Money Daily

Sunday, February 9, 2025

WEEKEND WRAP: Chaos at the Capital and Over Capital; Gold Soars as More Pours into US; Stocks Peaked? Treasuries Divergent

Three weeks into the second term of presidency for Donald J. Trump and what have we gotten?

Lots of people fired or quit, agencies being blown apart by DOGE, Democrats in congress running around screaming like somebody just stole their lunch money (Musk and Trump actually did).

Sounds like a WIN-WIN-WIN situation, because 1) wasteful spending, kickbacks, and corruption are being eliminated; 2) the government is downsizing its workforce, saving money, and; 3) Democrats are putting on quite a show for the American public, which is at the same time as entertaining as it is revealing about where all the money went.

Wait until they dig into the Ukraine funding, the Clinton foundation (billions stolen from Haiti), defense contractors. Those will make the USAid slush fund look like chump change, a bad tip, a rounding error.

Can we get the Epstein list and Diddy tapes released? Do you want to see suicides and hangings?

While the government willingly and thankfully self-destructs, Wall Street eyes the situation with a jaundiced eye and begins to question things. The S&P, NASDAQ, and the Dow Jones Transportation Average were down for a second straight week, with the Dow down as well this week after a small positive last week. The NYSE Composite has strung together four straight weekly gains, though the last two combined amounted to just 42 points up, less than 1/4 percent.

Stocks

Pattern recognition is something of an art, though it shouldn't be difficult to spot the changes since early December in the daily drift from morning highs to afternoon lows that have manifested themselves. One longer term pattern worth watching is that of the major indices as compared to those in early 2020, just prior to the big "plandemic" crash engineered by globalist forces.

Back then, the major indices were hitting new highs after an extended bull run that began in December 2018, similar to the current condition off the October 2022 lows. This does not suggest anything other than the patterns and time elements are well-aligned. In February 2020, stocks began to fall, culminating in a huge selloff in stocks, forcing extraordinary interest rate cuts and implementation of emergency programs by the Fed and direct payments to Americans from congress. The end result was massive money creation out of thin air and inflation, the likes of which hadn't been seen since the 1970s.

Considering the degree of chaos being fomented in Washington D.C. by the unraveling of the deep state and all the corruption, kickbacks, and levels of fraud that would make Al Capone jealous, the possibility of a major correction in stocks cannot be dismissed. Coupled with the mysterious on-shoring of massive quantities of gold, there's at least a non-zero possibility that the United States might suffer a constitutional crisis resulting in what would be a happy ending: trials and dismissals of large numbers of congress and elimination of the leeches at the Federal Reserve, a return to honest money issued by the U.S. Treasury at minimal cost (printing).

Wall Street, which prefers its bread buttered on both sides, would probably be against such a disorderly process and signal its displeasure by decisive selling pressure until there's resolution, which could take months if not years. The end result is an impoverished nation setting about rebuilding itself. Golden ages are built with gold, not paper. No matter what happens over the next six to 18 months, risk is ever-present and growing, gnawing away at investor confidence as the financial and political systems are pressured.

In the meantime, stocks and Wall Street will continue whistling past the graves of retail investors. Theshow must go on, as they say. The coming week will be chock-full of earnings reports and important data.

Monday: (before open) McDonald's (MCD), Tower Semicnductor (TSEM), CNA (CNA), Incyte (INCY); (after close) Vertex (VRTX), Lattice Semiconductor (LSCC), Inspire Medical (INSP)

Tuesday: (before open) Humana (HUM), British Petroleum (BP), Coca-Cola (KO), AutoNation (AN), Shopify (SHOP), Marriott (MAR); (after close) Doordash (DASH), Zillow Group (ZG), Lyft (LYFT), Gilead (GILD), Supermircro (SMCI)

Wednesday: (before open) KraftHeinz (KHC), Ryder (R), Barrick Gold (GOLD), Generac (GNRC), CVS Health (CVS), Bigen (BIIB); (after close) Kinross (KGC), Cisco (CSCO), MGM Resorts (MGM), Robinhood (HOOD), Reddit (RDDT)

Thursday: (before open) SONY (SONY), Duke Energy (DUK), Crocs (CROX), John Deere (DE); (after close) Twilio (TWLO), Draft Kings (DKNG), Coinbase (COIN), Roku (ROKU), Wynn Resorts (WYNN), Applied Materials (AMAT), AirB&B (ABNB), Hecla Mining (HL)

Friday: (before open) Enbridge (ENB), Fortis (FTS), AMC Networks (AMCX), Moderna (MRNA).

Data drops will be substantial later in the week, starting with January CPI on Wednesday, and PPI Thursday. January Retail Sales on Friday probably won't cause much of a ruckus unless, of course, they're better than expected, in which case stocks would sell off because Wall Street's tortured logic has returned to a "good news is bad" condition in which economic and/or employment strength translates into further delays on Fed rate cuts (or rate hikes).

As far as CPI and PPI are concerned, analysts have been turning a blind eye to the data, preferring to always and everywhere consider inflation to be already conquered and thus, unimportant, without considering the reality of its persistence or the possibility of continued dis-inflation and recession or worse.

