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Fed Rate Increase Still on Track; Fighting to The Last Ukrainian

The User's Profile davefairtex July 11, 2022
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My focus this week: what are market expectations are for Fed rate increases, and prospects for a recession? Futures markets predictions for Fed rate increases located here.

Last week:
• July 27, 71%: 2.25% – 2.50% +0.75% vs. now
• Nov 2, 61%: 3.00% – 3.25% +1.5% vs. now

This week:
• July 27, 92%: 2.25%-2.50% +0.75% vs. now
• Nov 2, 50%: 3.25%-3.50% +1.75% vs. now

So, that’s a projected Fed rate increase – by Nov 2 – of 175 basis point total, or 25 bp higher than last week. So far, the market does not see the Fed backing off. Perhaps as a result, the Euro/USD plunged 2.32% to a new 20-year low. The flip side: a strong rally in the buck, which broke out to a new 20-year high. Money appears to be fleeing the EU for the U.S. A dollar rally = risk-off behavior.

The CRB (Commodity Research Bureau) Index made another lower-low this week; unlike Chris who sees dropping commodity prices (wheat, crude, natgas, etc) as a result of market manipulation, Ed Dowd believes that falling commodity prices are a sign of a severe recession in the offing which the markets have sniffed out, while at the same time the Fed appears determined to raise rates into the teeth of this alleged upcoming recession. I am still trying to figure out who is right. All I’m sure about: the CRB is in a downtrend. The unknown: food production shortages and possible starvation.

There was talk this week of an “inverted yield curve” which is another recession signal. I took a peek – it is getting closer, but we aren’t there just yet. 1Y=2.94%, 10Y=3.09%, 30Y=3.27%. No inversion – at least not at end of this week. But we are getting close. More-than-hints of recession.

In spite of the sharp move higher this week in the 10-year yield (up 21 bp), 30-year mortgage rates plunged, dropping a massive 40 bp (from 5.70% to 5.30%). This would seem to support the recessionary thesis. Still not sure why 30-year mortage rates plunged, while 10-year rates moved strongly higher.

There was a fair amount of fuss over the “unexpectedly good” Payrolls report: headline up 372k. But here’s a wrinkle: the CNP disabled 16+ series was also up: 235k. So, 372k new workers, and 235k new disabled workers. I’m guessing it is quite hard for companies to get qualified workers with those ever-increasing three million disabled workers since 2021. Gun to your head: are the three million disabled workers inflationary or deflationary? (This was something a former Bank of America forex trader at my old company used to say to us engineers: “gun to your head” = what’s your gut reaction? No long complicated answer needed, and don’t think about it too long).

So – gun to my head – feels like a setup for wage-price inflation to me. Workers now sense they have more leverage. And once the reason for the disability becomes public knowledge…boy, the wage demands will get a lot more intense. Nothing like reigniting the struggle between labor and capital – where capital’s forced-vaccination policies ended up killing or injuring labor – by the millions. Labor is going to be pissed.

Gold broke down to a new low this week, falling $66.84 [-3.68%], which was a new 7-month low. Most of the losses came on Tuesday and Wednesday. While some of the move was probably due to the strong dollar rally, it does appear as though the banksters have a firm grip on gold prices at the moment, and the whole rate-increase-mania isn’t great for gold prices. [Just FYI – I’m still working on getting the new data feed to generate reliable commodity prices. It’s a slow process. You’d think this would be easy, but it isn’t.]

Our precious Strategic Petroleum Reserve (red line) continues to be emptied by the WEF factotums that have “penetrated the U.S. Cabinet”; SPR is down -5.8 million barrels this week alone. At $100/barrel, that’s $580 million of oil, paid for by You and Me. In one week. At least the SPR withdrawal appears to have made it into the commercial U.S. reserves this week, so that’s a plus.  Perhaps the WEF factotums have belatedly figured out that selling U.S. SPR oil to the Chinese Communist Party (CCP) might be a bad look for them. Remember, they weren’t selected for intelligence.

