Looking Backwards …
LB #1
On Saturday, Iran sent dozens upon dozens of drones and missiles toward Israel in response to the Israeli bombing of their top commander in Syria last week. The US has sent air defense forces to intercept incoming aerial projectiles and the Israeli Iron dome defense seems to be getting the majority of them shot down. Israel has now promised to retaliate against Iran. Iran has said that this retaliation ends their response, and the US should not become involved. Biden and the national security team had an emergency meeting Saturday afternoon and as yet there has not been a response other than the US stands behind Israel. Hezbollah and the Houthis are also involved bombing Israel and the entire region seems very unstable. When missiles fly and lives are at stake, I choose not to forecast anything regarding war. I tend to look toward the financial impact of the conflict.
If we try to do that, there have been numerous escalations. Iran has seized a ship in the Strait of Hormuz that was affiliated with Israel. This is the waterway connecting the Gulf of Oman and the Persian Gulf. The amount of oil that flows through this waterway is enormous and if this waterway gets shut down like the Houthis have done with the Red Sea, we will see much higher gas prices. I think the prices from two summers ago are again in play. That would be very crippling for the world economy which is very fragile as is. Markets are closed on Saturdays when I am writing this, but Bitcoin and cryptocurrencies are down 5-10%. These have correlated very closely with the S&P 500 so stocks could be affected on Monday. Oil prices will likely be higher, but this was expected so we will have to see if this is a one-off event or a continuous escalatory action.
This all comes after Russia and China both denounced the Israel attack saying it violated the Vienna conventions. China also denounced the attack on the Iranian consulate building in Damascus. I guess what is acceptable and what is unacceptable now depends on which side you are on. We now know the sides. It is Europe, Israel, and the US vs China and Russia and the Arab world.
To recap, explosions are reported over the skies of Israel as their air defense systems are capturing most of the incoming drones and missiles. Germany has just denounced the attack and said they stand by Israel. Latin America has been very neutral in their statements. The whole world is now focused on this conflict.
I have two thoughts, it is a very interesting distraction for the horror show that happened in markets this week. I always question when the government, and don’t think for a minute we aren’t hip deep in these conflicts, starts these distractions. The gold and silver markets were wild on Friday, Volatility spiked, and the stock market sold off again. Remember in Aug 1998 when Monica Lewinsky was testifying in front of the grand jury and Bill Clinton bombed an aspirin factory in the Sudan? There is no limit to the lengths these people will go to distract the American public.
The second thought is why Israel? I don’t get it. Two weeks ago they were about to go into Rafa and the US government was telling them to stop and we mentioned even Nancy Pelosi was talking about cutting Israel off from further aid. Israel’s move is to bomb a consulate and kill and Iranian general to get us to back their play when Iran responds. Did Joe Biden just fall for the banana in the tailpipe routine? We were telling Israel to knock it off and now Biden is calling the G7 countries together to discuss what they are going to do with Iran. That was tricky Israel, of course it only works with Joe Biden.
LB#2
At what point is the entire world going to tell Biden to shut up? Don’t bomb Ukraine? Israel don’t attack Iran. Don’t these people know I am running for reelection? And inflation, what are you doing going higher… This is what I was writing before the Saturday bombings of Israel. Biden is running around telling everyone not to bomb each other so the oil price stays down so he can win an election. Is this the real reason we are having this conflict? Is the Middle East saying, please give us anyone but Biden? We saw how he treated his partners in Afghanistan, and we want no part of that. The answer is maybe, I don’t know. I do know that the world is complicated and when the president has Americans running all over the world trying to put out all these fires, it just makes us weak and incompetent. We can’t even control the Red Sea.
Biden telling Ukraine what to do
LB#3
Orenthal James Simpson died this week from cancer, he was 76 years old. He leaves behind one of the most complicated life histories of all time. This was a golden boy. Really, he was golden when he was a boy. He was part of the 4 by 110-yard relay team that broke the world record in college. Track was his second-best sport. He was one of the greatest running backs of all time. In college he was a Heisman trophy winner and 2 time unanimous All-American. He was big and he was fast. His NFL career was less glamorous as he ended up in Buffalo and on some bad teams, but individually he was one of the best to ever do it. In 1973, he became the first running back to run for over 2,000 in a single season. To this day, he is the only person to do it in 14 games. Seasons got lengthened to 16 and now 17 games. OJ was an icon and the best running back of the 70s. This is where most athletes cease being famous, and their ensuing fame is a derivative of their athletic achievement. Not OJ, he becomes an actor playing a variety of characters on tv and the big screen. Who can forget his Nordberg character during the Naked Gun trilogy with Leslie Nielsen? But OJ or the Juice as he was called was way more than just an actor.