Treasury Yield Curve Rates

Date	1 Mo	2 Mo	3 Mo	4 Mo	6 Mo	1 Yr
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
01/31/2025	4.37	4.37	4.31	4.33	4.28	4.17
02/07/2025	4.37	4.38	4.35	4.37	4.30	4.25

Date	2 Yr	3 Yr	5 Yr	7 Yr	10 Yr	20 Yr	30 Yr
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
01/31/2025	4.22	4.27	4.36	4.47	4.58	4.88	4.83
02/07/2025	4.29	4.31	4.34	4.42	4.49	4.75	4.69

Treasuries began to manifest the ongoing confusion and chaos emanating from the nation's capital. With the short end virtually unchanged, a noticeable, structural divergence is evidenced in notes, with a split apparent between three and five year yields. Ones, twos, and threes all increased, but fives, sevens, and 10s went in the opposite direction, resulting in a severe flattening of the entire structure, from the lowest yield of 4.25% on 1-year notes to the high of 4.69% on 30-year bonds for a complete spread of less than one-half percent.

With the Fed and the Trump Treasury department at loggerheads, the result is a tug-of-war-and-will between the two most powerful forces in monetary and fiscal policy. While the Federal Reserve envisions no reason to lower the federal funds target rate at the base of all monetary policy, Trump and newly-installed Treasury Secretary Scott Bessent are taking a fiscal approach to long-term rates.

Bessent recently opined, "If we deregulate the economy, if we get this tax bill done, if we get energy down, then rates will take care of themselves and the dollar will take care of itself." For all appearances, Bessent can not just talk the talk, he is willing to walk the walk.

What the Fed - itself becoming inconsequential and something of an ineffectual mirage in monetary matters - does from here on out is not likely to be as important or influential in markets as what Trump and Treasury propose and perform. It should come as welcome relief to American citizens that their lives are no longer going to be ruled by the dictates of a private banking behemoth which is nearing the end of its useful existence. With Trump commanding markets, policy, and broadly, the economy, the Fed will likely be out of business in a few short years.

Gold isn't rushing to America for no good reason. The United States is rapidly aligning itself with BRICS nations that have been acquiring gold for the better part of the last two decades. In America's rush to catch up, the price of gold will matter much more than the yield on a one-month bill or one-year note.

The effect of this reordering of control over financial markets can be seen quite clearly in the spread on 2s-10s, which dropped dramatically this week, from +36 to +20. When the 10-year note yield falls below 4.00%, which it will, expect the Fed to cry foul and have no choice but to lower the federal funds target rate to 3.75-4.00% or lower, a full fifty basis points from its current level.

This condition of the federal government warring against policies of the Federal Reserve bears close attention going forward as the changes brought about are certain to be monumental.

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
1/31: +36
2/7: +20

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
1/31: +36
2/7: +32

Oil/Gas

WTI crude oil prices continue to fall, from $77.37 at the New York close on January 17, to $74.60 on January 24, to $73.81 on January 31, and finally to $71.06 at the New York close this Friday. The oil rout has only begun. Prices should continue coming down into the mid-to-low 60s and possibly further.

Energy, priced in dollars, will become cheaper and cheaper should President Trump's policies and deregulation take firm hold of markets.

Prices at the pump have yet to reflect lower input prices, i.e., crude, but they will, shortly. There's usually a lag of roughly a month as old supply is sold off and replaced by newer, cheaper fuel. The switch from winter to summer blends will also keep prices artificially elevated for a short time, but, considering the direction of the trend, almost every state other than Hawaii and California will probably see gas at the pump under $3.00 by May or June.

Gasbuddy.com is reporting the national average for a gallon of unleaded regular gas at the pump up four cents from last week, at $3.11 a gallon Sunday morning.

California continues to lead the way, up sharply from last week, at $4.56, from $4.43 a gallon.

Pennsylvania was stable at $3.36, the Keystone State remaining the price leader in the Northeast. New York is a distant second or third, at $3.15. Connecticut ($3.08) was slightly higher along with Massachusetts ($3.01). Maryland is now the second-priciest in the Northeast ($3.19).

Illinois fell by a penny, to $3.22. Ohio ($3.03) and Indiana ($2.93) were both marginally higher, though the overall trend is headed down further.

Mississippi ($2.63) wrested back the tital of overall low-leader from Oklahoma ($2.71) this week. Following are Texas ($2.68) and Louisiana ($2.70) are now both lower than Oklahoma. Tennessee ($2.73), Alabama ($2.78), and Arkansas ($2.79) come in just pennies lower than Kentucky and Kansas (both, $2.82), and South Carolina ($2.83). Missouri ($2.87) and Georgia ($2.93) follow. Florida's price popped back up a dime, to $3.15.

Sub-$3.00 gas can now be found in fewer states than in prior weeks. At least 24 U.S. states have prices under $3.00, down from more than 28 last week.

Arizona ($3.26) is up another two cents from last week. Oregon showed prices higher, at $3.63, Nevada at $3.69. Washington was up eight cents to $4.00, joining California in the small club of mainland states at $4.00 or higher. Utah ($3.03) was stable, but Idaho ($3.17) was higher by ten cents.

Bitcoin

This week: $96,477.31
Last week: $98,218.74
2 weeks ago: $105,019.30
6 months ago: $60,463.20
One year ago: $47,746.95
Five years ago: $8,531.39

Bitcoin was close to $106,000 on Thursday, January 30, less than two weeks ago. It can't die soon enough. Those hodlers hoping for bitcoin to become part of a U.S. sovereign wealth fund might as well be living in Wonderland along with Alice and the Mad Hatter.

