Friday, November 17, 2017 12:29:00 AM
Beethoven's 5th Data
MMgys
program note: server may melt down
Nov 16/2017/Gold up 90 cents on the day but silver, is the real star up 11 cents to $17.09/In Zimbabwe Robert Mugabe refuses to resign/The House passes the tax reform bill and now it goes to the Senate/
November 16, 2017 ·
GOLD: $1278.50 up $0.90
Silver: $17.09 UP 11 cents
Closing access prices:
Gold $1278.60
silver: $17.08`
SHANGHAI GOLD FIX: FIRST FIX 10 15 PM EST (2:15 SHANGHAI LOCAL TIME)
SECOND FIX: 2:15 AM EST (6:15 SHANGHAI LOCAL TIME)
SHANGHAI FIRST GOLD FIX: $1286.38 DOLLARS PER OZ
NY PRICE OF GOLD AT EXACT SAME TIME: $1278.35
PREMIUM FIRST FIX: $8.03
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SECOND SHANGHAI GOLD FIX: $1287.39
NY GOLD PRICE AT THE EXACT SAME TIME: $1276.15
Premium of Shanghai 2nd fix/NY:$11.19
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LONDON FIRST GOLD FIX: 5:30 am est $1277.70
NY PRICING AT THE EXACT SAME TIME: $1277.70
LONDON SECOND GOLD FIX 10 AM: $1280.00
NY PRICING AT THE EXACT SAME TIME. 1280.00
For comex gold:
NOVEMBER/
NOTICES FILINGS TODAY FOR OCT CONTRACT MONTH:11 NOTICE(S) FOR 1100 OZ.
TOTAL NOTICES SO FAR: 1020 FOR 10,200 OZ (3.172TONNES)
For silver:
NOVEMBER
1 NOTICE(S) FILED TODAY FOR
5,000 OZ/
Total number of notices filed so far this month: 876 for 4,380,000 oz
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Bitcoin: BID $7452 OFFER /$7479 up $186.00 (MORNING)
BITCOIN : BID $7756 OFFER: $7781 // UP $490.00 (CLOSING)
end
Let us have a look at the data for today
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In silver, the total open interest ROSE BY A CONSIDERABLE 1557 contracts from 199,122 UP TO 201,456 EVEN THOUGH YESTERDAY’S TRADING SAW SILVER FALL BY 10 CENTS. WE DID HAVE ZERO LONG LIQUIDATION AND FURTHER WE WERE NOTIFIED THAT WE HAD QUITE A FEW MORE COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP ROUTE AS WE HAD A HUGE 1312 DECEMBER EFP’S ISSUED ALONG WITH 0 EFP’S FOR MARCH FOR A TOTAL ISSUANCE OF 1312 CONTRACTS. THE ISSUANCE FOR MARCH BOTHERS ME A LOT AS THIS IS SUPPOSE TO BE FOR EMERGENCY IN THE UPCOMING DELIVERY MONTH. I GUESS WHAT THE CME IS STATING IS THAT THERE IS NO SILVER TO BE DELIVERED UPON AT THE COMEX AND THEY MUST EXPORT THEIR OBLIGATION TO LONDON. YESTERDAY WE HAD 1050 TOTAL EFP’S ISSUED.
RESULT: A GOOD SIZED RISE IN OI COMEX DESPITE THE 10 CENT PRICE FALL. COMEX LONGS REFUSED TO EXIT OUT OF THE COMEX AND FROM THE CME DATA 1312 EFP’S WERE ISSUED FOR A DELIVERABLE CONTRACT OVER IN LONDON WITH A FIAT BONUS. IN ESSENCE THE DEMAND FOR SILVER INTENSIFIES
In ounces, the OI is still represented by just OVER 1 BILLION oz i.e. 1.007 BILLION TO BE EXACT or 144% of annual global silver production (ex Russia & ex China).
FOR THE NEW FRONT OCT MONTH/ THEY FILED: 1 NOTICE(S) FOR 5,000 OZ OF SILVER
In gold, the open interest ROSE BY A LARGER THAN EXPECTED 3244 CONTRACTS DESPITE THE FALL IN PRICE OF GOLD ($5.15) WITH RESPECT TO YESTERDAY’S TRADING IN WHICH WE SAW NO GOLD LEAVES FALL FROM THE COMEX GOLD TREE. THE TOTAL NUMBER OF GOLD EFP’S ISSUED TODAY TOTALED A MONSTROUS: 12,392 CONTRACTS OF WHICH THE MONTH OF DECEMBER SAW 12,352 CONTRACTS AND FEB SAW THE ISSUANCE OF 40 CONTRACTS. The new OI for the gold complex rests at 536,298. DEMAND FOR GOLD INTENSIFIES DESPITE THE RAIDS.
Result: A HUGE SIZED INCREASE IN OI DESPITE THE FALL IN PRICE IN GOLD ON YESTERDAY ($5.15). WE HAD A HUGE NUMBER OF COMEX LONG TRANSFERS TO LONDON THROUGH THE EFP ROUTE AS (12,392 EFP’S). THERE OBVIOUSLY DOES NOT SEEM TO BE MUCH PHYSICAL AT THE COMEX AS WE ARE APPROACHING THE HUGE DELIVERY MONTH OF DECEMBER. WE OBVIOUSLY HAD NO GOLD COMEX OI LEAVE THE COMEX GOLD ARENA.
we had: 11 notice(s) filed upon for 1100 oz of gold.
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With respect to our two criminal funds, the GLD and the SLV:
GLD:
A small change in gold inventory at the GLD/ a deposit of .300 tonnes
Inventory rests tonight: 843.39 tonnes.
SLV
TODAY WE HAD NO CHANGE IN SILVER INVENTORY AT THE SLV
INVENTORY RESTS AT 318.074 MILLION OZ
end
.
First, here is an outline of what will be discussed tonight:
1. Today, we had the open interest in silver UNEXPECTEDLY ROSE BY 1557 contracts from 199,899 UP TO 201,456 (AND now A LITTLE CLOSER TO THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) DESPITE THE FALL IN SILVER PRICE (A LOSS OF 10 CENTS). OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE 1312 PRIVATE EFP’S FOR DECEMBER(WE DO NOT GET A LOOK AT THESE CONTRACTS) AND 0 EFP’S FOR MARCH FOR A TOTAL OF 1050 EFP CONTRACTS EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. THIS IS QUITE EARLY FOR THESE EFP ISSUANCE..USUALLY WE WITNESS THIS ONE WEEK PRIOR TO FIRST DAY NOTICE AND THIS CONTINUES RIGHT UP UNTIL FDN. WE ALSO HAD NO SILVER COMEX LIQUIDATION. TOTAL EFP’S ISSUED YESTERDAY BY THE CME IN SILVER TOTAL 1050 CONTRACTS. SO THIS FRAUD IS CONTINUING ON A DAILY BASIS
RESULT: A HUGE SIZED INCREASE IN SILVER OI AT THE COMEX DESPITE THE 10 CENT FALL IN PRICE (WITH RESPECT TO YESTERDAY’S TRADING). WE HAD ANOTHER 1312 EFP’S ISSUED TRANSFERRING OUR COMEX LONGS OVER TO LONDON TOGETHER WITH NO SILVER COMEX LIQUIDATION.
(report Harvey)
.
2.a) The Shanghai and London gold fix report
(Harvey)
2 b) Gold/silver trading overnight Europe, Goldcore
(Mark O’Byrne/zerohedge
and in NY: Bloomberg
3. ASIAN AFFAIRS
i)Late WEDNESDAY night/THURSDAY morning: Shanghai closed DOWN 3.27 points or .10% /Hang Sang CLOSED UP 167.07 pts or 0.58% / The Nikkei closed UP 322.80 POINTS OR 1.47%/Australia’s all ordinaires CLOSED UP 0.19%/Chinese yuan (ONSHORE) closed DOWN at 6.6320/Oil DOWN to 55.27 dollars per barrel for WTI and 61.62 for Brent. Stocks in Europe OPENED GREEN . ONSHORE YUAN CLOSED DOWN AGAINST THE DOLLAR AT 6.6320. OFFSHORE YUAN CLOSED WEAKER TO THE ONSHORE YUAN AT 6.638 //ONSHORE YUAN WEAKER AGAINST THE DOLLAR/OFF SHORE WEAKER TO THE DOLLAR/. THE DOLLAR (INDEX) IS STRONGER AGAINST ALL MAJOR CURRENCIES. CHINA IS OT VERY HAPPY TODAY
3a)THAILAND/SOUTH KOREA/NORTH KOREA
i)North Korea//South Korea
b) REPORT ON JAPAN
c) REPORT ON CHINA
4. EUROPEAN AFFAIRS
And this guy is deputy Governor of the Bank of England?
( zerohedge)
5. RUSSIAN AND MIDDLE EASTERN AFFAIRS
i)Documents surface which indicate that Israel is ready to share intelligence with the Saudis against Iran. The key component is an understanding that the Saudi’s will agree that refugees cannot return to Palestinian land in return for a lasting peace with Israel. Israel and Saudi Arabia must stop the formation of two Shia crescents:
i. from Lebanon to Iran
ii) from the Gulf to the Red Sea
( zerohedge)
ii)SAUDI ARABIA
Brandon Smith warns that the Saudi coup signals war and an end to the USA petrodollar and a New World Order reset. He may be right as he contends that this is what the globalists are seeking
( Brandon Smith/Alt Market.com)
iib)Seems to be working: Saudi Arabia has offered the arrested royals a deal: Lots of cash (up to 70% of net worth) for your freedomIt is now clear: the whole exercise was nothing but to replenish the treasury
( zerohedge)
6 .GLOBAL ISSUES
Zimbabwe
Mugabe refuses to resign which in turn causes their stock market to collapse
( zerohedge)
7. OIL ISSUES
Somehow Norway now does not believe oil will rise in the next few years: They are planning a divestiture of 35 billion in oil stocks.
( zerohedge)
8. EMERGING MARKET
i)Now the fun begins as underwriters of credit default swaps must pay out and there will be a considerable amount that they have to muster up:
( zerohedge)
ii)At 5:30 pm est, Bitcoin surges near $8,000.00 on the announcement of a credit event and bankers must pay out:
( zerohedge)
9. PHYSICAL MARKETS
i)A joke: the one exchange that the CME plans to use when it starts with its futures operation is down again and it is having serious issues
(Russo/Bloomberg)
ii)What a joke: this one BIS official urges accountability while it undergoes in secret huge gold swaps
( GATA/Chris Powell)
10. USA stories which will influence the price of gold/silver
i)Trading today:
(zerohedge)
ii)China continues to export deflation to the rest of the world as import prices are contained despite hotter CPI and PPI
( zerohedge)
iii)Soft data Philly manufacturing index disappoints but still the hope component rebounds. There was a considerable drop in the important jobs sector( zerohedge)
iv)This came out of nowhere: initial jobless claims jump the most in over a year:
( zerohedge)
v)The house is expected to pass the GPO tax reform bill this afternoon but the less friendly senate will not affirm it
( zerohedge)
v b)The house passes the tax reform bill by 227 to 205
( zerohedge)
vi)We now have the identity of our secret informant in the FBI Clinton probe on the Uranium One deal: his name is Christopher Campbell and he was formerly a lobbyist for Tenex, the USA based arm of Russian government’s Rosatom
(courtesy zerohedge)
Let us head over to the comex:
The total gold comex open interest SURPRISINGLY ROSE BY 3244 CONTRACTS UP to an OI level of 536,298 DESPITE THE FAIR SIZED FALL IN THE PRICE OF GOLD ($5.15 FALL WITH RESPECT TO YESTERDAY’S TRADING). OBVIOUSLY WE DID NOT HAVE ANY GOLD COMEX LIQUIDATION. HOWEVER WE DID HAVE A MONSTROUS 12,392 COMEX LONGS EXIT THE COMEX ARENA THROUGH THE EFP ROUTE AS THEY RECEIVE A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS. THE CME REPORTS THAT 12,352 EFPS WERE ISSUED FOR DECEMBER AND 40 WERE ISSUED FOR MARCH. THE OBLIGATION STILL RESTS WITH THE BANKERS ON THESE TRANSFERS.
Result: a HUGE INCREASE IN OPEN INTEREST DESPITE THE FAIR SIZED FALL IN THE PRICE OF GOLD ($5.15.) A HUGE 12,392 EFP’S ISSUED FOR A FIAT BONUS AND A DELIVERABLE FORWARD GOLD CONTRACT IN LONDON AND ZERO COMEX GOLD LIQUIDATION DESPITE THE RAID.
.
We have now entered the NON active contract month of NOVEMBER.HERE WE HAD A LOSS OF 9 CONTRACT(S) FALLING TO 62. We had 18 notices filed YESTERDAY so GAINED 9 contracts or 900 additional oz will stand for delivery in this non active month of November. TO SEE BOTH GOLD AND SILVER RISE IN AMOUNT STANDING (QUEUE JUMPING) IS A GOOD INDICATOR OF PHYSICAL SHORTNESS FOR BOTH OF OUR PRECIOUS METALS.
The very big active December contract month saw it’s OI LOSE 10,236 contracts DOWN to 269,029 (OF WHICH 12,392 WERE EFP TRANSFERS). THUS ALL THE ROLLOVERS ARE TURNING INTO EFP’S. January saw its open interest RISE by 67 contracts up to 911. FEBRUARY saw a gain of 12,241 contacts up to 192,213. DEMAND FOR GOLD INTENSIFIES.
.
We had 11 notice(s) filed upon today for 1100 oz
VOLUME FOR TODAY : 279,714 (PRELIMINARY)
CONFIRMED VOLUME YESTERDAY: 467,777 contracts. (comex volumes are intensifying)
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And now for the wild silver comex results.
Total silver OI UNEXPECTEDLY ROSE BY 1557 CONTRACTS FROM 199,899 UP TO 201,456 DESPITE YESTERDAY’S 10 CENT LOSS IN PRICE . WE HAD 1312 PRIVATE EFP’S ISSUED FOR DECEMBER AND 0 EFP’S FOR MARCH BY OUR BANKERS TO COMEX LONGS WHO RECEIVED A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. THIS IS QUITE EARLY FOR THE ISSUANCE. USUALLY WE WITNESS THIS EVENT ONE WEEK PRIOR TO FIRST DAY NOTICE AND IT CONTINUES RIGHT UP TO FDN. WE HAD NO LONG SILVER COMEX LIQUIDATION. THE TOTAL EFP’S ISSUED TODAY TO OUR COMEX LONGS TOTAL 1312 AND THUS DEMAND FOR SILVER INTENSIFIES
The new front month of November saw its OI FALL by 0 contract(s) and thus it stands at 2. We had 1 notice(s) served YESTERDAY so we gained 1 contracts or an additional 5,000 oz will stand in this non active month of November. After November we have the big active delivery month of December and here the OI FELL by ONLY 649 contracts DOWN to 106,594, YET WE HAD 1312 EFP’S ISSUED WHICH MEANS ALL THE ROLLOVERS LANDED INTO EFP’S AND THEN SOME!!. January saw A GAIN OF 9 contracts RISING TO 1055.
We had 1 notice(s) filed for 5,000 oz for the NOV. 2017 contract
INITIAL standings for NOVEMBER
Nov 16/2017.
Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
nil
oz
Deposits to the Dealer Inventory in oz nil oz
Deposits to the Customer Inventory, in oz
65,829.761 oz
HSBC
Scotia
No of oz served (contracts) today
11 notice(s)
1100 OZ
No of oz to be served (notices)
51 contracts
(5100 oz)
Total monthly oz gold served (contracts) so far this month
1020 notices
102,000 oz
3.172 tonnes
Total accumulative withdrawals of gold from the Dealers inventory this month NIL oz
Total accumulative withdrawal of gold from the Customer inventory this month xxx oz
Today we HAD 0 kilobar trans
WE HAD nil DEALER DEPOSIT:
total dealer deposits: nil oz
We had nil dealer withdrawals:
total dealer withdrawals: nil oz
we had 2 customer deposit(s):
i) into HSBC: 56,056.956 oz
ii) into Scotia: 9,772.805 oz
total customer deposits 65,829.761 oz
We had 0 customer withdrawal(s)
Total customer withdrawals: nil
we had 1 adjustment(s)
i) Out of Delaware: 2341.534 oz was adjusted out of the customer account and this landed into the dealer account
For NOVEMBER:
Today, 0 notice(s) were issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 11 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 4 notice(s) was (were) stopped/ Received) by j.P.Morgan customer account.
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To calculate the INITIAL total number of gold ounces standing for the NOVEMBER. contract month, we take the total number of notices filed so far for the month (1020) x 100 oz or 102,000 oz, to which we add the difference between the open interest for the front month of NOV. (62 contracts) minus the number of notices served upon today (11 x 100 oz per contract) equals 107,100 oz, the number of ounces standing in this NON active month of NOV
Thus the INITIAL standings for gold for the NOVEMBER contract month:
No of notices served (1020) x 100 oz or ounces + {(62)OI for the front month minus the number of notices served upon today (11) x 100 oz which equals 107,100 oz standing in this active delivery month of NOVEMBER (3.303 tonnes)
WE GAINED 9 ADDITIONAL CONTRACTS OR 900 OZ OF ADDITIONAL GOLD STANDING FOR METAL AT THE COMEX
THIS IS THE FIRST TIME EVER THAT WE HAVE WITNESSED CONSIDERABLE QUEUE JUMPING IN GOLD AT THE COMEX. SILVER’S QUEUE JUMPING STARTED IN MAY 2017 AND HAS NOT LET UP ONCE COMMENCED.
.
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Total dealer inventory 529,409.586 or 16.406 tonnes (dealer gold continues to disappear)
Total gold inventory (dealer and customer) = 8,732,195.729 or 271.60 tonnes
I have a sneaky feeling that these withdrawals of gold in kilobars are being used in the hypothecating process and are being used in the raiding of gold!
The gold comex is an absolute fraud. The use of kilobars and exact weights makes the data totally absurd and fraudulent! To me, the only thing that makes sense is the fact that “kilobars: are entries of hypothecated gold sent to other jurisdictions so that they will not be short with their underwritten derivatives in that jurisdiction. This would be similar to the rehypothecated gold used by Jon Corzine at MF Global.
IN THE LAST 14 MONTHS 83 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
AND NOW THE NOVEMBER DELIVERY MONTH
NOVEMBER INITIAL standings
AND NOW THE NOVEMBER DELIVERY MONTH
Nov 16/ 2017
Silver Ounces
Withdrawals from Dealers Inventory nil
Withdrawals from Customer Inventory
3000.08 oz
Delaware
Deposits to the Dealer Inventory
nil oz
Brinks
Deposits to the Customer Inventory
22,251.620
oz
HSBC
No of oz served today (contracts)
1 CONTRACT(S)
(5,000,OZ)
No of oz to be served (notices)
1 contract
(5,000 oz)
Total monthly oz silver served (contracts) 876 contracts(4,380,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month NIL oz
Total accumulative withdrawal of silver from the Customer inventory this month
Nov 13/ 2017
today, we had 0 deposit(s) into the dealer account:
total dealer deposit: nil oz
we had nil dealer withdrawals:
total dealer withdrawals: nil oz
we had 1 customer withdrawal(s):
i) Out of Delaware: 3000.08 oz
TOTAL CUSTOMER WITHDRAWAL 3000.08 oz
We had 1 Customer deposit(s):
i) Into HSBC: 22,251.620 oz
***deposits into JPMorgan have stopped again
In the month of March and February, JPMorgan stopped (received) almost all of the comex silver contracts.
why is JPMorgan bringing in so much silver??? why is this not criminal in that they are also the massive short in silver
total customer deposits: 22,251.620 oz
we had 0 adjustment(s)
The total number of notices filed today for the NOVEMBER. contract month is represented by 1 contracts FOR 5,000 oz. To calculate the number of silver ounces that will stand for delivery in NOVEMBER., we take the total number of notices filed for the month so far at 876 x 5,000 oz = 4,380,0000 oz to which we add the difference between the open interest for the front month of NOV. (2) and the number of notices served upon today (1 x 5000 oz) equals the number of ounces standing.
.
Thus the INITIAL standings for silver for the NOVEMBER contract month: 876 (notices served so far)x 5000 oz + OI for front month of NOVEMBER(2) -number of notices served upon today (1)x 5000 oz equals 4,385,000 oz of silver standing for the NOVEMBER contract month. This is EXCELLENT for this NON active delivery month of November.
We gained 1 contract(s) or an additional 5,000 oz will stand for metal in the non active delivery month of November.
AS I MENTIONED ABOVE, WE HAVE BEEN WITNESSING QUEUE JUMPING IN SILVER FROM MAY 1 2017 ONWARD. IT IS NOW COMFORTING TO SEE CONSIDERABLE QUEUE JUMPING OCCURRING CONTINUALLY IN GOLD FOR THE FIRST TIME SINCE RECORDED TIME AT THE GOLD COMEX!!(1974). QUEUE JUMPING CAN ONLY OCCUR ON PHYSICAL METAL SHORTAGE.
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ESTIMATED VOLUME FOR TODAY: 90,208
CONFIRMED VOLUME FOR YESTERDAY: 121,980 CONTRACTS
YESTERDAY’S CONFIRMED VOLUME OF 121,980 CONTRACTS EQUATES TO 610 MILLION OZ OR 87.1% OF ANNUAL GLOBAL PRODUCTION OF SILVER
Total dealer silver: 43.817 million
Total number of dealer and customer silver: 231.665 million oz
The record level of silver open interest is 234,787 contracts set on April 21./2017 with the price at that day at $18.42
The previous record was 224,540 contracts with the price at that time of $20.44
end
NPV for Sprott and Central Fund of Canada
1. Central Fund of Canada: traded at Negative 2.4 percent to NAV usa funds and Negative 1,4% to NAV for Cdn funds!!!!
Percentage of fund in gold 62.2%
Percentage of fund in silver:37.5%
cash .+.3%( Nov 16/2017)
2. Sprott silver fund (PSLV): NAV FALLS TO -1.00% (Nov 16 /2017)
3. Sprott gold fund (PHYS): premium to NAV FALLS TO -0.56% to NAV (Nov 16/2017 )
Note: Sprott silver trust back into NEGATIVE territory at -1.00%-/Sprott physical gold trust is back into NEGATIVE/ territory at -0.56%/Central fund of Canada’s is still in jail but being rescued by Sprott.
Sprott WINS hostile 3.1 billion bid to take over Central Fund of Canada
(courtesy Sprott/GATA)
END
And now the Gold inventory at the GLD
Nov 16./NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 843.09 TONNES
Nov 15./no change in gold inventory at the GLD/inventory rests at 843.09 tonnes
NOV 14/a small deposit of .300 tonnes into the GLD inventory/Inventory rests at 843.39 tonnes
Nov 13/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 843.09 TONNES
Nov 10/no change in gold inventory at the GLD/Inventory rests at 843.09 tonnes
Nov 9/no changes in inventory at the GLD/Inventory rests at 843.09 tonnes
NOV 8/ANOTHER HUGE WITHDRAWAL OF 1.18 TONNES OF GOLD FROM THE GLD DESPITE GOLD’S RISE TODAY. INVENTORY RESTS AT 843.09
Nov 7/a huge withdrawal of 1.48 tonnes of gold from the GLD/Inventory rests at 844.27 tonnes
NOV 6/ a tiny withdrawal of .29 tonnes to pay for fees etc/inventory rests at 845.75 tonnes
Nov 3/no change in gold inventory at the GLD/Inventory rests at 846.04 tonnes
NOV 2/STRANGE!!! WE HAD ANOTHER WITHDRAWAL OF 3.55 TONNES FROM THE GLD DESPITE GOLD’S RISE OF $6.60 YESTERDAY AND $1.55 TODAY/INVENTORY RESTS AT 846.04 TONNES
Nov 1/a withdrawal of 1.18 tonnes of gold from the GLD/Inventory rests at 849.59 tonnes
OCT 31/no change in gold inventory at the GLD/Inventory rests at 850.77 tonnes
Oct 30/STRANGE WITH GOLD UP THESE PAST TWO TRADING DAYS, THE GLD HAS A WITHDRAWAL OF 1.18 TONNES FROM ITS INVENTORY/INVENTORY RESTS AT 850.77 TONES
Oct 27/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 851.95 TONNES
Oct 26./A WITHDRAWAL OF 1.18 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 851.95 TONNES
Oct 25/NO CHANGE (SO FAR) IN GOLD INVENTORY/INVENTORY RESTS AT 853.13 TONNES
Oct 24./no change in gold inventory at the GLD/inventory rests at 853.13 tonnes
OCT 23./NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY REMAINS AT 853.13 TONNES
OCT 20/NO CHANGE IN GOLD INVENTORY AT THE GLD/ INVENTORY REMAINS AT 853.13 TONNES
oCT 19/NO CHANGE/853.13 TONNES
Oct 18 /no change in gold inventory at the GLD/ inventory rests at 853.13 tonnes
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Nov 16/2017/ Inventory rests tonight at 843.39 tonnes
*IN LAST 273 TRADING DAYS: 97.56 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 208 TRADING DAYS: A NET 59,72 TONNES HAVE NOW BEEN ADDED INTO GLD INVENTORY.
*FROM FEB 1/2017: A NET 28.61 TONNES HAVE BEEN ADDED.
end
Now the SLV Inventory
Nov 16./NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.074 MILLION OZ/
Nov 15./no change in silver inventory at the SLV/inventory rests at 318.074 tones
NOV 14/no change in silver inventory at the SLV/Inventory rests at 318.074 tonnes
Nov 13/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.074 MILLION OZ
Nov 10/no change in silver inventory at the SLV/Inventory rests at 318.074 million oz/
Nov 9/no change in silver inventory at the SLV/inventory rests at 318.074 million oz.
NOV 8/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.074 MILLION OZ
Nov 7/a huge withdrawal of 944,000 oz from the SLV/inventory rests at 318.074 million oz/
NOV 6/no change in silver inventory at the SLV/Inventory rests at 319.018 million oz/
Nov 3/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS TONIGHT AT 319.018 MILLION OZ.
NOV 2/A TINY LOSS OF 137,000 OZ BUT THAT WAS TO PAY FOR FEES LIKE INSURANCE AND STORAGE/INVENTORY RESTS AT 319.018 MILLION OZ/
Nov 1/STRANGE! WITH SILVER’S HUGE 48 CENT GAIN WE HAD NO GAIN IN INVENTORY AT THE SLV/INVENTORY RESTS AT 319.155 MILLION OZ/
Oct 31/no change in silver inventory at the SLV/Inventory rests at 319.155 million oz
Oct 30/STRANGE!WITH SILVER UP THESE PAST TWO TRADING DAYS, WE HAD A HUGE WITHDRAWAL OF 1.133 MILLION OZ FROM THE SLV/INVENTORY RESTS AT 319.155 MILLION OZ/
Oct 27/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 320.288 MILLION OZ
Oct 26/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 320.288 MILLION OZ/
Oct 25/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 320.288 MILLION OZ
Oct 24/no change in inventory at the SLV/inventory rests at 320.288 million oz/
oCT 23./STRANGE!!WITH SILVER RISING TODAY WE HAD A HUGE WITHDRAWAL OF 1.039 MILLION OZ/inventory rests at 320.288 million oz/
OCT 20NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 321.327 MILLION OZ
oCT 19/INVENTORY LOWERS TO 321.327 MILLION OZ
Oct 18 no change in silver inventory at the SLV/inventory rest at 322.271 million oz
Nov 16/2017:
Inventory 318.074 million oz
end
6 Month MM GOFO
Indicative gold forward offer rate for a 6 month duration
+ 1.60%
12 Month MM GOFO
+ 1.79%
30 day trend
end
Major gold/silver trading/commentaries for THURSDAY
GOLDCORE/BLOG/MARK O’BYRNE.
