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Money Daily has been providing business and financial market news, views, and coverage on a nearly continuous basis since 2006. Complete archives are available at moneydaily.blogspot.com.
PRIOR COVERAGE:
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Friday, April 11, 2025, 9:25 am ET As might be expected, following Wednesday's record gains, stocks are looking at a very solid week, despite traders opting to give some of those gains back on Thursday. Through Thursday's close, the Dow enters Friday holding onto a massive 1278-point advance (3.38%). The NASDAQ is up 5.13%, or, 799.52 points, while the S&P has added 193 points (3.82%). Friday's pre-market focus falls on bank earnings and March PPI, all of which registered positively with market-watchers. The BLS released March PPI data an hour prior to the opening bell, and, like it's counterpart CPI, which showed inflation reversing course, final demand decreased 0.4 percent, seasonally adjusted, with the bulk of the drop in the goods sector (-0.9%). Services fell 0.2%. The annualized increase came in at 2.7%. Core PPI, defined as less foods, energy, and trade services edged up 0.1 percent in March after increasing 0.4 percent in each of the previous three months. These figures registered positively, sending stock futures higher, though not by a great deal. Reporting first quarter earnings Friday morning were JP Morgan (JPM), which beat expectations for the first quarter by nearly 10%, with an EPS of $5.07. Morgan Stanley reported net revenues of $17.7 Billion and EPS of $2.60, both of which topped estimates and were positive compared to the year-ago first quarter. Wells Fargo (WFC) announced EPS of $1.40, beating expectations. Pre-market trading had Wells Fargo and Morgan Stanley down slightly with JPM up about two percent. BlackRock (BLK) also beat, with EPS of $11.30, but the stock was headed lower prior to the opening bell by less than one percent. Overall, a positive tone prevailed, sending stock futures higher. Dow futures gained 150 points at 9:00 am ET. NASDAQ futures were up 40 to 50 points and S&P futures gained 12 points. However, futures began to decline as the open approached, likely due to the continuing chaos concerning tariff struggles with China, spoiling the party for the banking sector and possibly the rest of the market. The general mood is cautious with equal amounts of optimism and pessimism clouding consensus. With earnings season hitting full stride over the next three weeks, the early indications from some of the nation's largest financial institutions should provide a solid backdrop, though the tariff confusion hangs over the market like an ominous dark cloud. Investors need clarity on the issues with China, but it appears that negotiations with America's largest trading partner might take quite some time to reach any reasonable compromise. For now, neither side is budging from established positions, with both continuing to add to tariff levels and harangue the other side. While stock futures were losing steam, overnight, gold and silver were bid higher, with gold reaching a record level at $3,251 and rising. Silver had been lagging after its massive smackdown below $30 last week, though it has begun to gain ground at an accelerating pace. The gold:silver ratio over 100 continues to suggest silver is the buy. Crude oil was flat, with WTI at $60/barrel. Bitcoin overcame earlier weakness, rallying to nearly $83,000 early Friday, but pulling back from that level. The week's conclusion could be just about any flavor, though the real winner appears to be gold, which has gone from $2,973 to $3,250 just this week. Are you not amused?