 

U.S. Politics:

WEF/Technocracy:

“Health”:

  • Canada’s Health Minister: “You Will Never Be Fully-Vaxxed” Canadians will be required to get a Covid shot every nine months for the foreseeable future,” says Health Minister Jean-Yves Duclos. Shots don’t work, they cause disability and death, but Mr. Minister will force you to get one every nine months anyway. Your Body, My Choice!

  • With monkeypox, let’s not let the stupidity that hurt us with COVID strike again. “Maybe the name monkeypox, which sounds far more scary than coronavirus, will stop all the insanity before it begins.” Problem: Monkeypox is basically a rash, which has caused no deaths, and mainly affects the “more enthusiastic” members of the male gay community.  In the picture below, you will see an example of how much fear monkeypox is causing; the ridicule is getting a little bit out of control. Res ipsa loquitur.

    • Doctors Warn of Vitamin D Supplement “Overdosing” – Man Hospitalized After Losing 28 Pounds. As usual, nobody has died; this single case report is literally the scariest thing they could dig up for vitamin D from a nation of 350 million people. I think: the recent increase in vitamin D supplementation has led to an alarming increase in accidental cancer prevention, accidental flu prevention, and intentional COVID-19 mortality reduction; as a result, I’m projecting tens of billions in damage to Pharma/Sickcare revenues from shocking, widespread vitamin D and melatonin sufficiency. Truly, this is a disaster, which must be stopped at all costs, and led directly to the writing of this article. [Target: 50 ng/ml]
  • The “safe and effective” narrative is falling apart [stkirsh]. Steve is starting to see an increasing number of cracks in the wall. He might be a little optimistic, but in the main, I think he’s right. At some point – I think soon – a switch will flip, and things will change dramatically. Eventually, “treatment for vax damage” – for millions of victims – will become the responsibility of government. There are just too many vax-damaged to ignore. Once proposed, it will be a very compelling campaign issue. Not sure if 2022 or 2024.

Save the Blessed Ukraine:

So recession: yes probably on the way. So are at least two rate increases. Commodities appear to have topped out. For now. Shortages of labor remain in the workforce, exacerbated by the three million newly-disabled. Hints of a vaccine-damage information breakout is on the way. There are historically bad numbers for the WEF Biden-Handlers going into the midterms. (If you still wonder if there are WEF Biden-Handlers, see Grandpa and his painfully detailed instructions; sure looks like President-in-Name-Only Grandpa is rebelling, in his own way, to all this Elder Abuse):

We have a decision point coming up. If the WEF Biden-Handlers choose to cheat egregiously in November, it will be easily detected, and they will demonstrate to the now-awakened Plebes – many of whom are pretty upset over the last time widespread cheating happened during the elections while they weren’t really paying attention – that there is effectively no democracy. Then what happens? There are lots of people who lost their career over the mandated shots. Lots of people who lost their health, or their family members over those shots, which have been forced on us all by the WEF Biden-Handlers. What is now just a bunch of disconnected, depressed, SSRI-gobbling teenagers with rifles, could turn into something else entirely. “I can’t feed my family. I can’t vote in new leadership. I’m really, really annoyed.”

My unsolicited advice to the Handlers: let the November election play out honestly. It’s really the safest way to go. Consider BoJo; he’s selected the “safe” route. He has realized that just because he’s in the WEF, it doesn’t mean he gets the slot for life. Just saying. Y’all had a fun two years. You got your chance to “build back better.” Gas is at $5: a win! Food shortages: a win! Oil production shortfalls: a win! 50-year highs in inflation: a win! Disaster in Afghanistan: a win! War in Ukraine = billions for defense/industrial and the Ukranian Oligarchs: a win! Your vax mandates have killed and injured millions: another win! (but, maybe leave before this “win” becomes public knowledge, amirite?). Now your time on the stage is just about up. Accept your electoral fate with dignity, and go collect your well-earned private jets and “book deals” and fly off into the sunset. Just my two cents.