He was the first black man to be hired for a major corporate advertising campaign. Hertz rental cars made him their main spokesman. He killed it. He would run through airports in his commercials, and everyone would yell “go O.J. go.” Their brand recognition and earnings went through the roof. OJ could put butts in seats and move a needle in marketing which was rare for anyone much less athletes to do. Then he killed his beautiful model wife or ex-wife Nicole Simpson and a waiter. That’s right, this was before DNA testing was generally accepted and good thing. OJ had gone over to Nicole’s and stabbed her and her friend Ron Goldman. He had blood all over, his car, his clothes, at the scene and at his home, but his superstar legal team managed to get him acquitted. This was the biggest court case of the 1900s and was called the case of the century. If they didn’t find him innocent, the rumor was the riots which were fresh in everyone’s mind in 1991 would explode again. He walked and he set himself out to find Nicole’s killers. His words not mine. Then years later he gets arrested in Las Vegas for trying to buy his own memorabilia back or threaten to steal it from someone in a Las Vegas hotel room. You don’t do armed robbery in Las Vegas hotels and they sent him away for a very long prison sentence. He did 9 years and then got out and lived until his death in Las Vegas. He was handsome, charming, and played tennis in Brentwood with Al Michaels the long time NFL broadcaster. He is also rumored to be Khloe Kardashian’s true father and Robert Kardasian, the sex tape family patriarch, was on his legal team. This man lived a full and crazy life. I watch the movie Troy and there is this line in it where Achilles is asked if he is scared and he responds no, but the little kid that asks replies well I would be. Achilles responds that is why no one will remember your name. I feel like we will be talking about OJ Simpson will be remembered for centuries with all the stuff he did, and no one will believe it.
Looking Forwards…
LF#1
Why do I wonder if there is a bit of a smokescreen happening to take our attention off the real issue in America? The Tuesday 3-year auction of $58 billion was tied for the largest on record because our debt is at record’s and these auctions are Santa Ana’s soldiers at the Alamo. The auction went poorly the day before the CPI print came out. It tailed at 2.0 basis points, which is bad the worst since February 2023. The next day, I watched the world’s reserve currency show higher than expected inflation in the CPI report and then I watched us try to sell bonds. Wednesday after the CPI report came out and bond yields spiked and bonds sold off, the Wednesday auction was awful. Wednesday’s auction of 10-year bonds was almost 40 basis points higher than last month and tailed, which is bad for demand. It was the largest tail at 3.1 bps since December of 22, and the third largest on record. There is more, from ZeroHedge, “The internals were even uglier, with foreign buyers tumbling from an already low 64.3% to 61.8% the lowest since Oct 23 and far below the six-auction average of 65.9; and with Directs also sliding to just 14.2%, the lowest since Nov 21, Dealers ended up stepping up bigly and taking down a whopping 24.0%, the highest since November 22. The market reaction was instantaneous and brutal with 10Y yields, already trading at session and 2024 highs, spiking by 6 bps to another day high of 4.56%, and fast approaching a level where not only stocks will tumble but the entire economy collapses as it grinds to a halt, similar to where Biden’s approval rating will be in the very near future.” Do I think that our government is capable of creating distractions from their awful performance, yes I do.
LF#2
The American government is being sued by its people, more specifically the National Park Service. Saman Shafiq writes for Yahoo news, “The Americans − from California, New York and Georgia − filed the lawsuit earlier this month in federal court in Washington, D.C., saying that the park service is violating federal law by not allowing guests to pay cash to enter various parks, monuments and historic sites. The lawsuit says the park service’s policy violates a U.S. law that says that “coins and currency … are legal tender for all debts, public charges, taxes and dues.” This is fantastic news and I hope that there is a precedent set. The use of cards is the use of credit, not money and we are about to learn a lesson in credit so the quicker we can stop the irresponsible use of credit the better. Just look at what we just talked about to see how well and responsibly we are using credit. These are our national parks, these civil servants work for us not the other way around, and if we show up with constitutionally backed currency and are denied entry to our parks, we should take the administration away from them. We will soon have to take away a lot of powers from the government because they have abused their powers. That will be a showdown for a different day, when we become Argentina. You can see that Javier Milei is currently slashing and burning his government and government agencies. Yeah, that will have to happen here someday. Hopefully I won’t be around to see it.
LF#3
Last week a deranged person went to a shopping mall and started stabbing people. Joel Cauchi fatally stabbed 6 people, no word on whether the American liberals want to outlaw knives at this point but I digress. In Bondi Junction, Australia near the famed surf beach a lone female cop, or inspector in Australian parlance, responded to the emergency. This from Hannah Ritchie from the BBC regarding the actions of hero Amy Scott, “She confronted the offender who had moved, by this stage, to level five. As she continued to walk quickly behind to catch up with him he turned to face her, raised a knife, she discharged a firearm and that person is now deceased.”
One lone officer ran towards the scene while all those were running away. She acted alone with no back up. I write about my disgust for most of our overreaching government functions, but we need to remember that in times of need the police provide a service that we take for granted and we shouldn’t. Amy Scott is a hero and saved lives. Thank you for your service to your people.
Sincerely Yours,
C Thomas Printer
The Dow Jones finished trading at …………37,983
The 10-year Treasury bond is at …a 4.518%
The price of Brent Crude is … at $90.45 per barrel.
The price of gold is … at $2,360/oz.
The price of silver is … $27.97/oz.
Thank you for listening today and you can find all of our articles and more on our website cthomasprinter.com.