At the Close, Thursday, April 10, 2025:
Thursday, April 10, 2025, 9:09 am ET On Wednesday, Money Daily offered a bold perspective on markets and the politics of tariffs, speculating that stock markets globally could be subject to crash dynamics in the near term, given the uncertainty and tensions stemming from President Trump's tariff regime and the herd-like behavior of algorithmic trading. Given that stock prices on major indices worldwide were either in correction or bear market conditions, it seemed appropriate that stocks could suffer from seen or unforeseen shocks. Midday on Wednesday, however, an unforeseen shock sent stocks soaring in the opposite direction when Trump backed off on his retaliatory tariffs, issuing a 90-day delay in their implementation on all countries other than China. Trump's announcement spurred an enormous upside spike and trading volume of around 30 billion shares, the highest level in history, as far as is known. CNBC offered some sobering perspective on the record day's developments, quoting Mohamed El-Erian, Allianz's chief economic advisor, "I think you need certainty. I think the 90 days, that's a good period, but quickly people are going to start asking what happens next." For his rationale on lifting the tariffs for 90 days, President Trump, always quick with a line, said, "I thought that people were jumping a little bit out of line. They were getting yippy, you know, they were getting a little bit yippy, a little bit afraid." What "people" was Trump referencing? It sounds suspiciously like he was talking about Wall Street and other investment types, as the stock market had been tanking since he announced his tariff plans just a week prior. Maybe he was talking about people in his administration, trading partners, or the whole world. Trump's changing policies have sparked general chaos in markets, which isn't good for investors or his overall image. Simply put, the 90-day delay on tariffs was totally bush-league, and, despite the huge gains on Wednesday, stocks are still down since he took office, though not quite so severely. From a numbers perspective, here's how Wednesday's market advance stacks up: The Dow's gain of 2,962.86 points was the highest all-time, though on a percentage basis, the +7.87 spike ranked only 19th historically. It is noteworthy that three of the top four point gains on the Dow came in March and April of 2020, during the dot-com crash, as well as three of the top four losses. Additionally, the third-largest point loss on the Dow happened less than a week ago, on April 4, when the industrials fell 2,231.07 points, or 5.50% and that came on the heels of the prior day, when the Dow lost 1,679.39 points, the sixth largest loss ever. The NASDAQ more than doubled the previous record point gain. It's 1,679.39-point rise surpassed the November 10, 2022 gain of 760.97 points. On a percentage basis, Wednesday's 12.16% rise was second to the 14.17 on January 3rd, 2001. Similar to the Dow, three of the top five point losses on the NASDAQ have occurred in just the past month. The other two are from March, 2020. The S&P 500 gain of 9.52% tied for the 8th-highest, though the point gain of 474.13 more than doubled the 230.38 gain of March 13, 2020. All this goes to show is that - with 2020 as a reference point - stocks will move violently in periods of uncertainty. Volatility is a two-way street. Additionally, the outsized point and volume totals demonstrate just how overvalued stocks still are, despite the major averages being down year-to-date (Dow: -4.55%; S&P: -7.22%; NASDAQ: -11.32%). Thus, the Money Daily crash alert cannot be taken off the table, as one-day events, especially record-shattering ones, can easily be reversed in periods such as the current one. There are also any number of suspicious stock moves. A couple of them involve companies that had issued first quarter earnings. Delta Airlines (DAL) reported Wednesday morning, beat estimates, but withdrew its full-year financial guidance, citing increased costs due to tariffs in purchasing planes from Airbus, based in Europe. The stock was marginally higher early in the session, but ended up with a gain of 23%. Other airlines, United, American, and Southwest, also recorded big gains. Constellation Brands (STZ), which reported Wednesday after the close, had been as high as 244 (December 9) and as low as 161 (February 12) recently. It gained 13 points on the day, about 8%, but is still trading close to its recent lows at 183 after reporting that it planned to sell off its cache of lower-priced wines and focus more on premium beers and wines. As Thursday's open approaches, investors are guessing what will happen next. Japan's NIKKEI led Asian markets with a gain of 9.13%. Even with that, it's still down more than 14% from recent highs. The same can be said for European stocks, all sporting gains between four and five percent, though still down 12-15% generally. Bitcoin is down $1500 ($81,800) after soaring to erase early Wednesday losses. WTI crude oil dropped to a low of $55.40 Wednesday before bounding higher, reaching $63.09 in the market euphoria. This morning it is back to $60.51, hardly a ringing endorsement of yesterday's outpouring of love for all assets. What has held up overnight and was up more than $100 prior to Wednesday's big bang is gold, soaring another $64 dollars this morning, to as high as $3,148. Silver tagged along, rising from $29.44 early Wednesday to as high as $31.17 this morning. Stock futures were trending lower overnight and into the U.S. AM. Dow futures were down as much as 730 points, NASDAQ futures bottomed about 500 points lower and S&P futures were off as much as 128 points, but they had firmed up somewhat after 7:00 am. At 8:30 am ET, March CPI was announced by the BLS:
The Consumer Price Index for All Urban Consumers (CPI-U) decreased 0.1 percent on a seasonally adjusted basis in March, after rising 0.2 percent in February, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 2.4 percent before seasonal adjustment. The big mover was energy, down 2.4% for the month, led by a 6.3% drop in the price of gasoline. Everything else was higher. Further:
The all items index rose 2.4 percent for the 12 months ending March, after rising 2.8 percent over the 12 months ending February. The all items less food and energy index rose 2.8 percent over the last 12 months, the smallest 12-month increase since March 2021. The energy index decreased 3.3 percent for the 12 months ending March. The food index increased 3.0 percent over the last year. As expected, equity traders sent stock futures galloping higher, but the gains were quickly reversed, dropping back close to overnight lows. Six months from now, intrepid inflation fighters will likely be pleading with the Fed to lower rates to give producers some pricing power. The big picture still offers more than sufficient uncertainty to move markets any which way. Trump remains unpredictable and largely in charge of the world order. After Wednesday's obscene showing, Wall Street and the President may not want to wish so hard, as they may get more than they bargain for. Stocks are still lower from a month ago and down year-to-date. Bear markets - which is and has been the obvious primary trend since March - don't end on good news, even the biggest gains ever on record volume. There's almost certainly more downside ahead, possibly even today. Everybody knows when its time to take profits.
