The GraveYard Shift

[JD400]

Catching Data


Good Morning Ladies and Gentlemen !

~Welcome To :

~*~Mining & Metals Du Jour~*~ Graveyard Shift~

MMgys

Pleasure having you with us tonight enJoy

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When the mighty fall

The gold cartel’s a scandal in waiting, says GATA’s Bill Murphy

by Greg Klein

Don Quixote comes in two guises. Bill Murphy of the Gold Anti-Trust Action Committee associates his group with neither.

Cervantes wrote of a delusional character convinced he was protecting the local peasantry from horrific monsters as the wannabe knight charged on horseback at a windmill. The words “Quixotic” and “tilting at windmills,” however, later came to describe not delusions but the pursuit of a real and noble campaign that’s also a lost cause.
The gold cartel’s a scandal in waiting, says GATA’s Bill Murphy

Bill Murphy

Understandably, Murphy would reject any comparison with the original Quixote. He also rejects the second interpretation because, while firmly believing in GATA’s legitimacy, he sees it as anything but an exercise in futility. Especially now. That’s the message he’ll bring to the Vancouver Resource Investment Conference with his January 22 presentation, The Gold Cartel, Sex Scandals and GATA.

The recent wave of scandals has taken down some rich and previously powerful people, showing limitations to their supposed invincibility. But to Murphy, there’s an additional lesson to be learned. Disturbing conditions of injustice or corruption can fester for decades, known only to a few. They become scandals only with widespread public awareness—and the ensuing outrage.

Murphy’s concern with market machinations began as he worked for a brokerage in the 1980s. Recognizing the burgeoning Internet’s potential, he began LeMetropoleCafe.com to express his views and those of others. An epiphany of sorts came in 1998 with the collapse of Long Term Capital Management.

“I realized something was wrong when gold was capped at $300 an ounce. We knew that LTCM had to get out of all their positions and they were heavily short the gold market. They couldn’t let the price go up because it would affect the positions of the bullion banks. They got together and stopped it and I realized the price was being rigged.

“At the time I thought it was just the bullion banks. Then I realized it was much bigger and included the Fed, the Treasury, the Bank for International Settlements and other central banks. It was much bigger than we realized. I started GATA with my colleague Chris Powell, who was a daily newspaper editor. That was around the end of 1998 and the beginning of 1999, when we realized the market was rigged. We decided to expose it and try to do something about it.”
The gold cartel’s a scandal in waiting, says GATA’s Bill Murphy

Nearly 20 full years have seen lots of GATA writing and presentations, along with some GATA conferences. But no big breakthrough. Undeterred, Murphy sees a parallel in current high-profile scandals taking down the likes of CBS News host Charlie Rose, NBC News host Matt Lauer, U.S. senator Al Franken and Hollywood bigshot Harvey Weinstein.

When allegations first surfaced against Bernie Madoff, “the authorities did nothing,” Murphy points out. Enron’s accolades included America’s Most Innovative Company, bestowed by Fortune for six years straight. “The people who tried to expose the company were fired.” But eventually widespread public awareness brought widespread public outrage.

“When you take on the rich and powerful, it can go on for decades,” he says. “Then all of a sudden the dam breaks. We now have mega-scandals with a senator and major media people having to resign. It’s going to be a major financial scandal in the U.S. when gold and silver prices finally blow up.”

Newton’s law of equal and opposite reaction is going to take hold. As the cartel loses control, prices are going to explode.
—Bill Murphy

The markets face other serious issues too, he acknowledges. “But in my opinion, number one is how artificially low these prices are because of what this gold cartel has done. Newton’s law of equal and opposite reaction is going to take hold. As the cartel loses control, prices are going to explode.

“It’s going to happen and it’ll probably happen when many of us least expect it. But it’s coming because they’ve gone through too much physical gold and silver at too-cheap prices over the years. Eventually, when the horde moves in to buy, they won’t be able to stop it. Gold and silver are so cheap they’re the most under-valued assets on the planet. And they’re going to explode.”

Bill Murphy speaks on The Gold Cartel, Sex Scandals and GATA at the Vancouver Resource Investment Conference 2018 on January 22 at 11 a.m. GATA’s Ed Steer gives a presentation called JPMorgan and Scotiabank: Still Rigging the Silver Price on January 21 at 1:40 p.m. Click here for more VRIC 2018 information and complimentary registration.

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http://resourceclips.com/2018/01/16/when-the-mighty-fall/
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Dollar's weakness unsettles central bankers
Submitted by cpowell on Wed, 2018-01-17 14:21. Section: Daily Dispatches

All they have to do is rig gold down some more.

* * *

By Roger Blitz
Financial Times
Wednesday, January 17, 2018

The persistent weakness of the U.S. dollar is forcing global central bankers to step up their efforts in warning about the cost of currency appreciation on their economies.