Precious Metals

Gold:Silver Ratio: 89.66; last week: 87.14

Per COMEX continuous contracts:

Gold price 1/12: $2,717.40
Gold price 1/19: $2,740.00
Gold price 1/26: $2,777.40
Gold price 2/2: $2,809.30
Gold price 2/9: $2,886.10

Silver price 1/12: $31.30
Silver price 1/19: $31.05
Silver price 1/26: $31.04
Silver price 2/2: $32.24
Silver price 2/9: $32.19

Gold soared to another record close on Friday, up $76.80 for the week while silver actually fell a nickel, proving once again the nearly-complete disregard for silver as a monetary metal, at least according to COMEX and the LBMA.

Bemused silver stackers should be reminded that silver remains the measure of U.S. constitutional money despite the many efforts over the years by central bankers, legislators, and other nefarious people to destroy it in its role as the money of gentlemen. Once again, the blatant disregard for silver sets up yet another buying opportunity for true believers. A gold:silver ratio indicates gold in an overbought condition with silver lagging and the obvious investment choice going forward.

There is perhaps something of a buyer's strike or remorse setting in. Silver holders are likely to be less-than-enthusiastic about this most recent slap in the face. Prices on ebay reflect a lull in demand. When silver regains its rightful place as a monetary metal, the price will soar. Some believe triple digits are possible, and they may be on the right track. A gold:silver ratio of even 25 would put silver at $115.44 TODAY. When sanity is eventually restored and fiat currencies dead and buried, silver should command a price commensurate with the historical 12:1 or 16:1 ratio to gold.

The United State constitution mandates that 1 US dollar should equal 371.25 grains of silver, this means that the dollar is defined as containing 0.7734375 troy ounces of silver. If silver was backing our currency, we would be by far the wealthiest nation on Earth by orders of magnitude.

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:	36.00	40.00	38.14	38.06
1 oz silver bar:	37.00	46.95	41.00	40.50
1 oz gold coin:	2,935.00	3,138.40	3,035.46	3,041.23
1 oz gold bar: 2,972.10	3,081.84	3,008.20	2,999.45

The Single Ounce Silver Market Price Benchmark (SOSMPB) fell for a third straight week, to $39.43, a decline of 75 cents from the February 2nd price of $40.18 per troy ounce.

Once more, silver is indicating buyer pushback against high premia. 10-15% should be standard. Besides, with the COMEX continuing to pressure the silver price, why would anybody pay over $40 when spot is $31-32?

WEEKEND WRAP

“You can ignore reality, but you cannot ignore the consequences of ignoring reality.” - Ayn Rand

Enjoy the game. Fearless Rick has posted his pick and the coin flip pick, plus 19 Super Bowl quizzes, popular prop bets, theories and more at IdleGuy.com Sports.

Also, scores and MVPs of every Super Bowl from 1967 to the present.

At the Close, Friday, February 7, 2025:
Dow: 44,303.40, -444.23 (-0.99%)
NASDAQ: 19,523.40, -268.59 (-1.36%)
S&P 500: 6,025.99, -57.58 (-0.95%)
NYSE Composite: 20,039.48, -118.10 (-0.59%)

For the Week:
Dow: -241.26 (-0.54%)
NASDAQ: -104.04 (-0.53%)
S&P 500: -14.54 (-0.24%)
NYSE Composite: +40.66 (+0.20%)
Dow Transports: -159.65 (-0.98%)

Friday, February 7, 2025

January Jobs +143,000, November, December 2024 Revised Higher; Amazon Flops; Big Football Game Sunday

Beyond the Washington D.C. DOGE spectacle, protesting Democrats, laysuits flying in every direction, Friday morning's January Non-farm Payroll report takes precedence over everything, at least for a few hours.

The ever-reliable BLS reports this morning that the U.S. economy created 143,000 jobs in January, less than estimated (160,000), but still solid, with the unemployment rate falling to 4.0%. The number was lower than last January's 166,000, but the numbers under Biden are hardly believable. November was revised up by 49,000, from +212,000 to +261,000, and the change for December was revised up by 51,000, from +256,000 to +307,000. With these revisions, employment in November and December combined is 100,000 higher than previously reported. (My, oh, my, what accuracy! Only 23% and 20% off, respectively.)

This report isn't exactly what Wall Street wanted. The cumulative desire among the speculating class is for cratering employment figures, so that the Federal Reserve will have cause to lower the federal funds rate, making it less expensive for corporate execs to borrow money to repurchase shares of their companies. That's how money is made these days, other than, well, getting $7 million in subscriptions from the government, like Politico.

Whether any of these numbers matter much is a good question, given that there are likely to be thousands and thousands of government employees hitting the bricks in months ahead.

Moving on, the other headline this morning is Amazon earnings, which came in above estimates, though growth in AI-related services wasn't as expected, so it's trending lower Friday morning by about three percent.

Thus far, the week has gone well. Through Thursday's close, the Dow is ahead by 203 points, the NASDAQ is up 164, and the S&P shows a gain of 22 points.

Stock futures bounced around a bit after the jobs report release, but other than Dow futures up 35 points with a half hour to the opening bell, the NASDAQ and S&P futures are flat. Gold and silver are bid, slightly. WTI crude oil is at $71.02.

There is some kind of big football game this Sunday. The NFL prohibits commercial use of the term "Super Bowl", so you didn't see that. Maybe call it the NFL Championship? In any case, Fearless Rick has thoughts, theories, Taylor Swift, and picks over at IdleGuy.com Sports.

Enjoy the show, the game, the weirdness all around. Take Monday off. The day after big football games should be national holidays. Maybe Elon Musk can have Presidents' Day moved up a week or so in the name of efficiency, or, make every Monday from September through March (lest we forget March Madness) a mandatory day off without pay. Most federal employees take Mondays off anyhow.

