one-time increases.

"Bloomberg News quoted people familiar with the matter..." says it all.

The story goes on without any "quote" other than a few from Shaniel Ramjee, senior investment manager at Pictet Asset Management.

Wikipedia says, "Pictet Asset Management manages assets for institutional investors and investment funds, including large pension funds, sovereign wealth funds, and financial institutions. It also manages assets for individual investors through an extensive range of mandates, products, and services."

Well, OK. Quote some flunky in Geneva, Switzerland or Genoa, Italy, who cannot be held accountable for anything. That's SOP for FNS (Fake News Syndicate).

Does Michael Bloomberg hate Donald J. Trump?

Opinions vary, but it's a safe bet that the vainglorious Bloomberg surely isn't thrilled that the Donald is about to become president of the United States for a second time. The two have a history. After all, Trump built or expanded much of his real estate empire in New York City while Bloomberg was mayor. Additionally, Bloomberg launched a brief, failed bid for president in 2020.

A couple of tweets from the campaign trail suggest the two don't like each other very much.

Trump called Bloomberg a loser.

Bloomberg responds that people call Trump a "carnival barking clown" behind his back.

That's just the tip of the iceberg. A search for "Trump Bloomberg feud" or similar reveals a deep animosity.

European stocks and U.S. equity futures jumped upon release of the story. SSDD.

Stocks got pounded pretty hard again on Monday, but the chart pattern was changed. Instead of starting out the session high and proceeding lower (sure as shootin' bear market stuff), stocks started lower and then proceeded to drift higher throughout the day.

That's fine, and maybe there was some actual dip-buying out there, but the problem is that new, lower intraday lows were established on the S&P (5,781.10) and NASDAQ (18,859.79). Coincidentally, both indices bottomed out exactly at 10:30 am ET and made double bottoms right at noon.

With Tuesday's opening bell approaching, the ever-reliable BLS released December PPI at 8:30 am ET:

The Producer Price Index for final demand advanced 0.2 percent in December, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices rose 0.4 percent in November and 0.2 percent in October. On an unadjusted basis, the index for final demand increased 3.3 percent in 2024 after moving up 1.1 percent in 2023.

On the surface, that doesn't sound good, particularly when drilling down to find that the December rise can be traced to a 0.6 percent advance in the index for final demand goods, which had been quiet in recent months.

Prices for final demand less foods, energy, and trade services (Super Core) rose 3.3 percent in 2024 after advancing 2.7 percent in 2023.

Somehow, Wall Street interpreted the numbers as positive, most likely because they were below heightened expectations (+0.4% on monthly and 3.5% year-over-year). Futures flew higher in knee-jerk fashion after falling close to unchanged earlier. Apparently, the Bloomberg fake news article didn't have much effect, though, amid rumors that PPI and CPI had been leaked, there might have been some necessity in boosting futures in the wee hours of the U.S. morning if only to avoid a sharp decline when PPI was made public.

Tin foil hats firmly attached, Tuesday morning futures appear to be a case of classic misdirection. Looks like the markets are going to revert back to the chart pattern of recent vintage: up at the open, down by the close.

At the Close, Monday, January 13, 2025:
Dow: 42,297.12, +358.67 (+0.86%)
NASDAQ: 19,088.10, -73.53 (-0.38%)
S&P 500: 5,836.22, +9.18 (+0.16%)
NYSE Composite: 19,047.33, +84.32 (+0.44%)

WEEKEND WRAP: Stocks Take a Hit, Down Year-to-Date; Long Bond Yields Approach 5%; Gold, Silver Gain on Big December Jobs Report

2025 isn't off to a very good start. In fact, all the major U.S. indices are down for the year, albeit at a very early juncture, but the first six trading days of the year have not been happy ones for equity holders.

Stocks

Investors got spanked, and hard, on Friday, after the BLS announced January job gains of 256,000, shattering estimates that largely ranged between 110,000 and 160,000. The good news was enough to trigger Wall Street's inverse response, that a strong economy is not conducive to lower interest rates, which is what the stock pushers and pumpers have been squealing for since the Fed began raising rates nearly three years ago (March 2022).

Not only did the selling result in a the biggest decline of the new year on the S&P and the Dow, but it sent the NASDAQ lower, even after a 376-point loss on Tuesday, January 7. The weekly gauge was down as well and stuck stocks on the wrong side of the ledger year-to-date.

