Daily Close | Forex, Metals, Oil, Agriculture August 27, 2020



Given that the seasonality now suggests a period of likely decline in the wheat price, in my opinion and in this context, wheat is a bit expensive. Source: Goodfone The Teucrium Wheat Fund (WEAT) provides investors unleveraged direct exposure to wheat without the need for a futures account. In the corn market, as a commodity market, the price is formed on the basis of the balance between supply and demand. But there is no significant deviation from the five-year range: The latest USDA forecast assumes a surplus in the world wheat market (excluding China) of 9.89 million tons.
According to the latest USDA data, the stock-to-use ratio for the global wheat market will exceed 42% in the current season. The current wheat futures price is above its five-year high. Export demand is the primary demand for US Cotton so poor weekly sales means weak overall demand. I see no reason why a strong movement in the price of wheat could now be expected. Therefore, the decision to invest in this fund should be made after analyzing the wheat market.
less General Comments: Winter Wheat markets were higher AS \Hurricane Laura was to come onshore in Texas and Louisiana and bring potentially heavy rains into the MidSouth. USDA said that net weekly Upland Cotton export sales were 156,600 bales this year and 7,900 bales next year. Spring Wheat was developing under good growing conditions in both the US and Canada. In other words, wheat and corn become less sensitive to each other.
Therefore, in the long run, there is the relationship between the values of the stock-to-use ratio and the average price of the corn futures. But nothing more.Fundamentally, there is no particular reason for expensive wheat at the moment. About half of the Argentine Wheat belt is still too dry. Export demand for US Cotton has been poor for the last few weeks but was improved last week. The hot and dry weather extends north into Oklahoma and western Kansas.


For Dollar Tree, it was a second consecutive quarter of year-over-year growth for its historical laggard, Family Dollar, which looks much more like rival Dollar General. While Dollar Tree didn’t give out specific numbers, Dollar General indicated that year-over-year sales growth in August, after enhanced unemployment benefits expired, had slowed down to 15%. Family Dollar grew same-store sales by a solid 11.6% but faced the unenviable challenge of being compared with Dollar General’s breakout revenue performance.
Both Dollar General and Family Dollar sell a broad category of goods and position themselves as an alternative to big box retailers such as Walmart and Target. Both companies outperformed sales expectations, but the rural-heavy Dollar General was the real standout, with net sales increasing 24.4% in the quarter ended July 31. Nonetheless, the devaluation of the dollar and the demand for wealth protection are two of the most prominent factors affecting the fair value of the yellow metal.
Also, ad agencies want to know exactly how many consumers each dollar of advertising is reaching, through measurable metrics — that’s what The Trade Desk offers. The government argues that disclosing dollar figures for individual firms would hurt their business and such details should be exempt from the Freedom of Information Act. The likelihood of continued cheap money in the US hurt the dollar and almost all foreign stocks. Over the past month, the value of the Real has weakened versus the Dollar by 8.27%.
The dollar mirrored gold, dumping on Powell’s initial comments but then rocketed higher…
Exxon Mobil Guyana Project – Exxon Mobil Investor Presentation Exxon Mobil is an enormous company with plenty of moving parts and multi-billion dollar projects. Dollar Tree grew revenue by a respectable 9.4%. Gross profit on a dollar basis was $268 million, down 80% Y/Y.


(Source: Author via TradingView) Alternative to the traditional money supply method, the balance sheet method also provides valuable insights in determining gold’s fair value. So what makes everyone believes that gold is considered as a safe-haven, and what makes the countries on this planet to buy back and accumulate gold? Normally, the money supply curve represents the reasonable prices of gold, and prices over or under the curve are treated as overvalued or undervalued, respectively.
As of now, the fair value of gold is approximately sitting at $2,040 to 2,070, measured by both the M1 and M2 money stock curves. As an example, if both balance sheet and GDP increase 5% for the year, then the value of gold remains unchanged. Some investors think gold is nothing but the relic of the past, that it is no longer a medium of exchange today and thus it has little intrinsic value. There are many reasons to drive the prices of gold, including but not limited to jewelry and industrial demand, investment demand, central bank reserves, and mining production.
the economic growth cannot keep up with the amount printed in percentage, then fair value of gold will increase. In short-term, the market may not realize the true value of gold and can go completely wild, neglecting all the fundamentals. But before discussing about the valuation models, let us first solve the mystery of gold: Where does its value come from? Thus, this article will develop on my previous idea, that gold currently is undervalued and should be included in the portfolio.
Gold has already reached an all-time high, and the Fed even came out today and openly admitted it will happily “tolerate” higher levels of inflation. Therefore, according to this standard, gold is currently undervalued and should be included in the investors’ portfolio. In accordance with the suggested models, gold could be an attractive investment for now you can buy it below what it is worth.
There are some analysts who claim that gold prices could hit $5,000, $10,000, or even $15,000. (Source: Author via Excel Spreadsheet) It is always wise to include at least a small proportion of gold in the portfolio as a safety net. My philosophy for gold investing is simple: buy more when it is undervalued and hold or rebalance when it is overvalued. Hence, in the following I will explain why gold is currently undervalued and how we can take advantage of it. Via SchiffGold.com, Last month, gold broke its all-time record price.
Paxos is a New York-based company and the tokens are redeemable for LBMA-accredited London Good Delivery gold bars.