The dollar's decline has extended into 2018, with the index measuring the currency against its leading peers touching a three-year low. The decline in the global reserve currency matters greatly for other economies that have rebounded thanks to stronger exports, such as Europe and Japan.

The euro, which rose by as much as 2.7 percent since the start of the year, dropped sharply from an intraday high of $1.2322 today after Vitor Constancio, European Central Bank vice president, became the latest policymaker to take issue with the single currency's sharp rise against the dollar.

"I am concerned about sudden movements [in the euro] which don't reflect changes in fundamentals," he said.

Ewald Nowotny, fellow ECB member, added that the euro’s rise was "not helpful." The euro was trading 0.4 percent lower today. ...

... For the remainder of the report:

https://www.ft.com/content/23dbe094-fb79-11e7-9b32-d7d59aace167
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Monetary metals holding up well despite suppression, GATA chairman says
Submitted by cpowell on Wed, 2018-01-17 00:22. Section: Daily Dispatches

7:23p ET Tuesday, January 16, 2018

Dear Friend of GATA and Gold:

GATA Chairman Bill Murphy, interviewed by Ken Ameduri for Crush The Street, says the monetary metals are holding up well against the intensifying campaign to keep them down, but he admits that the rise of cryptocurrencies has been taking some interest away from the metals. The interview is 13 minutes long and can be heard at Crush The Street here:

https://crushthestreet.com/videos/live-interviews/precious-metals-suppre...

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
[e-mail]
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Thanks GATA http://www.gata.org/
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Jan 17/GOLD RISES ANOTHER $2.20 UP TO $1338.95/SILVER DOWN 3 CENTS/GOLD AND SILVER WHACKED IN THE ACCESS MARKET/GOLD REGISTERS A REMARKABLE 23,183 EFP CONTRACTS TRANSFERRING FROM THE GOLD COMEX FOR LONDON BASED FORWARDS/SILVER REGISTERS A HUGE 7310 EFP CONTRACT TRANSFERS TO LONDON/MORE SWAMP STORIES/
January 17, 2018 · by harveyorgan · in Uncategorized · Leave a comment




GOLD: $1338.95 UP $2.20

Silver: $17.17 DOWN 3 cents

Closing access prices:

Gold $1327.00

silver: $17.00

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: $1346.38 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME: $1338.80

PREMIUM FIRST FIX: $7.58

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SECOND SHANGHAI GOLD FIX: $1342.50

NY GOLD PRICE AT THE EXACT SAME TIME: $1333.25

Premium of Shanghai 2nd fix/NY:$9.25

SHANGHAI REJECTS NY /LONDON PRICING OF GOLD

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LONDON FIRST GOLD FIX: 5:30 am est $1337.35

NY PRICING AT THE EXACT SAME TIME: $1336.65

LONDON SECOND GOLD FIX 10 AM: $1335.65

NY PRICING AT THE EXACT SAME TIME. $1335.00

For comex gold:

JANUARY/
NUMBER OF NOTICES FILED TODAY FOR JANUARY CONTRACT: 0 NOTICE(S) FOR NIL OZ.

TOTAL NOTICES SO FAR: 449 FOR 44900 OZ (1.3965 TONNES),

For silver:

jANUARY
52 NOTICE(S) FILED TODAY FOR
260,000 OZ/

Total number of notices filed so far this month: 625 for 3,125,000 oz

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Bitcoin: BID $10,088/OFFER $10,193 DOWN $1255 (morning)
Bitcoin: BID 11,186/OFFER $11,294 DOWN $160(CLOSING)

end

Let us have a look at the data for today

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In silver, the total open interest FELL BY A RATHER LARGE 3912 contracts from 200,423 FALLING TO 196,511 DESPITE YESTERDAY’S 5 CENT RISE IN SILVER PRICING. WE HAD CONSIDERABLE COMEX LIQUIDATION BUT WITHOUT A DOUBT WE WITNESSED ANOTHER FAILED MAJOR BANK SHORT- COVERING OPERATION YESTERDAY AS SPECS CONTINUE TO POUR IT ON. NOT ONLY THAT , WE WERE AGAIN NOTIFIED THAT WE HAD ANOTHER GIGANTIC SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP ROUTE: 7310 EFP’S FOR MARCH AND ZERO FOR OTHER MONTHS AND THUS TOTAL ISSUANCE OF 7310 CONTRACTS. HOWEVER THE MOVEMENT ACROSS TO LONDON IS NOT AS SEVERE AS IN GOLD AS THERE SEEMS TO BE MAJOR PLAYERS WILLING TO TAKE ON THE BANKS AT THE COMEX. STILL, WITH THE TRANSFER OF 7310 CONTRACTS, WHAT THE CME IS STATING IS THAT THERE IS NO SILVER (OR GOLD) TO BE DELIVERED UPON AT THE COMEX AS THEY MUST EXPORT THEIR OBLIGATION TO LONDON. ALSO KEEP IN MIND THAT THERE CAN BE A DELAY OF 24 HRS IN THE ISSUING OF EFP’S.

