Dear CIGAs,

The dollar rallied in terms of the USDX yesterday, and the Euro came under pressure as Goldman Sachs repudiated a longstanding Euro buy and hold recommendation by issuing a sell Euro recommendation as the 5 year US Treasury bond auction went sour.

Logic has nothing to do with day to day trading. We all know the games that are played by big money interests with their lightening fast privileged information, goosed bids and offers, market manipulation (just in case you did not know exactly what that is all about) plus gold and silver market bravado bids and offerings to force price and neither buy or sell quantity.

Logic does have a lot to do with trends.

Let’s look at the logic of yesterday, forgetting the manipulative market intervention.

If you were to believe the market,you run out and BUY the US dollar to avoid risk BECAUSE MAJOR INTERNATIONAL INTERESTS WERE NO LONGER INTERESTED IN ACCUMULATING MAJOR ADDITIONAL DOLLAR DEBT ITEMS WHICH EQUATE TO THE DOLLAR ITSELF BEARISHLY. That is SIMPLE LOGICAL supply versus demand reasoning.

Now that is an exercise in INVESTMENT INSANITY.

Now here are today’s items concerning dollar fundamentals.

Keep in mind that if Bernanke does not support these US Treasury bond auctions without limit via QE, Bernanke whose term is coming up, is out, the Fed is a relic, and QE will support the auctions.

Chairman Bernanke’s decision is to either go full blast with QE or go back to teaching at Princeton while having chaired the demise of the Federal Reserve.

Volcker won it all. Greenspan gave it all way and more.

Bernanke will have chaired the demise of the Federal Reserve and its transition into something with teeth like the Department of Commerce plus an office for two lower level employees acting as financial traffic cops.

New jobless claims rise more than expected
Jul 30, 8:59 AM (ET)
By CHRISTOPHER S. RUGABER

WASHINGTON (AP) – The number of newly laid-off workers filing first-time claims for jobless benefits rose last week, the government said, though the increase was mostly due to seasonal distortions.

The number of people remaining on the jobless benefit rolls, meanwhile, fell to 6.2 million from 6.25 million, the lowest level since mid-April.

The Labor Department said new claims for unemployment aid increased by 25,000 to a seasonally adjusted 584,000. That’s above analysts’ estimates of 570,000.

A department analyst said the increase comes after claims were artificially depressed earlier this month by the timing of temporary auto factory shutdowns, which happened earlier this year than in most years. Still, this week’s total is below the 617,000 initial claims reported in late June before the seasonal distortions began. It reflects a trend that economists say indicates a slowing pace of layoffs.

The four-week average of claims, which smooths out fluctuations, fell to 559,000, its lowest level since late January.

But jobs remain scarce and the unemployment rate, which hit 9.5 percent for June, is expected to surpass 10 percent by year’s end.

More…

May-June joblessness up in 90 pct of metro areas
By JEANNINE AVERSA (AP) – 12 hours ago

WASHINGTON — More than 90 percent of the nation’s largest metropolitan areas saw their unemployment rates climb in June from the previous month.

Some of the biggest increases hit college towns, where the annual summertime exodus of students causes bars, restaurants and other businesses to cut staff. The Detroit area, hit hard by manufacturing layoffs tied to the beleaguered auto industry, also got stung in June.

Unemployment rates rose from May to June in 348 of more than 370 metro areas, according to an Associated Press analysis of Labor Department data released Wednesday.

The figures aren’t adjusted to account for seasonal trends, such as lifeguards hired during summer or retail clerks let go after the holiday shopping season. So they tend to be volatile from month to month.

The Labor Department does not provide seasonally adjusted metro area unemployment data. It does adjust the national unemployment rate for seasonal factors. The U.S. jobless rate, which hit 9.5 percent in June, is expected to rise to 9.7 percent when the department reports the July rate next week.

Tuscaloosa, Ala., home to the University of Alabama, suffered the biggest monthly increase in unemployment from May to June. Its jobless rate jumped to 12.5 percent in June, up 3.8 percentage points.

More…