Year-to-date:
Dow: -605.77 (-1.4%)
NASDAQ: -149.17 (-0.8%)
S&P 500: -54.59 (-0.9%)
NYSE Composite: -134.09 (-0.7)
Russell 2000: -40.93 (-1.8%)

How bad it is depends on who you ask. The Dow, for instance, has dropped 17 of the last 24 trading sessions after hitting an all-time high on December 4. Since then, it's down 6.83%, just shy of 3,100 points. By comparison, the S&P and NASDAQ have suffered less, losing around five percent over similar time spans, though it appears the NASDAQ-Tech-AI selling spree might be just getting started.

With the January jobs jamboree in the books, investors will begin gauging earnings in the coming week, sweating it out until Trump's inauguration on Monday, January 20. As has become regular practice, the first week of earnings season will be dominated by the biggest banks.

Monday (Jan. 13): KB Homes (KBH)

Tuesday: Applied Digital (APLD)

Wednesday: JPMorgan Chase (JPM), Goldman Sachs (GS), Wells Fargo (WFC), BlackRock (BLK) Citigroup (C), Bank of New York Mellon (BK)

Thursday: Taiwan Semiconductor (TSM), Morgan Stanley (MS), Bank of America (BAC), U.S. Bancorp (USB), UnitedHealth Group (UNH), PNC Financial Services (PNC)

Friday: Citizens Financial Group (CFG), State Street (STT), Regions Financial (RF), Truist (TFC), Schlumberger (SLB), Fastenal (FAST)

In addition, December PPI is released on Tuesday and CPI on Wednesday, both prior to the opening bell. There's also data drops from the Philly and New York Feds, December Retail Sales (Thursday).

Fed Presidents John Williams, Neel Kashkari, and Austan Goolsbee will be out jaw-boning their mumbo-jumbo at various conferences during the week.

Should be just swell.

Treasury Yield Curve Rates

Date	1 Mo	2 Mo	3 Mo	4 Mo	6 Mo	1 Yr
12/06/2024	4.57	4.50	4.42	4.42	4.34	4.19
12/13/2024	4.43	4.43	4.34	4.36	4.32	4.24
12/20/2024	4.43	4.42	4.34	4.35	4.29	4.27
12/27/2024	4.44	4.43	4.31	4.35	4.29	4.20
01/03/2025	4.44	4.35	4.34	4.31	4.25	4.18
01/10/2025	4.42	4.35	4.36	4.33	4.27	4.25

Date	2 Yr	3 Yr	5 Yr	7 Yr	10 Yr	20 Yr	30 Yr
12/06/2024	4.10	4.05	4.03	4.09	4.15	4.42	4.34
12/13/2024	4.25	4.21	4.25	4.33	4.40	4.69	4.61
12/20/2024	4.30	4.32	4.37	4.45	4.52	4.79	4.72
12/27/2024	4.31	4.36	4.45	4.53	4.62	4.89	4.82
01/03/2025	4.28	4.32	4.41	4.51	4.60	4.88	4.82
01/10/2025	4.40	4.46	4.59	4.70	4.77	5.04	4.96

Despite the Fd cutting the federal funds rate by one percent since August with a 50 basis point cut in September (political), and a pair of 25 basis point cuts in November and December, long-dated maturities have not cooperated as intended, instead rising by more than the one-percent blessed by the Fed governors and regional presidents.

Since the day before the first cut in September, the 17th, yield on the 10-year note stood at 3.65%, the 20-year bond yielded 4.02%, and the 30-year returned 3.96%. On the release of the policy announcement on the 18th, they all moved in the opposite direction, to 3.70%, 4.08%, and 4.03%, respectively.

Look where they are now. At a minimum the longest-dated maturities are not one percent lower, but one percent HIGHER! One conclusion to draw from this conundrum is that the bond vigilantes are back with a vengeance, revolting against what they consider to be a grave policy error on the part of the Fed by shunning treasuries by demanding a payoff commensurate with what they percieve as high risk.

They are not alone. America's strongest foreign debt buyers, Japan and China, have been shedding U.S. debt since 2022 and they aren't stopping. According to Bloomberg:

Japanese investors sold a record $61.9 billion of the securities in the three months ended Sept. 30, data from the US Department of the Treasury showed on Monday. Funds in China offloaded $51.3 billion during the same period, the second biggest sum on record.