At the Close, Wednesday, April 9, 2025:
Wednesday, April 9, 2025, 9:22 am ET WARNING: This is explosive material that may not be entirely correct. This is information and conjecture concerning recent and past events and there is no guarantee of its authenticity. However, this information has been researched in depth and is presented as honestly as possible. -FR There's no easy way to explain why stock markets globally are all suffering. The recent carnage cannot be completely attributed to President Trump's tariffs, which overnight soared to 104% on Chinese imports and also have been imposed on over 100 nations at various percentages. There are many other contributing factors, all of which have stocks in markets around the world headed for an imminent crash, which, honestly, is already well underway. A useful analogy would be to envision the global financial system as a giant skyscraper rigged with an enormous bomb that is linked by fuses to stock, bond, commodity, FX exchanges, governments, and central banks around the world, each wired with smaller, though no less lethal bombs. Trump's tariffs are fuses, connected to each of the various markets. Those fuses were lit last Wednesday, when Trump unveiled his tariff agenda in a Rose Garden ceremony. Exchanges have been blowing up, gradually, but the action is accelerating. Stock markets around the world have been reeling and the explosions haven't stopped. There's every reason to believe that the entire house of cards that is the international system of finance, complete with central banks, stock exchanges, bond markets, floating currencies, fractional reserve banking, fiat money, government debt, household debt, leveraged brokerages, hedge funds and all manner of derivate bets like the ones that nearly brought the entire global financial system down in 2008. When Donald J. Trump was elected president of the United States back in November, one of his most prominent campaign promises was his desire to "drain the swamp," euphemistically referencing the corruption, theft, and villainy that pervaded government in the United States. Most of the people who voted for Mr. Trump agreed that cleaning up the U.S. federal government was long overdue. What they did not understand, and which was never explicitly mentioned was that the "swamp" extended far beyond congress, and federal agencies of the U.S. government. The "swamp" which Trump vowed to drain included Wall Street, the Federal Reserve, the Bank of England, the World Trade Organization, World Bank, World Economic Forum (WEF) central banks and governments around the world which enabled massive inflation by creating counterfeit money out of thin air, stock markets, many major corporations and their executives, the global financial and mainstream media complex of propaganda and misinformation and much more. This is what Trump understands, along with Chairman Xi in China, President Putin in Russia, Prime Minister Modi in India, and probably some other well-connected business and political leaders entrusted with Trump's bold agenda. President Donald J. Trump has literally nothing to lose. The deep state has tried to kill him twice that the public is aware of, probably many more times. They used every legal means available to keep him out of the White House. They even stole the 2020 election and rigged results in various congressional races to tilt the levers of power toward Democrats and liberals. They failed. By igniting the fuse of tariff trauma, President Trump, notable for his book, "The Art of the Deal" has also undoubtably read Sun Tzu's "The Art of War," which he is now waging full force against the deep state, the swamp, the utterly vile, corrupt establishment that seeks to enslave the entire world. Trump had no choice but to light the fuse that would bring down not just the U.S. government, but Wall Street, the City of London, various other governments around the world, and corporations that have been hiding the truth, cooking the books, and basically lying to everybody all time for many years. Just this morning, China retaliated by applying an 84% tariff on U.S. imports and overnight issued