GOLD/SILVER
Deepening Crisis In Hyper-inflationary Venezuela and Zimbabwe Show Why Physical Gold Is Ultimate Protection
GoldCore's picture
by GoldCore
Nov 16, 2017 7:36 AM
Deepening Crisis In Hyper-inflationary Venezuela and Zimbabwe
– Real inflation in Zimbabwe is 313 percent annually and 112 percent on a monthly basis
– Venezuela’s new 100,000-bolivar note is worth less oday thehan USD 2.50
– Maduro announces plans to eliminate all physical cash
– Gold rises in response to ongoing crises
A military coup-de-grace in Zimbabwe and a bankrupt Venezuela. Both countries have extreme hyperinflation, citizens are starving and basic medical treatment is near impossible to find. These are the real world problems 47.5 million people are currently facing.
Presidents Robert Mugabe and Nicolas Maduro both deny the crises in their respective countries. For Maduro it is the media propagating false truths. In Zimbabwe the response to hyperinflation has been to declare it illegal.
Both countries are in the media spotlight after a significant week that has left one man powerless and another scrambling to restore faith in his bankrupt country.
Each country’s mess is thanks to mismanagement of resources and the central banking system. Citizens have had their rights almost decimated as the cash in the bank is worth increasingly less and fewer people are receiving income. Basic goods and services are near impossible to come by, with little sign of let-up.
The hyperinflation and economic situations in both the Latin American and south African country are a reminder of the damage caused by governments. Both Maduro and Mugabe have acted under the premise of serving the electorate. Citizens as a result have only suffered and seen their wealth diminish on a daily basis.
Both countries may seem a million miles away from the West in terms of political situation and cultures. However there is a strong lesson to be learnt. Savers should learn the need to protect their earnings and wealth from the manipulative decisions of governments and destructive monetary policies.
Zimbabwe: The tyranny of a despot and his central bank
“Zimbabwe, welcome back to the record books! You have once again entered the inglorious world of hyperinflation. It is a world of economic chaos, wrenching poverty and death,”
– Steve Hanke, economics professor at Johns Hopkins University
We all recall the hyperinflation event of 2008 when Zimbabwe suffered the second most severe episode of hyperinflation in recorded history. Zimbabwe’s annual inflation rate reached 89.7 sextillion (10^23) percent. In response Mugabe and his cronies replaced the Zimbabwean currency with the US currency.
Now Zimbabwe is undergoing a fresh currency crisis as well as a coup-de-grace. It is facing shortages of the US dollar and banks are being forced to ration withdrawals. The bond notes, issued to make up the shortfall, have dropped sharply in value on black market exchanges. The end result is inflation in retail stores and foreign suppliers refusing to accept the made-up-money.
Today the country is thought to be heading back towards 2008, once again. Steve Hanke, economics professor at Johns Hopkins University has calculated that as of 25 October this year the monthly rate of inflation is 77% and the annual rate is 348%. The official the official, dollar-denominated rate is 0.38%. This is hyperinflation and not something you can just outlaw or ignore.
As a result citizens are suffering and the government is unable to meet basic requirements. The central bank has previously said Zimbabwe had a backlog of more than $500 million in pending foreign payments. This is for necessities such as fuel and medical supplies.
Agricultural production, in the once-known bread basket of Africa, has collapsed following the farm seizures and a lack of cash. Wheat production in 1990, before the farm seizures began, was 325,000 tonnes. In 2016, it was just 20,000 tonnes.
Meanwhile, on the ground citizens are struggling to protect the value of their money. With a 95% unemployment rate this is a hard enough situation to bear. Reports of earners and savers withdrawing their money to invest in real assets are rife as few trust that $200 in the bank today will still be there tomorrow.
Whilst the latest political turn of events is likely to be welcomed, it still brings about an air of uncertainty. Few foreign governments are likely to support aid packages to the country until matters have been resolved and a stable(ish) government is in power. Even China, which is the country’s main source of income and support, is likely to stand still and await to see how it all unfolds.
In the meantime feet on the ground continue to suffer as hyperinflation increases and they struggle to pay for and find basic goods and services.
Venezuela: A socialist experiment gone wrong?
Venezuela reminds me of a quote that is often misattributed to Milton Friedman:
“If you put the federal government in charge of the Sahara Desert, in 5 years there’d be a shortage of sand.”
Today you could say the same about oil and the Venezuelan government. The country was once the richest in Latin America but can no longer cover its own debts.
On Monday it missed interest payments on two government bonds. Even after a 30-day grace period it is unable to muster up $280 million owed in payments.
Meanwhile the value of the bolivar continues to plunge, causing major financial problems for Venezuelans. As explained by Business Insider:
After the country’s economic collapse in 2016, high inflation caused the bolivar’s value to plummet. By December, the then-largest note of 100 bolivares, which was worth about $US0.02, was pulled from circulation. To counter this, new denominations of 500, 1,000, 2,000, 5,000, 10,000, and 20,000 bolivares were introduced.
Maduro’s unveiling of the 100,000 bolivar note means it’s possible that some of these smaller notes may soon be phased out. This would cause serious problems for Venezuelans who, on average, are only allowed to withdraw about 10,000 to 20,000 bolivares a day. In October, the daily withdrawal allowance equalled roughly $3 to $6 at black market exchange rates. On the current market, 20,000 bolivares are worth around 50 cents.
To ‘combat’ the problem of cash shortages Maduro recently announced in a public broadcast that he planned to phase out physical cash, saying “the use of the physical currency is being replaced.”
This is something that was also seen in Zimbabwe. During their first notable hyperinflation era of 2005-2009, the government ran out of money to pay for money. The local currency cost US Dollars, which they could not afford to buy.
Should this happen this will be even more damming for those with cash in the bank. Currently they are able to withdraw physical cash in order to keep on top of the daily increase in inflation. Now they will have little choice but to sit and watch its value disappear.
The enforced holding of cash in the bank will no doubt bring with it capital controls as citizens are prevented from exchanging the bolivar for stronger currencies such as the US dollar. The first step has already been taken as Maduro has tried to contain the financial rout by banning the publication of black market rates. Something Mugabe also tried.
Venezuela’s default should also be of concern to citizens elsewhere, especially in the US. It has come to light that a number of Americans with 401(k) own a hefty amount of Venezuela’s $60 billion debt. How will this work out if the country is unable to pay or has its debt restructured?
Avoid exposure to hyperinflation
Here in the West we are currently extremely fortunate as we are not facing political leaders such as Maduro or hyper inflationary scenarios as those seen in both Zimbabwe and Venezuela.
However, as evidenced just above we may still be exposed in the immediate sense to the failings of these countries, whether through our pension plans or investments elsewhere.
Even if you can be certain that you hold no Venezuelan debt or exposure to the Zimbabwean economy this is still a lesson in how one must diversify their assets outside of cash and the banking system. This is thanks to ultimate control institutions and governments have over these entities, should they so choose.
By holding assets outside of the system you can work to protect your wealth from such measures as those seen in Zimbabwe and Venezuela. Gold is one of the best examples. When held in a physical, allocated and segregated manner the owner cannot be prevented from accessing it whenever they so wish. Nor can it be devalued at will or suddenly illegal to trade. It is a borderless currency that acts without the control of governments looking to further their own wealth or political beliefs.
News and Commentary
Gold steady as dollar gains amid U.S. rate hike expectations (Reuters.com)
Asia Stocks Gain, Halting Slide; Aussie, Won Rise (Bloomberg.com)
Stocks Fall, Treasuries Rise as Commodities Slump (Bloomberg.com)
U.S. business inventories unchanged in September (Reuters.com)
U.S. consumer prices edge up; retail sales unexpectedly increase (Reuters.com)
TURKS follow Erdogan’s call to get rid of dollars & buy gold (RT.com)
Chinese buying more gold as global demand falls (CGTN.com)
Gold inches down as U.S. rate hike looms (Reuters.com)
Paulson Holds Stake in Gold Steady, Soros Stays on Sidelines (NewsMax.com)
Why We’re Buying Physical Gold with a $1700 Target (ZeroHedge.com)
Gold Prices (LBMA AM)
16 Nov: USD 1,277.70, GBP 969.01 & EUR 1,085.53 per ounce
15 Nov: USD 1,285.70, GBP 976.62 & EUR 1,086.29 per ounce
14 Nov: USD 1,273.70, GBP 972.47 & EUR 1,086.59 per ounce
13 Nov: USD 1,278.40, GBP 977.59 & EUR 1,097.89 per ounce
10 Nov: USD 1,284.45, GBP 976.44 & EUR 1,102.19 per ounce
09 Nov: USD 1,284.00, GBP 980.98 & EUR 1,106.29 per ounce
08 Nov: USD 1,282.25, GBP 976.82 & EUR 1,105.43 per ounce
Silver Prices (LBMA)
16 Nov: USD 17.04, GBP 12.92 & EUR 14.48 per ounce
15 Nov: USD 17.12, GBP 13.00 & EUR 14.45 per ounce
14 Nov: USD 16.94, GBP 12.92 & EUR 14.45 per ounce
13 Nov: USD 16.93, GBP 12.93 & EUR 14.53 per ounce
10 Nov: USD 17.00, GBP 12.92 & EUR 14.60 per ounce
09 Nov: USD 17.10, GBP 13.03 & EUR 14.69 per ounce
08 Nov: USD 17.00, GBP 12.96 & EUR 14.65 per ounce
Recent Market Updates
– UK Debt Crisis Is Here – Consumer Spending, Employment and Sterling Fall While Inflation Takes Off
– Protect Your Savings With Gold: ECB Propose End To Deposit Protection
– Internet Shutdowns Show Physical Gold Is Ultimate Protection
– Gold Coins and Bars Saw Demand Rise 17% to 222T in Q3
– Prepare For Interest Rate Rises And Global Debt Bubble Collapse
– Platinum Bullion ‘May Be One Of The Only Cheap Assets Out There’
– World’s Largest Gold Producer China Sees Production Fall 10%
– German Investors Now World’s Largest Gold Buyers
– Gold Price Reacts as Central Banks Start Major Change
– Why Switzerland Could Save the World and Protect Your Gold
– Invest In Gold To Defend Against Bail-ins
– Stumbling UK Economy Shows Importance of Gold
END
A joke: the one exchange that the CME plans to use when it starts with its futures operation is down again and it is having serious issues
(Russo/Bloomberg)
The bitcoin exchange CME plans to use for futures is down
Submitted by cpowell on Wed, 2017-11-15 18:27. Section: Daily Dispatches
By Camila Russo
Bloomberg News
Wednesday, November 15, 2017
This is exactly what the bitcoin futures naysayers have been warning about: One of the exchanges which CME Group Inc. would use to price the contracts is having serious issues.
Clients of San Francisco-based Kraken are seeing slow responses from the website, connection timeouts, and delays in withdrawals, the cryptocurrency exchange said in a statement late Tuesday. “We are investigating these issues and working to resolve as quickly as possible,” the statement said.
Problems in the fifth-biggest exchange by bitcoin trading volume come just three days after Seoul-based Bithumb’s servers crashed as a sudden surge in usage caused a connection failure. The issues raise concerns about whether largely unregulated exchanges, without the safeguards of securities bourses, will be able to reliably provide prices for indexes tied to futures and exchange traded funds, and cope with higher trading volume that could come if institutional investors start buying cryptos. …
… For the remainder of the report:
https://www.bloomberg.com/news/articles/2017-11-15/bitcoin-exchange-that…
END
German Precious Metals Association honors GATA consultant Dimitri Speck
Submitted by cpowell on Wed, 2017-11-15 18:39. Section: Daily Dispatches
1:40p ET Wednesday, November 15, 2017
Dear Friend of GATA and Gold:
Financial analyst and GATA consultant Dimitri Speck, author of “The Gold Cartel,” has been given the German Precious Metals Association’s Winged Sculpture prize, which is awarded annually to people or projects whose work has engaged the public with precious metals and related topics.
Association board member said: “Dimitri Speck succeeded already as far back as 2002 in discovering statistical proof for the manipulation of the London gold fixing. In 2011 he followed up by providing statistical proof for the manipulation of the silver fixing as well, followed in 2014 by statistical proof for the manipulation of the platinum fixing.”
The announcement of Speck’s award is posted in German at the association’s internet site here:
http://www.goldseiten.de/artikel/352515–Dimitri-Speck-mit-Preis-der-Deu…
And in an English translation at Speck’s own internet site, Seasonax, here:
https://seasonax.com/news/dimitri-speck-winner-2017-prize-german-preciou…
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org
END
What a joke: this one BIS official urges accountability while it undergoes in secret huge gold swaps
(courtesy GATA/Chris Powell)
BIS official urges accountability while his press office rejects it
Submitted by cpowell on Wed, 2017-11-15 19:24. Section: Daily Dispatches
2:33p ET Wednesday, November 15, 2017
Dear Friend of GATA and Gold:
Even as the Bank for International Settlements was refusing on Tuesday to answer GATA’s questions about the bank’s activity in the gold market —
http://www.gata.org/node/17793
— the bank’s economic adviser and head of research, Hyun Song Shin, was addressing a conference at the European Central Bank in Frankfurt, Germany, giving a speech titled “Can Central Banks Talk Too Much?”:
https://www.bis.org/speeches/sp171114.pdf
And:
http://www.gata.org/files/BIS-HyunSongShinSpeech-11-14-2017.pdf
Shin echoed the 2005 remarks of another BIS official, William R. White, who said a major objective of central banking is “to influence asset prices (especially gold and foreign exchange) in circumstances where this might be thought useful”:
http://www.gata.org/node/4279
Shin told the ECB conference: “If central banks talk more to influence market prices, they should listen less to the signals emanating from those same markets. Otherwise, they could find themselves in an echo chamber of their own making, acting on market signals that are echoes of their own pronouncements.
On the other hand,” Shin continued, “talking less is hardly a viable option. Central bank actions matter too much for the lives of ordinary people to turn the clock back to an era when silence was golden. Accountability demands that central banks make clear the basis for their actions.”
In fact at the moment accountability seems to mean little at the BIS, whose press office replied as follows to GATA on Tuesday: “We do not comment on specific accounts / holdings of central banks or of the BIS.”
(See: http://www.gata.org/node/17793)
So much for “the lives of ordinary people,” who, instead of being told how the BIS is meddling in the markets, can just drop dead.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org
END
Gold trading today:
Your early THURSDAY morning currency, Asian stock market results, important USA/Asian currency crosses, gold/silver pricing overnight along with the price of oil Major stories overnight/9 AM EST
i) Chinese yuan vs USA dollar/CLOSED DOWN AT 6.6320/shanghai bourse CLOSED DOWN AT 3.27 POINTS .10% / HANG SANG CLOSED UP 167.07 POINTS OR 0.58%
2. Nikkei closed UP 322.80 POINTS OR 1.47% /USA: YEN RISES TO 113.14
3. Europe stocks OPENED GREEN /USA dollar index RISES TO 93.94/Euro FALLS TO 1.1766
3b Japan 10 year bond yield: RISES TO . +.052/ GOVERNMENT INTERVENTION !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 114.07/ THIS IS TROUBLESOME AS BANK OF JAPAN IS RUNNING OUT OF BONDS TO BUY./JAPAN 10 YR YIELD FINALLY IN THE POSITIVE/BANK OF JAPAN LOSING CONTROL OF THEIR YIELD CURVE AS THEY PURCHASE ALL BONDS TO GET TO ZERO RATE!!
3c Nikkei now JUST BELOW 17,000
3d USA/Yen rate now well below the important 120 barrier this morning
3e WTI:: 55.27 and Brent: 61.62
3f Gold DOWN/Yen DWON
3g Japan is to buy the equivalent of 108 billion uSA dollars worth of bond per month or $1.3 trillion. Japan’s GDP equals 5 trillion usa./“HELICOPTER MONEY” OFF THE TABLE FOR NOW /REVERSE OPERATION TWIST ON THE BONDS: PURCHASE OF LONG BONDS AND SELLING THE SHORT END
Japan to buy 100% of all new Japanese debt and by 2018 they will have 25% of all Japanese debt. Fifty percent of Japanese budget financed with debt.
3h Oil UP for WTI and UP FOR Brent this morning
3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund RISES TO +.386%/Italian 10 yr bond yield DOWN to 1.850% /SPAIN 10 YR BOND YIELD DOWN TO 1.515%
3j Greek 10 year bond yield RISES TO : 5.18???
3k Gold at $1277.15 silver at:17.05: 6 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50
3l USA vs Russian rouble; (Russian rouble UP 24/100 in roubles/dollar) 59.97
3m oil into the 55 dollar handle for WTI and 61 handle for Brent/
3n Higher foreign deposits out of China sees huge risk of outflows and a currency depreciation. This can spell financial disaster for the rest of the world/China forced to do QE!! as it lowers its yuan value to the dollar/GOT A GOOD SIZED DEVALUATION SOUTHBOUND
JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 112.76 DESTROYING JAPANESE CITIZENS WITH HIGHER FOOD INFLATION
30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF. It is not working: USA/SF this morning 0.9925 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1678 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.
3p BRITAIN VOTES AFFIRMATIVE BREXIT/LOWER PARLIAMENT APPROVES BREXIT COMMENCEMENT/ARTICLE 50 COMMENCES MARCH 29/2017
3r the 10 Year German bund now POSITIVE territory with the 10 year RISING to +0.386%
The bank withdrawals were causing massive hardship to the Greek bank. the Greek referendum voted overwhelming “NO”. Next step for Greece will be the recapitalization of the banks and that will be difficult.
4. USA 10 year treasury bond at 2.359% early this morning. Thirty year rate at 2.797% /
5. Details Ransquawk, Bloomberg, Deutsche bank/Jim Reid.
(courtesy Jim Reid/Bloomberg/Deutsche bank/zero hedge)
Futures Jump, Global Stocks Rebound From Longest Losing Streak Of The Year
After five consecutive daily losses on the MSCI world stock index and seven straight falls in Europe, there was finally a bounce, as investors returned to global equity markets in an optimistic mood on Thursday, sending US futures higher after several days of losses as global stocks rebounded following a Chinese commodity-driven rout.
The House is poised to vote, and pass, on tax legislation although what happens in the Senate remains unclear. European shares rebounded for the first time in eight sessions, following Asian stocks higher as the global risk-off mood eased. The euro, Swiss franc and yen all weakened as the dollar edged higher. “After five or six days of steady selling you have got people coming back in looking for bargains,” said CMC Markets’ Michael Hewson. “I think it’s temporary though. We haven’t had a significant sell off this year and the fact of the matter is that equity markets have done so much better than anyone dared to envisage.”
As Bloomberg echoes, “investors seem to be regaining their appetite for risk after several days of global declines in stocks and high-yield credit that had many questioning whether the selloff could become a rout.”
Still, investor concern over the progress of a massive U.S. tax reform plan showed no sign of abating as two Republican lawmakers on Wednesday criticized the Senate’s latest proposal. U.S. President Donald Trump hit back, tweeting that “Tax cuts are getting close!”
“If we look at what the markets are focusing on, it’s still very much the tax cut debates in the U.S., and how much progress there’s going to be on this front,” Barclays’ Mitul Kotecha told Reuters.
Indices in Tokyo, Shanghai and Hong Kong and Seoul all rallied overnight, while London, Frankfurt and Paris started 0.3-0.4% higher as cyclical stocks which had driven the sell-off made a comeback. In Japan the Topix index ended its longest losing streak in a year, rising 1% with technology stocks providing the biggest boost, and the Nikkei 225 advances 1.5%. The ASX (+0.2%) also managed to shake off its early losses, closing higher with the energy sector outperforming as consumer staples and utilities weighed. Chinese stocks edged lower despite a massive cash injection by the PBOC, while the Hang Seng moved higher. Hong Kong stocks rebounded from their worst day in four weeks, as insurers led by Ping An Insurance Group Co. jumped on optimism that rising bond yields will boost investment income. Tencent Holdings climbed after posting its fastest revenue growth in seven years.
China’s sovereign bonds finally rebounded, advancing after the central bank boosted cash injections by the most in 10 months, fueling speculation that the authorities are looking to stabilize sentiment after a debt selloff. Having flirted with 4% in recent days, the yield on 10-year government notes dropped 3 basis points to 3.95%; the 5-year yield fell 1 basis point to 3.95%. The 10-year yield surpassed 4% this week for the first time since 2014. The People’s Bank of China added a net 310 billion yuan ($47 billion) through reverse-repurchase agreements on Thursday, bringing this week’s open-market operation additions to 820 billion yuan, also the most since January.
European stocks bounce back from a seven-day rout – the longest losing streak of the year – that had erased almost 400 billion euros ($471 billion) from the value of the region’s benchmark. The Stoxx Europe 600 Index adds 0.7%, following gains in Asia and climbing from a two-month low. All national benchmarks in the region are in the green, except those in Italy and Greece. Most industry groups also rise, with automakers rebounding from an eight-day slump on data showing European car sales grew in October. Financial services firms and builders were among the biggest gainers in the broad advance of the Stoxx Europe 600 Index.
There was some relief too that oil prices had pulled out of what had been a near 5 percent drop and that upbeat U.S. data on Wednesday had helped the dollar halt the euro’s sharp recent rise.
In currencies, the pound fluctuated as Brexit rhetoric rumbled on, and data showed U.K. retail sales barely rose in October. Concerns about Brexit continue to mount: an article in ‘The Sun’ newspaper, stated that UK PM May, could increase her divorce bill offer to the EU in December; deal would add GBP 20bln to the GBP 18bln said to already be on offer. Source reports indicate that EU is said to reject UK bid for `bespoke’ trade deal, according to Politico. BoE’s Carney states that the Bank will do whatever they can to support the UK economy during the Brexit transition period. Chancellor Hammond said to stick to fiscal rules and resist demands for spending surge in upcoming UK budget. Michael Gove is reportedly facing a Conservative party backlash as he is accused of using the cabinet to audition for UK Chancellor
The dollar index was slightly higher on the day at 93.828 having hit four- and five-week lows against the yen and euro. The euro was down around 14 ticks at $1.1760 retreating from a one-month top of $1.1860 on Wednesday. Havens underperformed on Thursday, with gold trading little changed, and the yen and Swiss franc among the worst-performing major currencies. The Swiss franc decreased 0.3 percent to $0.9918, the largest dip in more than two weeks.
Commodities largely stabilized as China’s central bank boosted the supply of cash in the system by the most since January, though oil eventually reversed a gain. Gold edged 0.1% lower to $1,277.29 an ounce. It reached $1,289.09 overnight, its highest since Oct. 20. Oil prices gained despite pressure after the U.S. government reported an unexpected increase in crude and gasoline stockpiles. They had lost ground to this week’s International Energy Agency (IEA) outlook for slower growth in global crude demand.
European government bonds took their cue from the U.S. benchmark, turning lower as the yield on 10-year Treasuries increased. Bond markets saw a broad rise in yields after mostly upbeat U.S. economic news on Wednesday had added to expectations the Federal Reserve will hike interest rates again next month as well as multiple times next year. Two-year Treasury yields US2YT=RR crept to fresh nine-year peaks in European trading, though significantly the U.S. yield curve remained at its flattest in a decade. European yields nudged higher too but the standout there was a fall in the premium investors demand to hold French debt over German peers to its lowest in over two years, almost to record lows.
Wal-Mart, Viacom, Best Buy and Applied Materials are among companies due to release results. Economic data include initial jobless claims, Philadelphia Fed Business Outlook.
Market Snapshot
S&P 500 futures up 0.4% to 2,574
STOXX Europe 600 up 0.7% to 384.61
MSCI Asia up 0.8% to 169.14
MSCI Asia ex Japan up 0.7% to 555.93
Nikkei up 1.5% to 22,351.12
Topix up 1% to 1,761.71
Hang Seng Index up 0.6% to 29,018.76
Shanghai Composite down 0.1% to 3,399.25
Sensex up 1% to 33,095.23
Australia S&P/ASX 200 up 0.2% to 5,943.51
Kospi up 0.7% to 2,534.79
German 10Y yield rose 1.3 bps to 0.389%
Euro down 0.1% to $1.1779
Brent Futures down 0.03% to $61.85/bbl
Italian 10Y yield rose 0.7 bps to 1.57%
Spanish 10Y yield rose 1.1 bps to 1.561%
Brent Futures down 0.03% to $61.85/bbl
Gold spot down 0.02% to $1,277.91
U.S. Dollar Index up 0.1% to 93.91
Intermission
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Top Overnight News
After a month of discussions, German Chancellor Angela Merkel faces a self-imposed end-of-week deadline to unlock coalition negotiations
British PM Theresa May saw some support from officials of her German counterpart Merkel
Manfred Weber, who leads Merkel’s Christian Democrats in the European Parliament and is a self-proclaimed skeptic on Brexit, changed his tone dramatically after meeting May saying the U.K. had a “credible” position and there was a “willingness to contribute to a positive outcome”
Sterling came under pressure after a Politico report said the EU’s Chief Brexit Negotiator Michel Barnier’s team flatly reject May’s bid for a “bespoke” trade deal
Fed officials are pushing for a potentially radical revamp of the playbook for guiding U.S. monetary policy. With inflation and interest rates still low, the central bank has little room to ease policy in a downturn
U.S. Treasury Secretary Steven Mnuchin is trying to persuade businesses and the Republican faithful to get behind a proposed tax overhaul from the Trump administration that so far lacks broad public support
The tax plan has provisions that may affect coverage and increase medical expenses for millions of families
President Robert Mugabe’s refusal to publicly resign is stalling plans by Zimbabwe’s military to swiftly install a transitional government after seizing power on Wednesday
Tax overhaul update: President Donald Trump is scheduled to head to the House, rallying Republican members before vote on tax bill
German Chancellor Angela Merkel meets heads of her Christian Democratic-led bloc, Free Democrats and Green party to kick coalition talks into gear
Cisco Sees First Revenue Growth in Eight Quarters; Shares Up
Koch Brothers Are Said to Back Meredith Bid to Buy Time Inc.
Health Care for Millions at Risk as Tax Writers Look for Revenue
Cerberus’s Feinberg Switches Strategy to Shake Up German Banking
Mattel Drops on Report That It Rebuffed Approach From Hasbro
New SUVs at Peugeot, Ford Offset U.K. Drag on Europe Car Sales
Google Sued for Using ‘Bait and Switch’ to Hook Minority Hires
Santos Seen Luring More Bids After Rejecting $7.2 Billion Offer
AT&T’s Clash With America Movil Slows Nafta Telecom Talks
Mobileye’s $15 Billion Deal Masks Drop in Israel Tech M&A
Mugabe’s Refusal to Resign Is Said to Stall Zimbabwe Transition
In Asian markets, a modest uptick in US stock index futures helped the Nikkei 225 stem some of its recent losses, with financials and retailers leading the way; as a result, he Japanese blue-chip index closed up 1.5%. The ASX (+0.2%) also managed to shake off its early losses, last closing up, with the energy sector outperforming (although this was on the back of confirmation of a rebuffed Santos takeover offer) as consumer staples and utilities weighed. Chinese stocks edged lower, while the Hang Seng moved higher Treasuries operated in a narrow range throughout the APac session, while JGBs were relatively listless, with a solid 20-year auction the highlight of the session. Aussie bond yields moved to session highs in the wake of the aforementioned labour market release, where they consolidated.