Have a Happy!

At the Close, Thursday, February 6, 2025:
Dow: 44,747.63, -125.65 (-0.28%)
NASDAQ: 19,791.99, +99.66 (+0.51%)
S&P 500: 6,083.57, +22.09 (+0.36%)
NYSE Composite: 20,157.58, +28.69 (+0.14%)

Thursday, February 6, 2025

Stocks Continue Push Toward All-Time Highs; Gold Rocketing Higher Every Day; Trump, Musk, DOGE Continue Downsizing Government

At the rate Elon Musk and his merry band of disruptors at DOGE are going, the federal budget will be balanced next year.

That may sound like hyperbole, but the reality is that the corruption, fraud, and waste in Washington D.C. is so extensive and well-ingrained into every agency and department that cutting out $1.7 trillion might not be all that difficult. And then, there's clawbacks to consider. And, department closures, buyouts, lower employee headcount.

DOGE is currently inside the offices of the Medicare/Medicaid complex, which accounts for 22% of federal spending, some $1.5 trillion. It's a safe bet that between overpaid staff, fraudulent payments, and associated graft, there will be $500 billion cut right out of the heart of the nation's welfare health system.

When DOGE gets around to the Pentagon, Department of Defense and the other agencies that have been throwing away or giving to special interests and friends billions in taxpayer dollars for the last 40 years, the amounts will stagger the imagination. Americans will likely be calling for the heads of House members and Senators who were all too eager to play along.

It's great entertainment and very satisfying for the American public, but there should be rage that it's gone on for so long. Thanks to President Trump and Elon Musk, the days of handouts, carve-outs, hush money, kickbacks, lobbyists writing bills, and corruption are OVER.

By the middle of summer, heads will be rolling. Congresspeople, lobbyists, corporate types, and high-level government operatives will be getting their passports updated, shredding documents, closing bank accounts. Assuredly, a lot of that is already happening.

In the end, there's going to be a big void in the budget and at least as big a hole in GDP, since government spending accounts for about 40%. The effect on stocks is probably going to be negative, but by how much, nobody is really certain.

For now, Wall Street is content to just accept the carnage as collateral damage and keep pushing stocks higher. The major indices are closing in on all-time highs again.

On the other hand, gold continues to set new highs, day after day. Earlier this morning, gold touched $2,894 on the COMEX. $3,000 within months looks like a done deal. Silver continues to lag, despite widespread reports of shortages. It's trading on the COMEX around $32.50 this morning, but charts indicate a major breakout within months if not weeks.

WTI crude oil is reeling. It hit a low of $70.84 on Tuesday, but has rebounded somewhat, back above $71/barrel.

Enjoy the show.

At the Close, Wednesday, February 5, 2025:
Dow: 44,873.28, +317.24 (+0.71%)
NASDAQ: 19,692.33, +38.31 (+0.19%)
S&P 500: 6,061.48, +23.60 (+0.39%)
NYSE Composite: 20,128.89, +164.29 (+0.82%)

Wednesday, February 5, 2025

Market Bullishness, Complacency May Lead to Missing Bigger Picture; Trump Administration Turning World Upside Down

With stocks remaining close to all-time highs - within 2-4% currently - there's a tendency in human nature to become complacent. It's when everything seems to be going well that something seemingly coming out of nowhere becomes a cause of grief and panic.

Today's post will examine some of the looming issues that may have profound effects on stock performance in the short, medium, and long term, but mostly, these projections will look at the next six to 18 months, or, until about the middle (June, July) or 2026.

First, however, a few companies that reported earnings Tuesday and Wednesday, prior to the open, should be examined.

Estee Lauder (EL) was rocked on Tuesday, down 16% after reporting its fiscal second quarter 2025 earnings. Adjusted earnings of 62 cents per share beat most estimates (which are adjusted lower all the time), but the bottom line was down 29% from earnings of 88 cents in the year-ago quarter. Gross revenue was also down year-on-year. This is a huge consumer outfit, and it's forecasting slower and lower for the next quarter and beyond.

This company is, and has been, in big trouble for the past three years, though one would hardly know it given the lack of reporting by the financial media. Shares of EL hit a high on December 31, 2021, of 370. Tuesday it closed at 69.47, representing an 80% loss. But, that's not a problem, because (sarcasm warning) bitcoin fixes that or "muh, AI." EL's price/earnings ratio is somewhere in the stratosphere. Nobody's buying it.

This is a recurring theme that Money Daily has been reporting on for months. Companies beat estimates, stock is rated a buy by analysts, Wall Street coos happily, but, underneath the hood, revenue and profit are down from the same period a year ago. Wall Street and the financial press are famous for whistling past graves, mostly those of unsuspecting retail investors, people with their life savings tied up in 401k, IRA, and other retirement-type vehicles.

The most prominent company that reported Tuesday was Alphabet (GOOG), parent of Google, Youtube, et. al. The company, from all outward appearances, had a solid quarter, beating top and bottom line. So, why is the stock down seven percent pre-market? Maybe AI can tell us? Probably not, though the company announced it was planning to spend $75 billion building out its AI architecture. Maybe that's a bit much.

Advanced Micro Devices (AMD) reported Tuesday post-close, and the stock got hit by as much as a nine percent decline. With Wednesday's opening bell less than an hour ahead, it's still down seven percent. AMD is a chip-maker, caught up in the whole AI trend, but they're a competitor to Nvidia, and they're losing the war.