a White Paper outlining China's position regarding tariffs and trade. Yesterday, rumors of hedge funds needing a bailout from the Federal Reserve circulated, indicating a severe liquidity event could explode at any time. Trump, likely with assistance and knowledge from Putin, Modi, and Xi, are blowing up the world's financial system. That's all there is to it because the system is so corrupt, the deep state so deeply entrenched, that it has to be completely demolished and a new system erected in its place. These plans have almost certainly been well-laid and decided upon by the interested parties and are evolving as each day goes by. The time to exit stocks was last month or even back in February or November of last year. Anybody with significant amounts of the wealth should have been considering trimming back at the very least before Trump lit the fuse of international financial armageddon with his tariffs. There is still time to save some of your money, get out of the stock market and hold still while all of this carnage unfolds over the next few days, weeks, and months. With any luck, the crash will be short, but very painful for anybody who hasn't heeded the multiple warnings. Cash, gold, silver, anything unconnected to the global financial system is going to outperform stocks by miles. Today is the final warning. The Dow, S&P, and NASDAQ, which is already down more than 20% are going to decline by as much as 75% from their peaks. Ask yourself, can I handle losing 30%, 40%, 50% of my money? If the answer is no, you must sell your stocks as quickly as possible because this is not going to end soon or well. Good luck. You'll need it.
At the Close, Tuesday, April 8, 2025:
Tuesday, April 8, 2025, 9:25 am ET Monday's trading was all algorithmic. If you take the labels and numbers off of Monday's charts for the Dow, NASDAQ, and S&P, you could not tell which was which. They are all identical. As much as 90% of all trading is done by computer algorithm, reacting to headlines thrown like chum to sharks by the mainstream media. Reactions are instantaneous, which is why early Monday's action was so volatile, especially the spike from the message (most likely Bloomberg) that there would be a 90-day delay on tariffs, which Trump's people readily dismissed as the "fake news" that it was. However detached from reality the tariff delay story was, it still managed to rip stocks higher from early losses. In a span of about 35 minutes from around 9:45 to 10:20, the S&P gained an astonishing 400 points. The Dow rose nearly 2500 points, and the NASDAQ gained 1400 points. While most of the gains were soon erased, the stage had been set for the usual day-trading antics that played out over the course of the remaining session. Tuesday morning has futures soaring on soothing words on tariffs and negotiations from Treasury Secretary Scott Bessent, with Dow futures up over 1,000 points, NASDAQ futures ahead by 400, and S&P futures 123 points higher. In their generous euphoria, even gold and siver futures are higher, with gold back above $3,000 and silver above $30 an ounce, though the gold:silver ratio over 100 is totally out of whack. WTI crude oil remains depressed at around $61.50. Even with stocks looking to rebound from last week's rout, there's nothing to suggest what happens today will turn markets around. The losses have been steep and the effect of the tariffs - outside of some countries like Vietnam, Japan, and South Korea seeking negotiations - have not yet been felt anywhere outside of Wall Street. Stocks were overpriced to begin with. Trump's realignment of international trade just shook things loose. The shaking, gyrations, and volatility of recent days are likely to continue for some time. Anything that occurs today could just as easily be reversed tomorrow, as President Trump has promised additional 50% tariffs on China if they don't withdraw their 34% retaliatory tariffs from last week. China has also leaked, via top-line bloggers - other options available to counter America's new-found aggressiveness. Trade wars have only just begun. Europe seems the likely next show to drop. Stay liquid.