Since the latest deal, the stock has dropped almost $2, so I’m not sure the company will get an even better rate unless shares rebound or oil prices jump. Exxon Mobil’s risk to this thesis is quite clear, the company’s risk is a substantial decline in oil prices. It almost goes without saying that global offshore operations have sagged over the last couple of years due to weak and unstable global oil prices. However, long-term low oil prices are incredibly unlikely in our view.Exxon Mobil (NYSE:XOM) was the world’s largest company in 2013.
The company has arguably the most diversified and exciting portfolio of upstream oil assets across the world and has found a number of exciting growth opportunities. That’d approach $0 at $30/barrel – and means that oil prices are essential to the company’s business. However, given that oil prices are already well above this $30 threshold and still have significant room to recover, we feel this is unlikely. As 45% operator with a $25/barrel breakeven, that’s >$70 billion in profits for Exxon Mobil alone at current, post COVID-19 collapse, oil prices.
The company’s 2025 cash flow at $40/barrel would be $40 billion, which would be only $10 billion of FCF instead of $30 billion. The emergence of Covid-19 and its impact on demand and therefore, oil prices only exacerbated poor sentiment and clouded visibility. Assuming the markets recover to a flat $60/barrel by 2025, recovering from COVID-19, the company’s cash flow from operations and asset sales in 2025 would be roughly $60 billion.
The crude oil market has traded risk on, but has yet to price in all the consequences we won’t realize until the storms aftermath. Between the two, the company has utilized only ~700 million barrels of this 10 billion barrel resource base. Exxon Mobil has already dipped to $40 on the news and concerns of Gulf of Mexico oil production disruption by Hurricane Laura isn’t helping the stock. In the overnight electronic session the October crude oil is currently trading at 4311 which is 28 points lower.
Exxon Mobil Liquidity – Exxon Mobil Investor Presentation Exxon Mobil has focused on dramatically improving its financial positioning and liquidity in response to the collapse in oil. All of this is quality oil with a $25 Brent breakeven that actually sells at a several dollars/barrel premium to Brent. Zoya Teirstein with Grist reports that 9 oil refineries in Texas alone could produce that magnitude of pollution.
The likely mess in US oil drilling boosted energy stocks. In the Permian Basin, the company is targeting >1 million barrels/day of production at a $15/barrel breakeven.

United States

Moreover, inflation is under 2% because the Fed ignores housing prices, employer health care costs, education, and stock market bubbles. The Fed is apparently even willing to turn the other way the inevitable result of printing money – price inflation – begins to become apparent in the economy. CarGurus is a good news/bad news situation, with the key points as follows: It’s also important to note that Wall Street is expecting a recovery for CarGurus in FY21.
A new critical documentary, that features interviews with various mental health professionals, argues that president Donald Trump is a malignant narcissist.
Source: Bloomberg Submitted by Mike “Mish” Shedlock, The Fed announced a new inflation policy today. He also said that the violence playing out in cities such as Kenosha, Wisconsin, and Portland, Oregon, are pushing urban voters to Trump. Perdue went on to say, “President Trump is taking care of America’s working-class families who have been hit hard with economic distress due to the coronavirus. Directly a result of the Fed printing trillions to prop up the stock market, while giving most people $1,200.
The Fed announced a potentially major change this morning when Chair Powell announced a strategy shift at the bank. Rasmussen had Hillary Clinton up 1.7 points over Trump on election day 2016, while she ended up winning the popular vote by 2.1 points above him (48.2% vs. 46.1%). Neither Bezos nor Musk would have achieved such milestones of wealth had the Fed not intervened in the markets months ago. Somehow the Fed is wedded to a goal of 2% inflation with no explanation as to why the goal should be 2% in the first place.
President Trump’s threats to shut down TikTok come just as Facebook has been pushing a competing offering with its new Reels service. Rather than bringing his beef to the Fed, where it belongs, he would rather simply confiscate wealth from billionaires. Fed chair Jerome Powell would not recognize price stability if it jumped out of the audience and spit grapefruit juice in his eye. (Or, they don’t and President Trump will authorize stimulus extensions until the election) “Why should there be a bill that has far less [of] what the public needs?”
Recently, a major hurricane hit the Gulf of Mexico and key refining part of the US, and prices didn’t really respond. Share Downloading TikTok and WeChat from the Google or Apple app stores in the U.S. could be blocked by President Trump’s executive orders to restrict the Chinese-owned apps. According to The Hill, Democratic leaders say they had a much easier time negotiating with Treasury Secretary Steven Mnuchin before Mark Meadows joined the conversation.
In that context, it appears telling that according to a new Reuters/Ipsos poll, in his numbers after the DNC, while ironically, Trump did.