Analysts have cut their price targets on the stock, down to around a consensus of 140. Ha, ha, the stock is going to open around 107 or 108 and nobody's buying. These analysts are so optimistic, like stocks never go down. Sure, buy the dip, dips--ts.

One company that usually reports rosy earnings is Chipolte Mexican Grill (CMG), and they did so again Tuesday night. So, why is the stock down five percent pre-market? Why does this question keep re-appearing company after company? A good question, and anybody with a good answer is probably preparing to short everything in sight, because, usually, when companies beat expectations but then sell off, the next thing you know is they're losing money the next quarter or, at least not making enough to keep investors happy.

And then you end up living on the street in a box. (just thought that should be thrown in)

Next up, Disney (DIS), which beat estimates and is only down less than one percent. Should anybody buy Disney stock? Seems a safe bet, maybe. At least they're not involved in spending billions on AI infrastructure. But, the stock is down from a high of 197 in March, 2021, to 113 as of Tuesday's close. Streaming? Mickey Mouse? Theme Parks? Maybe a pass on putting much money into this still-somewhat-WOKE company. Prospects are not without risk. Next!

Thought there might be a winner in Stanley Black & Decker (SWK). However, even though the company did well, shares are being pummeled prior to the open, down more than four percent.

Earnings: $194.9 million in Q4 vs. -$304.4 million in the same period last year. EPS: $1.28 in Q4 vs. -$2.03 in the same period last year. Excluding items, Stanley Black & Decker, Inc. reported adjusted earnings of $226.0 million or $1.49 per share for the period.

Those are solid numbers. Something is not adding up.

Last, Uber (UBER). Ooops, sorry. Here's a cross-section of headlines on the company's earnings: Strongest quarter ever, operating income well short of estimates, earnings, gross bookings outlook disappointing.

Well, shares are only down six percent heading toward the open.

Here's why all these stocks are falling and people are beginning to be a little less optimistic about future prospects, and this is only the short list:

Stocks are generally overpriced and have been for quite a while.
President Trump is upsetting the apple cart in Washington D.C. and around the world.
Elon Musk is exposing the extreme levels of theft and corruption in the U.S. congress. Some House members and Senators may be looking at a choice of options ranging from jail time, to extensive investigations, to retirement. It's very serious and everybody knows it.

Wall Street doesn't like uncertainty, and President Trump is bringing buckets-full of it. He and his henchmen in the cabinet are going to gut the government, end the handouts, bribes, kickbacks, and generally destroy the "go along to get along" good buddy system in congress, which is where the evil has been for a long time. The last four years may have been the worst of it, but the corruption goes back at least fourty.

Considering that the U.S. government is $36 trillion in debt, most of it squandered lining the pockets of legislators and campaign contributors, it might occur to President Trump that the American people shouldn't be saddled with that kind of debt.

What could Trump do? Default on some, maybe, but more likely re-negotiate. Instead of paying 3 or 4 percent interest, he may want that cut to one or 1.25%, helping the American public by lowering the cost of borrowing. Additionally, once the President and his people are done tearing the heart out of official Washington, the unemployment rate is going to be around six or seven percent, and all those government bureaucrats can start life over again as roofers, construction workers, fast food employees or crop pickers. It's not going to be easy, or pretty, but, one thing it is is NECESSARY.

The rot and corruption needs to be completely wrung out of the system to enable a proper new beginning. There will be a deep recession, but it's likely to be short. And, inflation? Don't worry about that. Prices are about to come down hard on food, energy, and housing, because there isn't going to be much in the way of demand and there's plenty of supply in food and gas, and yes, even housing, if regulations are lifted and zoning laws gutted.

This is why stocks are beating street estimates but losing ground. The world is being turned upside down, and, while it's a good thing and necessary, it does not come without an inordinate share of bumps and bruises along the way.

Good luck.

At the Close, Tuesday, February 4, 2025:
Dow: 44,556.04, +134.13 (+0.30%)
NASDAQ: 19,654.02, +262.06 (+1.35%)
S&P 500: 6,037.88, +43.31 (+0.72%)
NYSE Composite: 19,964.61, +94.28 (+0.47%)

Markets That Respond in Real Time to Geo-Political Events are Dangerously Clinging to Prior False Narratives

The world needed Donald J. Trump in the White House so badly. The need was palpable. Now, we’re beginning to see why.

Monday's market response to his tariff threats against Mexico and Canada were, in a sickeningly cynical manner, hilarious.

First, the futures markets sent stocks skidding lower, which extended into the opening hour of the cash session. When Mexico's president, Claudia Sheinbaum, agreed to send military troops to the Southern border and crack down on border crossings and trafficking of humans and drugs into the United States in exchange for a month's reprieve on imposition of the tariffs, markets were relieved.

Stocks jumped.

Later in the session, ineffectual Canadian Prime Minister Justin Trudeau agreed to similar terms, markets shrugged and moved on, still with a sense of doubt and uncertainty, finishing lower, though only slightly.

What happened to USAid offices over the weekend and into Monday morning, with Elon Musk and his merry bank of DOGE staffers diving headlong into slush fund records and oceans of graft and corruption, is a sign of things to come. While USAid was likely the major conduit of hush money and payoffs to congressional grifters, other departments will be found to be similarly weak and dishonest about their expenses.

Just wait until DOGE begins to examine the Defense Department. That's when the real bombs - truth bombs - go off.

As for markets that react like Pavlovian dogs to Washington's whistles, it's all been done before. Rich valuations, the product of too much hype, hope, and speculation, always end up in a dumpster fire of despair.