At the Close, Monday, April 7, 2025:
Sunday, April 6, 2025, 3:37 pm ET What a week! Anything that wasn't nailed down - and some that were - got sold down the river as President Donald J. Trump overturned the applecart of international trade with stinging tariffs on all countries exporting into the United States. There are any number of narratives being floated across the media spectrum, but the one most glaring is that Trump's tariffs will raise the price of everything from washing machines to denim jeans, though there's evidence that will not necessarily be the case. More on that below. Here are a few of the more prominent voices opining on the intent and the impact of Trump's across-the-board import tariffs. The most prescient posts explaining the tariff scenario are by former CIA Intel Analyst Larry Johnson at Sonar21, and Simplicious, the Thinker on Substack. Both are free, not behind paywalls and deliver somewhat the same message, that the tariffs aren't really about evening out the massive U.S. trade imbalance, but re-orienting the U.S. balance sheet, with an eye toward lowering interest rates on some of the $36+ trillion in U.S. debt obligations. The Simplicious article links to Stephen Miram's text, A User's Guide to Restructuring the Global Trading System [PDF], making the claim that Trump's tariff plan mirrors Miram's "Guide", especially in terms of deliberately devaluing the U.S. dollar, prompting more companies to re-locate manufacturing facilities in the United States. Those objectives seem to be the major thrust of Trump's tariffs, and, if he's right, will accomplish both. Reducing the interest burden on outstanding debt while simultaneously promoting the USA as the place to be in the re-ordered global trading complex would be a masterstroke. It will take years to accomplish both, though interest rates have already come down, with the 10-year note hitting 4.01% on Friday. David Stockman offers a detailed exposition on the tariff levels and an unhealthy degree of criticism, but fails to make any salient points concerning why the tariffs matter, why they were imposed, or what the future holds. Ultimately, Stockman's analysis boils down to just more Trump-bashing rhetoric, with no valuable insights. As far as U.S. inflation is concerned, the net effect will vary depending on a number of variables, including the level of tariffs (percentage), how the tariff is calculated, and whether the company or country chooses to pass along the cost of the tariff to the end consumer or keep their prices in an affordable range and reduce their profit margin.
The International Trade Administration defines tariffs thusly:
Obviously, the calculus is challenging and not uniform. Some companies may export direct to a retailer, others export to wholesalers, making the cost, or price, lower. Different countries are being assessed different rates of tariffs. Some will seek workarounds, like selling to a country with a lower tariff rate and then exporting into the United States at a lower rate. There will be plenty of gaming and negotiation on the tariffs and the end result is not necessarily inflationary. For example, many of the products subject to Trump's tariffs are supply chain items like car parts, computer chips, small motors, nuts, bolts, etc. Others are discretionary, like most consumer products, such as clothing, household supplies, TVs, electronics, etc. Where the tariffs will have little effect is on the most essential items, food and energy. Most food consumed in the U.S. is home-grown or raised. The U.S. also produces much of its own energy, having large oil, natural gas, coal, and renewable reserves. When it comes down to the money in the pockets and wallets of American consumers, the choice will be theirs. If silk shirts from Vietnam become too expensive, people don't have to buy them. The same goes for TVs, socks, shoes, bicycles, toys, and all manner of consumer discretionary goods. The prices of these items will either be too high, in which case the company loses its market share, or at a level consumers can afford, possibly at some profit margin loss to the producer, but maintaining a share of the local market by keeping prices in line. Thus, those screeching that the tariffs will cause runaway inflation or other evil effects are probably out to lunch, with little understanding of economics or international trade and only looking to score political points. At the end of the day, the tariffs are paid by the producer or importer at entry. There is no evidence that companies will be passing along the added cost to consumers. Some will, others will eat the cost, live with a lower profit margin and maintain their market. Some of that helps explain why stocks took a major hit Thursday and Friday. Companies that are dependent on exporting to the U.S., like Nike (NIKE), got slaughtered. Companies that sell - in the main - products made in the United States, like retail grocer Kroger (KR), barely registered a blip. While Nike ended Wednesday, April 2, before the tariffs were announced, at $64.97 and ended the week (April 4) at $57.25 (-11.88%), Kroger closed Wednesday at $67.26 and on Friday at $67.18, a loss of 8 cents, though there were some momentum traders that pushed the stock as high as $71 Friday morning before taking profits the rest of the day. Taking the comparison a little further, Kroger, your friendly neighborhood grocer, has a PE of 18.29 and a dividend yield of 1.91%, which is OK and somewhat conservative. Year-to-date, it is up 9.86%. Nike's PE is 19.05 with a dividend yiled of 2.79%, and is down 24.34% year-to-date, which skews the PE lower and the dividend yield higher. Essentially, it was overpriced and coming down anyway. The tariffs just accelerated the process. Trying to make sense of Trump's tariff policies may end up being a fool's gambit. First, the tariff percentages were derived simply by dividing the U.S. trade deficit of a country by its total exports to the U.S.. This was made well-known on Thursday. Here's a prime example:
So, it's already common knowledge that the tariffs calculations were a bunch of bologna. The intention of the tariffs was probably something much different than bringing manufacturing back to the United States, though that certainly seems like a Trumpian, rational move. The real reason is probably to rebalance the books, get more revenue at the borders rather than from the wallets and purses of U.S. citizens. Throwing the whole world into chaos, ending globalism (free trade), and causing a mini-crash on Wall Street are just bonus material. Trump's eventual goal might even be as far-reaching as shutting down the Federal Reserve and returning to some form of gold standard with currency issued directly by the U.S. treasury. That would take an act of Congress, which still isn't quite on board with the re-structuring plans that are already well underway.