In European markets, equities kicked off the session on the front-foot in a continuation of some of the sentiment seen overnight during Asia-Pac trade (Nikkei 225 +1.5%). Some slight underperformance has been observed in the FTSE 100 with gains capped by a slew of ex-dividends which have trimmed 14.56 points off the index. Notable ex-dividends include both of Royal Dutch Shell’s listings, with the oil-heavyweight subsequently hampering the energy sector as WTI and Brent crude have failed to make any meaningful recovery from Thursday’s losses. Elsewhere, the likes of Fiat Chrysler (+2.5%) and Volkswagen (+2.4%) have been giving a help hand by the latest EU new car registration data. In fixed income, a limited reaction to better than forecast UK consumption data, and clear reservations about retail activity over the key Xmas and New Year period based on bleaker signals from anecdotal surveys and non-ONS data. Hence, Gilts dipped to 124.72 (-15 ticks vs +8 ticks at best), while the Short Sterling strip reversed pre-data gains to stand flat to only 1 ticks adrift before stabilising again. In truth, core bonds were already on the retreat from early highs (ie Bunds down to 162.43 vs 162.71 at best) in what appears to be a broad retracement within recent ranges rather than anything more meaningful.
In FX, GBP has once again been a key source of focus with GBP/USD hit early doors amid reports in Politico that the EU are leaning towards rejecting the UK’s request for a bespoke trade deal. However, sentiment saw a mild recovery after reports in the Sun suggested that PM May could be on the cusp of upping her Brexit settlement offer in an attempt to kick-start trade talks. The main data release of the session thus far came in the form of UK retail sales which painted a less dreary picture of the UK economy than some had feared, although gains were short-lived as Brexit remains the focus. Marginal sterling buying was seen in EUR/GBP, trading around session lows, helped by a stop hunt through yesterday’s lows. Cable too saw a bid later in the session, benefiting from the weaker USD. Elsewhere, EUR/USD is back below 1.1800 vs the USD after topping out just ahead of October’s 1.1880 high, and now in a fresh albeit higher range flanked by big option expiries between 1.1795-1.1800 (913mln) and 1.1815-25 (4.8bln). Another roller-coaster ride for the Antipodeans, with AUD choppy on mixed labour data (headline count miss, but jobless rate and full employment upbeat) and pivoting the 0.7600 handle vs the USD.
In the commodities complex, as mentioned above, WTI and Brent crude futures have failed to make any noteworthy recovery from the sell-off seen on Tuesday with energy newsflow particularly light during today’s session thus far with markets looking ahead to the November 30th OPEC meeting which is set to give nations the instruction to extend oil production cuts. In metals markets, gold prices have traded in a relatively similar manner with prices unable to be granted any reprieve from their latest tumble. Elsewhere, Nickel and Copper have been weighed on, sending prices to multi-week lows as concerns around Chinese growth prospects continue to linger.
Looking at the day ahead, weekly initial jobless claims, Philly Fed PMI for November, import price index for October, industrial production for October and NAHB housing market index for November will be released. The BoE Carney’s, Broadbent and Haldane will all participate at a public plenary session while the ECB’s Villeroy de Galhau and Constancio are due to speak, along with the Fed’s Williams, Mester and Kaplan.
US Event Calendar
8:30am: U.S. Initial Jobless Claims, Nov. 11, est. 235k (prior 239k); Continuing Claims, Nov. 4, est. 1900k (prior 1901k)
8:30am: U.S. Philadelphia Fed Business Outl, Nov., est. 24.6 (prior 27.9)
8:30am: U.S. Import Price Index MoM, Oct., est. 0.4% (prior 0.7%); U.S. Export Price Index MoM, Oct., est. 0.4% (prior 0.8%);
9:15am: U.S. Industrial Production MoM, Oct., est. 0.5% (prior 0.3%); Capacity Utilization, Oct., est. 76.3% (prior 76.0%)
9:15am: U.S. Bloomberg Consumer Comfort, Nov. 12, no est. (prior 51.5); Economic Expectations, Nov., no est. (prior 47.5)
Central Bank speakers:
9:10am: Fed’s Mester delivers keynote address at Cato Conference
1:10pm: Fed’s Kaplan speaks to CFA society in Houston
3:00pm: ECB’s Constancio speaks in Ottawa
3:45pm: Fed’s Brainard delivers keynote at OFR FinTech Conference
4:45pm: Fed’s Williams speaks at Asia Economic Policy Conference
DB’s Jim Reid concludes the overnight wrap
There has been a lot of noise around the HY market in the past week or so as a combination of macro factors along with some notable earnings misses have weighed on the market. iTraxx Crossover and CDX HY have widened by around 25bps and 30bps respectively from their most recent tights, while the price level of the largest USD HY ETF (HYG US) is basically back to the same level as where it started the year, however this overstates the move in the US cash market and even more so in Europe. Looking in more detail at the cash market US HY has widened by around 60bps and EUR HY is 46bps wider from the recent cycle tights only a few weeks back but both are still around 25bps and 100bps tighter on the year respectively.
In a broad historic context the recent moves hardly register but in the context of a year that has been headlined by extremely low levels of volatility they are certainly significant. For EUR HY there were two other periods where we saw some sort of correction this year. In March/April (ahead of the French elections) the index widened 27bps in 42 days and then in August/September (after the North Korean escalation) we saw a 29bps widening over 30 days. So the current 46bps of widening in just 12 days has been somewhat more aggressive than anything else we’ve seen this year.
Looking at similar data for the US we have also seen two previous corrections. In March spreads widened 61bps in 20 days and then in July/August we saw 45bps of widening in 15 days. So the current c.60bps widening over 22 days is actually of a similar magnitude to this year’s previous corrections. The moves look even more stark when we focus on single-Bs though. EUR single-Bs have widened by more than 100bps from the most recent tights, more than halving the YTD tightening we had seen. For USD single-Bs the recent widening (65bps) has actually reversed more than 80% of the YTD spread tightening we had seen to the recent tights.
The question from here is whether this recent back-up in spreads is simply going to lead to a fresh buying opportunity or whether it will lead to something more significant. Despite some of the recent profit warnings we think that it is more likely to be the former at the moment. But at the very least the pace of this turn around highlights how quickly market sentiment can change, especially when spreads are so tight. HY was looking very very stretched relative to IG in Europe and this corrects some of that. Overall it certainly provides us with some food for thought as we look to publish our 2018 outlook in the next 10 days.
Even though US HY has been one of the weaker markets of late there’s no doubt that the recent global equity sell off has struggled to gather momentum as the US session has progressed over the last week. Following through on this, Asia has been weak since the Nikkei sudden sell-off last week and Europe has followed with yesterday seeing the 7th successive daily fall in the Stoxx 600 (-0.49%) – the longest losing streak since October/November 2016. Meanwhile yesterday the US (S&P 500 -0.55%) again closed off the early session lows showing that this equity sell-off isn’t really being US led. For the record since last Wednesday’s close the S&P 500, Stoxx 600 and Nikkei are down -1.15%, -3.17% and -3.86% respectively which helps illustrate this.
Volatility has been on the way up though even in the US over this period. The VIX spiked to 14.51 intraday which was the highest since August 18th. It closed at 13.13 (+13%) which is still the highest since the same period. Meanwhile the VSTOXX index was up +2.25% and is now at the highest level since early September.
This morning in Asia, markets have stemmed losses and are trading higher. The Nikkei (+1.24%), Kospi (+0.52%), Hang Seng (+0.53%) and ASX 200 (+0.30%) are all up as we type. WTI oil is trading marginally higher and after the bell in the US, Cisco was up c6% after guiding to its first revenue gain in eight quarters.
On now to the big data of the yesterday and possibly the month. US Core CPI inflation surprised modestly to the upside in October, rising 0.225% in month-on-month terms (a firmer 0.2% print than DB expected). This raised the year-overyear rate to 1.8% (1.7% expected). The data provide additional evidence that the core inflation trend is firming after a string of very weak prints earlier this year. According to our economists, the three-month annualised change in core CPI inflation is now at 2.4%, the strongest since February 2017. We think inflation is turning a corner and regular consistent misses vs expectations will not be a feature of markets in 2018.
Staying in the US, the House’s version of the tax plan is reportedly on track for a vote on Thursday (local time). In terms of the Senate’s version, rhetoric appears to be heating up as the mark up process continues. The Democrats were reportedly not impressed with the last minute change to add in the repeal of the Obamacare individual mandate, to which Republican Senator Collins partly agrees on, noting that it “gravely complicated our efforts to combine tax reform and changes”, although she has not decided whether to vote against the bill or not. Elsewhere, Republican Senator Johnson has publicly confirmed that he is opposed to the revised GOP plan as it stands, in part as it does not do enough to help partnerships relative to the larger tax cuts for corporates.
Quickly recapping other markets performance from yesterday. Bond markets were firmer with core bond yields down 2-5bp (UST 10y -5bp; Bunds -2.1bp; Gilts -3.5bp) while peripherals underperformed with Portugal bonds leading the softness (+2.5bp). Key currencies were little changed, with US dollar index marginally higher, while Euro dipped -0.06% but Sterling rose 0.05%. In commodities, WTI oil fell another -0.70% (-3.2% for the week), in part following reports that Russia believes it’s too early to announce a potential extension of production cuts at OPEC’s meeting at end of the month. Notably, WTI is still up c18% from late August. Elsewhere, precious metals softened a little (Gold -0.16%; Silver -0.14%) and other base industrial metals were little changed (Copper -0.45%; Zinc -0.54%; Aluminium +0.36%).
Away from the markets, there were a deluge of Fed and ECB central bankers commentaries yesterday but overall contained minimal market moving information. In the details, the Fed’s Evans noted he was open-minded regarding policy action at the December FOMC ahead of discussions with fellow colleagues and sounded dovish on inflation, noting “I feel we are facing below target inflations” while reiterating the US labour market is “vibrant” and unemployment rate “could go below 4%”.
In Europe, the ECB’s Hansson was upbeat on the demand side of the economy and “feel more confident that inflation will eventually reach the levels consistent with our aim”. Elsewhere, the ECB’s Praet pointed to the importance of interest rates post QE, noting that “policy rates will eventually regain their status as the main instrument of policy, and our forward guidance will revert to a singular approach”. Finally, the ECB’s Coeure noted that it’s important for the ECB “to ensure that our own measures do not adversely affect the intermediation capacity of repo markets”.
Over in China yesterday, there were more signs that the government may tolerate slower economic growth in 2018. The Economic Daily reported that the deputy head of the Research Office of the State Council Ms Han has flagged that GDP growth at 6.3% in 2018-2020 would be sufficient to achieve the Party’s 2020 growth target. As a reminder, our Chinese economists expect GDP growth to slow to 6.3% yoy by 1Q.
Finally, over in Zimbabwe, President Mugabe’s c40 years of power may be coming to an end with Bloomberg reporting the 93 year old was confined to his home, with military forces taking control of state owned media outlets and sealing offthe parliament and central bank’s offices.
Before we take a look at today’s calendar, we wrap up with other data releases from yesterday. In the US, the core retail sales for October (ex-auto & gas) was in line at 0.3% mom, but with the prior reading upwardly revised by 0.1ppt. Elsewhere, the September business inventories was flat and in line for the month. Finally, the November empire manufacturing index fell from a c3 year high of 30.2 to a still solid reading of 19.4. After the recent economic data, the Atlanta Fed’s GDPNow estimate of 4Q GDP growth has edged 0.1pp lower to 3.2% saar.
In the UK, the September unemployment rate was in line and steady at 4.3% – still at a 42 year low, while the average weekly earnings remains low but was slightly above expectations at 2.2% yoy (vs. 2.1% expected). Elsewhere, jobless claims (1.1k vs. 1.7k previous) and claimant count rate (2.3% vs. same as previous) were broadly similar to prior readings. The Eurozone’s September trade surplus widened to EUR$25bln (vs. EUR$21bln expected), while the final reading for France’s October CPI was unrevised at 0.1% mom and 1.2% yoy.
Looking at the day ahead, the final October CPI report for the Euro area will be out. UK retail sales data for October and Q3 employment data for France will also be released. In the US weekly initial jobless claims, Philly Fed PMI for November, import price index for October, industrial production for October and NAHB housing market index for November will be released. The BoE Carney’s, Broadbent and Haldane will all participate at a public plenary session while the ECB’s Villeroy de Galhau and Constancio are due to speak, along with the Fed’s Williams, Mester and Kaplan.
3. ASIAN AFFAIRS
i)Late WEDNESDAY night/THURSDAY morning: Shanghai closed DOWN 3.27 points or .10% /Hang Sang CLOSED UP 167.07 pts or 0.58% / The Nikkei closed UP 322.80 POINTS OR 1.47%/Australia’s all ordinaires CLOSED UP 0.19%/Chinese yuan (ONSHORE) closed DOWN at 6.6320/Oil DOWN to 55.27 dollars per barrel for WTI and 61.62 for Brent. Stocks in Europe OPENED GREEN . ONSHORE YUAN CLOSED DOWN AGAINST THE DOLLAR AT 6.6320. OFFSHORE YUAN CLOSED WEAKER TO THE ONSHORE YUAN AT 6.638 //ONSHORE YUAN WEAKER AGAINST THE DOLLAR/OFF SHORE WEAKER TO THE DOLLAR/. THE DOLLAR (INDEX) IS STRONGER AGAINST ALL MAJOR CURRENCIES. CHINA IS OT VERY HAPPY TODAY.
3 a NORTH KOREA/USA
NORTH KOREA/USA
3b) REPORT ON JAPAN
3c CHINA REPORT.
4. EUROPEAN AFFAIRS
And this guy is deputy Governor of the Bank of England?
(courtesy zerohedge)
BoE Deputy Governor Gives Crazy Speech Warning Markets Have Underestimated Rate Rises
On 2 November 2017, the Bank of England raised rates for the first time in a decade and Sterling’s initial rise was promptly sold off by forex traders as we discussed.
The 7-2 vote by the Monetary Policy Committee was not the unanimous decision some had expected, while Cunliffe and Ramsden saw insufficient evidence that wage growth would pick up in line with the BoE’s projections from just over 2% to 3% in a year’s time. Ben Broadbent, MPC member, deputy governor and known to be a close confidant of Governor Carney, gave a speech today at the London School of Economics (LSE) in which he warned markets that Brexit issues didn’t necessarily mean that interest rates have to remain low.
Bloomberg reports that Broadbent stated that the Brexit impact on monetary policy depends on how it affects demand, supply and the exchange rate.
“There are feasible combinations of the three that might require looser policy, others that lead to tighter policy.”
Which sounds alot like he doesn’t know, although he stuck to the central bankers trusty tool, reassuring LSE students the Phillips Curve “still seems to have a slope”.
According to the FT.
The deputy governor of the Bank of England has warned that financial markets have underestimated the chance of further interest rate rises. In a speech at the London School of Economics on Wednesday, Ben Broadbent said markets had placed too much emphasis on the idea that interest rates needed to be kept low in the face of Brexit uncertainty. The deputy governor said it was “uncertain” and “complex” to anticipate how Brexit would affect inflation. But he rejected the assertion that Brexit “necessarily implies low interest rates”.
“Even as inflation rose, and the rate of unemployment fell further, interest-rate markets continued to under-weight the possibility that (the) bank rate might actually go up this year,” he said.
The BoE’s Monetary Policy Committee announced its first interest rate rise in more than a decade earlier this month. But the central bank has struggled to convince financial markets that it is likely to raise rates further.
BoE officials were taken aback when sterling sold off on the day it announced the rate rise, and two-year gilt yields remain below the BoE base rate, suggesting markets are sceptical that the MPC will raise rates further while there is still considerable uncertainty around the UK’s economic future outside of the EU.
Broadbent acknowledged that there is a risk that Brexit uncertainty could adversely impact UK demand. However, he sees the potential for other factors, a reduction in trade, for example, which could crimp UK capacity and necessitate a rise in rates. While Broadbent’s thinking is flawed, and his barley field example plainly ridiculous, the FT continues.
Brexit-related uncertainty could weigh on demand and motivate the MPC to keep interest rates low to support the economy, but other factors could push the central bank to raise rates.
For example, if Brexit reduced the UK’s openness to trade, the country’s output capacity could suffer, which would require the BoE to raise rates to temper inflation.
“Economists often presume that changes in an economy’s underlying productivity occur only slowly,” Mr Broadbent said. However, he added: “A sharp reduction in the degree of openness (to trade) could have a more immediate impact. “A field currently producing barley, sold into the European market, can’t easily or as fruitfully be replanted with olive trees”. He said the challenge for monetary policymakers was that “reductions in supply can add inflationary pressure even as they lower aggregate (gross domestic product)”.
So, let’s consider Broadbent’s example…
The UK suffers a drop in aggregate demand due to a contraction in trade, the BoE raises rates in an over-leveraged economy to stem the inflation and…undoubtedly makes the contraction in GDP much worse. That makes no sense and is the kind of one dimensional thinking that we’ve had to put up with from central bankers. What’s worse is that Broadbent has specific responsibility for monetary policy and a c.v. as long as your arm – Cambridge, Harvard PhD, Fulbright Scholar, Columbia University, Goldman Sachs and UK Treasury.
It’s no wonder we are in such a mess with people like this pulling the levers of policy in the central banks. Crazy ideas aside, Broadbent and his BoE colleagues might be unhappy with market projections for the future path of interest rates, but they can hardly blame investors for being sceptical.
Which way are rates going, Ben?
END
5. RUSSIA AND MIDDLE EASTERN AFFAIRS
SAUDI ARABIA
Brandon Smith warns that the Saudi coup signals war and an end to the USA petrodollar and a New World Order reset. He may be right as he contends that this is what the globalists are seeking
(courtesy Brandon Smith/Alt Market.com)
Brandon Smith Warns: The Saudi Coup Signals War And The New World Order Reset
Authored by Brandon Smith via Alt-Market.com,
For years now, I have been warning about the relationship of interdependency between the U.S. and Saudi Arabia and how this relationship, if ended, would mean disaster for the petrodollar system and by extension the dollar’s world reserve status.
In my recent articles ‘Lies And Distractions Surrounding The Diminishing Petrodollar’ and ‘The Economic End Game Continues,’I point out that the death of the dollar as the premier petrocurrency is actually a primary goal for establishment globalists.
Why?
Because in an effort to achieve what they sometimes call the “global economic reset,” or the “new world order,” a more publicly accepted centralized global economy and monetary framework is paramount. And, this means the eventual implementation of a single world currency and a single global economic and political authority above and beyond the dollar system.
But, it is not enough to simply initiate such socially and fiscally painful changes in a vacuum. The banking powers are not interested in taking any blame for the suffering that would be dealt to the masses during the inevitable upheaval (or blame for the suffering that has already been caused). Therefore, a believable narrative must be crafted. A narrative in which political intrigue and geopolitical crisis make the “new world order” a NECESSITY; one that the general public would accept or even demand as a solution to existing instability and disaster.
That is to say, the globalists must fashion a propaganda story to be used in the future, in which “selfish” nation-states abused their sovereignty and created conditions for calamity, and the only solution was to end that sovereignty and place all power into the hands of a select few “wise and benevolent men” for the greater good of the world.
I believe the next phase of the global economic reset will begin in part with the breaking of petrodollar dominance. An important element of my analysis on the strategic shift away from the petrodollar has been the symbiosis between the U.S. and Saudi Arabia. Saudi Arabia has been the single most important key to the dollar remaining as the petrocurrency from the very beginning.
The very first oil exploration and extraction deal in Saudi Arabia was sought by the vast international oil cartels of Royal Dutch Shell, Near East Development Company, Anglo-Persian, etc., but eventually fell into the hands of none other than the Rockefeller’s Standard Oil Company. The dark history of Standard Oil aside, this meant that Saudi business would be handled primarily by American interests. And the Western thirst for oil, especially after World War I, would etch our relationship with the reigning monarchy in stone.
A founding member of OPEC, Saudi Arabia was one of the few primary oil-producing nations that maintained an oil pipeline that expedited processing and bypassed the Suez Canal. (The pipeline was shut down, however, in 1983). This allowed Standard Oil and the United States to tiptoe around the internal instability of Egypt, which had experienced ongoing conflict which finally culminated in the civil war of 1952.
Considered puppets of the British Empire at the time, the ruling elites of Egypt were toppled by the Muslim Brotherhood, leading to the eventual demise of the British pound sterling as the top petro-currency and the world reserve. The British economy faltered and has never since returned to its former glory.
Perhaps we are seeing some parallels here?
Civil war may not be in the cards for Saudi Arabia; so far a quiet coup has been rather effective in completely changing the power base of the nation over the past few years. The primary beneficiary of that change in power has been crown prince Mohammed Bin Salman, who only answers to King Salman, an 81-year-old ruler barely involved in leadership.
To understand how drastic this coup has been, consider this – for decades Saudi Kings maintained political balance by doling out vital power positions to separate, carefully chosen successors. Positions such as Defense Minister, the Interior Ministry and the head of the National Guard. Today, Mohammed Bin Salman controls all three positions. Foreign policy, defense matters, oil and economic decisions and social changes are now all in the hands of one man.
But the real question is, who is behind that man?
Well, the recent political purge of various “neo-conservative” tied Saudis might lead some to believe that Prince Mohammed is seeking an end to globalist control of Saudi oil and politics.
These people would be wrong for a number of reasons.
Prince Mohammed’s revolutionary “Vision for 2030” developed as he entered power was touted as a means to end Saudi reliance on oil revenues to support economic stability. However, I believe this plan is NOT about ending reliance on oil, but ending reliance on the U.S. dollar. In fact, the plan indicates a move away from the dollar as the world’s petrocurrency and a de-pegging of the Riyal from the dollar.
Prince Mohammed has also established much deeper ties to Russia and China, creating bilateral agreements which may end up removing the dollar as the mechanism for oil trade between the nations.
You would think that this kind of strategy would be highly damaging to the West and to American interests in particular and that the corporate establishment would be doing everything in their power to stop it. However, this is not at all the case. In reality, the globalist establishment is fully behind Mohammed Bin Sulman’s “Vision for 2030.”
Corporate behemoths such as the Carlyle Group (Bush family, etc), Goldman Sachs, Blackstone and Blackrock have ALL been backing the Vision for 2030 and Prince Mohammed through his Public Investment Fund (PIF), of which he is the chairman.
Trillions in capital are flowing through PIF, most of it from the coffers of globalist establishment companies. Once again I point out that the so-called “East versus West division” and the Eastern “opposition” to the globalists is complete nonsense; banking elites and globalists are the true influence behind the move away from the dollar, as the Saudi example and the Vision for 2030 shows. The end of the dollar as world reserve works in their favor — it is planned.
This does not end with the death of the dollar’s petro-status, though. These kinds of upsets in the power dynamic invariably lead to war. War acts as a kind of cleansing of the historical record; it tends to distract the public, for generations, from those that truly benefit from geopolitical and economic strife.
Prince Mohammed has already triggered conflicts with Yemen and Qatar, but this seems to have only been a precursor to greater kinetic displays of force. The next target appears to be Lebanon, and eventually Iran and Syria.
The first signal came with the resignation of Lebanon’s Prime Minister Saad Hariri on November 4, a resignation Hezbollah claims was forced by the Saudi government. Interestingly, Saad Hariri recorded the televised announcement in Saudi Arabia.
This shocking disruption to Lebanon’s political apparatus has been followed by an escalation in saber rattling by Saudi Arabia against Hezbollah (which is considered by many to be merely a puppet organization of the Iranian government). If official polls are to be believed, the Lebanese population is in extreme disagreement over Iran and Hezbollah, which could add to internal divisions and civil war if tensions continue to grow. Add to this the suspected (but officially denied) “secret visit” by Prince Mohammed to Israel in September, and the newfound “friendship” between the two nations in the months since, and we have quite a bit of momentum for a war in Lebanon.
The question is, will a war between Saudi Arabia and perhaps Israel against Hezbollah in Lebanon remain a proxy war, or will it gestate into a wider conflict drawing in Iran, Syria and perhaps even the U.S.?
First, keep in mind that Prince Mohammed has already frozen and/or confiscated approximately $800 billion in assets from his imprisoned political enemies. More than enough to fund a war campaign for several years, maybe even an expanded war against Iran.
Trump’s rhetoric against Iran and his re-institution of sanctions seems to coincide nicely with the increasing tension between the Saudis and Hezbollah. Israel attempted an invasion of Lebanon in 2006 and was soundly and embarrassingly defeated. But, the Israeli government does still showcase a willingness to enter into a ground war in the region, and with the combined forces of the Saudis and the Israelis, we might see a different outcome. Iran would be forced to intervene.
Syria under the Assad regime would also most likely be drawn in through its mutual defense pact with Iran.
I believe that major powers like the U.S. and Russia will probably not become involved in a wider sense, but continue to insert covert forces into the region and support opposing nations through funding and armaments. As with North Korea, I would not expect “world war” on the scale of a nuclear conflagration to develop in the Middle East.
What I do expect is something far more devastating – namely an accelerated disintegration of our already collapsing economic structure as war plays out abroad and the loss of the dollar’s world reserve and petro-status hits us hard at home. So far, in my view it appears that the insanity in Saudi Arabia, (along with the continued war drums against North Korea), is a perfect trigger point that provides a catalyst for mass distraction.
World economic war is the real name of the game here, as the globalists play puppeteers to East and West. It is a geopolitical crisis they will have created to engineer public support for a solution they predetermined.
END
Seems to be working: Saudi Arabia has offered the arrested royals a deal: Lots of cash (up to 70% of net worth) for your freedom
It is now clear: the whole exercise was nothing but to replenish the treasury
(courtesy zerohedge_
Saudi Arabia Offers Arrested Royals A Deal: Your Freedom For Lots Of Cash
As we noted shortly after the Crown Prince’s purge of potential rivals within Saudi Arabia’s sprawling ruling family, while the dozens of arrests were made under the pretext of an “anti-corruption crackdown”, Mohammed bin Salman’s ulterior motive was something else entirely: Replenishing the Kingdom’s depleted foreign reserves, which have been hammered for the past three years by low oil prices, with some estimating that the current purge could potentially bring in up to $800 billion in proceeds.
Furthermore, the geopolitical turmoil unleashed by the unprecedented crackdown helped push oil prices higher, creating an ancillary benefit for both the kingdom’s rulers and the upcoming IPO of Aramco.
Saudi Crown Prince Mohammed bin Salman
And, in the latest confirmation that the crackdown was all about cash, the Financial Times reports today that the Saudi government has offered the new occupants of the Riyadh Ritz-Carlton a way out…. and it’s going to cost them: In some cases, as much as 70% of their net worth.
Saudi authorities are negotiating settlements with princes and businessmen held over allegations of corruption, offering deals for the detainees to pay for their freedom, people briefed on the discussions say.
In some cases the government is seeking to appropriate as much as 70 per cent of suspects’ wealth, two of the people said, in a bid to channel hundreds of billions of dollars into depleted state coffers.
The arrangements, which have already seen some assets and funds handed over to the state, provide an insight into the strategy behind Crown Prince Mohammed bin Salman’s dramatic corruption purge.
The crackdown has led to the detention of hundreds of royals, ministers, officals and the country’s richest oligarchs including Prince Alwaleed bin Talal, the billionaire, Waleed al-Ibrahim, the founder of Middle East Broadcasting Center, which owns Al Arabiya, the Saudi satellite television channel, and Bakr bin Laden, chairman of the Saudi Binladin construction group and brother of Osama bin Laden.
Additionally, as we reported, the crackdown sent members of the country’s wealthy upper crust scrambling to liquidate their holdings and move their cash offshore, where they might have a better chance of keeping it away from the Saudi government.
Unsurprisingly, the Saudi “offer” is working.
Some of the suspects, most of whom have been rounded up at the Ritz-Carlton hotel in Riyadh since last week, are keen to secure their release by signing over cash and corporate assets, the FT’s sources say.
“They are making settlements with most of those in the Ritz,” said one adviser. “Cough up the cash and you will go home.”
One multi-billionaire businessman held at the Ritz-Carlton has been told to hand over 70% of his wealth to the state as a punishment for decades of involvement in allegedly corrupt business transactions. He wants to pay, but has yet to work out the details of transferring those assets to the Saudi state.