ACCUMULATION FOR EFP’S/SILVER/ STARTING FROM FIRST DAY NOTICE/FOR MONTH OF JANUARY:

31,554 CONTRACTS (FOR 12 TRADING DAYS TOTAL 31,554 CONTRACTS OR 157.770 MILLION OZ: AVERAGE PER DAY: 2629 CONTRACTS OR 13.147 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER: SO FAR THIS MONTH: 157.77 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 22.5% OF ANNUAL GLOBAL PRODUCTION

RESULT: A LARGE SIZED LOSS IN OI COMEX DESPITE THE GOOD 5 CENT RISE IN SILVER PRICE WHICH USUALLY INDICATES ANOTHER FAILED BANKER SHORT-COVERING. WE ALSO HAD A HUGE SIZED EFP ISSUANCE OF 7310 CONTRACTS WHICH EXITED OUT OF THE SILVER COMEX AND TRANSFERRED THEIR OI TO LONDON AS FORWARDS. SPECULATORS CONTINUED THEIR INTEREST IN ATTACKING THE SILVER COMEX . FROM THE CME DATA 7310 EFP’S WERE ISSUED FOR TODAY FOR A DELIVERABLE FORWARD CONTRACT OVER IN LONDON WITH A FIAT BONUS. WE REALLY GAINED 3398 OI CONTRACTS i.e. 7310 open interest contracts headed for London (EFP’s) TOGETHER WITH A DECREASE OF 3912 OI COMEX CONTRACTS. AND ALL OF THIS HAPPENED WITH THE RISE IN PRICE OF SILVER OF 5 CENTS AND A CLOSING PRICE OF $17.20 WITH RESPECT TO YESTERDAY’S TRADING. YET WE STILL HAVE A GOOD AMOUNT OF SILVER STANDING AT THE COMEX.

In ounces AT THE COMEX, the OI is still represented by just UNDER 1 BILLION oz i.e. 0.9860 BILLION TO BE EXACT or 141% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT JANUARY MONTH/ THEY FILED: 52 NOTICE(S) FOR 260,000 OZ OF SILVER

In gold, the open interest ROSE BY A CONSIDERABLE 7341 CONTRACTS UP TO 582,333 WITH THE SOLID RISE IN PRICE OF GOLD WITH YESTERDAY’S TRADING ($2.30). IN ANOTHER HUGE DEVELOPMENT, WE RECEIVED THE TOTAL NUMBER OF GOLD EFP’S ISSUED TUESDAY FOR WEDNESDAY AND IT TOTALED A GIGANTIC SIZED 23,183 CONTRACTS OF WHICH THE MONTH OF FEBRUARY SAW 23,183 CONTRACTS AND APRIL SAW THE ISSUANCE OF 0 CONTRACTS The new OI for the gold complex rests at 582,333. DEMAND FOR GOLD INTENSIFIES GREATLY AS WE CONTINUE TO WITNESS A HUGE NUMBER OF EFP TRANSFERS TOGETHER WITH THE MASSIVE INCREASE IN GOLD COMEX OI TOGETHER WITH THE TOTAL AMOUNT OF GOLD OUNCES STANDING FOR JANUARY COMEX. EVEN THOUGH THE BANKERS ISSUED THESE MONSTROUS EFPS, THE OBLIGATION STILL RESTS WITH THE BANKERS TO SUPPLY METAL BUT IT TRANSFERS THE RISK TO A LONDON BANKER OBLIGATION AND NOT A NEW YORK COMEX OBLIGATION. LONGS RECEIVE A FIAT BONUS TOGETHER WITH A LONG LONDON FORWARD. THUS, BY THESE ACTIONS, THE BANKERS AT THE COMEX HAVE JUST STATED THAT THEY HAVE NO APPRECIABLE METAL!! THIS IS A MASSIVE FRAUD: THEY CANNOT SUPPLY ANY METAL TO OUR COMEX LONGS BUT THEY ARE QUITE WILLING TO SUPPLY MASSIVE NON BACKED GOLD (AND SILVER) PAPER KNOWING THAT THEY HAVE NO METAL TO SATISFY OUR LONGS. LONDON IS NOW SEVERELY BACKWARD IN BOTH GOLD AND SILVER (BIG RISE IN BOTH GOFO AND SIFO) AND WE ARE WITNESSING DELAYS IN ACTUAL DELIVERIES. IN ESSENCE WE HAVE ANOTHER MONSTROUS GAIN OF 30,530 OI CONTRACTS: 7341 OI CONTRACTS INCREASED AT THE COMEX AND AN ATMOSPHERIC SIZED 23,183 OI CONTRACTS WHICH NAVIGATED OVER TO LONDON.

