Jim’s Mailbox

Posted at 6:57 AM (CST) by & filed under Jim's Mailbox.

Yes Wolfgang, as we have said all along…it is all about credit!



My stomach turns when I see this.

CIGA Wolfgang Rech

“Credit Card Splurge” Suggests Imminent Storm
July 25, 2019

Authored by Sven Henrich via NorthmanTrader.com,

You’d think that the drop in yields and a Fed about to cut rates would’ve brought about some relief to credit card bills. No Sir.

And you might think that the highest interest rates on credit cards ever would deter consumers from loading up on additional credit card debt. Oh no.










Pedal to the metal and the cumulative picture spells trouble.

Look at the data.

Here are credit card interest rates versus the Fed Funds rate:




If anyone believes this, I’ve got a bridge to sell them.






A significantly higher dollar, climbing every day, will cut the legs out from whatever profitability corporations still have.

-International firms lose big time with the repatriation of profits.

-On the domestic front, a high Dollar means foreign companies drop prices and kill our hometown corporate margins.

No way Kudlow can let the Dollar climb indefinitely.

Trump won’t allow it.

Of course, gold doesn’t give a hoot.  It still keeps climbing in the face of a stronger Dollar

It sees the light in what’s coming.

Dwindling economic activity, eventually requiring massive intervention.

CIGA Wolfgang Rech

Dollar Surges After Kudlow Says White House “Ruled Out Any Currency Intervention”
July 26, 2019

Update: Politico reports that Trump rejected Navarro’s options for devaluing the dollar, with CNBC’s Kayla Tausche reporting that Trump convened a cabinet-level trade meeting on Tuesday to discuss ideas to weaken dollar – including capital controls and active “jawboning” by officials on TV – however, the meeting broke with a decision not to intervene, and Navarro “didn’t get through 10% of his presentation,” per one official. But, as Tausche adds, “anti-interventionists worry they can’t keep Navarro and Pres. Trump at bay.”

* * *

In the past month there has been extensive speculation whether the Trump admin, as part of its desire to devalue the dollar against other currencies whose central banks are engaging in aggressive devaluation campaigns of their own, would pursue currency intervention as first Bank of America suggested last month, only to be followed by virtually every other research analyst, and culminating with a take from Standar Chartered’s Steven Englander who said that “The US Can Intervene To Weaken The Dollar… But What Would It Buy?”

To be sure there was ample reason for such speculation, not the least as a result of Trump’s own July 3 tweet in which he said that “China and Europe playing big currency manipulation game and pumping money into their system in order to compete with USA. We should MATCH…”