Settlements for royals will also include pledges of loyalty as MbS prepares himself to take the Saudi throne, though his father, King Salman, has vigorously denied these rumors.
One detainee told his staff that the authorities may be looking to take ownership of his main business. Families of detained suspects have started to hire consultants to assist efforts to secure their relatives’ release and to ring fence the damage to their business interests.
“They are looking for ways to isolate the tainted shareholder and keep the business going,” said the adviser.
The settlements aim to recover billions of dollars allegedly earned through “corruption” at a time when the government is grappling with a recession triggered by prolonged low oil prices and a budget deficit that widened to $79 billion last year.
The country’s attorney-general has said he is investigating allegations of corruption amounting to at least $100 billion – though the total value of assets seized could be as high as $800 billion. Though the Financial Times puts the high-end figure at a relatively modest $300 billion; to make up for the delta, more arrests are still expected.
Regular Saudis, who’ve seen their benefits cut and some of their jobs taken away, support MbS’s decision. “Why should the poor take all the pain of austerity,” said one Saudi academic. “The rich need to pay their way too.”
In Saudi Arabia, they are about to do just that.
end
Documents surface which indicate that Israel is ready to share intelligence with the Saudis against Iran. The key component is an understanding that the Saudi’s will agree that refugees cannot return to Palestinian land in return for a lasting peace with Israel. Israel and Saudi Arabia must stop the formation of two Shia crescents:
i. from Lebanon to Iran
ii) from the Gulf to the Red Sea
(courtesy zerohedge)
Israel Ready To Share Intelligence With Saudis “Against Iran” Ahead Of Possible War
This morning one of Israel’s largest international news broadcasters broke an explosive yet not entirely surprising story that Israel would take the unprecedented step of sharing intelligence with Saudi Arabia as both countries continue to ramp up efforts to curb what they perceive as Iranian expansion in the region.
Left: Israeli PM Netanyahu, Right: Saudi Prince Mohammed bin Salman
Israel’s i24NEWS cited statements by the head of the Israeli army given to a prominent Saudia Arabian newspaper on Thursday:
In an unprecedented interview with Saudi Arabia’s Alaf newspaper on Thursday, Israel Defense Force (IDF) chief-of-staff Lt. Gen. Gadi Eizenkot said that Israel is ready to share intelligence with Riyadh on their shared arch-foe Iran.
Eizenkot, who is the first senior Israeli military officer to be interviewed by a Saudi media outlet, called Iran the “biggest threat to the region” and said that Israel and Riyadh – which he noted have never fought one another – are in complete agreement about Iran’s intentions to dominate the Middle East.
The report continues, quoting the IDF chief:
The interview is a major public step forward in warming ties between Israel and Saudi Arabia – which do not share any diplomatic relations.
Eizenkot said that Iran wants to take control of the Middle East by creating two Shi’ite crescent, “from Lebanon to Iran and then from the Gulf to the Red Sea.”
“We must prevent this from happening,” he implored.
He said that Israel has no intention of initiating a conflict with Iran’s Lebanese proxy Hezbollah, saying that “we see Iranian attempts at bringing about an escalation, but I don’t see a high chance for this at the moment.”
The historic news, which is worrisome for the fact that it could bring the region closer to major war, follows last week’s leak of an Israeli diplomatic cable sent to all Israeli embassies throughout the world which reveals Israeli and Saudi behind the scenes coordination. The cable gave instructions to Israeli diplomats to express support for the Saudi war against Shia forces in Yemen and also urged embassies to aggressively lobby their host governments to take steps toward pushing Hezbollah out of Lebanon.
We summarized the now confirmed leaked document as follows:
On Sunday, just after Lebanese PM Hariri’s shocking resignation, Israel sent a cable to all of its embassies with the request that its diplomats do everything possible to ramp up diplomatic pressure against Hezbollah and Iran.
The cable urged support for Saudi Arabia’s war against Iran-backed Houthis in Yemen.
The cable stressed that Iran was engaged in “regional subversion”.
Israeli diplomats were urged to appeal to the “highest officials” within their host countries to attempt to expel Hezbollah from Lebanese government and politics.
Barak Ravid ?@BarakRavid
1 \ I published on channel 10 a cable sent to Israeli diplomats asking to lobby for Saudis\Hariri &against Hezbollah http://news.nana10.co.il/Article/?ArticleID=1272790&sid=126 …
3:11 PM – Nov 6, 2017
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news.nana10.co.il
And this week, another leaked document emerged, first obtained by Lebanon’s Al-Akhbar news, which reveals, according to regional media, “concessions to Israel that are certain to prove controversial in Palestine and the Arab world if true, including Saudi encouragement of the Palestinians to cede the right of return of their refugees, in return for a peace deal with Israel and closer cooperation with Tel Aviv against Iran and Hizballah.”
The ‘secret’ document is reportedly from the Saudi foreign ministry and provides further proof that Israel and Saudi Arabia – who for decades have been long time public bitter enemies – are increasingly cementing and formalizing their relationship while talking war with Iran and Hezbollah. According to a translation provided by The New Arab, the leaked Saudi foreign ministry document reads in part as follows:
“I have the honour to submit to you a project for establishing relations between the kingdom and the State of Israel based on the strategic partnership agreement with the United States of America, discussed with the US Secretary of State based on the guidance of your noble guidance,” opens the letter.
“Saudi Arabia…. has immense influence and diplomatic power that can give credibility to peace efforts,” the alleged letter continues.
“The kingdom had pledged in the strategic partnership agreement with US President Donald Trump that only a US-Saudi effort (for peace) is the key to success as… no solution to the Palestinian issue can be legitimate without the support of Saudi Arabia.
“Rapprochement between Saudi Arabia and Israel carries risks... given the spiritual, historical, and religious status of the Palestinian issue. The kingdom cannot risk this move unless it feels the US is honest about its efforts against Iran, which destabilizes the region.”
The more explosive passage of the secret Saudi document concerns Iran, and comes at the end of the memo, to wit: “Resolving this conflict will pave the way for security, commercial, and financial cooperation against Iran. Therefore, the Saudi and Israeli sides have the following (goals) in common:
Confronting any activities that serve the aggressive policies of Iran in the Middle East.
Increasing US and international sanctions over Iran’s ballistic missile programme
Increasing sanctions over Iran’s sponsorship of terrorism around the world.
Lobbying the 5+1 group over their position on the nuclear deal with Iran to ensure its strict implementation
Limiting Iranian access to frozen assets, and capitalizing on Iran’s economic problems to increase pressure on the regime
Intelligence cooperation against organised crime and drug trafficking supported by Iran and Hizbollah”
All of the above is yet further confirmation of the already well-known Saudi and Israeli common cause against perceived Iranian influence and expansion in places like Syria, Lebanon and Iraq of late. This has led the historic bitter enemies down a pragmatic path of unspoken cooperation as both seem to have placed the break up of the so-called “Shia crescent” as their primary policy goal in the region. For Israel, Hezbollah has long been its greatest foe, which Israeli leaders see as an extension of Iran’s territorial presence right up against the Jewish state’s northern border.
All of this this comes, perhaps not coincidentally, at the very moment ISIS is on the verge of complete annihilation (partly at the hands of Hezbollah), and as both Israel and Saudi Arabia have of late increasingly declared “red lines” concerning perceived Iranian influence across the region as well as broad Hezbollah acceptance and popularity within Lebanon.
end
6 .GLOBAL ISSUES
Zimbabwe
Mugabe refuses to resign which in turn causes their stock market to collapse
(courtesy zerohedge)
Zimbabwe Stock Market Crashes – What Happens After Mugabe?
In the last two days, the Zimbabwe stock market has crashed almost 10% as a ‘not-military-coup’ has ousted 93-year-old President Mugabe – the question is, what happens next?
Bloomberg reports that Zimbabwe President Robert Mugabe’s refusal to publicly resign is stalling plans by the military to swiftly install a transitional government after seizing power on Wednesday, two people familiar with the situation said.
That uncertainty is clearly showing up in Zimbabwe stocks…
The military wants Mugabe, who’s under house arrest, to agree to step aside so it can claim its action isn’t a coup and head off tension with the Southern African Development Community, which includes Zimbabwe and South Africa, the people said. The group previously intervened when the army took over in Lesotho.
However, as a reminder, Pedzisayi Ruhanya, the director of the Zimbabwe Democracy Institute, warns,
“Mugabe wants to die in office and is not interested in seeing his successor.”
“He is not a student of democratic processes.”
Bloomberg goes on to note that the new rulers, headed by armed forces commander Constantino Chiwenga, plan to try and negotiate the establishment of a transitional government with the opposition until elections can be held to restore stability, the people said.
But first they want a deal with Mugabe, whose 37-year rule left an economy that has halved in size since 2000, a severe cash shortage that’s choking businesses and a collapse in government services.
The military has declined to comment on its plans.
“The military, or the people who are now in charge, obviously they have some respect for Mugabe — he is someone who has led them for so many years,”Alex Magaisa, a Zimbabwean law lecturer who helped design the southern African nation’s 2013 constitution, said in a interview with Bloomberg Television in London.
“I think there is still some residual sympathy for him. They wouldn’t want to be seen to be mistreating him.”
The operation to take power had been planned for weeks but was accelerated after Mugabe fired his deputy Emmerson Mnangagwa, according to the people.
https://www.bloomberg.com/api/embed/iframe?id=8eba3774-a6c1-44e5-a298-ccb8287781b9
Many ordinary people simply hope that the authorities can improve daily life in Zimbabwe, where an estimated 95 percent of the workforce is jobless.The country doesn’t even have its own currency and relies mainly on the dollar.
“I hope and pray this takeover will bring lasting solutions for us,” said James Saunyama, as he collected his weekly allocation of $50 in coins from a bank in Harare.
“We’ve endured enough so this takeover must give us better and improved lifestyles going forward.”
The new rulers also want to repair relations with Western countries, who used to be among the biggest investors in the country, and international lenders, the people said.
They will seek investment from the more than 3 million people who left Zimbabwe because of the economic collapse including the white farmers driven off their land, the people said.
Mark Bohlund, Africa economist with Bloomberg Intelligence in London, expects Zimbabwe’s economic challenges to persist even if there is a power shift and the country adopts more orthodox economic policies.
“Expectations for quick progress toward receiving financial support and potential debt relief should be tempered,” Bohlund said.
“The huge challenges ahead and continued political uncertainty is likely to deter inward investment for many years to come.”
We leave it to Pedzisayi Ruhanya to sum things up…
“The chaos happening in Zimbabwe and ZANU-PF is what happens when the end of an authoritarian era approaches.”
end
7.OIL ISSUES
Somehow Norway now does not believe oil will rise in the next few years: They are planning a divestiture of 35 billion in oil stocks.
(courtesy zerohedge)
Norway’s $1 Trillion Wealth Fund Suddenly Considers Dumping $35 Billion Of Oil And Gas Stocks
One of the world’s largest sovereign wealth funds, and one which ironically amassed the overwhelming majority of their wealth via rich oil reserves, is now looking to sell off some $35 billion worth of energy stocks. According to central bank Deputy Governor Egil Matsen, the move is intended simply to “spread the risks for the state’s wealth,” but one has to wonder whether the owner of 1.5% of the world’s stocks has decided that oil has now moved into a period of secular decline. Per Bloomberg:
Norway’s $1 trillion sovereign wealth fund proposed dumping about $35 billion in oil and gas stocks, including Royal Dutch Shell Plc andExxon Mobil Corp., to protect the economy of western Europe’s biggest petroleum producer.
The nation will be “less vulnerable” to a drop in oil by not being invested in stocks of companies in the industry, the Oslo-based fund said Thursday. The Finance Ministry said it would study the plan and decide at the earliest in “autumn 2018.”
“Our perspective here is to spread the risks for the state’s wealth,” Egil Matsen, the deputy governor at the central bank in charge of overseeing the fund, said in an interview in Oslo Thursday. “We can do that better by not adding oil price risk through the fund.”
While the fund says the plan isn’t based on any view on the future of oil prices or the industry, it will likely add pressure on oil producers, already struggling in a world where renewable energy is gaining sway.
In light of this news, here is a list of Norway’s 10 largest energy holdings (valuesin NOK) that you should probably look to lighten up on at some point before they do.
Of course, roughly a year ago we scoffed at the wealth fund’s decision to respond to sinking returns and withdrawals required to fund budget deficits, deficits created by tumbling oil prices, by allocating another $130 billion in assets to what appeared to be an already massively overpriced equity bubble in return for an extra 40bps of “expected average annual real returns.” (see: Norway Buying $130 Billion In Global Equities As Sovereign Wealth Fund Continues To Bleed Cash). The extra equity purchases pushed the fund’s total equity allocation to a staggering 70% of their $860 billion in assets under management.
After being forced to withdraw at least $15 billion to fund 2017 budget deficits, the $860 billion Norwegian sovereign wealth fund has announced that it will change it’s portfolio allocations to try to make up the difference. The change will result in 75% of the fund’s capital being allocated to global equities, up from the current 60%. Sure, because funneling another $130 billion to the global equity bubble is just the prudent thing to do for an extra 40bps of “expected average annual real returns.”
The central bank’s board, which oversees the fund, on Thursday recommended an increase in the equity share to 70 percent from 60 percent. That will raise the expected average annual real return to 2.5 percent over 10 years and to 3.5 percent over 30 years, compared with 2.1 percent and 2.6 percent, respectively, under the current setup.
The world’s largest sovereign wealth fund said that it expects an annual return of only 0.25 percent on bonds over the next decade and that the expected “equity risk premium,” or return on stocks over government bonds, will be just 3 percentage points in a cautious estimate.
“In our analyses, this is clearly evident in global data: internationally, growth in firms’ cash flows and equity returns are correlated with growth in the global economy,” Deputy Governor Egil Matsen said in a speech Thursday in Oslo. “Global economic growth in the coming years is expected to be below its historical level. This ‘pessimism’ is partly related to the driving forces behind the low level of the real interest rate.”
Alas, with global equity bubbles becoming ever more bubblier with each passing day, the bet on equities paid off ‘bigly’ for Norway and pushed their AUM to over $1 trillion for the first time ever back in September. Per Bloomberg:
Norway’s sovereign wealth fund hit $1 trillion for the first time on Tuesday, driven higher by climbing stock markets and a weaker U.S. dollar.
The milestone valuation was reached for the first time on Sept. 19 at 2:01 a.m. in Oslo, Norges Bank Investment Management said in a statement on Tuesday.
“I don’t think anyone expected the fund to ever reach $1 trillion when the first transfer of oil revenue was made in May 1996,” Yngve Slyngstad, chief executive officer of the fund, said in the statement. “Reaching $1 trillion is a milestone, and the growth in the fund’s market value has been stunning.”
So, what say you? Is this just a logical diversification play for a state that is already highly levered to oil or is Norway signaling that the end is near for their black gold.
8. EMERGING MARKET
Now the fun begins as underwriters of credit default swaps must pay out and there will be a considerable amount that they have to muster up:
(courtesy zerohedge)
Venezuela, PDVSA CDS Triggered: ISDA Says Credit Event Has Occurred
In a long overdue, and not exactly surprising decision, moments ago the ISDA Determination Committee decided, after punting for three days in a row, that a Failure to Pay Credit Event has occurred with respect to both the Bolivarian Republic of Venezuela as well as Petroleos de Venezuela, S.A.
Specifically, in today’s determination, in response to the question whether a “Failure to Pay Credit Event occurred with respect to Petroleos de Venezuela, S.A.?” ISDA said that the Determinations Committee voted 15 to 0 that a failure to pay credit event had occurred with respect to PDVSA.
ISDA said the DC also voted 15 to 0 that date of credit event was Nov. 13 and that the potential failure to pay occurred on Oct. 12. ISDA also announced that the DC agreed to reconvene Nov. 20 to continue talks regarding the CDS auction, now that the Credit Default Swaps have been triggered.
Over the past week, all three rating agencies, with Fitch Ratings most recently, declared PDVSA in default, citing the state oil company’s repeated payment delays. The oil company failed to pay yet another $80 million in interest that was due in mid-October on bonds maturing in 2027, and whose buffer period expired over the weekend. Venezuela was declared in default by S&P Global ratings for a similar issue. According to Bloomberg, Fitch said that it expects PDVSA’s creditors to recover as little as 31 percent on their investment.
The panel will now meet next week to discuss whether to hold an auction to set the rate at which the CDS will pay out. When credit swaps are triggered, buyers of the contracts have their losses covered by the counterparties that sold them the insurance-like derivatives.
As recently as last month, traders had bought a net $250 million of default protection through the swaps market, according to the ISDA. Of course, with the PDVSA CDS already trading at a price which implied 100% certainty of default, none of this will be a surprise.
And moments after declaring PDVSA CDS triggered by a failure to pay event, the ISDA Americas DC also found that an identical Failure to Pay Credit Event had occurred with respect to Bolivarian Republic of Venezuela. The Determinations Committee voted 15 to 0 that a failure to pay credit event had occurred with respect to Venezuela, and added that the Determinations Committee voted 15 to 0 to reconvene Nov. 20 to continue talks on an auction.
Just like with PDVSA, the CDS triggering has been fully priced in.
The only question now is when the CDS auction will be, whether it will proceed smoothly and who is revealed as the biggest seller of Venezuela and PDVSA CDS.
END
At 5:30 pm est, Bitcoin surges near $8,000.00 on the announcement of a credit event and bankers must pay out:
(courtesy zerohedge)
Bitcoin Surges Near $8000 Record Highs After Venezuela Default
We have already discussed the hyperbitcoinization of the Venezuelan economy and it appears, judging by the most recent surge, that tonight’s ‘official’ default events for the sovereign (and PDVSA) have triggered a further rush to the ‘safety’ of a decentralized store of wealth…
As we noted previously, Venezuela’s worsening economic collapse has created something of a social experiment in the use of a digital currency as a de facto currency – a phenomenon that’s also playing out in troubled Zimbabwe.
According to TheNational.ae,bitcoin adoption in Zimbabwe is seemingly skyrocketing as the country’s economic situation looks bleak. So much so, that one bitcoin is trading at nearly $10,000 on the Golix.io exchange, while the global average is, at press time, of $5,642.00.
According to a local trader, bitcoin isn’t just being bought by individuals, but by businesses with bills to pay. The country adopted the U.S. dollar back in 2009 as its fiat currency, as the Zimbabwean dollar had lost nearly all its value.
At press time, LocalBitcoins Zimbabwe has people buying bitcoin at the global average, and some buying the cryptocurrency for cash for well over $10,000 in the country’s capital. Bitcoin, as every bitcoiner would expect, is helping people in the country survive times of economic uncertainty, as Zimbabwe has been embroiled in a crisis for years.
And as inflation in Venezuela has spiraled further out of control – by one estimated, it peaked above 2,400% in September – more Venezuelans are resorting to mining bitcoin, litecoin and other digital currencies as a means of coping with the country’s out-of-control hyperinflation and surviving in a country where staples like food and medicine are scarce.
And then, moments after ISDA found that Venezuela had triggered its Credit Default Swaps by failing to repay its debt on time, Bitcoin surged over $500 to new record highs just shy of $8000.
With the collapse of the economy and now default, Venezuelans are running out of options. Bitcoin – just like gold – will come as a saving grace to many people. It has kept food on the tables of families, helped Venezuelans escape the distraught nation, and acted as a voice of rebellion against the oppressive government. But how Maduro’s regime will proceed remains to be seen.
end
Your early morning currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings THURSDAY morning 7:00 am
Euro/USA 1.1766 DOWN .0015/ REACTING TO SPAIN VS CATALONIA/REACTING TO +GERMAN ELECTION WHERE ALT RIGHT PARTY ENTERS THE BUNDESTAG/ huge Deutsche bank problems + USA election:/TRUMP HEALTH CARE DEFEAT//ITALIAN REFERENDUM DEFEAT/AND NOW ECB TAPERING BOND PURCHASES/ /USA FALLING INTEREST RATES AGAIN/HOUSTON FLOODING/EUROPE BOURSES GREEN
USA/JAPAN YEN 113.14 UP 0.385(Abe’s new negative interest rate (NIRP), a total DISASTER/SIGNALS U TURN WITH INCREASED NEGATIVITY IN NIRP/JAPAN OUT OF WEAPONS TO FIGHT ECONOMIC DISASTER/
GBP/USA 1.3187 UP .0016 (Brexit March 29/ 2017/ARTICLE 50 SIGNED
THERESA MAY FORMS A NEW GOVERNMENT/STARTS BREXIT TALKS/MAY IN TROUBLE WITH HER OWN PARTY/
USA/CAN 1.2755 DOWN .0012(CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA)
Early THIS THURSDAY morning in Europe, the Euro FELL by 15 basis points, trading now ABOVE the important 1.08 level FALLING to 1.1766; / Last night the Shanghai composite CLOSED DOWN 3.27 POINTS OR .10% / Hang Sang CLOSED UP 167.07 POINTS OR 0.58% /AUSTRALIA CLOSED UP 0.19% / EUROPEAN BOURSES OPENED ALL GREEN
The NIKKEI: this THURSDAY morning CLOSED UP 322.80 POINTS OR 1.47%
Trading from Europe and Asia:
1. Europe stocks OPENED GREEN
2/ CHINESE BOURSES / : Hang Sang CLOSED UP 167.07 POINTS OR 0.58% / SHANGHAI CLOSED DOWN 3.27 POINTS OR .10% /Australia BOURSE CLOSED UP 0.19% /Nikkei (Japan)CLOSED UP 322.80 POINTS OR 1.47%
INDIA’S SENSEX IN THE GREEN
Gold very early morning trading: 1277.75
silver:$17.05
Early THURSDAY morning USA 10 year bond yield: 2.359% !!! UP 2 IN POINTS from WEDNESDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%. (POLICY FED ERROR)
The 30 yr bond yield 2.797 UP 3 IN BASIS POINTS from WEDNESDAY night. (POLICY FED ERROR)
USA dollar index early THURSDAY morning: 93.94 UP 13 CENT(S) from YESTERDAY’s close.
This ends early morning numbers THURSDAY MORNING
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And now your closing THURSDAY NUMBERS \1 PM
Portuguese 10 year bond yield:1.979% DOWN 2 in basis point(s) yield from WEDNESDAY
JAPANESE BOND YIELD: +.052% UP 1/2 in basis point yield from WEDNESDAY/JAPAN losing control of its yield curve/
SPANISH 10 YR BOND YIELD: 1.542% DOWN 1 IN basis point yield from WEDNESDAY
ITALIAN 10 YR BOND YIELD: 1.838 UP 0 POINTS in basis point yield from WEDNESDAY
the Italian 10 yr bond yield is trading 29 points HIGHER than Spain.
GERMAN 10 YR BOND YIELD: +.376% DOWN 0 IN BASIS POINTS ON THE DAY
END
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IMPORTANT CURRENCY CLOSES FOR THURSDAY
Closing currency crosses for THURSDAY night/USA DOLLAR INDEX/USA 10 YR BOND YIELD/1:00 PM
Euro/USA 1.1771 DOWN.0012 (Euro DOWN 12 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/
USA/Japan: 112.96 UP 0.201(Yen DOWN 20 basis points/
Great Britain/USA 1.3184 UP 0.0012( POUND UP 12 BASIS POINTS)
USA/Canada 1.2735 DOWN.0031 Canadian dollar UP 31 Basis points AS OIL FELL TO $55.24
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This afternoon, the Euro was DOWN 12 to trade at 1.1771
The Yen FELL to 112.96 for a LOSS of 20 Basis points as NIRP is STILL a big failure for the Japanese central bank/HELICOPTER MONEY IS NOW DELAYED/BANK OF JAPAN NOW WORRIED AS AS THEY ARE RUNNING OUT OF BONDS TO BUY AS BOND YIELDS RISE
The POUND ROSE BY 12 basis points, trading at 1.3184/
The Canadian dollar ROSE by 31 basis points to 1.2735 WITH WTI OIL FALLING TO : $55.24
The USA/Yuan closed AT 6.630
the 10 yr Japanese bond yield closed at +.052% UP 1/2 IN BASIS POINTS / yield/
Your closing 10 yr USA bond yield DOWN 0 IN basis points from WEDNESDAY at 2.348% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 2.790 DOWN 1/2 in basis points on the day /
Your closing USA dollar index, 93.90 UP 8 CENT(S) ON THE DAY/1.00 PM/BREAKS RESISTANCE OF 92.00
Your closing bourses for Europe and the Dow along with the USA dollar index closing and interest rates for THURSDAY: 1:00 PM EST
London: CLOSED UP 14.33 POINTS OR 0.19%
German Dax :CLOSED UP 70.85 POINTS OR 0.55%
Paris Cac CLOSED UP 35.14 POINTS OR 0.66%
Spain IBEX CLOSED UP 74.80 POINTS OR 0.75%
Italian MIB: CLOSED UP 47.72 POINTS OR 0.22%
The Dow closed UP 187.08 POINTS OR .80% (HUGE CHINESE INJECTION OF FUNDS)
NASDAQ WAS closed UP 87.09 Points OR 1.30% 4.00 PM EST
WTI Oil price; 55.24 1:00 pm;
Brent Oil: 61.43 1:00 EST
USA /RUSSIAN ROUBLE CROSS: 59.62 DOWN 60/100 ROUBLES/DOLLAR (ROUBLE HIGHER BY 60 BASIS PTS)
TODAY THE GERMAN YIELD FALLS TO +.376% FOR THE 10 YR BOND 1.00 PM EST EST
END
This ends the stock indices, oil price, currency crosses and interest rate closes for today 4:30 PM
Closing Price for Oil, 4:30 pm/and 10 year USA interest rate:
WTI CRUDE OIL PRICE 4:30 PM:$55.25
BRENT: $61.81
USA 10 YR BOND YIELD: 2.373% (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)
USA 30 YR BOND YIELD: 2.823%
EURO/USA DOLLAR CROSS: 1.1771 DOWN .0011
USA/JAPANESE YEN:113.03 UP 0.277
USA DOLLAR INDEX: 93.91 UP 10 cent(s)/
The British pound at 5 pm: Great Britain Pound/USA: 1.3191 : UP 19 POINTS FROM LAST NIGHT
Canadian dollar: 1.2755 UP 10 BASIS pts
German 10 yr bond yield at 5 pm: +0.376%
END
Nasdaq, Bitcoin Surge To Record Highs As China Saves The World
Seemingly thanks to a Risk Parity rebound…
And a huge China liquidity injection...
“The increase in cash additions will help soothe market sentiment,” said Qin Han, chief fixed-income analyst at Guotai Junan Securities Co.
And indeed it did: US equity markets soared today… (Small Caps and Trannies best, Dow and S&P lagged but up big)
Which sent Nasdaq back to record highs..
xxxxxxx
This came out of nowhere: initial jobless claims jump the most in over a year:
(courtesy zerohedge)
Initial Jobless Claims Jump Most Since 2016’s Growth Scare
Ignoring the storm-driven aberrations, this week’s 10k jump in initial jobless claims to 249k signals a notable regime shift in the labor market. For the first time since 2016’s growth scare, there are more Americans opening jobless claims than last year…
In fact there are over 4% more people on initial jobless claims than this time last year…
Did the jobs market just turn?
And when claims turn, a recession follows…
end
After the August storms, industrial production jumps in October but still remains below 2014 peak
(courtesy zerohedge)
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Thank You Harvey Always Good Stuff !
https://www.silverdoctors.com/tag/harvey-organ/
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Perhaps you have built up an appetite speed reading through this mountain of data.
if so, I think the cafe open all night
Cheers and Thanks
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Now Serving " Weekend Brunch " under the Gallows"
Welcome to the Graveyard Gallows Cafe.
Please have a seat
Kick back and relax as we prepare your brunch
EnJoy and have a Great weekend !
GYS_Dine
Ya'all come Back Now !