YESTERDAY, WE HAD 7163 EFP’S ISSUED.

ACCUMULATION OF EFP’S/ GOLD(EXCHANGE FOR PHYSICAL) FOR THE MONTH OF JANUARY STARTING WITH FIRST DAY NOTICE: 121,948 CONTRACTS OR 12,194 MILLION OZ OR 379.31 TONNES (12 TRADING DAYS AND THUS AVERAGING: 10,162 EFP CONTRACTS PER TRADING DAY OR 1,016,200 OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS : SO FAR THIS MONTH IN 12 TRADING DAYS: IN TONNES: 379 TONNES

TOTAL ANNUAL GOLD PRODUCTION, 2017, THROUGHOUT THE WORLD EX CHINA EX RUSSIA: 2200 TONNES

THUS EFP TRANSFERS REPRESENTS 379/2200 TONNES = 17.22% OF GLOBAL ANNUAL PRODUCTION SO FAR IN JANUARY ALONE.

Result: A HUGE SIZED INCREASE IN OI AT THE COMEX WITH THE SMALL RISE IN PRICE IN GOLD TRADING ON YESTERDAY ($2.30). WE HAD ANOTHER ATMOSPHERIC SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 23,183. THERE OBVIOUSLY DOES NOT SEEM TO BE MUCH PHYSICAL GOLD AT THE COMEX AND YET WE ALSO OBSERVED A HUGE DELIVERY MONTH FOR THE MONTH OF DECEMBER. I GUESS IT EXPLAINS THE HUGE ISSUANCE OF EFP’S…THERE IS HARDLY ANY GOLD PRESENT AT THE GOLD COMEX FOR DELIVERY PURPOSES. IF YOU TAKE INTO ACCOUNT THE 23,183 EFP CONTRACTS ISSUED, WE HAD A NET GAIN IN OPEN INTEREST OF 30,530 contracts ON THE TWO EXCHANGES:

23.183 CONTRACTS MOVE TO LONDON AND 7341 CONTRACTS INCREASED AT THE COMEX. (in tonnes, the gain in total oi equates to 100.40 TONNES)

we had: 0 notice(s) filed upon for NIL oz of gold.

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With respect to our two criminal funds, the GLD and the SLV:

GLD

With gold up again today, we had no changes in inventory from the GLD:

Inventory rests tonight: 828.96 tonnes.

SLV/

NO CHANGES IN SILVER INVENTORY AT THE SLV/

INVENTORY RESTS AT 316.348 MILLION OZ/

end

First, here is an outline of what will be discussed tonight:

1. Today, we had the open interest in silver FELL BY A CONSIDERABLE 3912 contracts from 200,423 DOWN TO 196,511 (AND now A LITTLE FURTHER FROM THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) DESPITE THE FAIR SIZED RISE IN PRICE OF SILVER TO THE TUNE OF 5 CENTS WITH RESPECT TO YESTERDAY’S TRADING. WE HAD WITHOUT A DOUBT ANOTHER FAILED SHORT COVERING FROM OUR BANKERS AS THEY HAVE CAPITULATED. NOT ONLY THAT BUT OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE ANOTHER GIGANTIC 7310 PRIVATE EFP’S FOR MARCH (WE DO NOT GET A LOOK AT THESE CONTRACTS AS IT IS PRIVATE BUT THE CFTC DOES AUDIT THEM) AND 0 EFP’S FOR ALL OTHER MONTHS . EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. WE HAD SOME COMEX SILVER COMEX LIQUIDATION. IF WE TAKE THE OI LOSS AT THE COMEX OF 3912 CONTRACTS TO THE 7310 OI TRANSFERRED TO LONDON THROUGH EFP’S WE OBTAIN A GAIN OF 3398 OPEN INTEREST CONTRACTS IN CONJUNCTION WITH ANOTHER FAILED BANKER SHORT COVERING. WE STILL HAVE A GOOD AMOUNT OF SILVER OUNCES THAT ARE STANDING FOR METAL IN JANUARY (SEE BELOW). THE NET GAIN TODAY IN OZ ON THE TWO EXCHANGES: 16.99 MILLION OZ!!!

RESULT: A STRONG SIZED DECREASE IN SILVER OI AT THE COMEX WITH THE SMALL RISE OF 5 CENTS IN PRICE (WITH RESPECT TO YESTERDAY’S TRADING). BUT WE ALSO HAD ANOTHER 7310 EFP’S ISSUED TRANSFERRING COMEX LONGS OVER TO LONDON. TOGETHER WITH THE GOOD SIZED AMOUNT OF SILVER OUNCES STANDING FOR JANUARY, DEMAND FOR PHYSICAL SILVER INTENSIFIES AS WE WITNESS MAJOR BANK SHORT COVERING ACCOMPANIED BY INCREASES IN GOFO AND SIFO RATES INDICATING SCARCITY.