To say the least, the week didn't go well for most equity investors, though those with more conservative allocations toward income-producing (dividends) stocks did better than those who were holding high-flyers in the growth department. Apple, Amazon, Nvidia, Nike, and others got taken to the cleaners.
For the Week: Closing at 15,587.79, the NASDAQ is already in bear market territory. It was down 17.96% as of Thursday's close. Friday's finish put it at -22.73%. The Dow Jones Transportation Average is even worse, down 25.88% from its November 25, 2024 high of 17,754.38. All of the major indices are trading below their respective 50 and 200-day and 40-month moving averages and all of them are off more than 10% (correction) from recent highs, which may not be seen again for a very long time. How long? Five years, 10, 15, maybe never. Like it or not, the selling, now that Trump has induced chaos and dis-inflation into the economic picture, is likely far from over. Defensive names, especially those in the consumer staples sector, should outperform 80-90% of the market in the near term. With a recession nearly built-in at this point, another 20-30% downside for all of the major averages over the next six to 12 months is not out of the question. There are certain to be days of huge upside moves ahead, but the economic data should continue to point toward slowing growth and a combination of inflation, dis-inflation, and outright deflation that will confound most professional and individual traders. Anybody who was largely short at the end of January has made huge profits and are not about to give up on their positions. Weeks ahead may prove challenging at best, though a strong bounce should be part of the analysis. Stocks, while they were severely overvalued for years, are still at very high levels. The major averages have only knocked off gains from the last year or so. If this is the beginning of a major structural change in global trade, the U.S. is likley to suffer more pain, as will markets in most of the developed nations in Asia and Europe. Stock market breaks often accompany recessions. First quarter data is suggesting that the U.S. is already in one. Most of Europe is in recession for certain and there's every indication that the economies of England, France, and Germany are going to be destroyed by a combination of prior bad decisions (Ukraine, Green Energy, etc.) and now, a realignment of trade arrangements which are not to the EU's benefit. Trump was urging Fed Chair Powell to lower rates and "stop playing politics," but Powell isn't about to rush to judgement and bail Wall Street out with more cuts designed to cheapen the cost of borrowing. The market is more likely to do Trump's bidding than the Fed. The next FOMC meeting isn't until May 6-7. Prior to that a slew of data will be available to the FOMC, including 1Q GDP (last Thursday of April, the 24th), April Non-farm Payrolls (May 2), and the usual ISM data, CPI, PPI, etc.