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MMgys
Good Morning
program note: server may melt down
Nov 16/2017/Gold up 90 cents on the day but silver, is the real star up 11 cents to $17.09/In Zimbabwe Robert Mugabe refuses to resign/The House passes the tax reform bill and now it goes to the Senate/
November 16, 2017 ·
GOLD: $1278.50 up $0.90
Silver: $17.09 UP 11 cents
Closing access prices:
Gold $1278.60
silver: $17.08`
SHANGHAI GOLD FIX: FIRST FIX 10 15 PM EST (2:15 SHANGHAI LOCAL TIME)
SECOND FIX: 2:15 AM EST (6:15 SHANGHAI LOCAL TIME)
SHANGHAI FIRST GOLD FIX: $1286.38 DOLLARS PER OZ
NY PRICE OF GOLD AT EXACT SAME TIME: $1278.35
PREMIUM FIRST FIX: $8.03
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SECOND SHANGHAI GOLD FIX: $1287.39
NY GOLD PRICE AT THE EXACT SAME TIME: $1276.15
Premium of Shanghai 2nd fix/NY:$11.19
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LONDON FIRST GOLD FIX: 5:30 am est $1277.70
NY PRICING AT THE EXACT SAME TIME: $1277.70
LONDON SECOND GOLD FIX 10 AM: $1280.00
NY PRICING AT THE EXACT SAME TIME. 1280.00
For comex gold:
NOVEMBER/
NOTICES FILINGS TODAY FOR OCT CONTRACT MONTH:11 NOTICE(S) FOR 1100 OZ.
TOTAL NOTICES SO FAR: 1020 FOR 10,200 OZ (3.172TONNES)
For silver:
NOVEMBER
1 NOTICE(S) FILED TODAY FOR
5,000 OZ/
Total number of notices filed so far this month: 876 for 4,380,000 oz
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Bitcoin: BID $7452 OFFER /$7479 up $186.00 (MORNING)
BITCOIN : BID $7756 OFFER: $7781 // UP $490.00 (CLOSING)
end
Let us have a look at the data for today
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In silver, the total open interest ROSE BY A CONSIDERABLE 1557 contracts from 199,122 UP TO 201,456 EVEN THOUGH YESTERDAY’S TRADING SAW SILVER FALL BY 10 CENTS. WE DID HAVE ZERO LONG LIQUIDATION AND FURTHER WE WERE NOTIFIED THAT WE HAD QUITE A FEW MORE COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP ROUTE AS WE HAD A HUGE 1312 DECEMBER EFP’S ISSUED ALONG WITH 0 EFP’S FOR MARCH FOR A TOTAL ISSUANCE OF 1312 CONTRACTS. THE ISSUANCE FOR MARCH BOTHERS ME A LOT AS THIS IS SUPPOSE TO BE FOR EMERGENCY IN THE UPCOMING DELIVERY MONTH. I GUESS WHAT THE CME IS STATING IS THAT THERE IS NO SILVER TO BE DELIVERED UPON AT THE COMEX AND THEY MUST EXPORT THEIR OBLIGATION TO LONDON. YESTERDAY WE HAD 1050 TOTAL EFP’S ISSUED.
RESULT: A GOOD SIZED RISE IN OI COMEX DESPITE THE 10 CENT PRICE FALL. COMEX LONGS REFUSED TO EXIT OUT OF THE COMEX AND FROM THE CME DATA 1312 EFP’S WERE ISSUED FOR A DELIVERABLE CONTRACT OVER IN LONDON WITH A FIAT BONUS. IN ESSENCE THE DEMAND FOR SILVER INTENSIFIES
In ounces, the OI is still represented by just OVER 1 BILLION oz i.e. 1.007 BILLION TO BE EXACT or 144% of annual global silver production (ex Russia & ex China).
FOR THE NEW FRONT OCT MONTH/ THEY FILED: 1 NOTICE(S) FOR 5,000 OZ OF SILVER
In gold, the open interest ROSE BY A LARGER THAN EXPECTED 3244 CONTRACTS DESPITE THE FALL IN PRICE OF GOLD ($5.15) WITH RESPECT TO YESTERDAY’S TRADING IN WHICH WE SAW NO GOLD LEAVES FALL FROM THE COMEX GOLD TREE. THE TOTAL NUMBER OF GOLD EFP’S ISSUED TODAY TOTALED A MONSTROUS: 12,392 CONTRACTS OF WHICH THE MONTH OF DECEMBER SAW 12,352 CONTRACTS AND FEB SAW THE ISSUANCE OF 40 CONTRACTS. The new OI for the gold complex rests at 536,298. DEMAND FOR GOLD INTENSIFIES DESPITE THE RAIDS.
Result: A HUGE SIZED INCREASE IN OI DESPITE THE FALL IN PRICE IN GOLD ON YESTERDAY ($5.15). WE HAD A HUGE NUMBER OF COMEX LONG TRANSFERS TO LONDON THROUGH THE EFP ROUTE AS (12,392 EFP’S). THERE OBVIOUSLY DOES NOT SEEM TO BE MUCH PHYSICAL AT THE COMEX AS WE ARE APPROACHING THE HUGE DELIVERY MONTH OF DECEMBER. WE OBVIOUSLY HAD NO GOLD COMEX OI LEAVE THE COMEX GOLD ARENA.
we had: 11 notice(s) filed upon for 1100 oz of gold.
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With respect to our two criminal funds, the GLD and the SLV:
GLD:
A small change in gold inventory at the GLD/ a deposit of .300 tonnes
Inventory rests tonight: 843.39 tonnes.
SLV
TODAY WE HAD NO CHANGE IN SILVER INVENTORY AT THE SLV
INVENTORY RESTS AT 318.074 MILLION OZ
end
.
First, here is an outline of what will be discussed tonight:
1. Today, we had the open interest in silver UNEXPECTEDLY ROSE BY 1557 contracts from 199,899 UP TO 201,456 (AND now A LITTLE CLOSER TO THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) DESPITE THE FALL IN SILVER PRICE (A LOSS OF 10 CENTS). OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE 1312 PRIVATE EFP’S FOR DECEMBER(WE DO NOT GET A LOOK AT THESE CONTRACTS) AND 0 EFP’S FOR MARCH FOR A TOTAL OF 1050 EFP CONTRACTS EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. THIS IS QUITE EARLY FOR THESE EFP ISSUANCE..USUALLY WE WITNESS THIS ONE WEEK PRIOR TO FIRST DAY NOTICE AND THIS CONTINUES RIGHT UP UNTIL FDN. WE ALSO HAD NO SILVER COMEX LIQUIDATION. TOTAL EFP’S ISSUED YESTERDAY BY THE CME IN SILVER TOTAL 1050 CONTRACTS. SO THIS FRAUD IS CONTINUING ON A DAILY BASIS
RESULT: A HUGE SIZED INCREASE IN SILVER OI AT THE COMEX DESPITE THE 10 CENT FALL IN PRICE (WITH RESPECT TO YESTERDAY’S TRADING). WE HAD ANOTHER 1312 EFP’S ISSUED TRANSFERRING OUR COMEX LONGS OVER TO LONDON TOGETHER WITH NO SILVER COMEX LIQUIDATION.
(report Harvey)
.
2.a) The Shanghai and London gold fix report
(Harvey)
2 b) Gold/silver trading overnight Europe, Goldcore
(Mark O’Byrne/zerohedge
and in NY: Bloomberg
3. ASIAN AFFAIRS
i)Late WEDNESDAY night/THURSDAY morning: Shanghai closed DOWN 3.27 points or .10% /Hang Sang CLOSED UP 167.07 pts or 0.58% / The Nikkei closed UP 322.80 POINTS OR 1.47%/Australia’s all ordinaires CLOSED UP 0.19%/Chinese yuan (ONSHORE) closed DOWN at 6.6320/Oil DOWN to 55.27 dollars per barrel for WTI and 61.62 for Brent. Stocks in Europe OPENED GREEN . ONSHORE YUAN CLOSED DOWN AGAINST THE DOLLAR AT 6.6320. OFFSHORE YUAN CLOSED WEAKER TO THE ONSHORE YUAN AT 6.638 //ONSHORE YUAN WEAKER AGAINST THE DOLLAR/OFF SHORE WEAKER TO THE DOLLAR/. THE DOLLAR (INDEX) IS STRONGER AGAINST ALL MAJOR CURRENCIES. CHINA IS OT VERY HAPPY TODAY
3a)THAILAND/SOUTH KOREA/NORTH KOREA
i)North Korea//South Korea
b) REPORT ON JAPAN
c) REPORT ON CHINA
4. EUROPEAN AFFAIRS
And this guy is deputy Governor of the Bank of England?
( zerohedge)
5. RUSSIAN AND MIDDLE EASTERN AFFAIRS
i)Documents surface which indicate that Israel is ready to share intelligence with the Saudis against Iran. The key component is an understanding that the Saudi’s will agree that refugees cannot return to Palestinian land in return for a lasting peace with Israel. Israel and Saudi Arabia must stop the formation of two Shia crescents:
i. from Lebanon to Iran
ii) from the Gulf to the Red Sea
( zerohedge)
ii)SAUDI ARABIA
Brandon Smith warns that the Saudi coup signals war and an end to the USA petrodollar and a New World Order reset. He may be right as he contends that this is what the globalists are seeking
( Brandon Smith/Alt Market.com)
iib)Seems to be working: Saudi Arabia has offered the arrested royals a deal: Lots of cash (up to 70% of net worth) for your freedomIt is now clear: the whole exercise was nothing but to replenish the treasury
( zerohedge)
6 .GLOBAL ISSUES
Zimbabwe
Mugabe refuses to resign which in turn causes their stock market to collapse
( zerohedge)
7. OIL ISSUES
Somehow Norway now does not believe oil will rise in the next few years: They are planning a divestiture of 35 billion in oil stocks.
( zerohedge)
8. EMERGING MARKET
i)Now the fun begins as underwriters of credit default swaps must pay out and there will be a considerable amount that they have to muster up:
( zerohedge)
ii)At 5:30 pm est, Bitcoin surges near $8,000.00 on the announcement of a credit event and bankers must pay out:
( zerohedge)
9. PHYSICAL MARKETS
i)A joke: the one exchange that the CME plans to use when it starts with its futures operation is down again and it is having serious issues
(Russo/Bloomberg)
ii)What a joke: this one BIS official urges accountability while it undergoes in secret huge gold swaps
( GATA/Chris Powell)
10. USA stories which will influence the price of gold/silver
i)Trading today:
(zerohedge)
ii)China continues to export deflation to the rest of the world as import prices are contained despite hotter CPI and PPI
( zerohedge)
iii)Soft data Philly manufacturing index disappoints but still the hope component rebounds. There was a considerable drop in the important jobs sector( zerohedge)
iv)This came out of nowhere: initial jobless claims jump the most in over a year:
( zerohedge)
v)The house is expected to pass the GPO tax reform bill this afternoon but the less friendly senate will not affirm it
( zerohedge)
v b)The house passes the tax reform bill by 227 to 205
( zerohedge)
vi)We now have the identity of our secret informant in the FBI Clinton probe on the Uranium One deal: his name is Christopher Campbell and he was formerly a lobbyist for Tenex, the USA based arm of Russian government’s Rosatom
(courtesy zerohedge)
Let us head over to the comex:
The total gold comex open interest SURPRISINGLY ROSE BY 3244 CONTRACTS UP to an OI level of 536,298 DESPITE THE FAIR SIZED FALL IN THE PRICE OF GOLD ($5.15 FALL WITH RESPECT TO YESTERDAY’S TRADING). OBVIOUSLY WE DID NOT HAVE ANY GOLD COMEX LIQUIDATION. HOWEVER WE DID HAVE A MONSTROUS 12,392 COMEX LONGS EXIT THE COMEX ARENA THROUGH THE EFP ROUTE AS THEY RECEIVE A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS. THE CME REPORTS THAT 12,352 EFPS WERE ISSUED FOR DECEMBER AND 40 WERE ISSUED FOR MARCH. THE OBLIGATION STILL RESTS WITH THE BANKERS ON THESE TRANSFERS.
Result: a HUGE INCREASE IN OPEN INTEREST DESPITE THE FAIR SIZED FALL IN THE PRICE OF GOLD ($5.15.) A HUGE 12,392 EFP’S ISSUED FOR A FIAT BONUS AND A DELIVERABLE FORWARD GOLD CONTRACT IN LONDON AND ZERO COMEX GOLD LIQUIDATION DESPITE THE RAID.
.
We have now entered the NON active contract month of NOVEMBER.HERE WE HAD A LOSS OF 9 CONTRACT(S) FALLING TO 62. We had 18 notices filed YESTERDAY so GAINED 9 contracts or 900 additional oz will stand for delivery in this non active month of November. TO SEE BOTH GOLD AND SILVER RISE IN AMOUNT STANDING (QUEUE JUMPING) IS A GOOD INDICATOR OF PHYSICAL SHORTNESS FOR BOTH OF OUR PRECIOUS METALS.
The very big active December contract month saw it’s OI LOSE 10,236 contracts DOWN to 269,029 (OF WHICH 12,392 WERE EFP TRANSFERS). THUS ALL THE ROLLOVERS ARE TURNING INTO EFP’S. January saw its open interest RISE by 67 contracts up to 911. FEBRUARY saw a gain of 12,241 contacts up to 192,213. DEMAND FOR GOLD INTENSIFIES.
.
We had 11 notice(s) filed upon today for 1100 oz
VOLUME FOR TODAY : 279,714 (PRELIMINARY)
CONFIRMED VOLUME YESTERDAY: 467,777 contracts. (comex volumes are intensifying)
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And now for the wild silver comex results.
Total silver OI UNEXPECTEDLY ROSE BY 1557 CONTRACTS FROM 199,899 UP TO 201,456 DESPITE YESTERDAY’S 10 CENT LOSS IN PRICE . WE HAD 1312 PRIVATE EFP’S ISSUED FOR DECEMBER AND 0 EFP’S FOR MARCH BY OUR BANKERS TO COMEX LONGS WHO RECEIVED A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. THIS IS QUITE EARLY FOR THE ISSUANCE. USUALLY WE WITNESS THIS EVENT ONE WEEK PRIOR TO FIRST DAY NOTICE AND IT CONTINUES RIGHT UP TO FDN. WE HAD NO LONG SILVER COMEX LIQUIDATION. THE TOTAL EFP’S ISSUED TODAY TO OUR COMEX LONGS TOTAL 1312 AND THUS DEMAND FOR SILVER INTENSIFIES
The new front month of November saw its OI FALL by 0 contract(s) and thus it stands at 2. We had 1 notice(s) served YESTERDAY so we gained 1 contracts or an additional 5,000 oz will stand in this non active month of November. After November we have the big active delivery month of December and here the OI FELL by ONLY 649 contracts DOWN to 106,594, YET WE HAD 1312 EFP’S ISSUED WHICH MEANS ALL THE ROLLOVERS LANDED INTO EFP’S AND THEN SOME!!. January saw A GAIN OF 9 contracts RISING TO 1055.
We had 1 notice(s) filed for 5,000 oz for the NOV. 2017 contract
INITIAL standings for NOVEMBER
Nov 16/2017.
Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
nil
oz
Deposits to the Dealer Inventory in oz nil oz
Deposits to the Customer Inventory, in oz
65,829.761 oz
HSBC
Scotia
No of oz served (contracts) today
11 notice(s)
1100 OZ
No of oz to be served (notices)
51 contracts
(5100 oz)
Total monthly oz gold served (contracts) so far this month
1020 notices
102,000 oz
3.172 tonnes
Total accumulative withdrawals of gold from the Dealers inventory this month NIL oz
Total accumulative withdrawal of gold from the Customer inventory this month xxx oz
Today we HAD 0 kilobar trans
WE HAD nil DEALER DEPOSIT:
total dealer deposits: nil oz
We had nil dealer withdrawals:
total dealer withdrawals: nil oz
we had 2 customer deposit(s):
i) into HSBC: 56,056.956 oz
ii) into Scotia: 9,772.805 oz
total customer deposits 65,829.761 oz
We had 0 customer withdrawal(s)
Total customer withdrawals: nil
we had 1 adjustment(s)
i) Out of Delaware: 2341.534 oz was adjusted out of the customer account and this landed into the dealer account
For NOVEMBER:
Today, 0 notice(s) were issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 11 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 4 notice(s) was (were) stopped/ Received) by j.P.Morgan customer account.
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To calculate the INITIAL total number of gold ounces standing for the NOVEMBER. contract month, we take the total number of notices filed so far for the month (1020) x 100 oz or 102,000 oz, to which we add the difference between the open interest for the front month of NOV. (62 contracts) minus the number of notices served upon today (11 x 100 oz per contract) equals 107,100 oz, the number of ounces standing in this NON active month of NOV
Thus the INITIAL standings for gold for the NOVEMBER contract month:
No of notices served (1020) x 100 oz or ounces + {(62)OI for the front month minus the number of notices served upon today (11) x 100 oz which equals 107,100 oz standing in this active delivery month of NOVEMBER (3.303 tonnes)
WE GAINED 9 ADDITIONAL CONTRACTS OR 900 OZ OF ADDITIONAL GOLD STANDING FOR METAL AT THE COMEX
THIS IS THE FIRST TIME EVER THAT WE HAVE WITNESSED CONSIDERABLE QUEUE JUMPING IN GOLD AT THE COMEX. SILVER’S QUEUE JUMPING STARTED IN MAY 2017 AND HAS NOT LET UP ONCE COMMENCED.
.
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Total dealer inventory 529,409.586 or 16.406 tonnes (dealer gold continues to disappear)
Total gold inventory (dealer and customer) = 8,732,195.729 or 271.60 tonnes
I have a sneaky feeling that these withdrawals of gold in kilobars are being used in the hypothecating process and are being used in the raiding of gold!
The gold comex is an absolute fraud. The use of kilobars and exact weights makes the data totally absurd and fraudulent! To me, the only thing that makes sense is the fact that “kilobars: are entries of hypothecated gold sent to other jurisdictions so that they will not be short with their underwritten derivatives in that jurisdiction. This would be similar to the rehypothecated gold used by Jon Corzine at MF Global.
IN THE LAST 14 MONTHS 83 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
AND NOW THE NOVEMBER DELIVERY MONTH
NOVEMBER INITIAL standings
AND NOW THE NOVEMBER DELIVERY MONTH
Nov 16/ 2017
Silver Ounces
Withdrawals from Dealers Inventory nil
Withdrawals from Customer Inventory
3000.08 oz
Delaware
Deposits to the Dealer Inventory
nil oz
Brinks
Deposits to the Customer Inventory
22,251.620
oz
HSBC
No of oz served today (contracts)
1 CONTRACT(S)
(5,000,OZ)
No of oz to be served (notices)
1 contract
(5,000 oz)
Total monthly oz silver served (contracts) 876 contracts(4,380,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month NIL oz
Total accumulative withdrawal of silver from the Customer inventory this month
Nov 13/ 2017
today, we had 0 deposit(s) into the dealer account:
total dealer deposit: nil oz
we had nil dealer withdrawals:
total dealer withdrawals: nil oz
we had 1 customer withdrawal(s):
i) Out of Delaware: 3000.08 oz
TOTAL CUSTOMER WITHDRAWAL 3000.08 oz
We had 1 Customer deposit(s):
i) Into HSBC: 22,251.620 oz
***deposits into JPMorgan have stopped again
In the month of March and February, JPMorgan stopped (received) almost all of the comex silver contracts.
why is JPMorgan bringing in so much silver??? why is this not criminal in that they are also the massive short in silver
total customer deposits: 22,251.620 oz
we had 0 adjustment(s)
The total number of notices filed today for the NOVEMBER. contract month is represented by 1 contracts FOR 5,000 oz. To calculate the number of silver ounces that will stand for delivery in NOVEMBER., we take the total number of notices filed for the month so far at 876 x 5,000 oz = 4,380,0000 oz to which we add the difference between the open interest for the front month of NOV. (2) and the number of notices served upon today (1 x 5000 oz) equals the number of ounces standing.
.
Thus the INITIAL standings for silver for the NOVEMBER contract month: 876 (notices served so far)x 5000 oz + OI for front month of NOVEMBER(2) -number of notices served upon today (1)x 5000 oz equals 4,385,000 oz of silver standing for the NOVEMBER contract month. This is EXCELLENT for this NON active delivery month of November.
We gained 1 contract(s) or an additional 5,000 oz will stand for metal in the non active delivery month of November.
AS I MENTIONED ABOVE, WE HAVE BEEN WITNESSING QUEUE JUMPING IN SILVER FROM MAY 1 2017 ONWARD. IT IS NOW COMFORTING TO SEE CONSIDERABLE QUEUE JUMPING OCCURRING CONTINUALLY IN GOLD FOR THE FIRST TIME SINCE RECORDED TIME AT THE GOLD COMEX!!(1974). QUEUE JUMPING CAN ONLY OCCUR ON PHYSICAL METAL SHORTAGE.
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ESTIMATED VOLUME FOR TODAY: 90,208
CONFIRMED VOLUME FOR YESTERDAY: 121,980 CONTRACTS
YESTERDAY’S CONFIRMED VOLUME OF 121,980 CONTRACTS EQUATES TO 610 MILLION OZ OR 87.1% OF ANNUAL GLOBAL PRODUCTION OF SILVER
Total dealer silver: 43.817 million
Total number of dealer and customer silver: 231.665 million oz
The record level of silver open interest is 234,787 contracts set on April 21./2017 with the price at that day at $18.42
The previous record was 224,540 contracts with the price at that time of $20.44
end
NPV for Sprott and Central Fund of Canada
1. Central Fund of Canada: traded at Negative 2.4 percent to NAV usa funds and Negative 1,4% to NAV for Cdn funds!!!!
Percentage of fund in gold 62.2%
Percentage of fund in silver:37.5%
cash .+.3%( Nov 16/2017)
2. Sprott silver fund (PSLV): NAV FALLS TO -1.00% (Nov 16 /2017)
3. Sprott gold fund (PHYS): premium to NAV FALLS TO -0.56% to NAV (Nov 16/2017 )
Note: Sprott silver trust back into NEGATIVE territory at -1.00%-/Sprott physical gold trust is back into NEGATIVE/ territory at -0.56%/Central fund of Canada’s is still in jail but being rescued by Sprott.
Sprott WINS hostile 3.1 billion bid to take over Central Fund of Canada
(courtesy Sprott/GATA)
END
And now the Gold inventory at the GLD
Nov 16./NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 843.09 TONNES
Nov 15./no change in gold inventory at the GLD/inventory rests at 843.09 tonnes
NOV 14/a small deposit of .300 tonnes into the GLD inventory/Inventory rests at 843.39 tonnes
Nov 13/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 843.09 TONNES
Nov 10/no change in gold inventory at the GLD/Inventory rests at 843.09 tonnes
Nov 9/no changes in inventory at the GLD/Inventory rests at 843.09 tonnes
NOV 8/ANOTHER HUGE WITHDRAWAL OF 1.18 TONNES OF GOLD FROM THE GLD DESPITE GOLD’S RISE TODAY. INVENTORY RESTS AT 843.09
Nov 7/a huge withdrawal of 1.48 tonnes of gold from the GLD/Inventory rests at 844.27 tonnes
NOV 6/ a tiny withdrawal of .29 tonnes to pay for fees etc/inventory rests at 845.75 tonnes
Nov 3/no change in gold inventory at the GLD/Inventory rests at 846.04 tonnes
NOV 2/STRANGE!!! WE HAD ANOTHER WITHDRAWAL OF 3.55 TONNES FROM THE GLD DESPITE GOLD’S RISE OF $6.60 YESTERDAY AND $1.55 TODAY/INVENTORY RESTS AT 846.04 TONNES
Nov 1/a withdrawal of 1.18 tonnes of gold from the GLD/Inventory rests at 849.59 tonnes
OCT 31/no change in gold inventory at the GLD/Inventory rests at 850.77 tonnes
Oct 30/STRANGE WITH GOLD UP THESE PAST TWO TRADING DAYS, THE GLD HAS A WITHDRAWAL OF 1.18 TONNES FROM ITS INVENTORY/INVENTORY RESTS AT 850.77 TONES
Oct 27/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 851.95 TONNES
Oct 26./A WITHDRAWAL OF 1.18 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 851.95 TONNES
Oct 25/NO CHANGE (SO FAR) IN GOLD INVENTORY/INVENTORY RESTS AT 853.13 TONNES
Oct 24./no change in gold inventory at the GLD/inventory rests at 853.13 tonnes
OCT 23./NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY REMAINS AT 853.13 TONNES
OCT 20/NO CHANGE IN GOLD INVENTORY AT THE GLD/ INVENTORY REMAINS AT 853.13 TONNES
oCT 19/NO CHANGE/853.13 TONNES
Oct 18 /no change in gold inventory at the GLD/ inventory rests at 853.13 tonnes
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Nov 16/2017/ Inventory rests tonight at 843.39 tonnes
*IN LAST 273 TRADING DAYS: 97.56 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 208 TRADING DAYS: A NET 59,72 TONNES HAVE NOW BEEN ADDED INTO GLD INVENTORY.
*FROM FEB 1/2017: A NET 28.61 TONNES HAVE BEEN ADDED.
end
Now the SLV Inventory
Nov 16./NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.074 MILLION OZ/
Nov 15./no change in silver inventory at the SLV/inventory rests at 318.074 tones
NOV 14/no change in silver inventory at the SLV/Inventory rests at 318.074 tonnes
Nov 13/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.074 MILLION OZ
Nov 10/no change in silver inventory at the SLV/Inventory rests at 318.074 million oz/
Nov 9/no change in silver inventory at the SLV/inventory rests at 318.074 million oz.
NOV 8/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.074 MILLION OZ
Nov 7/a huge withdrawal of 944,000 oz from the SLV/inventory rests at 318.074 million oz/
NOV 6/no change in silver inventory at the SLV/Inventory rests at 319.018 million oz/
Nov 3/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS TONIGHT AT 319.018 MILLION OZ.
NOV 2/A TINY LOSS OF 137,000 OZ BUT THAT WAS TO PAY FOR FEES LIKE INSURANCE AND STORAGE/INVENTORY RESTS AT 319.018 MILLION OZ/
Nov 1/STRANGE! WITH SILVER’S HUGE 48 CENT GAIN WE HAD NO GAIN IN INVENTORY AT THE SLV/INVENTORY RESTS AT 319.155 MILLION OZ/
Oct 31/no change in silver inventory at the SLV/Inventory rests at 319.155 million oz
Oct 30/STRANGE!WITH SILVER UP THESE PAST TWO TRADING DAYS, WE HAD A HUGE WITHDRAWAL OF 1.133 MILLION OZ FROM THE SLV/INVENTORY RESTS AT 319.155 MILLION OZ/
Oct 27/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 320.288 MILLION OZ
Oct 26/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 320.288 MILLION OZ/
Oct 25/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 320.288 MILLION OZ
Oct 24/no change in inventory at the SLV/inventory rests at 320.288 million oz/
oCT 23./STRANGE!!WITH SILVER RISING TODAY WE HAD A HUGE WITHDRAWAL OF 1.039 MILLION OZ/inventory rests at 320.288 million oz/
OCT 20NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 321.327 MILLION OZ
oCT 19/INVENTORY LOWERS TO 321.327 MILLION OZ
Oct 18 no change in silver inventory at the SLV/inventory rest at 322.271 million oz
Nov 16/2017:
Inventory 318.074 million oz
end
6 Month MM GOFO
Indicative gold forward offer rate for a 6 month duration
+ 1.60%
12 Month MM GOFO
+ 1.79%
30 day trend
end
Major gold/silver trading/commentaries for THURSDAY
GOLDCORE/BLOG/MARK O’BYRNE.