(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 TUESDAY night/WEDNESDAY morning: Shanghai closed UP 8.07 points or 0.24% /Hang Sang CLOSED UP 78.66 pts or 0.25% / The Nikkei closed DOWN 83.47 POINTS OR 0.35%/Australia’s all ordinaires CLOSED DOWN 0.51%/Chinese yuan (ONSHORE) closed WELL UP at 6.4348/Oil UP to 63.48 dollars per barrel for WTI and 68.74 for Brent. Stocks in Europe OPENED ALL RED. ONSHORE YUAN CLOSED UP AGAINST THE DOLLAR AT 6.4348. OFFSHORE YUAN CLOSED DOWN AGAINST THE ONSHORE YUAN AT 6.4364 //ONSHORE YUAN MUCH STRONGER AGAINST THE DOLLAR/OFF SHORE SLIGHTLY WEAKER TO THE DOLLAR/. THE DOLLAR (INDEX) IS MUCH STRONGER AGAINST ALL MAJOR CURRENCIES. CHINA IS VERY HAPPY TODAY.(GOOD MARKETS )




3a)THAILAND/SOUTH KOREA/NORTH KOREA

i)/South Korea/North Korea/USA

Trump: it is very possible that the crisis with North Korea cannot be resolved peacefully

( zerohedge)
b) REPORT ON JAPAN
3 c CHINA

i)China’s version of the Nasdaq, CHINEXT tumbles to 6 month lows as crypto related stocks crash

( zerohedge)

ii)With the trade deficit with China rising with the lower dollar, you can expect that Trump may initiate a trade war
( zerohedge)

iii)In the latest TIC report, China does liquidate some of its USA treasuries and right now, it’s level is at the July 2017 level

( zerohedge)
4. EUROPEAN AFFAIRS

i)Europe/Euro

Euro speculators are loading the boat on the long side as they are gearing up for the end of ECB QE which will end in September

( zerohedge)

ii) This is quite a hit: USA banks over $1 billion on the big European Steinhoff collapse
( zerohedge)


5. RUSSIAN AND MIDDLE EASTERN AFFAIRS
A good look at the Ukrainian/Russia and USA situation with respect to the Crimea and Donbass that may trigger a cold war

( Turd Ferguson/TFMetalsReport)


6 .GLOBAL ISSUES

i)CANADA

Even though the Bank of Canada raised their interest rate by 25 basis points, the dollar fell due to warnings of NAFTA uncertainty

( zerohedge)

ii)YEMEN/SAUDI ARABIA



This looks ominous: Yemen’s Houthi rebels claim a successful ballistic missile attack on a Saudi Military base

( zerohedge)


7. OIL ISSUES

Both oil and gasoline gain after a larger than expected draw



( zerohedge)
8. EMERGING MARKET
9. PHYSICAL MARKETS

i)Another Bitcoin exchange closes after regulatory crackdowns

( zerohedge)

ii)A good summary of why silver will always be money
( James Rickards/Daily Reckoning)

iii)Monetary metals holding up quite well despite price suppression
( GATA/Crushthestreet/Bill Murphy)
10. USA stories which will influence the price of gold/silver

i)Initial trading Wednesday morning: Deja Vu all over again

( zerohedge)

ii)The outlook for Ford is not too good as they miss estimates

( zerohedge)

iii)Goldman Sachs like other major banks reports its worst revenue in 2 years due to bond trading crashing by 50%

( zerohedge)

iv)Hard data industrial production surged .9% month/month

( zerohedge)





v)SWAMP STORIES

a)CNN’s Jim Acosta gets thrown out of the Oval office over the “shitgate” questions

( zerohedge)

b)According to this former CIA officer Kevin Shipp, Trump has declared war on the so called Deep State and shadow government of the uSA, This is why the Deep state wants Trump gone and thus the constant media bombardment on negative stories on the President.

( KevinShipp/Greg Hunter/USAWatchdog)

c)FBI agents hand deliver a Mueller subpoena to Steve Bannon’s home

( zerohedge)

d)It looks like the Republicans will not be able to strike a deal with the Democrats on spending and thus a shutdown looms:

( zerohedge)

e)Bannon’s one slip up and that may cause some grief to Trump’

( zerohedge)

f)The Inspector General of the uSA has concluded that the Awans used unathorized access to transfer congress data to a stolen server

( zerohedge)
Let us head over to the comex:

The total gold comex open interest ROSE BY A CONSIDERABLE 7341 CONTRACTS UP to an OI level of 582,333 WITH THE GOOD RISE IN THE PRICE OF GOLD ($2.30 GAIN WITH RESPECT TO YESTERDAY’S TRADING). WE HAD ZERO COMEX GOLD LIQUIDATION AND NO DOUBT WE WITNESSED SOME GOLD SHORT COVERING AT THE COMEX. WE ALSO WITNESSED ANOTHER STRONG COMEX TRANSFER THROUGH THE EFP ROUTE. THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS. THE CME REPORTS THAT A MONSTROUS 23,183 EFP’S WERE ISSUED FOR FEBRUARY , 0 EFP’s FOR APRIL, AND 0 FOR DECEMBER: TOTAL 23,183 CONTRACTS. THE OBLIGATION STILL RESTS WITH THE BANKERS ON THESE TRANSFERS. THE COMEX IS NOW AN ABSOLUTE FRAUD!!