It's worth noting that President Trump, who hailed stock market performance in his first go-round as President, hasn't but once mentioned Wall Street antics or praised their gains or leadership.

All of the tech billionaires - Bezos, Zuckerberg, Ellison, et. al. - bestowed riches on the Trump inauguration and were prominent in attendance. They don't care about stock prices or whether they're worth $100 billion or $50 billion or even $25 billion on paper. They have power, access, and, so long as they toe the line and kiss the ring, they'll be just fine, thank you.

Markets at nose-bleed levels and valuations that would make Michael Milken blush are more the product of slick salesmanship and the greed of passive investors. The baby-boomers, millennials, and tag-alongs from generations X, Y, and Z, will never see what's coming, even though it's staring them in the face.

In the meantime, party on. While there may not be much more in terms of upside for the general markets, there's still ample time to get out of Dodge before the sheriff, tariffs, and the Man from DOGE show up.

At the Close, Monday, February 3, 2025:
Dow: 44,421.91, -122.75 (-0.28%)
NASDAQ: 19,391.96, -235.49 (-1.20%)
S&P 500: 5,994.57, -45.96 (-0.76%)
NYSE Composite: 19,870.33, -128.50 (-0.64%)

Sunday, February 2, 2025

WEEKEND WRAP: Trump Tariffs Imposed; Illegals Protesting Deportation; Gold Makes New Record; Everything Points to Dis-inflation or Deflation

Designed to hit the Sunday talk shows, on Saturday, February 1, President Trump issued tariffs on Mexico, Canada, and China, with the focus on America’s North American neighbors. China is only facing 10% tariffs, which won't affect inflation much, but Mexico and Canada got the harshest treatment with 25% tariffs on goods available for consumption and 10% on energy imports as the President issued an Executive Order expanding the national emergency at the Southern border to include the Northern border.

Here's the kicker. With the Trump administration steadfast in its efforts to arrest, detain, and repatriate (deport) illegal migrants, there will be fewer useless eaters and "undocumented persons" buying anything. Trump is also cutting off funds to the NGOs which passed out money, assistance, food stamps, and all manner of grift to illegals, which should turn out to be dis-inflationary if not outright deflationary. Any price hikes due to tariffs should, over time, be offset by decreased demand. Once Trump's immigration czar, Tom Homan, has deported a few million illegals, supply-demand will correct toward lower demand in the face of potentially less supply, the net result being minimal in terms of prices.

The process is likely to take time. Relieving the country of millions of takers is not going to happen overnight, but, in the long run, it is best for the U.S. economy to be built upon the shoulders and labor of actual citizens, not imposters. Already, reports are emerging of illegals staging mass protests in cities across America, though the mainstream media is, as usual, negligent in reporting on any anti-immigrant activity. There are also contractors and small businesses who are suffering slowdowns due to lack of (illegal immigrant) labor, essentially in roofing, construction, farming, food processing, landscaping, housekeeping, service, and other menial jobs that are generally the province of illegals.

Changes in the makeup of America's population are going to be radically realigned over the next four years. Expect the U.S. population to shrink by as much as eight to 10 million adults and another two to three million children. Americans have had their fill of illegals draining resources meant for American citizens. Restoring balance and righteousness is at the core of Trump's America First policies.

Long story short, disruptions in employment, retail, and consumption will be a feature, not a bug, for the next six to 18 months, and may result in a short, and possibly deep recession. By summer of 2026, most of the criminal elements of the cartels will have been dealt with, and well over three million people will have been deported. Jobs that "American's cant or won't do" will ultimately pay more, providing opportunities for people who actually want to work and be paid for their labor.

Should the plans afoot by President Trump and Elon Musk's DODE come to fruition, temporary disruptions are likely to be ofset with positive gains in employment of Americans at competitive wages. Dealing with import prices will be a longer journey that involves re-shoring of manufacturing and production to the United State. Policy changes and regulatory relief will usher in an era of prosperity with limited inflationary pressure. More money will circulate within America's borders by Americans buying American-made goods and services. The U.S. economy will emerge as a domestic mercantilistic construct that serves its citizens properly.

Stocks

Friday's stock market rout may prove to be significant as the first week of February commences. While the major indices showed a positive "January Effect" (the idea that as goes January, so goes the rest of the year), shakiness in tech and energy appear to be pointing in another direction. Dow Theorists (are there any left?) will take note of confirmation by the Dow Jones Transportation Average of the primary trend reversal begun back in December, when the Industrials were sent to the woodshed on 11 consecutive sessions.

Beginning on December 1, the Trannies dropped 13 of 14 sessions, bouncing off two-month lows to regain some momentum with the Dow Industrials' January sugar rush. Vastly underperforming the Industrials, the Trannies may now be in the leadership position. It would be worthwhile to watch both averages for correlations, because they are currently sending a strong sell signal. Investors were piling out of techs and into the Dow and their relatively higher dividend-paying issues, seeking shelter from the storm that is brewing in international markets as tariffs and taxes begin to take their tolls.

NASDAQ is struggling to stay above its 50-day moving average. Tech tocks were battered by China's DeepSeek open source AI model, which blew apart some of big tech's subscription revenue forecasts and made heavy investments in chips and energy infrastructure appear to be less-than-optimal use of funds. Bull market bubbles are typified by mal-investment - a term that's become obsolete in the current financial jargon - and tech hustling into mass capital injections is beginning to look like text-book application. Hype is one thing. False promises, based on false premises, is the stuff of market crashes.

Adding in the Trump/Musk effect and the current dismantling of the deep state, geo-political turmoil, and mass arrests and deportations of illegals from the U.S. mainland makes for a very unsettled environment, just the condition Wall Street abhors.