GOLD/SILVER
Deepening Crisis In Hyper-inflationary Venezuela and Zimbabwe Show Why Physical Gold Is Ultimate Protection
GoldCore's picture
by GoldCore
Nov 16, 2017 7:36 AM
Deepening Crisis In Hyper-inflationary Venezuela and Zimbabwe
– Real inflation in Zimbabwe is 313 percent annually and 112 percent on a monthly basis
– Venezuela’s new 100,000-bolivar note is worth less oday thehan USD 2.50
– Maduro announces plans to eliminate all physical cash
– Gold rises in response to ongoing crises
A military coup-de-grace in Zimbabwe and a bankrupt Venezuela. Both countries have extreme hyperinflation, citizens are starving and basic medical treatment is near impossible to find. These are the real world problems 47.5 million people are currently facing.
Presidents Robert Mugabe and Nicolas Maduro both deny the crises in their respective countries. For Maduro it is the media propagating false truths. In Zimbabwe the response to hyperinflation has been to declare it illegal.
Both countries are in the media spotlight after a significant week that has left one man powerless and another scrambling to restore faith in his bankrupt country.
Each country’s mess is thanks to mismanagement of resources and the central banking system. Citizens have had their rights almost decimated as the cash in the bank is worth increasingly less and fewer people are receiving income. Basic goods and services are near impossible to come by, with little sign of let-up.
The hyperinflation and economic situations in both the Latin American and south African country are a reminder of the damage caused by governments. Both Maduro and Mugabe have acted under the premise of serving the electorate. Citizens as a result have only suffered and seen their wealth diminish on a daily basis.
Both countries may seem a million miles away from the West in terms of political situation and cultures. However there is a strong lesson to be learnt. Savers should learn the need to protect their earnings and wealth from the manipulative decisions of governments and destructive monetary policies.
Zimbabwe: The tyranny of a despot and his central bank
“Zimbabwe, welcome back to the record books! You have once again entered the inglorious world of hyperinflation. It is a world of economic chaos, wrenching poverty and death,”
– Steve Hanke, economics professor at Johns Hopkins University
We all recall the hyperinflation event of 2008 when Zimbabwe suffered the second most severe episode of hyperinflation in recorded history. Zimbabwe’s annual inflation rate reached 89.7 sextillion (10^23) percent. In response Mugabe and his cronies replaced the Zimbabwean currency with the US currency.
Now Zimbabwe is undergoing a fresh currency crisis as well as a coup-de-grace. It is facing shortages of the US dollar and banks are being forced to ration withdrawals. The bond notes, issued to make up the shortfall, have dropped sharply in value on black market exchanges. The end result is inflation in retail stores and foreign suppliers refusing to accept the made-up-money.
Today the country is thought to be heading back towards 2008, once again. Steve Hanke, economics professor at Johns Hopkins University has calculated that as of 25 October this year the monthly rate of inflation is 77% and the annual rate is 348%. The official the official, dollar-denominated rate is 0.38%. This is hyperinflation and not something you can just outlaw or ignore.
As a result citizens are suffering and the government is unable to meet basic requirements. The central bank has previously said Zimbabwe had a backlog of more than $500 million in pending foreign payments. This is for necessities such as fuel and medical supplies.
Agricultural production, in the once-known bread basket of Africa, has collapsed following the farm seizures and a lack of cash. Wheat production in 1990, before the farm seizures began, was 325,000 tonnes. In 2016, it was just 20,000 tonnes.
Meanwhile, on the ground citizens are struggling to protect the value of their money. With a 95% unemployment rate this is a hard enough situation to bear. Reports of earners and savers withdrawing their money to invest in real assets are rife as few trust that $200 in the bank today will still be there tomorrow.
Whilst the latest political turn of events is likely to be welcomed, it still brings about an air of uncertainty. Few foreign governments are likely to support aid packages to the country until matters have been resolved and a stable(ish) government is in power. Even China, which is the country’s main source of income and support, is likely to stand still and await to see how it all unfolds.
In the meantime feet on the ground continue to suffer as hyperinflation increases and they struggle to pay for and find basic goods and services.
Venezuela: A socialist experiment gone wrong?
Venezuela reminds me of a quote that is often misattributed to Milton Friedman:
“If you put the federal government in charge of the Sahara Desert, in 5 years there’d be a shortage of sand.”
Today you could say the same about oil and the Venezuelan government. The country was once the richest in Latin America but can no longer cover its own debts.
On Monday it missed interest payments on two government bonds. Even after a 30-day grace period it is unable to muster up $280 million owed in payments.
Meanwhile the value of the bolivar continues to plunge, causing major financial problems for Venezuelans. As explained by Business Insider:
After the country’s economic collapse in 2016, high inflation caused the bolivar’s value to plummet. By December, the then-largest note of 100 bolivares, which was worth about $US0.02, was pulled from circulation. To counter this, new denominations of 500, 1,000, 2,000, 5,000, 10,000, and 20,000 bolivares were introduced.
Maduro’s unveiling of the 100,000 bolivar note means it’s possible that some of these smaller notes may soon be phased out. This would cause serious problems for Venezuelans who, on average, are only allowed to withdraw about 10,000 to 20,000 bolivares a day. In October, the daily withdrawal allowance equalled roughly $3 to $6 at black market exchange rates. On the current market, 20,000 bolivares are worth around 50 cents.
To ‘combat’ the problem of cash shortages Maduro recently announced in a public broadcast that he planned to phase out physical cash, saying “the use of the physical currency is being replaced.”
This is something that was also seen in Zimbabwe. During their first notable hyperinflation era of 2005-2009, the government ran out of money to pay for money. The local currency cost US Dollars, which they could not afford to buy.
Should this happen this will be even more damming for those with cash in the bank. Currently they are able to withdraw physical cash in order to keep on top of the daily increase in inflation. Now they will have little choice but to sit and watch its value disappear.
The enforced holding of cash in the bank will no doubt bring with it capital controls as citizens are prevented from exchanging the bolivar for stronger currencies such as the US dollar. The first step has already been taken as Maduro has tried to contain the financial rout by banning the publication of black market rates. Something Mugabe also tried.
Venezuela’s default should also be of concern to citizens elsewhere, especially in the US. It has come to light that a number of Americans with 401(k) own a hefty amount of Venezuela’s $60 billion debt. How will this work out if the country is unable to pay or has its debt restructured?
Avoid exposure to hyperinflation
Here in the West we are currently extremely fortunate as we are not facing political leaders such as Maduro or hyper inflationary scenarios as those seen in both Zimbabwe and Venezuela.
However, as evidenced just above we may still be exposed in the immediate sense to the failings of these countries, whether through our pension plans or investments elsewhere.
Even if you can be certain that you hold no Venezuelan debt or exposure to the Zimbabwean economy this is still a lesson in how one must diversify their assets outside of cash and the banking system. This is thanks to ultimate control institutions and governments have over these entities, should they so choose.
By holding assets outside of the system you can work to protect your wealth from such measures as those seen in Zimbabwe and Venezuela. Gold is one of the best examples. When held in a physical, allocated and segregated manner the owner cannot be prevented from accessing it whenever they so wish. Nor can it be devalued at will or suddenly illegal to trade. It is a borderless currency that acts without the control of governments looking to further their own wealth or political beliefs.
News and Commentary
Gold steady as dollar gains amid U.S. rate hike expectations (Reuters.com)
Asia Stocks Gain, Halting Slide; Aussie, Won Rise (Bloomberg.com)
Stocks Fall, Treasuries Rise as Commodities Slump (Bloomberg.com)
U.S. business inventories unchanged in September (Reuters.com)
U.S. consumer prices edge up; retail sales unexpectedly increase (Reuters.com)
TURKS follow Erdogan’s call to get rid of dollars & buy gold (RT.com)
Chinese buying more gold as global demand falls (CGTN.com)
Gold inches down as U.S. rate hike looms (Reuters.com)
Paulson Holds Stake in Gold Steady, Soros Stays on Sidelines (NewsMax.com)
Why We’re Buying Physical Gold with a $1700 Target (ZeroHedge.com)
Gold Prices (LBMA AM)
16 Nov: USD 1,277.70, GBP 969.01 & EUR 1,085.53 per ounce
15 Nov: USD 1,285.70, GBP 976.62 & EUR 1,086.29 per ounce
14 Nov: USD 1,273.70, GBP 972.47 & EUR 1,086.59 per ounce
13 Nov: USD 1,278.40, GBP 977.59 & EUR 1,097.89 per ounce
10 Nov: USD 1,284.45, GBP 976.44 & EUR 1,102.19 per ounce
09 Nov: USD 1,284.00, GBP 980.98 & EUR 1,106.29 per ounce
08 Nov: USD 1,282.25, GBP 976.82 & EUR 1,105.43 per ounce
Silver Prices (LBMA)
16 Nov: USD 17.04, GBP 12.92 & EUR 14.48 per ounce
15 Nov: USD 17.12, GBP 13.00 & EUR 14.45 per ounce
14 Nov: USD 16.94, GBP 12.92 & EUR 14.45 per ounce
13 Nov: USD 16.93, GBP 12.93 & EUR 14.53 per ounce
10 Nov: USD 17.00, GBP 12.92 & EUR 14.60 per ounce
09 Nov: USD 17.10, GBP 13.03 & EUR 14.69 per ounce
08 Nov: USD 17.00, GBP 12.96 & EUR 14.65 per ounce
Recent Market Updates
– UK Debt Crisis Is Here – Consumer Spending, Employment and Sterling Fall While Inflation Takes Off
– Protect Your Savings With Gold: ECB Propose End To Deposit Protection
– Internet Shutdowns Show Physical Gold Is Ultimate Protection
– Gold Coins and Bars Saw Demand Rise 17% to 222T in Q3
– Prepare For Interest Rate Rises And Global Debt Bubble Collapse
– Platinum Bullion ‘May Be One Of The Only Cheap Assets Out There’
– World’s Largest Gold Producer China Sees Production Fall 10%
– German Investors Now World’s Largest Gold Buyers
– Gold Price Reacts as Central Banks Start Major Change
– Why Switzerland Could Save the World and Protect Your Gold
– Invest In Gold To Defend Against Bail-ins
– Stumbling UK Economy Shows Importance of Gold
END
A joke: the one exchange that the CME plans to use when it starts with its futures operation is down again and it is having serious issues
(Russo/Bloomberg)
The bitcoin exchange CME plans to use for futures is down
Submitted by cpowell on Wed, 2017-11-15 18:27. Section: Daily Dispatches
By Camila Russo
Bloomberg News
Wednesday, November 15, 2017
This is exactly what the bitcoin futures naysayers have been warning about: One of the exchanges which CME Group Inc. would use to price the contracts is having serious issues.
Clients of San Francisco-based Kraken are seeing slow responses from the website, connection timeouts, and delays in withdrawals, the cryptocurrency exchange said in a statement late Tuesday. “We are investigating these issues and working to resolve as quickly as possible,” the statement said.
Problems in the fifth-biggest exchange by bitcoin trading volume come just three days after Seoul-based Bithumb’s servers crashed as a sudden surge in usage caused a connection failure. The issues raise concerns about whether largely unregulated exchanges, without the safeguards of securities bourses, will be able to reliably provide prices for indexes tied to futures and exchange traded funds, and cope with higher trading volume that could come if institutional investors start buying cryptos. …
… For the remainder of the report:
https://www.bloomberg.com/news/articles/2017-11-15/bitcoin-exchange-that…
END
German Precious Metals Association honors GATA consultant Dimitri Speck
Submitted by cpowell on Wed, 2017-11-15 18:39. Section: Daily Dispatches
1:40p ET Wednesday, November 15, 2017
Dear Friend of GATA and Gold:
Financial analyst and GATA consultant Dimitri Speck, author of “The Gold Cartel,” has been given the German Precious Metals Association’s Winged Sculpture prize, which is awarded annually to people or projects whose work has engaged the public with precious metals and related topics.
Association board member said: “Dimitri Speck succeeded already as far back as 2002 in discovering statistical proof for the manipulation of the London gold fixing. In 2011 he followed up by providing statistical proof for the manipulation of the silver fixing as well, followed in 2014 by statistical proof for the manipulation of the platinum fixing.”
The announcement of Speck’s award is posted in German at the association’s internet site here:
http://www.goldseiten.de/artikel/352515–Dimitri-Speck-mit-Preis-der-Deu…
And in an English translation at Speck’s own internet site, Seasonax, here:
https://seasonax.com/news/dimitri-speck-winner-2017-prize-german-preciou…
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org
END
What a joke: this one BIS official urges accountability while it undergoes in secret huge gold swaps
(courtesy GATA/Chris Powell)
BIS official urges accountability while his press office rejects it
Submitted by cpowell on Wed, 2017-11-15 19:24. Section: Daily Dispatches
2:33p ET Wednesday, November 15, 2017
Dear Friend of GATA and Gold:
Even as the Bank for International Settlements was refusing on Tuesday to answer GATA’s questions about the bank’s activity in the gold market —
http://www.gata.org/node/17793
— the bank’s economic adviser and head of research, Hyun Song Shin, was addressing a conference at the European Central Bank in Frankfurt, Germany, giving a speech titled “Can Central Banks Talk Too Much?”:
https://www.bis.org/speeches/sp171114.pdf
And:
http://www.gata.org/files/BIS-HyunSongShinSpeech-11-14-2017.pdf
Shin echoed the 2005 remarks of another BIS official, William R. White, who said a major objective of central banking is “to influence asset prices (especially gold and foreign exchange) in circumstances where this might be thought useful”:
http://www.gata.org/node/4279
Shin told the ECB conference: “If central banks talk more to influence market prices, they should listen less to the signals emanating from those same markets. Otherwise, they could find themselves in an echo chamber of their own making, acting on market signals that are echoes of their own pronouncements.
On the other hand,” Shin continued, “talking less is hardly a viable option. Central bank actions matter too much for the lives of ordinary people to turn the clock back to an era when silence was golden. Accountability demands that central banks make clear the basis for their actions.”
In fact at the moment accountability seems to mean little at the BIS, whose press office replied as follows to GATA on Tuesday: “We do not comment on specific accounts / holdings of central banks or of the BIS.”
(See: http://www.gata.org/node/17793)
So much for “the lives of ordinary people,” who, instead of being told how the BIS is meddling in the markets, can just drop dead.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org
END
Gold trading today:
Your early THURSDAY morning currency, Asian stock market results, important USA/Asian currency crosses, gold/silver pricing overnight along with the price of oil Major stories overnight/9 AM EST
i) Chinese yuan vs USA dollar/CLOSED DOWN AT 6.6320/shanghai bourse CLOSED DOWN AT 3.27 POINTS .10% / HANG SANG CLOSED UP 167.07 POINTS OR 0.58%
2. Nikkei closed UP 322.80 POINTS OR 1.47% /USA: YEN RISES TO 113.14
3. Europe stocks OPENED GREEN /USA dollar index RISES TO 93.94/Euro FALLS TO 1.1766
3b Japan 10 year bond yield: RISES TO . +.052/ GOVERNMENT INTERVENTION !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 114.07/ THIS IS TROUBLESOME AS BANK OF JAPAN IS RUNNING OUT OF BONDS TO BUY./JAPAN 10 YR YIELD FINALLY IN THE POSITIVE/BANK OF JAPAN LOSING CONTROL OF THEIR YIELD CURVE AS THEY PURCHASE ALL BONDS TO GET TO ZERO RATE!!
3c Nikkei now JUST BELOW 17,000
3d USA/Yen rate now well below the important 120 barrier this morning
3e WTI:: 55.27 and Brent: 61.62
3f Gold DOWN/Yen DWON
3g Japan is to buy the equivalent of 108 billion uSA dollars worth of bond per month or $1.3 trillion. Japan’s GDP equals 5 trillion usa./“HELICOPTER MONEY” OFF THE TABLE FOR NOW /REVERSE OPERATION TWIST ON THE BONDS: PURCHASE OF LONG BONDS AND SELLING THE SHORT END
Japan to buy 100% of all new Japanese debt and by 2018 they will have 25% of all Japanese debt. Fifty percent of Japanese budget financed with debt.
3h Oil UP for WTI and UP FOR Brent this morning
3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund RISES TO +.386%/Italian 10 yr bond yield DOWN to 1.850% /SPAIN 10 YR BOND YIELD DOWN TO 1.515%
3j Greek 10 year bond yield RISES TO : 5.18???
3k Gold at $1277.15 silver at:17.05: 6 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50
3l USA vs Russian rouble; (Russian rouble UP 24/100 in roubles/dollar) 59.97
3m oil into the 55 dollar handle for WTI and 61 handle for Brent/
3n Higher foreign deposits out of China sees huge risk of outflows and a currency depreciation. This can spell financial disaster for the rest of the world/China forced to do QE!! as it lowers its yuan value to the dollar/GOT A GOOD SIZED DEVALUATION SOUTHBOUND
JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 112.76 DESTROYING JAPANESE CITIZENS WITH HIGHER FOOD INFLATION
30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF. It is not working: USA/SF this morning 0.9925 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1678 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.
3p BRITAIN VOTES AFFIRMATIVE BREXIT/LOWER PARLIAMENT APPROVES BREXIT COMMENCEMENT/ARTICLE 50 COMMENCES MARCH 29/2017
3r the 10 Year German bund now POSITIVE territory with the 10 year RISING to +0.386%
The bank withdrawals were causing massive hardship to the Greek bank. the Greek referendum voted overwhelming “NO”. Next step for Greece will be the recapitalization of the banks and that will be difficult.
4. USA 10 year treasury bond at 2.359% early this morning. Thirty year rate at 2.797% /
5. Details Ransquawk, Bloomberg, Deutsche bank/Jim Reid.
(courtesy Jim Reid/Bloomberg/Deutsche bank/zero hedge)
Futures Jump, Global Stocks Rebound From Longest Losing Streak Of The Year
After five consecutive daily losses on the MSCI world stock index and seven straight falls in Europe, there was finally a bounce, as investors returned to global equity markets in an optimistic mood on Thursday, sending US futures higher after several days of losses as global stocks rebounded following a Chinese commodity-driven rout.
The House is poised to vote, and pass, on tax legislation although what happens in the Senate remains unclear. European shares rebounded for the first time in eight sessions, following Asian stocks higher as the global risk-off mood eased. The euro, Swiss franc and yen all weakened as the dollar edged higher. “After five or six days of steady selling you have got people coming back in looking for bargains,” said CMC Markets’ Michael Hewson. “I think it’s temporary though. We haven’t had a significant sell off this year and the fact of the matter is that equity markets have done so much better than anyone dared to envisage.”
As Bloomberg echoes, “investors seem to be regaining their appetite for risk after several days of global declines in stocks and high-yield credit that had many questioning whether the selloff could become a rout.”
Still, investor concern over the progress of a massive U.S. tax reform plan showed no sign of abating as two Republican lawmakers on Wednesday criticized the Senate’s latest proposal. U.S. President Donald Trump hit back, tweeting that “Tax cuts are getting close!”
“If we look at what the markets are focusing on, it’s still very much the tax cut debates in the U.S., and how much progress there’s going to be on this front,” Barclays’ Mitul Kotecha told Reuters.
Indices in Tokyo, Shanghai and Hong Kong and Seoul all rallied overnight, while London, Frankfurt and Paris started 0.3-0.4% higher as cyclical stocks which had driven the sell-off made a comeback. In Japan the Topix index ended its longest losing streak in a year, rising 1% with technology stocks providing the biggest boost, and the Nikkei 225 advances 1.5%. The ASX (+0.2%) also managed to shake off its early losses, closing higher with the energy sector outperforming as consumer staples and utilities weighed. Chinese stocks edged lower despite a massive cash injection by the PBOC, while the Hang Seng moved higher. Hong Kong stocks rebounded from their worst day in four weeks, as insurers led by Ping An Insurance Group Co. jumped on optimism that rising bond yields will boost investment income. Tencent Holdings climbed after posting its fastest revenue growth in seven years.
China’s sovereign bonds finally rebounded, advancing after the central bank boosted cash injections by the most in 10 months, fueling speculation that the authorities are looking to stabilize sentiment after a debt selloff. Having flirted with 4% in recent days, the yield on 10-year government notes dropped 3 basis points to 3.95%; the 5-year yield fell 1 basis point to 3.95%. The 10-year yield surpassed 4% this week for the first time since 2014. The People’s Bank of China added a net 310 billion yuan ($47 billion) through reverse-repurchase agreements on Thursday, bringing this week’s open-market operation additions to 820 billion yuan, also the most since January.
European stocks bounce back from a seven-day rout – the longest losing streak of the year – that had erased almost 400 billion euros ($471 billion) from the value of the region’s benchmark. The Stoxx Europe 600 Index adds 0.7%, following gains in Asia and climbing from a two-month low. All national benchmarks in the region are in the green, except those in Italy and Greece. Most industry groups also rise, with automakers rebounding from an eight-day slump on data showing European car sales grew in October. Financial services firms and builders were among the biggest gainers in the broad advance of the Stoxx Europe 600 Index.
There was some relief too that oil prices had pulled out of what had been a near 5 percent drop and that upbeat U.S. data on Wednesday had helped the dollar halt the euro’s sharp recent rise.
In currencies, the pound fluctuated as Brexit rhetoric rumbled on, and data showed U.K. retail sales barely rose in October. Concerns about Brexit continue to mount: an article in ‘The Sun’ newspaper, stated that UK PM May, could increase her divorce bill offer to the EU in December; deal would add GBP 20bln to the GBP 18bln said to already be on offer. Source reports indicate that EU is said to reject UK bid for `bespoke’ trade deal, according to Politico. BoE’s Carney states that the Bank will do whatever they can to support the UK economy during the Brexit transition period. Chancellor Hammond said to stick to fiscal rules and resist demands for spending surge in upcoming UK budget. Michael Gove is reportedly facing a Conservative party backlash as he is accused of using the cabinet to audition for UK Chancellor
The dollar index was slightly higher on the day at 93.828 having hit four- and five-week lows against the yen and euro. The euro was down around 14 ticks at $1.1760 retreating from a one-month top of $1.1860 on Wednesday. Havens underperformed on Thursday, with gold trading little changed, and the yen and Swiss franc among the worst-performing major currencies. The Swiss franc decreased 0.3 percent to $0.9918, the largest dip in more than two weeks.
Commodities largely stabilized as China’s central bank boosted the supply of cash in the system by the most since January, though oil eventually reversed a gain. Gold edged 0.1% lower to $1,277.29 an ounce. It reached $1,289.09 overnight, its highest since Oct. 20. Oil prices gained despite pressure after the U.S. government reported an unexpected increase in crude and gasoline stockpiles. They had lost ground to this week’s International Energy Agency (IEA) outlook for slower growth in global crude demand.
European government bonds took their cue from the U.S. benchmark, turning lower as the yield on 10-year Treasuries increased. Bond markets saw a broad rise in yields after mostly upbeat U.S. economic news on Wednesday had added to expectations the Federal Reserve will hike interest rates again next month as well as multiple times next year. Two-year Treasury yields US2YT=RR crept to fresh nine-year peaks in European trading, though significantly the U.S. yield curve remained at its flattest in a decade. European yields nudged higher too but the standout there was a fall in the premium investors demand to hold French debt over German peers to its lowest in over two years, almost to record lows.
Wal-Mart, Viacom, Best Buy and Applied Materials are among companies due to release results. Economic data include initial jobless claims, Philadelphia Fed Business Outlook.
Market Snapshot
S&P 500 futures up 0.4% to 2,574
STOXX Europe 600 up 0.7% to 384.61
MSCI Asia up 0.8% to 169.14
MSCI Asia ex Japan up 0.7% to 555.93
Nikkei up 1.5% to 22,351.12
Topix up 1% to 1,761.71
Hang Seng Index up 0.6% to 29,018.76
Shanghai Composite down 0.1% to 3,399.25
Sensex up 1% to 33,095.23
Australia S&P/ASX 200 up 0.2% to 5,943.51
Kospi up 0.7% to 2,534.79
German 10Y yield rose 1.3 bps to 0.389%
Euro down 0.1% to $1.1779
Brent Futures down 0.03% to $61.85/bbl
Italian 10Y yield rose 0.7 bps to 1.57%
Spanish 10Y yield rose 1.1 bps to 1.561%
Brent Futures down 0.03% to $61.85/bbl
Gold spot down 0.02% to $1,277.91
U.S. Dollar Index up 0.1% to 93.91
Intermission
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Top Overnight News
After a month of discussions, German Chancellor Angela Merkel faces a self-imposed end-of-week deadline to unlock coalition negotiations
British PM Theresa May saw some support from officials of her German counterpart Merkel
Manfred Weber, who leads Merkel’s Christian Democrats in the European Parliament and is a self-proclaimed skeptic on Brexit, changed his tone dramatically after meeting May saying the U.K. had a “credible” position and there was a “willingness to contribute to a positive outcome”
Sterling came under pressure after a Politico report said the EU’s Chief Brexit Negotiator Michel Barnier’s team flatly reject May’s bid for a “bespoke” trade deal
Fed officials are pushing for a potentially radical revamp of the playbook for guiding U.S. monetary policy. With inflation and interest rates still low, the central bank has little room to ease policy in a downturn
U.S. Treasury Secretary Steven Mnuchin is trying to persuade businesses and the Republican faithful to get behind a proposed tax overhaul from the Trump administration that so far lacks broad public support
The tax plan has provisions that may affect coverage and increase medical expenses for millions of families
President Robert Mugabe’s refusal to publicly resign is stalling plans by Zimbabwe’s military to swiftly install a transitional government after seizing power on Wednesday
Tax overhaul update: President Donald Trump is scheduled to head to the House, rallying Republican members before vote on tax bill
German Chancellor Angela Merkel meets heads of her Christian Democratic-led bloc, Free Democrats and Green party to kick coalition talks into gear
Cisco Sees First Revenue Growth in Eight Quarters; Shares Up
Koch Brothers Are Said to Back Meredith Bid to Buy Time Inc.
Health Care for Millions at Risk as Tax Writers Look for Revenue
Cerberus’s Feinberg Switches Strategy to Shake Up German Banking
Mattel Drops on Report That It Rebuffed Approach From Hasbro
New SUVs at Peugeot, Ford Offset U.K. Drag on Europe Car Sales
Google Sued for Using ‘Bait and Switch’ to Hook Minority Hires
Santos Seen Luring More Bids After Rejecting $7.2 Billion Offer
AT&T’s Clash With America Movil Slows Nafta Telecom Talks
Mobileye’s $15 Billion Deal Masks Drop in Israel Tech M&A
Mugabe’s Refusal to Resign Is Said to Stall Zimbabwe Transition
In Asian markets, a modest uptick in US stock index futures helped the Nikkei 225 stem some of its recent losses, with financials and retailers leading the way; as a result, he Japanese blue-chip index closed up 1.5%. The ASX (+0.2%) also managed to shake off its early losses, last closing up, with the energy sector outperforming (although this was on the back of confirmation of a rebuffed Santos takeover offer) as consumer staples and utilities weighed. Chinese stocks edged lower, while the Hang Seng moved higher Treasuries operated in a narrow range throughout the APac session, while JGBs were relatively listless, with a solid 20-year auction the highlight of the session. Aussie bond yields moved to session highs in the wake of the aforementioned labour market release, where they consolidated.