ON A NET BASIS IN OPEN INTEREST WE GAINED TODAY: 30,530 OI CONTRACTS IN THAT 23,183 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE GAINED 7341 COMEX CONTRACTS. NET GAIN ON THE TWO EXCHANGES: 30,530 contracts OR 3.0530 MILLION OZ OR 94.96 TONNES

Result: A CONSIDERABLE INCREASE IN COMEX OPEN INTEREST WITH THE RISE IN THE PRICE YESTERDAY’S GOLD TRADING ($2.30.) WE HAD NO GOLD LIQUIDATION AT THE COMEX. HOWEVER WE, NO DOUBT WE HAD ANOTHER FAILED BANKER SHORT COVERING .. TOTAL OPEN INTEREST GAIN ON THE TWO EXCHANGES: 30,530 OI CONTRACTS…

We have now entered the active contract month of JANUARY. The open interest for the front month of JANUARY saw it’s open interest FALL by 0 contracts REMAINING AT 40. We had 12 notices served upon yesterday so we gained 12 contracts or an additional 1200 oz of gold will stand AT THE COMEX in this non active month of January AND QUEUE JUMPING INTENSIFIES.

FEBRUARY saw a LOSS of 5069 contacts DOWN to 319,889. March saw a loss of 7 contracts down to 485. April saw a GAIN of 10,533 contracts UP to 150,606.

We had 0 notice(s) filed upon today for NIL oz
PRELIMINARY VOLUME TODAY ESTIMATED; 374,337
FINAL NUMBERS CONFIRMED FOR YESTERDAY: 555,977

comex gold volumes are RISING AGAIN

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And now for the wild silver comex results.

Total silver OI FELL BY A CONSIDERABLE 3,912 CONTRACTS FROM 200,423 DOWN TO 196,511 WITH YESTERDAY’S GOOD 5 CENT GAIN. AGAIN WE HAD CONTINUED FAILED BANKER SHORT COVERING. NOT ONLY THAT, WE HAD ANOTHER HUGE SIZED 7310 EMERGENCY EFP’S FOR MARCH ISSUED BY OUR BANKERS (AND ZERO FOR ALL OTHER MONTHS) TO COMEX LONGS WHO RECEIVED A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON: THE TOTAL EFP’S ISSUED: 7310. IT SURE LOOKS LIKE THE SILVER BOYS HAVE STARTED TO MIGRATE TO LONDON FROM THE START OF DELIVERY MONTH AND CONTINUING RIGHT THROUGH UNTIL FIRST DAY NOTICE JUST LIKE WE ARE WITNESSING TODAY. USUALLY WE NOTED THAT CONTRACTION IN OI OCCURRED ONLY DURING THE LAST WEEK OF AN UPCOMING ACTIVE DELIVERY MONTH. THIS PROCESS HAS JUST BEGUN IN EARNEST IN SILVER STARTING IN SEPTEMBER. HOWEVER, IN GOLD, WE HAVE BEEN WITNESSING THIS FOR THE PAST 2 YEARS. WE HAD SOME LONG COMEX SILVER LIQUIDATION BUT A RISE IN TOTAL SILVER OI. WE ARE ALSO WITNESSING A FAIR AMOUNT OF SILVER OUNCES STANDING FOR COMEX METAL IN THIS NON ACTIVE JANUARY AS WELL AS THAT CONTINUAL MIGRATION OF EFPS OVER TO LONDON. ON A PERCENTAGE BASIS THERE ARE MORE EFP’S ISSUED FOR GOLD THAN SILVER. ON A NET BASIS WE GAINED 3398 OPEN INTEREST CONTRACTS:

3912 CONTRACT LOSS AT THE COMEX COMBINING WITH THE ADDITION OF 7310 OI CONTRACTS NAVIGATING OVER TO LONDON.

NET GAIN TWO EXCHANGES: 3398 CONTRACTS

We are now in the poor non active delivery month of January and here the OI LOST 47 contracts FALLING TO 63. We had 31 notices served upon yesterday, so we lost 16 contracts or an additional 80,000 oz will not stand for delivery AT THE COMEX BUT THESE GUYS JOINED THEIR BRETHREN IN MORPHING INTO LONDON BASED FORWARDS.

February saw a LOSS OF 196 OI contracts FALLING TO 383. The March contract LOST 4402 contracts DOWN to 140,169.