The week ahead will be not quite as busy as last week for fourth quarter and full year 2024 earnings reports, with the focus on Alphabet, parent of Google (GOOG), Amazon (AMZN), Disney (DIS), Pfizer (PFE), Merck (MRK), PayPal (PYPL), and Palantir (PLTR).

Monday: (before open) Tyson (TSN), Kyocera (KYOCY); (after close) Rambus (RMBS), Clorox (CLX), Palantir (PLTR)

Tuesday: (before open) Merck (MRK), Estee Lauder (EL), Pfizer (PFE), Spotify (SPOT), PayPal (PYPL), Pepsico (PEP); (after close) AMD (AMD), Snap (SNAP), Amgen (AMGN), Prudential (PRU), Chipolte Mexican Grill (CMG), Alphabet (GOOG), Electronic Arts (EA)

Wednesday: (before open) Toyota (TM), Stanley Black & Decker (SWK), Johnson Controls (JCI), Uber (UBER), Disney (DIS); (after close) Ford (F), MetLife (MET), ARM (ARM), AMSC (AMSC), O'Reilly Auto Parts (ORLY), Qualcomm (QCOM)

Thursday: (before open) Roblox (RBLX), Hershey (HSY), Bristol Myers Squibb (BMY), Yum Brands (YUM), Lilly (LLY), Peloton (PTON), ConocoPhillips (COP); (after close) Cloudfare (NET), Amazon (AMZN), Pinterest (PINS),

Friday: (before open) Avantar (AVTR), Canopy Growth (CGC), CBOE (CBOE).

The data calendar is not substantial until later in the week, highlighted by January Retail Sales on Thursday, and the January Non-farm Payroll report on Friday. Wednesday's ADP private sector jobs report should give a sneak peek at Friday's NFP, expected to be a clunker, with estimated centered around 160,000 or whatever the first NFP report for the Trump administration can dream up.

Friday also sees the University of Michigan's consumer sentiment survey results.

Treasury Yield Curve Rates

Date	1 Mo	2 Mo	3 Mo	4 Mo	6 Mo	1 Yr
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
01/31/2025	4.37	4.37	4.31	4.33	4.28	4.17

Date	2 Yr	3 Yr	5 Yr	7 Yr	10 Yr	20 Yr	30 Yr
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
01/31/2025	4.22	4.27	4.36	4.47	4.58	4.88	4.83

For the second straight week, treasuries were relatively well-behaved, with the majority of bills, notes, and bonds slipping slightly, thanks, not to the FOMC and the Fed, but to bond buyers seeking and finding value in fixed income.

Notably, despite the Fed's reluctance to lower the federal funds target rate, 30-day bills droppd eight basis points, a reflection of increasing interest on the short end of the curve. Yields on all notes dropped slightly, losing five to seven basis points over the course of the week. The curve continues to flatten, with spreads diminishing or remaining on hold. 2s-10s have stabilized at +36. 30-day/30-year full spectrum is a match at +36, down four basis points from last week.

As was evidenced on Wednesday, FOMC meetings and the Fed in general are increasingly becoming less and less consequential. The economy doesn't run on interest rates alone and the era of investors hanging on every syllable coming out of a Federal Reserve official's mouth is coming to a happy ending. With a yield curve ultimately up-sloping from around 3.50-3.75 to 4.75-5.00, the nature and importance of treasury rates will become more matter-of-fact than a parlor game played by the ultra-rich and connected and more a reflection of a stabilized U.S. economy focused on prosperity and growth rather than greed and gamesmanship.

As the Fed diminishes in importance as it gradually lowers the federal funds target rate, normalization will provide a solid foundation for a better economy. Lending rates between 3.5% and 6.0% (mortgages) will become normative and the Fed's actions will become more of an afterthought than a primary consideration. America's debt burden, from consumers, to businesses, to governments needs to be put in order, a process that necessarily won't happen overnight.

Expect the Fed to keep interest rates on hold at least until June or July and possibly even September unless some exogenous event changes the economic landscape in a significant way, such as a serious recession, which remains likely, but should eventually be sharp and short-lived. A longer term view sees the federal funds target rate at around 3.50% by mid-2026, implying three more cuts of 0.25%. Inflation will cease to be a concern of the Fed and more a priority on the fiscal side.

Spreads:

Oil/Gas

WTI crude oil prices backed off again during the week, from $77.37 at the New York close on January 17, to $74.60 on January 24, to Friday's artificially-inflated finish at $73.81. The sudden jerk higher from a low of $72.00 was likely the result of speculation over Trump's imposition of tariffs on China, Mexico, and Canada. With a 10% hike on energy imports from Canada, there's little to no upside pressure on oil prices outside of the usual speculative gaming. Oil prices continue to decline, and should eventually find a quiet resting place in the range of $55-65 over time, possibly lower, though prices around $45-50 would be indicative of recession, if not outright deflation.

There's a possibility of global slowing due to tariffs and trade imbalances being seriously confronted. America, Russia, parts of Africa and South America have little to worry about from lower fuel prices, In fact, cheap energy in abundance produces prosperity. See America in the 1950s and 1960s and present-day Russia for reference.

Those countries dependent on energy imports, including the giant economies of India and China, may suffer short term from energy disruptions, but eventually, cheaper crude will flow to them as well, all of this making for a dis-inflationary environment globally under a peaceful co-existence sponsored by the leaders of the "Big Four", Russia, China, India, and the United States.