In European markets, equities kicked off the session on the front-foot in a continuation of some of the sentiment seen overnight during Asia-Pac trade (Nikkei 225 +1.5%). Some slight underperformance has been observed in the FTSE 100 with gains capped by a slew of ex-dividends which have trimmed 14.56 points off the index. Notable ex-dividends include both of Royal Dutch Shell’s listings, with the oil-heavyweight subsequently hampering the energy sector as WTI and Brent crude have failed to make any meaningful recovery from Thursday’s losses. Elsewhere, the likes of Fiat Chrysler (+2.5%) and Volkswagen (+2.4%) have been giving a help hand by the latest EU new car registration data. In fixed income, a limited reaction to better than forecast UK consumption data, and clear reservations about retail activity over the key Xmas and New Year period based on bleaker signals from anecdotal surveys and non-ONS data. Hence, Gilts dipped to 124.72 (-15 ticks vs +8 ticks at best), while the Short Sterling strip reversed pre-data gains to stand flat to only 1 ticks adrift before stabilising again. In truth, core bonds were already on the retreat from early highs (ie Bunds down to 162.43 vs 162.71 at best) in what appears to be a broad retracement within recent ranges rather than anything more meaningful.
In FX, GBP has once again been a key source of focus with GBP/USD hit early doors amid reports in Politico that the EU are leaning towards rejecting the UK’s request for a bespoke trade deal. However, sentiment saw a mild recovery after reports in the Sun suggested that PM May could be on the cusp of upping her Brexit settlement offer in an attempt to kick-start trade talks. The main data release of the session thus far came in the form of UK retail sales which painted a less dreary picture of the UK economy than some had feared, although gains were short-lived as Brexit remains the focus. Marginal sterling buying was seen in EUR/GBP, trading around session lows, helped by a stop hunt through yesterday’s lows. Cable too saw a bid later in the session, benefiting from the weaker USD. Elsewhere, EUR/USD is back below 1.1800 vs the USD after topping out just ahead of October’s 1.1880 high, and now in a fresh albeit higher range flanked by big option expiries between 1.1795-1.1800 (913mln) and 1.1815-25 (4.8bln). Another roller-coaster ride for the Antipodeans, with AUD choppy on mixed labour data (headline count miss, but jobless rate and full employment upbeat) and pivoting the 0.7600 handle vs the USD.
In the commodities complex, as mentioned above, WTI and Brent crude futures have failed to make any noteworthy recovery from the sell-off seen on Tuesday with energy newsflow particularly light during today’s session thus far with markets looking ahead to the November 30th OPEC meeting which is set to give nations the instruction to extend oil production cuts. In metals markets, gold prices have traded in a relatively similar manner with prices unable to be granted any reprieve from their latest tumble. Elsewhere, Nickel and Copper have been weighed on, sending prices to multi-week lows as concerns around Chinese growth prospects continue to linger.
Looking at the day ahead, weekly initial jobless claims, Philly Fed PMI for November, import price index for October, industrial production for October and NAHB housing market index for November will be released. The BoE Carney’s, Broadbent and Haldane will all participate at a public plenary session while the ECB’s Villeroy de Galhau and Constancio are due to speak, along with the Fed’s Williams, Mester and Kaplan.
US Event Calendar
8:30am: U.S. Initial Jobless Claims, Nov. 11, est. 235k (prior 239k); Continuing Claims, Nov. 4, est. 1900k (prior 1901k)
8:30am: U.S. Philadelphia Fed Business Outl, Nov., est. 24.6 (prior 27.9)
8:30am: U.S. Import Price Index MoM, Oct., est. 0.4% (prior 0.7%); U.S. Export Price Index MoM, Oct., est. 0.4% (prior 0.8%);
9:15am: U.S. Industrial Production MoM, Oct., est. 0.5% (prior 0.3%); Capacity Utilization, Oct., est. 76.3% (prior 76.0%)
9:15am: U.S. Bloomberg Consumer Comfort, Nov. 12, no est. (prior 51.5); Economic Expectations, Nov., no est. (prior 47.5)
Central Bank speakers:
9:10am: Fed’s Mester delivers keynote address at Cato Conference
1:10pm: Fed’s Kaplan speaks to CFA society in Houston
3:00pm: ECB’s Constancio speaks in Ottawa
3:45pm: Fed’s Brainard delivers keynote at OFR FinTech Conference
4:45pm: Fed’s Williams speaks at Asia Economic Policy Conference
DB’s Jim Reid concludes the overnight wrap
There has been a lot of noise around the HY market in the past week or so as a combination of macro factors along with some notable earnings misses have weighed on the market. iTraxx Crossover and CDX HY have widened by around 25bps and 30bps respectively from their most recent tights, while the price level of the largest USD HY ETF (HYG US) is basically back to the same level as where it started the year, however this overstates the move in the US cash market and even more so in Europe. Looking in more detail at the cash market US HY has widened by around 60bps and EUR HY is 46bps wider from the recent cycle tights only a few weeks back but both are still around 25bps and 100bps tighter on the year respectively.
In a broad historic context the recent moves hardly register but in the context of a year that has been headlined by extremely low levels of volatility they are certainly significant. For EUR HY there were two other periods where we saw some sort of correction this year. In March/April (ahead of the French elections) the index widened 27bps in 42 days and then in August/September (after the North Korean escalation) we saw a 29bps widening over 30 days. So the current 46bps of widening in just 12 days has been somewhat more aggressive than anything else we’ve seen this year.
Looking at similar data for the US we have also seen two previous corrections. In March spreads widened 61bps in 20 days and then in July/August we saw 45bps of widening in 15 days. So the current c.60bps widening over 22 days is actually of a similar magnitude to this year’s previous corrections. The moves look even more stark when we focus on single-Bs though. EUR single-Bs have widened by more than 100bps from the most recent tights, more than halving the YTD tightening we had seen. For USD single-Bs the recent widening (65bps) has actually reversed more than 80% of the YTD spread tightening we had seen to the recent tights.
The question from here is whether this recent back-up in spreads is simply going to lead to a fresh buying opportunity or whether it will lead to something more significant. Despite some of the recent profit warnings we think that it is more likely to be the former at the moment. But at the very least the pace of this turn around highlights how quickly market sentiment can change, especially when spreads are so tight. HY was looking very very stretched relative to IG in Europe and this corrects some of that. Overall it certainly provides us with some food for thought as we look to publish our 2018 outlook in the next 10 days.
Even though US HY has been one of the weaker markets of late there’s no doubt that the recent global equity sell off has struggled to gather momentum as the US session has progressed over the last week. Following through on this, Asia has been weak since the Nikkei sudden sell-off last week and Europe has followed with yesterday seeing the 7th successive daily fall in the Stoxx 600 (-0.49%) – the longest losing streak since October/November 2016. Meanwhile yesterday the US (S&P 500 -0.55%) again closed off the early session lows showing that this equity sell-off isn’t really being US led. For the record since last Wednesday’s close the S&P 500, Stoxx 600 and Nikkei are down -1.15%, -3.17% and -3.86% respectively which helps illustrate this.
Volatility has been on the way up though even in the US over this period. The VIX spiked to 14.51 intraday which was the highest since August 18th. It closed at 13.13 (+13%) which is still the highest since the same period. Meanwhile the VSTOXX index was up +2.25% and is now at the highest level since early September.
This morning in Asia, markets have stemmed losses and are trading higher. The Nikkei (+1.24%), Kospi (+0.52%), Hang Seng (+0.53%) and ASX 200 (+0.30%) are all up as we type. WTI oil is trading marginally higher and after the bell in the US, Cisco was up c6% after guiding to its first revenue gain in eight quarters.
On now to the big data of the yesterday and possibly the month. US Core CPI inflation surprised modestly to the upside in October, rising 0.225% in month-on-month terms (a firmer 0.2% print than DB expected). This raised the year-overyear rate to 1.8% (1.7% expected). The data provide additional evidence that the core inflation trend is firming after a string of very weak prints earlier this year. According to our economists, the three-month annualised change in core CPI inflation is now at 2.4%, the strongest since February 2017. We think inflation is turning a corner and regular consistent misses vs expectations will not be a feature of markets in 2018.
Staying in the US, the House’s version of the tax plan is reportedly on track for a vote on Thursday (local time). In terms of the Senate’s version, rhetoric appears to be heating up as the mark up process continues. The Democrats were reportedly not impressed with the last minute change to add in the repeal of the Obamacare individual mandate, to which Republican Senator Collins partly agrees on, noting that it “gravely complicated our efforts to combine tax reform and changes”, although she has not decided whether to vote against the bill or not. Elsewhere, Republican Senator Johnson has publicly confirmed that he is opposed to the revised GOP plan as it stands, in part as it does not do enough to help partnerships relative to the larger tax cuts for corporates.
Quickly recapping other markets performance from yesterday. Bond markets were firmer with core bond yields down 2-5bp (UST 10y -5bp; Bunds -2.1bp; Gilts -3.5bp) while peripherals underperformed with Portugal bonds leading the softness (+2.5bp). Key currencies were little changed, with US dollar index marginally higher, while Euro dipped -0.06% but Sterling rose 0.05%. In commodities, WTI oil fell another -0.70% (-3.2% for the week), in part following reports that Russia believes it’s too early to announce a potential extension of production cuts at OPEC’s meeting at end of the month. Notably, WTI is still up c18% from late August. Elsewhere, precious metals softened a little (Gold -0.16%; Silver -0.14%) and other base industrial metals were little changed (Copper -0.45%; Zinc -0.54%; Aluminium +0.36%).
Away from the markets, there were a deluge of Fed and ECB central bankers commentaries yesterday but overall contained minimal market moving information. In the details, the Fed’s Evans noted he was open-minded regarding policy action at the December FOMC ahead of discussions with fellow colleagues and sounded dovish on inflation, noting “I feel we are facing below target inflations” while reiterating the US labour market is “vibrant” and unemployment rate “could go below 4%”.
In Europe, the ECB’s Hansson was upbeat on the demand side of the economy and “feel more confident that inflation will eventually reach the levels consistent with our aim”. Elsewhere, the ECB’s Praet pointed to the importance of interest rates post QE, noting that “policy rates will eventually regain their status as the main instrument of policy, and our forward guidance will revert to a singular approach”. Finally, the ECB’s Coeure noted that it’s important for the ECB “to ensure that our own measures do not adversely affect the intermediation capacity of repo markets”.
Over in China yesterday, there were more signs that the government may tolerate slower economic growth in 2018. The Economic Daily reported that the deputy head of the Research Office of the State Council Ms Han has flagged that GDP growth at 6.3% in 2018-2020 would be sufficient to achieve the Party’s 2020 growth target. As a reminder, our Chinese economists expect GDP growth to slow to 6.3% yoy by 1Q.
Finally, over in Zimbabwe, President Mugabe’s c40 years of power may be coming to an end with Bloomberg reporting the 93 year old was confined to his home, with military forces taking control of state owned media outlets and sealing offthe parliament and central bank’s offices.
Before we take a look at today’s calendar, we wrap up with other data releases from yesterday. In the US, the core retail sales for October (ex-auto & gas) was in line at 0.3% mom, but with the prior reading upwardly revised by 0.1ppt. Elsewhere, the September business inventories was flat and in line for the month. Finally, the November empire manufacturing index fell from a c3 year high of 30.2 to a still solid reading of 19.4. After the recent economic data, the Atlanta Fed’s GDPNow estimate of 4Q GDP growth has edged 0.1pp lower to 3.2% saar.
In the UK, the September unemployment rate was in line and steady at 4.3% – still at a 42 year low, while the average weekly earnings remains low but was slightly above expectations at 2.2% yoy (vs. 2.1% expected). Elsewhere, jobless claims (1.1k vs. 1.7k previous) and claimant count rate (2.3% vs. same as previous) were broadly similar to prior readings. The Eurozone’s September trade surplus widened to EUR$25bln (vs. EUR$21bln expected), while the final reading for France’s October CPI was unrevised at 0.1% mom and 1.2% yoy.
Looking at the day ahead, the final October CPI report for the Euro area will be out. UK retail sales data for October and Q3 employment data for France will also be released. In the US weekly initial jobless claims, Philly Fed PMI for November, import price index for October, industrial production for October and NAHB housing market index for November will be released. The BoE Carney’s, Broadbent and Haldane will all participate at a public plenary session while the ECB’s Villeroy de Galhau and Constancio are due to speak, along with the Fed’s Williams, Mester and Kaplan.
3. ASIAN AFFAIRS
i)Late WEDNESDAY night/THURSDAY morning: Shanghai closed DOWN 3.27 points or .10% /Hang Sang CLOSED UP 167.07 pts or 0.58% / The Nikkei closed UP 322.80 POINTS OR 1.47%/Australia’s all ordinaires CLOSED UP 0.19%/Chinese yuan (ONSHORE) closed DOWN at 6.6320/Oil DOWN to 55.27 dollars per barrel for WTI and 61.62 for Brent. Stocks in Europe OPENED GREEN . ONSHORE YUAN CLOSED DOWN AGAINST THE DOLLAR AT 6.6320. OFFSHORE YUAN CLOSED WEAKER TO THE ONSHORE YUAN AT 6.638 //ONSHORE YUAN WEAKER AGAINST THE DOLLAR/OFF SHORE WEAKER TO THE DOLLAR/. THE DOLLAR (INDEX) IS STRONGER AGAINST ALL MAJOR CURRENCIES. CHINA IS OT VERY HAPPY TODAY.
3 a NORTH KOREA/USA
NORTH KOREA/USA
3b) REPORT ON JAPAN
3c CHINA REPORT.
4. EUROPEAN AFFAIRS
And this guy is deputy Governor of the Bank of England?
(courtesy zerohedge)
BoE Deputy Governor Gives Crazy Speech Warning Markets Have Underestimated Rate Rises
On 2 November 2017, the Bank of England raised rates for the first time in a decade and Sterling’s initial rise was promptly sold off by forex traders as we discussed.
The 7-2 vote by the Monetary Policy Committee was not the unanimous decision some had expected, while Cunliffe and Ramsden saw insufficient evidence that wage growth would pick up in line with the BoE’s projections from just over 2% to 3% in a year’s time. Ben Broadbent, MPC member, deputy governor and known to be a close confidant of Governor Carney, gave a speech today at the London School of Economics (LSE) in which he warned markets that Brexit issues didn’t necessarily mean that interest rates have to remain low.
Bloomberg reports that Broadbent stated that the Brexit impact on monetary policy depends on how it affects demand, supply and the exchange rate.
“There are feasible combinations of the three that might require looser policy, others that lead to tighter policy.”
Which sounds alot like he doesn’t know, although he stuck to the central bankers trusty tool, reassuring LSE students the Phillips Curve “still seems to have a slope”.
According to the FT.
The deputy governor of the Bank of England has warned that financial markets have underestimated the chance of further interest rate rises. In a speech at the London School of Economics on Wednesday, Ben Broadbent said markets had placed too much emphasis on the idea that interest rates needed to be kept low in the face of Brexit uncertainty. The deputy governor said it was “uncertain” and “complex” to anticipate how Brexit would affect inflation. But he rejected the assertion that Brexit “necessarily implies low interest rates”.
“Even as inflation rose, and the rate of unemployment fell further, interest-rate markets continued to under-weight the possibility that (the) bank rate might actually go up this year,” he said.
The BoE’s Monetary Policy Committee announced its first interest rate rise in more than a decade earlier this month. But the central bank has struggled to convince financial markets that it is likely to raise rates further.
BoE officials were taken aback when sterling sold off on the day it announced the rate rise, and two-year gilt yields remain below the BoE base rate, suggesting markets are sceptical that the MPC will raise rates further while there is still considerable uncertainty around the UK’s economic future outside of the EU.
Broadbent acknowledged that there is a risk that Brexit uncertainty could adversely impact UK demand. However, he sees the potential for other factors, a reduction in trade, for example, which could crimp UK capacity and necessitate a rise in rates. While Broadbent’s thinking is flawed, and his barley field example plainly ridiculous, the FT continues.
Brexit-related uncertainty could weigh on demand and motivate the MPC to keep interest rates low to support the economy, but other factors could push the central bank to raise rates.
For example, if Brexit reduced the UK’s openness to trade, the country’s output capacity could suffer, which would require the BoE to raise rates to temper inflation.
“Economists often presume that changes in an economy’s underlying productivity occur only slowly,” Mr Broadbent said. However, he added: “A sharp reduction in the degree of openness (to trade) could have a more immediate impact. “A field currently producing barley, sold into the European market, can’t easily or as fruitfully be replanted with olive trees”. He said the challenge for monetary policymakers was that “reductions in supply can add inflationary pressure even as they lower aggregate (gross domestic product)”.
So, let’s consider Broadbent’s example…
The UK suffers a drop in aggregate demand due to a contraction in trade, the BoE raises rates in an over-leveraged economy to stem the inflation and…undoubtedly makes the contraction in GDP much worse. That makes no sense and is the kind of one dimensional thinking that we’ve had to put up with from central bankers. What’s worse is that Broadbent has specific responsibility for monetary policy and a c.v. as long as your arm – Cambridge, Harvard PhD, Fulbright Scholar, Columbia University, Goldman Sachs and UK Treasury.
It’s no wonder we are in such a mess with people like this pulling the levers of policy in the central banks. Crazy ideas aside, Broadbent and his BoE colleagues might be unhappy with market projections for the future path of interest rates, but they can hardly blame investors for being sceptical.
Which way are rates going, Ben?
END
5. RUSSIA AND MIDDLE EASTERN AFFAIRS
SAUDI ARABIA
Brandon Smith warns that the Saudi coup signals war and an end to the USA petrodollar and a New World Order reset. He may be right as he contends that this is what the globalists are seeking
(courtesy Brandon Smith/Alt Market.com)
Brandon Smith Warns: The Saudi Coup Signals War And The New World Order Reset
Authored by Brandon Smith via Alt-Market.com,
For years now, I have been warning about the relationship of interdependency between the U.S. and Saudi Arabia and how this relationship, if ended, would mean disaster for the petrodollar system and by extension the dollar’s world reserve status.
In my recent articles ‘Lies And Distractions Surrounding The Diminishing Petrodollar’ and ‘The Economic End Game Continues,’I point out that the death of the dollar as the premier petrocurrency is actually a primary goal for establishment globalists.
Why?
Because in an effort to achieve what they sometimes call the “global economic reset,” or the “new world order,” a more publicly accepted centralized global economy and monetary framework is paramount. And, this means the eventual implementation of a single world currency and a single global economic and political authority above and beyond the dollar system.
But, it is not enough to simply initiate such socially and fiscally painful changes in a vacuum. The banking powers are not interested in taking any blame for the suffering that would be dealt to the masses during the inevitable upheaval (or blame for the suffering that has already been caused). Therefore, a believable narrative must be crafted. A narrative in which political intrigue and geopolitical crisis make the “new world order” a NECESSITY; one that the general public would accept or even demand as a solution to existing instability and disaster.
That is to say, the globalists must fashion a propaganda story to be used in the future, in which “selfish” nation-states abused their sovereignty and created conditions for calamity, and the only solution was to end that sovereignty and place all power into the hands of a select few “wise and benevolent men” for the greater good of the world.
I believe the next phase of the global economic reset will begin in part with the breaking of petrodollar dominance. An important element of my analysis on the strategic shift away from the petrodollar has been the symbiosis between the U.S. and Saudi Arabia. Saudi Arabia has been the single most important key to the dollar remaining as the petrocurrency from the very beginning.
The very first oil exploration and extraction deal in Saudi Arabia was sought by the vast international oil cartels of Royal Dutch Shell, Near East Development Company, Anglo-Persian, etc., but eventually fell into the hands of none other than the Rockefeller’s Standard Oil Company. The dark history of Standard Oil aside, this meant that Saudi business would be handled primarily by American interests. And the Western thirst for oil, especially after World War I, would etch our relationship with the reigning monarchy in stone.
A founding member of OPEC, Saudi Arabia was one of the few primary oil-producing nations that maintained an oil pipeline that expedited processing and bypassed the Suez Canal. (The pipeline was shut down, however, in 1983). This allowed Standard Oil and the United States to tiptoe around the internal instability of Egypt, which had experienced ongoing conflict which finally culminated in the civil war of 1952.
Considered puppets of the British Empire at the time, the ruling elites of Egypt were toppled by the Muslim Brotherhood, leading to the eventual demise of the British pound sterling as the top petro-currency and the world reserve. The British economy faltered and has never since returned to its former glory.
Perhaps we are seeing some parallels here?
Civil war may not be in the cards for Saudi Arabia; so far a quiet coup has been rather effective in completely changing the power base of the nation over the past few years. The primary beneficiary of that change in power has been crown prince Mohammed Bin Salman, who only answers to King Salman, an 81-year-old ruler barely involved in leadership.
To understand how drastic this coup has been, consider this – for decades Saudi Kings maintained political balance by doling out vital power positions to separate, carefully chosen successors. Positions such as Defense Minister, the Interior Ministry and the head of the National Guard. Today, Mohammed Bin Salman controls all three positions. Foreign policy, defense matters, oil and economic decisions and social changes are now all in the hands of one man.
But the real question is, who is behind that man?
Well, the recent political purge of various “neo-conservative” tied Saudis might lead some to believe that Prince Mohammed is seeking an end to globalist control of Saudi oil and politics.
These people would be wrong for a number of reasons.
Prince Mohammed’s revolutionary “Vision for 2030” developed as he entered power was touted as a means to end Saudi reliance on oil revenues to support economic stability. However, I believe this plan is NOT about ending reliance on oil, but ending reliance on the U.S. dollar. In fact, the plan indicates a move away from the dollar as the world’s petrocurrency and a de-pegging of the Riyal from the dollar.
Prince Mohammed has also established much deeper ties to Russia and China, creating bilateral agreements which may end up removing the dollar as the mechanism for oil trade between the nations.
You would think that this kind of strategy would be highly damaging to the West and to American interests in particular and that the corporate establishment would be doing everything in their power to stop it. However, this is not at all the case. In reality, the globalist establishment is fully behind Mohammed Bin Sulman’s “Vision for 2030.”
Corporate behemoths such as the Carlyle Group (Bush family, etc), Goldman Sachs, Blackstone and Blackrock have ALL been backing the Vision for 2030 and Prince Mohammed through his Public Investment Fund (PIF), of which he is the chairman.
Trillions in capital are flowing through PIF, most of it from the coffers of globalist establishment companies. Once again I point out that the so-called “East versus West division” and the Eastern “opposition” to the globalists is complete nonsense; banking elites and globalists are the true influence behind the move away from the dollar, as the Saudi example and the Vision for 2030 shows. The end of the dollar as world reserve works in their favor — it is planned.
This does not end with the death of the dollar’s petro-status, though. These kinds of upsets in the power dynamic invariably lead to war. War acts as a kind of cleansing of the historical record; it tends to distract the public, for generations, from those that truly benefit from geopolitical and economic strife.
Prince Mohammed has already triggered conflicts with Yemen and Qatar, but this seems to have only been a precursor to greater kinetic displays of force. The next target appears to be Lebanon, and eventually Iran and Syria.
The first signal came with the resignation of Lebanon’s Prime Minister Saad Hariri on November 4, a resignation Hezbollah claims was forced by the Saudi government. Interestingly, Saad Hariri recorded the televised announcement in Saudi Arabia.
This shocking disruption to Lebanon’s political apparatus has been followed by an escalation in saber rattling by Saudi Arabia against Hezbollah (which is considered by many to be merely a puppet organization of the Iranian government). If official polls are to be believed, the Lebanese population is in extreme disagreement over Iran and Hezbollah, which could add to internal divisions and civil war if tensions continue to grow. Add to this the suspected (but officially denied) “secret visit” by Prince Mohammed to Israel in September, and the newfound “friendship” between the two nations in the months since, and we have quite a bit of momentum for a war in Lebanon.
The question is, will a war between Saudi Arabia and perhaps Israel against Hezbollah in Lebanon remain a proxy war, or will it gestate into a wider conflict drawing in Iran, Syria and perhaps even the U.S.?
First, keep in mind that Prince Mohammed has already frozen and/or confiscated approximately $800 billion in assets from his imprisoned political enemies. More than enough to fund a war campaign for several years, maybe even an expanded war against Iran.
Trump’s rhetoric against Iran and his re-institution of sanctions seems to coincide nicely with the increasing tension between the Saudis and Hezbollah. Israel attempted an invasion of Lebanon in 2006 and was soundly and embarrassingly defeated. But, the Israeli government does still showcase a willingness to enter into a ground war in the region, and with the combined forces of the Saudis and the Israelis, we might see a different outcome. Iran would be forced to intervene.
Syria under the Assad regime would also most likely be drawn in through its mutual defense pact with Iran.
I believe that major powers like the U.S. and Russia will probably not become involved in a wider sense, but continue to insert covert forces into the region and support opposing nations through funding and armaments. As with North Korea, I would not expect “world war” on the scale of a nuclear conflagration to develop in the Middle East.
What I do expect is something far more devastating – namely an accelerated disintegration of our already collapsing economic structure as war plays out abroad and the loss of the dollar’s world reserve and petro-status hits us hard at home. So far, in my view it appears that the insanity in Saudi Arabia, (along with the continued war drums against North Korea), is a perfect trigger point that provides a catalyst for mass distraction.
World economic war is the real name of the game here, as the globalists play puppeteers to East and West. It is a geopolitical crisis they will have created to engineer public support for a solution they predetermined.
END
Seems to be working: Saudi Arabia has offered the arrested royals a deal: Lots of cash (up to 70% of net worth) for your freedom
It is now clear: the whole exercise was nothing but to replenish the treasury
(courtesy zerohedge_
Saudi Arabia Offers Arrested Royals A Deal: Your Freedom For Lots Of Cash
As we noted shortly after the Crown Prince’s purge of potential rivals within Saudi Arabia’s sprawling ruling family, while the dozens of arrests were made under the pretext of an “anti-corruption crackdown”, Mohammed bin Salman’s ulterior motive was something else entirely: Replenishing the Kingdom’s depleted foreign reserves, which have been hammered for the past three years by low oil prices, with some estimating that the current purge could potentially bring in up to $800 billion in proceeds.
Furthermore, the geopolitical turmoil unleashed by the unprecedented crackdown helped push oil prices higher, creating an ancillary benefit for both the kingdom’s rulers and the upcoming IPO of Aramco.
Saudi Crown Prince Mohammed bin Salman
And, in the latest confirmation that the crackdown was all about cash, the Financial Times reports today that the Saudi government has offered the new occupants of the Riyadh Ritz-Carlton a way out…. and it’s going to cost them: In some cases, as much as 70% of their net worth.
Saudi authorities are negotiating settlements with princes and businessmen held over allegations of corruption, offering deals for the detainees to pay for their freedom, people briefed on the discussions say.
In some cases the government is seeking to appropriate as much as 70 per cent of suspects’ wealth, two of the people said, in a bid to channel hundreds of billions of dollars into depleted state coffers.
The arrangements, which have already seen some assets and funds handed over to the state, provide an insight into the strategy behind Crown Prince Mohammed bin Salman’s dramatic corruption purge.
The crackdown has led to the detention of hundreds of royals, ministers, officals and the country’s richest oligarchs including Prince Alwaleed bin Talal, the billionaire, Waleed al-Ibrahim, the founder of Middle East Broadcasting Center, which owns Al Arabiya, the Saudi satellite television channel, and Bakr bin Laden, chairman of the Saudi Binladin construction group and brother of Osama bin Laden.
Additionally, as we reported, the crackdown sent members of the country’s wealthy upper crust scrambling to liquidate their holdings and move their cash offshore, where they might have a better chance of keeping it away from the Saudi government.
Unsurprisingly, the Saudi “offer” is working.
Some of the suspects, most of whom have been rounded up at the Ritz-Carlton hotel in Riyadh since last week, are keen to secure their release by signing over cash and corporate assets, the FT’s sources say.
“They are making settlements with most of those in the Ritz,” said one adviser. “Cough up the cash and you will go home.”
One multi-billionaire businessman held at the Ritz-Carlton has been told to hand over 70% of his wealth to the state as a punishment for decades of involvement in allegedly corrupt business transactions. He wants to pay, but has yet to work out the details of transferring those assets to the Saudi state.
Settlements for royals will also include pledges of loyalty as MbS prepares himself to take the Saudi throne, though his father, King Salman, has vigorously denied these rumors.