We had 52 notice(s) filed for NIL 260,000 for the January 2018 contract for silver
INITIAL standings for JANUARY

Jan 17/2018.
Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
172,332.235 oz
HSBC
Manfra
Scotia
Deposits to the Dealer Inventory in oz nil oz
Deposits to the Customer Inventory, in oz
96,095.253 oz
HSBC
No of oz served (contracts) today
0 notice(s)
NIL OZ
No of oz to be served (notices)
40 contracts
(4000 oz)
Total monthly oz gold served (contracts) so far this month
449 notices
44900 oz
1.3965 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
we had one kilobar transaction/
We had 0 inventory movement at the dealer accounts
total inventory movement into the dealer accounts: nil oz
we had 3 withdrawals into the customer account:
i) Out of HSBC: 168,406.935 oz
ii) Out of Manfra: 2317.800 oz
iii) Out of Scotia: 16077.500 oz (50 kilobars)
total withdrawal: 172,332.235 oz
we had 1 customer deposit
i) Into HSBC: 96,095.253 oz
total deposits: nil oz
we had 0 adjustments
total registered or dealer gold: 586,501.473 oz or 18.242 tonnes
total registered and eligible (customer) gold; 9,152,732.544 oz 284.68 tones

For JANUARY:
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 0 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 0 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 JANUARY. contract month, we take the total number of notices filed so far for the month (449) x 100 oz or 44900 oz, to which we add the difference between the open interest for the front month of JAN. (40 contracts) minus the number of notices served upon today (0 x 100 oz per contract) equals 48,900 oz, the number of ounces standing in this active month of JANUARY

Thus the INITIAL standings for gold for the JANUARY contract month:

No of notices served (449 x 100 oz or ounces + {(40)OI for the front month minus the number of notices served upon today (0 x 100 oz which equals 48,900 oz standing in this active delivery month of JANUARY (1.5109 tonnes). THERE IS 18.245 TONNES OF REGISTERED GOLD AVAILABLE FOR DELIVERY SO FAR.

WE GAINED 12 CONTRACTS OR AN ADDITIONAL 1200 OZ WILL STAND IN THIS NON ACTIVE DELIVERY MONTH OF JANUARY

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

ON FIRST DAY NOTICE FOR JANUARY 2017, THE INITIAL GOLD STANDING: 3.904 TONNES STANDING

BY THE END OF THE MONTH: FINAL: 3.555 TONNES STOOD FOR COMEX DELIVERY AS THE REMAINDER HAD TRANSFERRED OVER TO LONDON FORWARDS.

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

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 70 NET TONNES HAS LEFT THE COMEX.

end
And now for silver
AND NOW THE DECEMBER DELIVERY MONTH
DECEMBER FINAL standings
Jan 17 2018
Silver Ounces
Withdrawals from Dealers Inventory nil oz
Withdrawals from Customer Inventory
132,745.01 oz
Brinks
CNT
Scotia
Deposits to the Dealer Inventory
nil
oz
Deposits to the Customer Inventory
nil oz
No of oz served today (contracts)
52
CONTRACT(S)
(260,000 OZ)
No of oz to be served (notices)
11 contracts
(55,000 oz)
Total monthly oz silver served (contracts) 625 contracts

(3,125,000 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

we had no inventory movement at the dealer side of things

total inventory movement dealer: nil oz

we had 0 inventory deposits into the customer account



total inventory deposits: nil oz

we had 3 withdrawals from the customer account;

i) out of Brinks; 4131.15 oz

ii) Out of CNT: 28,086.980 oz

iii) Out of Scotia: 100,526.88 oz

total withdrawals; 132,745.01 oz

we had 0 adjustments

total dealer silver: 45.456 million

total dealer + customer silver: 246.352 million oz

The total number of notices filed today for the JANUARY. contract month is represented by 52 contract(s) FOR 260,000 oz. To calculate the number of silver ounces that will stand for delivery in JANUARY., we take the total number of notices filed for the month so far at 625 x 5,000 oz = 3,125,000 oz to which we add the difference between the open interest for the front month of JAN. (63) and the number of notices served upon today (52 x 5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the JANUARY contract month: 625(notices served so far)x 5000 oz + OI for front month of JANUARY(63) -number of notices served upon today (52)x 5000 oz equals 3,180,000 oz of silver standing for the JANUARY contract month. This is VERY GOOD for this NONACTIVE delivery month of JANUARY. WE LOST 16 CONTRACTS OR AN ADDITIONAL 80,000 OZ WILL NOT STAND FOR DELIVERY IN THIS NON ACTIVE DELIVERY MONTH OF JANUARY BUT THESE GUYS JOINED THEIR BRETHREN IN OBTAINING A LONDON BASED FORWARD.

ON FIRST DAY NOTICE FOR THE JANUARY 2017 CONTRACT WE HAD 3,790 MILLION OZ STAND.