Movemnent on the treasury yield curve was dramatic, and, in terms of spreads, more flat than ever, with full spectrum (30-days out to 30-years) squeezed down to a mere +5 basis points, easily the lowest its been since dis-inversion back in early December of last year. 2s-10s were more moderated, ending up at +33 basis points, down just five from last week. With the market taking pains to adjust to Trump's new trade reality, dropping the 30-year bond a massive 23 basis points over the course of the week will have the general effect of weakening the dollar, which is one of the targets of Trump's strategy, though what the government needs are lower short-term rates by which to deal with the deficit. For now, the government should be content to issue one, two, and three-year debt, swapping out some of the short-term bunk left over by Janet Yellen. Trump has put the ball squarely in Powell and the Fed's court. Expect the President to continue haranguing the Fed with calls to lower the federal funds rate. He might get some support from the banking community and Wall Street, who surely wouldn't mind overnight borrowing at 3.00-3.25%, but it seems, because the Fed isn't quite convinced it has done enough on inflation, lower rates will have to wait, for now. Spreads:
2s-10s
Full Spectrum (30-days - 30-years) Oil/Gas WTI crude oil got absolutely crushed in the Tariff Trauma, closing out Friday in New York at $62.32 a barrel, the lowest closing price since August, 2021, after the Biden administration made sure the price would rise by cutting off drilling and exploration and promoting the "Green New Deal." Last week's closeout price of $69.04 on Friday, March 28, likely won't be seen again for years. Most of the major producers in the Middle East and elsewhere in OPEC+ have already begun boosting production. Oil is headed to the $50s in short order and along with it the price of gas in the U.S., Europe and elsewhere, a welcome relief for consumers. Gasbuddy.com is reporting the national average for a gallon of unleaded regular gas at the pump at $3.22, up a dime from last week's $3.12. Gas prices haven't actually declined much since January and February and were actually lower in November and December, but, a year ago, the national average was $3.52, so there has been progress. Of course, gas buyers won't see the effect of the huge drop in the price of oil for a few more weeks as stations use up inventory purchased at higher prices. Gas prices this week were higher across the country, led by California is up 17 cents this week to $4.90. Oklahoma, at $2.73, is the cheapest, followed right behind by Mississippi ($2.74), though both are higher than last week and significantly up from the lows of December and January. Tennessee ($2.77) and Louisiana ($2.81) are next up the ladder. Outside of Pennsylvania ($3.40) and Maryland ($3.26), New England and East coast states all range between $2.85 (New Hampshire) and $3.14 (Delaware). New York was two cents higher at $3.09. Every state in the Southeast is under $3.00 except Florida ($3.16) and Georgia ($3.03). The Midwest is also elevated with Illinois at $3.49. Every state in the Midwest other than Kansas ($2.88), Kentucky ($2.89) and Missouri ($2.95) are back over $3.00 a gallon. The West continues to have the highest prices. Along with California, Washington is the only state above $4.00, at $4.34, though Oregon ($3.96) and Nevada ($3.91) are getting dangerously close. Idaho is at $3.33, while neighboring Utah is $3.19. Sub-$3.00 gas can be found in at fewer states this week, with just 15 hitting the mark as opposed to 24 last week and 33 two weeks past. Prospects for lower gas prices are very good now, though it's likely going to be a little while before Trump gets them down where he'd like them, with a national average around $2.60. On the supply side, the president's "drill, baby, drill" directive has been met with yawns and inconsistent support by oil producers who are reluctant to spend money on new projects when prices are, or could be, falling. While depressed oil and gas prices are a boon to the overall economy, they hurt profits at the major drillers and refiners, prompting a general wait-and-see attitude currently. Along with his tariff regime, the path to lower gas prices will likely come from lower demand with some contribution from greater Middle East supply.
This week: $78,955.22 Bitcoin held up very well through the end of the week, and many - especially gold and silver holders and stackers - wondered why. Sunday afternoon is supplying the response: whales were "hodling" through the tariff carnage, waiting until nobody was looking (Sunday) to drop the price down a few thousand dollars with probably more declines straight ahead. Bitcoin is going to go to $70,000 in a hurry, and it will still be massively overpriced. Anybody "hodling" or holding any significant amount of crypto is just plain stupid. There's nothing there at all and one has to question, when real things like gold and silver are going down, stocks are getting decimated and real estate will soon feel the pinch, why should something like Bitcoin or any other crypto element be spared? The selling began in earnest just after noon Eastern Time and seems very suspicious. Why wasn't bitcoin deprecated like any other asset on Thursday and Friday? Maybe because it's a massive fraud? Could be. Bitcoin has not been over $100,00 since February 4. There's almost no chance of it going back to that level. Falling to around $65,000-$70,000 before an even deeper plummet, seems the most likely direction, based on bitcoin's past history of crashes. The chaos in financial markets virtually guarantees bitcoin's demise and those of the rest of the thousands of crypto-mintages that are going to vaporize a large amount of what is perceived to be wealth. The worst part about bitcoin or crypto as an asset is that you can't even say one's wealth is "on paper" because any measure of crypto is electronic. It's not "on" anything except a computer screen. Crypto is absolutely worthless.