Part of that strategy has to do with incoming tariffs from the Trump administration, but it is part of an overall tendency to shun U.S. debt markets that began when the the U.S. and Europe sequestered (that's being kind) roughly $300 billion in Russian assets at the start of the Ukraine project (Feb. 2022). While Trump may find a way to end the Ukraine and other conflicts, repairing the financial damage will require even more effort. He could start with ending the tariff regime, which only serves to harm U.S. interests and maybe find a way to return to Russia the funds that are rightfully theirs.

Whether he takes action in those directions, we may begin to find out within eight days. Something's got to give and there's growing talk that a global debt crisis is approaching.

Spreads:

2s-10s
9/15/2023: -69
9/22/2023: -66
9/29/2023: -44
10/06/2023: -30
10/13/2023: -41
10/20/2023: -14
10/27/2023: -15
11/03/2023: -26
11/10/2023: -43
11/17/2023: -44
11/24/2023: -45
12/01/2023: -34
12/08/2023: -48
12/15/2023: -53
12/22/2023: -41
12/29/2023: -35
1/5/2024: -35
1/12/2024: -18
1/19/2024: -24
1/26/2024: -19
2/2/2024: -33
2/9: -31
2/16: -34
2/23: -41
3/1: -35
3/8: -39
3/15: -41
3/22: -37
3/28: -39
4/5: -34
4/12: -38
4/19: -35
4/26: -29
5/3: -31
5/10: -37
5/17: -39
5/24: -47
5/31: -38
6/7: -44
6/14: -47
6/21: -45
6/28: -35
7/5: -32
7/12: -27
7/19: -24
7/26: -16
8/2: -08
8/9: -11
8/16: -17
8/23: -09
8/30: 00
9/6: +06
9/13: +09
9/20: +18
9/27: +20
10/4: +5
10/11: +13
10/18: +13
10/25: +14
11/1: +16
11/8: +5
11/15: +12
11/22: +4
11/29: +5
12/6: +5
12/13: +15
12/20: +22
12/27: +31
1/3: +32
1/10: +37

Full Spectrum (30-days - 30-years)
9/15/2023: -109
9/22/2023: -99
9/29/2023: -82
10/06/2023: -64
10/13/2023: -82
10/20/2023: -47
10/27/2023: -54
11/03/2023: -76
11/10/2023: -80
11/17/2023: -93
11/24/2023: -95
12/01/2023: -105
12/08/2023: -123
12/15/2023: -154
12/22/2023: -149
12/29/2023: -157
1/5/2024: -133
1/12/2024: -135
1/19/2024: -118
1/26/2024: -116
2/2/2024: -127
2/9: -117
2/16: -103
2/23: -112
3/1: -121
3/8: -125
3/15: -109
3/22: -112
3/28: -115
4/5: -93
4/12: -87
4/19: -77
4/26: -70
5/3: -85
5/10: -87
5/17: -94
5/24: -99
5/31: -83
6/7: -92
6/14: -113
6/21: -103
6/28: -96
7/5: -101
7/12: -108
7/19: -103
7/26: -104
8/2: -143
8/9: -131
8/16: -138
8/23: -141
8/30: -121
9/6: -125
9/13: -117
9/20: -80
9/27: -80
10/4: -75
10/11: -58
10/18: -54
10/25: -38
11/1: -18
11/8: -23
11/15: -10
11/22: -12
11/29: -40
12/6: -23
12/13: +18
12/20: +29
12/27: +38
1/3: +38
1/10: +54

Oil/Gas

WTI crude oil continued its wild ride higher, finishing out the week at $75.70, up from $74.07 the prior Friday. Right after the jobs report, WTI hit a high at $76.75, the highest level in three months. What appears to be moving the price of oil recently is the spate of frigid weather across the lower 48 states, prompting just a little price gouging from those benevolent producers.

This week's bump sent oil prices closer to summer's levels above $82/barrel. This appears to be a little more than a response rally. There's still plenty of winter left and prices tend to rise in the spring, though the supply-demand dynamic remains in favor of consumers.

Gasbuddy.com is reporting the national average for a gallon of unleaded regular gas at the pump unchanged at $3.05 a gallon.

California continues on top, at $4.36 a gallon, remaining well below prices prevailing during the summer.

Pennsylvania prices stabilized, at $3.26, with the Keystone State the price leader in the Northeast. New York saw little change, at $3.11. Connecticut ($3.03) was up slightly while Massachusetts ($2.98) was lower by a penny. Maryland settled lower, at $3.10.