One detainee told his staff that the authorities may be looking to take ownership of his main business. Families of detained suspects have started to hire consultants to assist efforts to secure their relatives’ release and to ring fence the damage to their business interests.
“They are looking for ways to isolate the tainted shareholder and keep the business going,” said the adviser.
The settlements aim to recover billions of dollars allegedly earned through “corruption” at a time when the government is grappling with a recession triggered by prolonged low oil prices and a budget deficit that widened to $79 billion last year.
The country’s attorney-general has said he is investigating allegations of corruption amounting to at least $100 billion – though the total value of assets seized could be as high as $800 billion. Though the Financial Times puts the high-end figure at a relatively modest $300 billion; to make up for the delta, more arrests are still expected.
Regular Saudis, who’ve seen their benefits cut and some of their jobs taken away, support MbS’s decision. “Why should the poor take all the pain of austerity,” said one Saudi academic. “The rich need to pay their way too.”
In Saudi Arabia, they are about to do just that.
end
Documents surface which indicate that Israel is ready to share intelligence with the Saudis against Iran. The key component is an understanding that the Saudi’s will agree that refugees cannot return to Palestinian land in return for a lasting peace with Israel. Israel and Saudi Arabia must stop the formation of two Shia crescents:
i. from Lebanon to Iran
ii) from the Gulf to the Red Sea
(courtesy zerohedge)
Israel Ready To Share Intelligence With Saudis “Against Iran” Ahead Of Possible War
This morning one of Israel’s largest international news broadcasters broke an explosive yet not entirely surprising story that Israel would take the unprecedented step of sharing intelligence with Saudi Arabia as both countries continue to ramp up efforts to curb what they perceive as Iranian expansion in the region.
Left: Israeli PM Netanyahu, Right: Saudi Prince Mohammed bin Salman
Israel’s i24NEWS cited statements by the head of the Israeli army given to a prominent Saudia Arabian newspaper on Thursday:
In an unprecedented interview with Saudi Arabia’s Alaf newspaper on Thursday, Israel Defense Force (IDF) chief-of-staff Lt. Gen. Gadi Eizenkot said that Israel is ready to share intelligence with Riyadh on their shared arch-foe Iran.
Eizenkot, who is the first senior Israeli military officer to be interviewed by a Saudi media outlet, called Iran the “biggest threat to the region” and said that Israel and Riyadh – which he noted have never fought one another – are in complete agreement about Iran’s intentions to dominate the Middle East.
The report continues, quoting the IDF chief:
The interview is a major public step forward in warming ties between Israel and Saudi Arabia – which do not share any diplomatic relations.
Eizenkot said that Iran wants to take control of the Middle East by creating two Shi’ite crescent, “from Lebanon to Iran and then from the Gulf to the Red Sea.”
“We must prevent this from happening,” he implored.
He said that Israel has no intention of initiating a conflict with Iran’s Lebanese proxy Hezbollah, saying that “we see Iranian attempts at bringing about an escalation, but I don’t see a high chance for this at the moment.”
The historic news, which is worrisome for the fact that it could bring the region closer to major war, follows last week’s leak of an Israeli diplomatic cable sent to all Israeli embassies throughout the world which reveals Israeli and Saudi behind the scenes coordination. The cable gave instructions to Israeli diplomats to express support for the Saudi war against Shia forces in Yemen and also urged embassies to aggressively lobby their host governments to take steps toward pushing Hezbollah out of Lebanon.
We summarized the now confirmed leaked document as follows:
On Sunday, just after Lebanese PM Hariri’s shocking resignation, Israel sent a cable to all of its embassies with the request that its diplomats do everything possible to ramp up diplomatic pressure against Hezbollah and Iran.
The cable urged support for Saudi Arabia’s war against Iran-backed Houthis in Yemen.
The cable stressed that Iran was engaged in “regional subversion”.
Israeli diplomats were urged to appeal to the “highest officials” within their host countries to attempt to expel Hezbollah from Lebanese government and politics.
Barak Ravid ?@BarakRavid
1 \ I published on channel 10 a cable sent to Israeli diplomats asking to lobby for Saudis\Hariri &against Hezbollah http://news.nana10.co.il/Article/?ArticleID=1272790&sid=126 …
3:11 PM – Nov 6, 2017
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news.nana10.co.il
And this week, another leaked document emerged, first obtained by Lebanon’s Al-Akhbar news, which reveals, according to regional media, “concessions to Israel that are certain to prove controversial in Palestine and the Arab world if true, including Saudi encouragement of the Palestinians to cede the right of return of their refugees, in return for a peace deal with Israel and closer cooperation with Tel Aviv against Iran and Hizballah.”
The ‘secret’ document is reportedly from the Saudi foreign ministry and provides further proof that Israel and Saudi Arabia – who for decades have been long time public bitter enemies – are increasingly cementing and formalizing their relationship while talking war with Iran and Hezbollah. According to a translation provided by The New Arab, the leaked Saudi foreign ministry document reads in part as follows:
“I have the honour to submit to you a project for establishing relations between the kingdom and the State of Israel based on the strategic partnership agreement with the United States of America, discussed with the US Secretary of State based on the guidance of your noble guidance,” opens the letter.
“Saudi Arabia…. has immense influence and diplomatic power that can give credibility to peace efforts,” the alleged letter continues.
“The kingdom had pledged in the strategic partnership agreement with US President Donald Trump that only a US-Saudi effort (for peace) is the key to success as… no solution to the Palestinian issue can be legitimate without the support of Saudi Arabia.
“Rapprochement between Saudi Arabia and Israel carries risks... given the spiritual, historical, and religious status of the Palestinian issue. The kingdom cannot risk this move unless it feels the US is honest about its efforts against Iran, which destabilizes the region.”
The more explosive passage of the secret Saudi document concerns Iran, and comes at the end of the memo, to wit: “Resolving this conflict will pave the way for security, commercial, and financial cooperation against Iran. Therefore, the Saudi and Israeli sides have the following (goals) in common:
Confronting any activities that serve the aggressive policies of Iran in the Middle East.
Increasing US and international sanctions over Iran’s ballistic missile programme
Increasing sanctions over Iran’s sponsorship of terrorism around the world.
Lobbying the 5+1 group over their position on the nuclear deal with Iran to ensure its strict implementation
Limiting Iranian access to frozen assets, and capitalizing on Iran’s economic problems to increase pressure on the regime
Intelligence cooperation against organised crime and drug trafficking supported by Iran and Hizbollah”
All of the above is yet further confirmation of the already well-known Saudi and Israeli common cause against perceived Iranian influence and expansion in places like Syria, Lebanon and Iraq of late. This has led the historic bitter enemies down a pragmatic path of unspoken cooperation as both seem to have placed the break up of the so-called “Shia crescent” as their primary policy goal in the region. For Israel, Hezbollah has long been its greatest foe, which Israeli leaders see as an extension of Iran’s territorial presence right up against the Jewish state’s northern border.
All of this this comes, perhaps not coincidentally, at the very moment ISIS is on the verge of complete annihilation (partly at the hands of Hezbollah), and as both Israel and Saudi Arabia have of late increasingly declared “red lines” concerning perceived Iranian influence across the region as well as broad Hezbollah acceptance and popularity within Lebanon.
end
6 .GLOBAL ISSUES
Zimbabwe
Mugabe refuses to resign which in turn causes their stock market to collapse
(courtesy zerohedge)
Zimbabwe Stock Market Crashes – What Happens After Mugabe?
In the last two days, the Zimbabwe stock market has crashed almost 10% as a ‘not-military-coup’ has ousted 93-year-old President Mugabe – the question is, what happens next?
Bloomberg reports that Zimbabwe President Robert Mugabe’s refusal to publicly resign is stalling plans by the military to swiftly install a transitional government after seizing power on Wednesday, two people familiar with the situation said.
That uncertainty is clearly showing up in Zimbabwe stocks…
The military wants Mugabe, who’s under house arrest, to agree to step aside so it can claim its action isn’t a coup and head off tension with the Southern African Development Community, which includes Zimbabwe and South Africa, the people said. The group previously intervened when the army took over in Lesotho.
However, as a reminder, Pedzisayi Ruhanya, the director of the Zimbabwe Democracy Institute, warns,
“Mugabe wants to die in office and is not interested in seeing his successor.”
“He is not a student of democratic processes.”
Bloomberg goes on to note that the new rulers, headed by armed forces commander Constantino Chiwenga, plan to try and negotiate the establishment of a transitional government with the opposition until elections can be held to restore stability, the people said.
But first they want a deal with Mugabe, whose 37-year rule left an economy that has halved in size since 2000, a severe cash shortage that’s choking businesses and a collapse in government services.
The military has declined to comment on its plans.
“The military, or the people who are now in charge, obviously they have some respect for Mugabe — he is someone who has led them for so many years,”Alex Magaisa, a Zimbabwean law lecturer who helped design the southern African nation’s 2013 constitution, said in a interview with Bloomberg Television in London.
“I think there is still some residual sympathy for him. They wouldn’t want to be seen to be mistreating him.”
The operation to take power had been planned for weeks but was accelerated after Mugabe fired his deputy Emmerson Mnangagwa, according to the people.
https://www.bloomberg.com/api/embed/iframe?id=8eba3774-a6c1-44e5-a298-ccb8287781b9
Many ordinary people simply hope that the authorities can improve daily life in Zimbabwe, where an estimated 95 percent of the workforce is jobless.The country doesn’t even have its own currency and relies mainly on the dollar.
“I hope and pray this takeover will bring lasting solutions for us,” said James Saunyama, as he collected his weekly allocation of $50 in coins from a bank in Harare.
“We’ve endured enough so this takeover must give us better and improved lifestyles going forward.”
The new rulers also want to repair relations with Western countries, who used to be among the biggest investors in the country, and international lenders, the people said.
They will seek investment from the more than 3 million people who left Zimbabwe because of the economic collapse including the white farmers driven off their land, the people said.
Mark Bohlund, Africa economist with Bloomberg Intelligence in London, expects Zimbabwe’s economic challenges to persist even if there is a power shift and the country adopts more orthodox economic policies.
“Expectations for quick progress toward receiving financial support and potential debt relief should be tempered,” Bohlund said.
“The huge challenges ahead and continued political uncertainty is likely to deter inward investment for many years to come.”
We leave it to Pedzisayi Ruhanya to sum things up…
“The chaos happening in Zimbabwe and ZANU-PF is what happens when the end of an authoritarian era approaches.”
end
7.OIL ISSUES
Somehow Norway now does not believe oil will rise in the next few years: They are planning a divestiture of 35 billion in oil stocks.
(courtesy zerohedge)
Norway’s $1 Trillion Wealth Fund Suddenly Considers Dumping $35 Billion Of Oil And Gas Stocks
One of the world’s largest sovereign wealth funds, and one which ironically amassed the overwhelming majority of their wealth via rich oil reserves, is now looking to sell off some $35 billion worth of energy stocks. According to central bank Deputy Governor Egil Matsen, the move is intended simply to “spread the risks for the state’s wealth,” but one has to wonder whether the owner of 1.5% of the world’s stocks has decided that oil has now moved into a period of secular decline. Per Bloomberg:
Norway’s $1 trillion sovereign wealth fund proposed dumping about $35 billion in oil and gas stocks, including Royal Dutch Shell Plc andExxon Mobil Corp., to protect the economy of western Europe’s biggest petroleum producer.
The nation will be “less vulnerable” to a drop in oil by not being invested in stocks of companies in the industry, the Oslo-based fund said Thursday. The Finance Ministry said it would study the plan and decide at the earliest in “autumn 2018.”
“Our perspective here is to spread the risks for the state’s wealth,” Egil Matsen, the deputy governor at the central bank in charge of overseeing the fund, said in an interview in Oslo Thursday. “We can do that better by not adding oil price risk through the fund.”
While the fund says the plan isn’t based on any view on the future of oil prices or the industry, it will likely add pressure on oil producers, already struggling in a world where renewable energy is gaining sway.
In light of this news, here is a list of Norway’s 10 largest energy holdings (valuesin NOK) that you should probably look to lighten up on at some point before they do.
Of course, roughly a year ago we scoffed at the wealth fund’s decision to respond to sinking returns and withdrawals required to fund budget deficits, deficits created by tumbling oil prices, by allocating another $130 billion in assets to what appeared to be an already massively overpriced equity bubble in return for an extra 40bps of “expected average annual real returns.” (see: Norway Buying $130 Billion In Global Equities As Sovereign Wealth Fund Continues To Bleed Cash). The extra equity purchases pushed the fund’s total equity allocation to a staggering 70% of their $860 billion in assets under management.
After being forced to withdraw at least $15 billion to fund 2017 budget deficits, the $860 billion Norwegian sovereign wealth fund has announced that it will change it’s portfolio allocations to try to make up the difference. The change will result in 75% of the fund’s capital being allocated to global equities, up from the current 60%. Sure, because funneling another $130 billion to the global equity bubble is just the prudent thing to do for an extra 40bps of “expected average annual real returns.”
The central bank’s board, which oversees the fund, on Thursday recommended an increase in the equity share to 70 percent from 60 percent. That will raise the expected average annual real return to 2.5 percent over 10 years and to 3.5 percent over 30 years, compared with 2.1 percent and 2.6 percent, respectively, under the current setup.
The world’s largest sovereign wealth fund said that it expects an annual return of only 0.25 percent on bonds over the next decade and that the expected “equity risk premium,” or return on stocks over government bonds, will be just 3 percentage points in a cautious estimate.
“In our analyses, this is clearly evident in global data: internationally, growth in firms’ cash flows and equity returns are correlated with growth in the global economy,” Deputy Governor Egil Matsen said in a speech Thursday in Oslo. “Global economic growth in the coming years is expected to be below its historical level. This ‘pessimism’ is partly related to the driving forces behind the low level of the real interest rate.”
Alas, with global equity bubbles becoming ever more bubblier with each passing day, the bet on equities paid off ‘bigly’ for Norway and pushed their AUM to over $1 trillion for the first time ever back in September. Per Bloomberg:
Norway’s sovereign wealth fund hit $1 trillion for the first time on Tuesday, driven higher by climbing stock markets and a weaker U.S. dollar.
The milestone valuation was reached for the first time on Sept. 19 at 2:01 a.m. in Oslo, Norges Bank Investment Management said in a statement on Tuesday.
“I don’t think anyone expected the fund to ever reach $1 trillion when the first transfer of oil revenue was made in May 1996,” Yngve Slyngstad, chief executive officer of the fund, said in the statement. “Reaching $1 trillion is a milestone, and the growth in the fund’s market value has been stunning.”
So, what say you? Is this just a logical diversification play for a state that is already highly levered to oil or is Norway signaling that the end is near for their black gold.
8. EMERGING MARKET
Now the fun begins as underwriters of credit default swaps must pay out and there will be a considerable amount that they have to muster up:
(courtesy zerohedge)
Venezuela, PDVSA CDS Triggered: ISDA Says Credit Event Has Occurred
In a long overdue, and not exactly surprising decision, moments ago the ISDA Determination Committee decided, after punting for three days in a row, that a Failure to Pay Credit Event has occurred with respect to both the Bolivarian Republic of Venezuela as well as Petroleos de Venezuela, S.A.
Specifically, in today’s determination, in response to the question whether a “Failure to Pay Credit Event occurred with respect to Petroleos de Venezuela, S.A.?” ISDA said that the Determinations Committee voted 15 to 0 that a failure to pay credit event had occurred with respect to PDVSA.
ISDA said the DC also voted 15 to 0 that date of credit event was Nov. 13 and that the potential failure to pay occurred on Oct. 12. ISDA also announced that the DC agreed to reconvene Nov. 20 to continue talks regarding the CDS auction, now that the Credit Default Swaps have been triggered.
Over the past week, all three rating agencies, with Fitch Ratings most recently, declared PDVSA in default, citing the state oil company’s repeated payment delays. The oil company failed to pay yet another $80 million in interest that was due in mid-October on bonds maturing in 2027, and whose buffer period expired over the weekend. Venezuela was declared in default by S&P Global ratings for a similar issue. According to Bloomberg, Fitch said that it expects PDVSA’s creditors to recover as little as 31 percent on their investment.
The panel will now meet next week to discuss whether to hold an auction to set the rate at which the CDS will pay out. When credit swaps are triggered, buyers of the contracts have their losses covered by the counterparties that sold them the insurance-like derivatives.
As recently as last month, traders had bought a net $250 million of default protection through the swaps market, according to the ISDA. Of course, with the PDVSA CDS already trading at a price which implied 100% certainty of default, none of this will be a surprise.
And moments after declaring PDVSA CDS triggered by a failure to pay event, the ISDA Americas DC also found that an identical Failure to Pay Credit Event had occurred with respect to Bolivarian Republic of Venezuela. The Determinations Committee voted 15 to 0 that a failure to pay credit event had occurred with respect to Venezuela, and added that the Determinations Committee voted 15 to 0 to reconvene Nov. 20 to continue talks on an auction.
Just like with PDVSA, the CDS triggering has been fully priced in.
The only question now is when the CDS auction will be, whether it will proceed smoothly and who is revealed as the biggest seller of Venezuela and PDVSA CDS.
END
At 5:30 pm est, Bitcoin surges near $8,000.00 on the announcement of a credit event and bankers must pay out:
(courtesy zerohedge)
Bitcoin Surges Near $8000 Record Highs After Venezuela Default
We have already discussed the hyperbitcoinization of the Venezuelan economy and it appears, judging by the most recent surge, that tonight’s ‘official’ default events for the sovereign (and PDVSA) have triggered a further rush to the ‘safety’ of a decentralized store of wealth…
As we noted previously, Venezuela’s worsening economic collapse has created something of a social experiment in the use of a digital currency as a de facto currency – a phenomenon that’s also playing out in troubled Zimbabwe.
According to TheNational.ae,bitcoin adoption in Zimbabwe is seemingly skyrocketing as the country’s economic situation looks bleak. So much so, that one bitcoin is trading at nearly $10,000 on the Golix.io exchange, while the global average is, at press time, of $5,642.00.
According to a local trader, bitcoin isn’t just being bought by individuals, but by businesses with bills to pay. The country adopted the U.S. dollar back in 2009 as its fiat currency, as the Zimbabwean dollar had lost nearly all its value.
At press time, LocalBitcoins Zimbabwe has people buying bitcoin at the global average, and some buying the cryptocurrency for cash for well over $10,000 in the country’s capital. Bitcoin, as every bitcoiner would expect, is helping people in the country survive times of economic uncertainty, as Zimbabwe has been embroiled in a crisis for years.
And as inflation in Venezuela has spiraled further out of control – by one estimated, it peaked above 2,400% in September – more Venezuelans are resorting to mining bitcoin, litecoin and other digital currencies as a means of coping with the country’s out-of-control hyperinflation and surviving in a country where staples like food and medicine are scarce.
And then, moments after ISDA found that Venezuela had triggered its Credit Default Swaps by failing to repay its debt on time, Bitcoin surged over $500 to new record highs just shy of $8000.
With the collapse of the economy and now default, Venezuelans are running out of options. Bitcoin – just like gold – will come as a saving grace to many people. It has kept food on the tables of families, helped Venezuelans escape the distraught nation, and acted as a voice of rebellion against the oppressive government. But how Maduro’s regime will proceed remains to be seen.
end
Your early morning currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings THURSDAY morning 7:00 am
Euro/USA 1.1766 DOWN .0015/ REACTING TO SPAIN VS CATALONIA/REACTING TO +GERMAN ELECTION WHERE ALT RIGHT PARTY ENTERS THE BUNDESTAG/ huge Deutsche bank problems + USA election:/TRUMP HEALTH CARE DEFEAT//ITALIAN REFERENDUM DEFEAT/AND NOW ECB TAPERING BOND PURCHASES/ /USA FALLING INTEREST RATES AGAIN/HOUSTON FLOODING/EUROPE BOURSES GREEN
USA/JAPAN YEN 113.14 UP 0.385(Abe’s new negative interest rate (NIRP), a total DISASTER/SIGNALS U TURN WITH INCREASED NEGATIVITY IN NIRP/JAPAN OUT OF WEAPONS TO FIGHT ECONOMIC DISASTER/
GBP/USA 1.3187 UP .0016 (Brexit March 29/ 2017/ARTICLE 50 SIGNED
THERESA MAY FORMS A NEW GOVERNMENT/STARTS BREXIT TALKS/MAY IN TROUBLE WITH HER OWN PARTY/
USA/CAN 1.2755 DOWN .0012(CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA)
Early THIS THURSDAY morning in Europe, the Euro FELL by 15 basis points, trading now ABOVE the important 1.08 level FALLING to 1.1766; / Last night the Shanghai composite CLOSED DOWN 3.27 POINTS OR .10% / Hang Sang CLOSED UP 167.07 POINTS OR 0.58% /AUSTRALIA CLOSED UP 0.19% / EUROPEAN BOURSES OPENED ALL GREEN
The NIKKEI: this THURSDAY morning CLOSED UP 322.80 POINTS OR 1.47%
Trading from Europe and Asia:
1. Europe stocks OPENED GREEN
2/ CHINESE BOURSES / : Hang Sang CLOSED UP 167.07 POINTS OR 0.58% / SHANGHAI CLOSED DOWN 3.27 POINTS OR .10% /Australia BOURSE CLOSED UP 0.19% /Nikkei (Japan)CLOSED UP 322.80 POINTS OR 1.47%
INDIA’S SENSEX IN THE GREEN
Gold very early morning trading: 1277.75
silver:$17.05
Early THURSDAY morning USA 10 year bond yield: 2.359% !!! UP 2 IN POINTS from WEDNESDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%. (POLICY FED ERROR)
The 30 yr bond yield 2.797 UP 3 IN BASIS POINTS from WEDNESDAY night. (POLICY FED ERROR)
USA dollar index early THURSDAY morning: 93.94 UP 13 CENT(S) from YESTERDAY’s close.
This ends early morning numbers THURSDAY MORNING
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And now your closing THURSDAY NUMBERS \1 PM
Portuguese 10 year bond yield:1.979% DOWN 2 in basis point(s) yield from WEDNESDAY
JAPANESE BOND YIELD: +.052% UP 1/2 in basis point yield from WEDNESDAY/JAPAN losing control of its yield curve/
SPANISH 10 YR BOND YIELD: 1.542% DOWN 1 IN basis point yield from WEDNESDAY
ITALIAN 10 YR BOND YIELD: 1.838 UP 0 POINTS in basis point yield from WEDNESDAY
the Italian 10 yr bond yield is trading 29 points HIGHER than Spain.
GERMAN 10 YR BOND YIELD: +.376% DOWN 0 IN BASIS POINTS ON THE DAY
END
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IMPORTANT CURRENCY CLOSES FOR THURSDAY
Closing currency crosses for THURSDAY night/USA DOLLAR INDEX/USA 10 YR BOND YIELD/1:00 PM
Euro/USA 1.1771 DOWN.0012 (Euro DOWN 12 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/
USA/Japan: 112.96 UP 0.201(Yen DOWN 20 basis points/
Great Britain/USA 1.3184 UP 0.0012( POUND UP 12 BASIS POINTS)
USA/Canada 1.2735 DOWN.0031 Canadian dollar UP 31 Basis points AS OIL FELL TO $55.24
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This afternoon, the Euro was DOWN 12 to trade at 1.1771
The Yen FELL to 112.96 for a LOSS of 20 Basis points as NIRP is STILL a big failure for the Japanese central bank/HELICOPTER MONEY IS NOW DELAYED/BANK OF JAPAN NOW WORRIED AS AS THEY ARE RUNNING OUT OF BONDS TO BUY AS BOND YIELDS RISE
The POUND ROSE BY 12 basis points, trading at 1.3184/
The Canadian dollar ROSE by 31 basis points to 1.2735 WITH WTI OIL FALLING TO : $55.24
The USA/Yuan closed AT 6.630
the 10 yr Japanese bond yield closed at +.052% UP 1/2 IN BASIS POINTS / yield/
Your closing 10 yr USA bond yield DOWN 0 IN basis points from WEDNESDAY at 2.348% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 2.790 DOWN 1/2 in basis points on the day /
Your closing USA dollar index, 93.90 UP 8 CENT(S) ON THE DAY/1.00 PM/BREAKS RESISTANCE OF 92.00
Your closing bourses for Europe and the Dow along with the USA dollar index closing and interest rates for THURSDAY: 1:00 PM EST
London: CLOSED UP 14.33 POINTS OR 0.19%
German Dax :CLOSED UP 70.85 POINTS OR 0.55%
Paris Cac CLOSED UP 35.14 POINTS OR 0.66%
Spain IBEX CLOSED UP 74.80 POINTS OR 0.75%
Italian MIB: CLOSED UP 47.72 POINTS OR 0.22%
The Dow closed UP 187.08 POINTS OR .80% (HUGE CHINESE INJECTION OF FUNDS)
NASDAQ WAS closed UP 87.09 Points OR 1.30% 4.00 PM EST
WTI Oil price; 55.24 1:00 pm;
Brent Oil: 61.43 1:00 EST
USA /RUSSIAN ROUBLE CROSS: 59.62 DOWN 60/100 ROUBLES/DOLLAR (ROUBLE HIGHER BY 60 BASIS PTS)
TODAY THE GERMAN YIELD FALLS TO +.376% FOR THE 10 YR BOND 1.00 PM EST EST
END
This ends the stock indices, oil price, currency crosses and interest rate closes for today 4:30 PM
Closing Price for Oil, 4:30 pm/and 10 year USA interest rate:
WTI CRUDE OIL PRICE 4:30 PM:$55.25
BRENT: $61.81
USA 10 YR BOND YIELD: 2.373% (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)
USA 30 YR BOND YIELD: 2.823%
EURO/USA DOLLAR CROSS: 1.1771 DOWN .0011
USA/JAPANESE YEN:113.03 UP 0.277
USA DOLLAR INDEX: 93.91 UP 10 cent(s)/
The British pound at 5 pm: Great Britain Pound/USA: 1.3191 : UP 19 POINTS FROM LAST NIGHT
Canadian dollar: 1.2755 UP 10 BASIS pts
German 10 yr bond yield at 5 pm: +0.376%
END
Nasdaq, Bitcoin Surge To Record Highs As China Saves The World
Seemingly thanks to a Risk Parity rebound…
And a huge China liquidity injection...
“The increase in cash additions will help soothe market sentiment,” said Qin Han, chief fixed-income analyst at Guotai Junan Securities Co.
And indeed it did: US equity markets soared today… (Small Caps and Trannies best, Dow and S&P lagged but up big)
Which sent Nasdaq back to record highs..
xxxxxxx
This came out of nowhere: initial jobless claims jump the most in over a year:
(courtesy zerohedge)
Initial Jobless Claims Jump Most Since 2016’s Growth Scare
Ignoring the storm-driven aberrations, this week’s 10k jump in initial jobless claims to 249k signals a notable regime shift in the labor market. For the first time since 2016’s growth scare, there are more Americans opening jobless claims than last year…
In fact there are over 4% more people on initial jobless claims than this time last year…
Did the jobs market just turn?
And when claims turn, a recession follows…
end
After the August storms, industrial production jumps in October but still remains below 2014 peak
(courtesy zerohedge)
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Thank You Harvey Always Good Stuff !
https://www.silverdoctors.com/tag/harvey-organ/
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Perhaps you have built up an appetite speed reading through this mountain of data.
if so, I think the cafe open all night
Cheers and Thanks
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Now Serving " Weekend Brunch " under the Gallows"
Welcome to the Graveyard Gallows Cafe.
Please have a seat
Kick back and relax as we prepare your brunch
EnJoy and have a Great weekend !
GYS_Dine
Thank You For Dining with Us Under The Gallows Cafe
Ya'all come Back Now !
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