Gasbuddy.com is reporting the national average for a gallon of unleaded regular gas at the pump down a nickel from last week, at $3.07 a gallon Sunday morning. People who are touting inflation under Trump's watch are going to be proven serially incorrect. Prices have stabilized and a coming down, despite the fear-mongering in the financial press that predicts gas prices to rise by as much as 70 cents a gallon. Please avoid listening to TV morons spouting off on subjects they know nothing about, like economics.

California continues to lead the way, up a few cents from last week, at $4.43 a gallon.

Pennsylvania prices dropped to $3.35, with the Keystone State the price leader in the Northeast. New York saw a slightly smaller change, at $3.14. Connecticut ($3.07) was slightly lower while Massachusetts ($3.00) declined two cents. Maryland prices were lower by a dime, at $3.20.

Illinois fell two cents, to $3.23. Ohio ($2.85) and Indiana ($2.94) were both significantly lower and likely headed down further.

Mississippi and Oklahoma ($2.64) continue to vie for the low-price crown. Following are Texas ($2.67), Louisiana and Arkansas ($2.72). South Carolina slipped to $2.73, ahead of Kentucky ($2.76), Alabama ($2.78) and Tennessee ($2.79). Kansas ($2.82), Missouri ($2.88) and Georgia ($2.91) follow. Florida's price drop was dramatic, to $3.05, after $3.21 last week.

Sub-$3.00 gas can now be found in at least 28 U.S. states, though that number will likely increase to more than 40 in months ahead, despite summer "driving" season. The Northeast and West coast remain over-$3.00 holdouts.

Arizona ($3.24) is up another ten cents from last week. Oregon showed prices higher, at $3.52, Nevada at $3.62, and Washington at $3.92, leaving only California above $4.00. Utah ($3.03) and Idaho ($3.07) were higher, as were all Western states.

Bitcoin

This week: $98,218.74
Last week: $105,019.30
2 weeks ago: $105,074.80
6 months ago: $61,732.21
One year ago: $43,004.49
Five years ago: $9,895.13

Bitcoin was close to $106,000 on Thursday. It's shed more than $7,000 into Sunday morning. It's such an obvious scam. Bitcoin, as well as all other crypto-frauds are not stores of value, nor are they reliable media of exchange. They facilitate nothing more than cover for hiding off-balance sheet bank assets and criminal activity (same thing).

The crash to zero can't come soon enough. 16 years of grifting is more than enough.

Precious Metals

Gold:Silver Ratio: 87.14; last week: 89.48

Per COMEX continuous contracts:

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
Gold price 2/2: $2,809.30

Silver price 1/5: $30.10
Silver price 1/12: $31.30
Silver price 1/19: $31.05
Silver price 1/26: $31.04
Silver price 2/2: $32.24

Gold set a new all-time record on the Comex this week, checking in at $2838.00 on Friday before the usual cram-down by the LBMA and Comex riggers sent it to a close almost $30 lower. Silver was up on the week, substantially. Expect both to continue accelerating to the upside. Consider any knockdowns a gift. You know what to do.

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	43.95	39.32	39.34
1 oz silver bar:	39.00	45.46	41.31	40.50
1 oz gold coin:	2,853.00	3,037.93	2,947.72	2,945.88
1 oz gold bar:	2,875.00	3,003.79	2,937.86	2,934.70

The Single Ounce Silver Market Price Benchmark (SOSMPB) fell moderately, to $40.18, a drop of 73 cents from the January 19 price of $40.91 per troy ounce.

This may indicate some buyer pushback against high premia. 10-15% should be standard.

WEEKEND WRAP

Carry on.

At the Close, Friday, January 24, 2025:
Dow: 44,544.66, -337.47 (-0.75%)
NASDAQ: 19,627.44, -54.31 (-0.28%)
S&P 500: 6,040.53, -30.64 (-0.50%)
NYSE Composite: 19,998.82, -167.40 (-0.83%)

For the Week:
Dow: +120.41 (+0.27%)
NASDAQ: -326.86 (-1.64%)
S&P 500: -60.71 (-1.00)
NYSE Composite: +1.35 (+0.01%)
Dow Transports: -299.11 (-1.80%)

Friday, January 31, 2025

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%)

Thursday, January 30, 2025

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%)

Wednesday, January 29, 2025

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%)

Tuesday, January 28, 2025

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%)

Sunday, January 26, 2025

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:

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%)

Money Daily

Sunday, February 9, 2025

WEEKEND WRAP: Chaos at the Capital and Over Capital; Gold Soars as More Pours into US; Stocks Peaked? Treasuries Divergent

Friday, February 7, 2025

January Jobs +143,000, November, December 2024 Revised Higher; Amazon Flops; Big Football Game Sunday

Thursday, February 6, 2025

Stocks Continue Push Toward All-Time Highs; Gold Rocketing Higher Every Day; Trump, Musk, DOGE Continue Downsizing Government

Wednesday, February 5, 2025

Market Bullishness, Complacency May Lead to Missing Bigger Picture; Trump Administration Turning World Upside Down

Markets That Respond in Real Time to Geo-Political Events are Dangerously Clinging to Prior False Narratives

Sunday, February 2, 2025

WEEKEND WRAP: Trump Tariffs Imposed; Illegals Protesting Deportation; Gold Makes New Record; Everything Points to Dis-inflation or Deflation

Friday, January 31, 2025

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

Thursday, January 30, 2025

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

Wednesday, January 29, 2025

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

Tuesday, January 28, 2025

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

Sunday, January 26, 2025

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

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