Illinois was four cents higher, to $3.22. Ohio ($2.96) and Indiana ($2.99) dipped back under $3 after a week above.

Fuel prices in Oklahoma ($2.53) continue to be the lowest in the nation, despite rising three cents this week. Following are Mississippi ($2.57), Louisiana and Kansas ($2.66) Texas and Arkansas ($2.67), Tennessee ($2.69), Alabama ($2.74), and Missouri, $2.75. Florida's is steady, at $3.11, Georgia remains sub-$3 at $2.91.

Sub-$3.00 gas can now be found in more than 30 U.S. states. The Northeast and West coast remain over-$3.00 holdouts.

Arizona ($3.03) continues to tease at $3 gas. Oregon checked in at $3.45, Nevada at $3.58, and Washington at $3.89, leaving only California above $4.00. Utah ($3.02) and Idaho ($3.02) remain just above the $3.00 threshold.

Bitcoin

This week: $94,640.44
Last week: $97,453.01
2 weeks ago: $94,597.53
6 months ago: $57,935.24
One year ago: $42,848.36
Five years ago: $8,910.66

The crypto market continues its struggle for identity. The price of bitcoin fluctuates as much as five percent or more weekly, often by that much or more in a single day, which is probably because it's nothing more than a Wall Street slush fund. Watch how quickly it evaporates in the next liquidity crisis or spate of margin calls.

Bitcoin ia a swell place to park money if you can handle the volatility and potential for theft or loss.

Precious Metals

Gold:Silver Ratio: 86.82; last week: 88.13

Per COMEX continuous contracts:

Gold price 12/13: $2,665.90
Gold price 12/20: $2,640.50
Gold price 12/27: $2,636.50
Gold price 1/5: $2,652.70
Gold price 1/12: $2,717.40

Silver price 12/13: $31.00
Silver price 12/20: $30.08
Silver price 12/27: $29.98
Silver price 1/5: $30.10
Silver price 1/12: $31.30

Gold began a serious breakout on the back of Friday's jobs report, vaulting over $2,700 to reach a high of $2,728.90 early in the day before settling down in the afternoon to its highest close in a month. Silver also got the memo, breaking through $31, hitting a high of $31.83.

The outsized gains on Friday indicate that precious metals are on their own flight path. With the blowout jobs report and higher interest rates, PMs would often take a hit in such a scenario. Instead, both got jacked higher because people see inflation rising again and the chance that the Fed will not only fail to lower interest rates again, but possible raise them. That's a sword that cuts both ways. On one hand, gold and silver provide the best protection from currency debasement manifested as inflation. Otherwise, rising interest rates provide an alternative and hedge.

Perhaps there's a growing concern that U.S. treasuries aren't exactly risk-free and subject holders to losing money against inflation. That's a huge plus for gold and silver which continue to gain new supporters in retail channels.

Here are the most recent prices for common one ounce gold and silver items sold on eBay (numismatics excluded, free shipping):

Item/Price	Low	High	Average	Median
1 oz silver coin:	35.00	52.00	42.27	42.00
1 oz silver bar:	38.05	44.95	40.66	40.13
1 oz gold coin:	2,794.70	2,904.70	2,860.71	2,879.68
1 oz gold bar:	2,650.00	2,855.75	2,793.99	2,805.92

The Single Ounce Silver Market Price Benchmark (SOSMPB) galloped ahead, to $41.27, a gain of $1.73 from the January 5th price of $39.54 per troy ounce.

WEEKEND WRAP

The upcoming week will be the first full week of trading for the year. The trend has been lower for stocks and higher for long-dated treasuries.

Is the trend your friend?

At the Close, Friday, January 10, 2025:
Dow: 41,938.45, -696.75 (-1.63%)
NASDAQ: 19,161.63, -317.25 (-1.63%)
S&P 500: 5,827.04, -91.21 (-1.54%)
NYSE Composite: 18,963.01, -277.73 (-1.44%)

For the week:
Dow: -793.68 (-1.86%)
NASDAQ: -460.05 (-2.34%)
S&P 500: -115.43 (-1.94%)
NYSE Composite: -291.28 (-1.51%)
Dow Transports: -83.60 (-0.52%)
Russell 2000: -79.24 (-3.53%)

Year-to-date:
Dow: -605.77 (-1.4%)
NASDAQ: -149.17 (-0.8%)
S&P 500: -54.59 (-0.9%)
NYSE Composite: -134.09 (-0.7)
Russell 2000: -40.93 (-1.8%)