Gold:Silver Ratio: 103.53; last week: 88.74 Per COMEX continuous contracts:
Gold price 3/9: $2,917.70
Silver price 3/9: $32.55 The significance of the degree by which silver was sold off on the COMEX last week cannot be understated. The severity of the declines sent the gold-silver ratio to unfathomable levels above 100, which, in the longer view, is completely out of bounds and an indication of just how corrupted, unreliable and unrealistic Western measures such as the COMEX and LBMA's London fix really are. These relics of price suppression are - like the London Gold Pool back in the 1960s - close to being entirely broken and out-of-touch. For what it's worth, silver's actual, real world price is nowhere near $29.52, which was the COMEX settlement price at the close of trading on Friday. That can clearly be seen at retail and also, if ever contract that closed at that price had stood for delivery, the COMEX would have had to declare "Force Majeure" (which they do routinely, though not on an official basis) and shut itself down. Here are the most recent prices for common one ounce gold and silver items sold on eBay (numismatics excluded, free shipping):
The Single Ounce Silver Market Price Benchmark (SOSMPB) declind severely, to $38.57, losing $4.99 from the March 30 price of $43.56 per troy ounce. While silver prices at retail did tumble, with eBay pricing down nearly $5.00 overall, the drawdown was not as severe as what the COMEX had been pricing in with steep declines Thursday and Friday. Gold also held up relatively well, with finished one-ounce pieces remaining well above the $3,100 level. Buyers and sellers on eBay managed to find a sweet spot between $37 and $39. Those prices, while constituting a high premium over spot, reaffirms silver's value to stackers. The COMEX price and LBMA fix are quickly becoming little more than what they were designed for, a discounting mechanism, a definite trend developing between the COMEX "paper" price, where every 1000-ounce contract has multiple claims and settlement is made in fiat, not metal. The same can be said for gold. Despite the rigged markdowns at week's end, buyers continue to step up and buy at high premium prices, the concept being more of having gold in hand regardless of price during the current turmoil. More and more individuals are becoming cognizant of the concept that gold and silver are money, regardless of what "official" price-setters determine in their relentless discounting against fiat currencies, especially the US dollar. The last time stocks, bonds, and precious metals all fell at the same time - circa the GFC in 2008-09 - gold and silver recovered much more quickly than their financial rivals. With central banks continuing to buy gold in quantity, gold's price should remain near record levels. The tariff event horizon, while potentially devastating for the FIRE (Financial, Insurance, Real Estate) does not apply to precious metals to the same degree.
This site, FinanceCharts.com, was recommended to Money Daily by a friendly source. Worth a look if you are doing your own research and trading. Finally, where is the world headed. The best guess is that everybody - from billionaires to sovereign nations to middle and lower class folks - is going to feel poorer, for a while. The effects of chaotic economic turmoil cannot last long and adjustments will occur in all aspects of the human condition. In the current environment, people holding stocks are already a bit nervous and possibly scared, to the point at which some panic selling is likely to occur. They may turn out to be the lucky ones as the stock market's deterioration proceeds. Like the government is full of corruption and fraud, stocks don't really provide value, only the appearance of it, and remain massively overpriced. The Shiller PE stands today at 31.31, after attaining a high above 38.50 a few months back. That should be considered a good start because reversion to the mean requires 17.23, which is less than half of the number at present. Can stocks fall another 50% from here? Sure, why not? People don't like losing money, and the more they believe they are losing, the more likely they are to make very, very bad moves. A year from now, people will still be scratching their heads, trying to figure out just what happened. Most of them will come to the wrong conclusions. Poor people might find themselves a little better off, able to buy some things, like groceries, clothes, and household goods, at lower prices. Some may even be able to consider buying a home. Being middle class may not sound like such a bad idea again. At the same time, a lot of formerly "rich" people will not feel so high and mighty, though, relatively thinking, they'll still be better off than most. There will be more than a few people on Wall Street looking very, very stupid, as if there aren't enough already. In the end, measuring wealth is a relativity game. It's all about what you're measuring against.
At the Close, Friday, April 4, 2025:
For the Week:
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