THE FINAL STANDING: 3,730 MILLION OZ

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ESTIMATED VOLUME FOR TODAY: 185,446

CONFIRMED VOLUME FOR FRIDAY: 129,233 CONTRACTS

YESTERDAY’S CONFIRMED VOLUME OF 129,233 CONTRACTS EQUATES TO 646.5 MILLION OZ OR 92.5% OF ANNUAL GLOBAL PRODUCTION OF SILVER

COMMODITY LAW SUGGESTS THAT OPEN INTEREST SHOULD NOT BE MORE THAN 3% OF ANNUAL GLOBAL PRODUCTION. THE CROOKS ARE SUPPLYING MASSIVE PAPER TRYING TO KEEP SILVER IN CHECK.

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



1. Sprott silver fund (PSLV): NAV RISES TO -0.84% (Jan 17/2018)
2. Sprott gold fund (PHYS): premium to NAV RISES TO -0.65% to NAV (Jan 17/2018 )
Note: Sprott silver trust back into NEGATIVE territory at -0.84%-/Sprott physical gold trust is back into NEGATIVE/ territory at -0.65%/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

Jan 17/no changes in gold inventory at the GLD/inventory rests at 828.96 tonnes

Jan 16/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 828.96 TONNES

Jan 12/no changes in inventory at the GLD despite the rise in gold price/inventory rests at 828.96 tonnes

Jan 11/ANOTHER IDENTICAL WITHDRAWAL OF 2.95 TONNES FROM THE GLD INVENTORY/INVENTORY RESTS AT 828.96 TONNES

Jan 10/with gold up today, a strange withdrawal of 2.95 tonnes/inventory rests at 831.91 tonnes

Jan 9/no changes in gold inventory at the GLD/Inventory rests at 834.88 tonnes

Jan 8/with gold falling by a tiny $1.40 and this being after 12 consecutive gains, today they announce another 1.44 tonnes of gold withdrawal from the GLD/

Jan 5/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 836.32 TONNES

Jan 4/2018/no change in gold inventory at the GLD/Inventory rests at 836.32 tonnes

Jan 3/a huge withdrawal of 1.18 tonnes of gold from the GLD/Inventory rests at 836.32 tonnes

Jan 2/2018/no changes in gold inventory at the GLD/inventory rests at 837.50 tonnes

Dec 29/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 837.50 TONNES

Dec 28/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 837.50 TONNES

Dec 27/NO CHANGES IN GOLD INVENTORY AT THE GLD/ INVENTORY RESTS AT 837.50 TONNES

Dec 26/no change in gold inventory at the GLD

Dec 22/ A DEPOSIT OF 1.48 TONNES OF GOLD INTO GLD INVENTORY/INVENTORY RESTS AT 837.50 TONNES

Dec 21' NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 836.02 TONNES

Dec 20/DESPITE THE GOOD ADVANCE IN PRICE TODAY/THE CROOKS RAIDED THE COOKIE JAR TO THE TUNE OF 1.18 TONNES/INVENTORY RESTS AT 836.02 TONNES

Dec 19/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 837.20 TONNES

Dec 18 SHOCKINGLY AFTER TWO GOOD GOLD TRADING DAYS, THE CROOKS RAID THE COOKIE JAR BY THE SUM OF 7.09 TONNES/INVENTORY RESTS AT 837.20 TONNES

Dec 15/NO CHANGES IN GOLD INVENTORY/RESTS AT 844.29 TONNES.

Dec 14/a good sized gain of 1.48 tonnes of gold into the GLD/inventory rests at 844.29 tones

Dec 13/no changes in gold inventory at the GLD/inventory rests at 842.81 tonnes

Dec 12/SURPRISINGLY NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 842.81 TONNES

Dec 11/SURPRISINGLY NO CHANGES IN GOLD INVENTORY AT THE GLD DESPITE THE CONSTANT RAIDS ON GOLD/INVENTORY RESTS AT 842.81 TONNES

Dec 8/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 842.81 TONNES

Dec 7/A BIG WITHDRAWAL OF 2.66 TONNES FROM THE GLD/INVENTORY RESTS AT 842.81 TONNES

Dec 6/No changes in GOLD inventory at the GLD/Inventory rests at 845.47 tonnes

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Jan 17/2018/ Inventory rests tonight at 828.96 tonnes

*IN LAST 310 TRADING DAYS: 111.99 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 245 TRADING DAYS: A NET 45.32 TONNES HAVE NOW BEEN ADDED INTO GLD INVENTORY.

end

Now the SLV Inventory

Jan 17/no changes in silver inventory at the SLV/inventory rests at 316.348 million oz/

Jan 16/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 316.348 MILLION OZ

Jan 12/no changes in silver inventory at the SLV/inventory rests at 316.348 million oz/

Jan 11/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 316.348 MILLION OZ/

Jan 10/with silver up again, we had a huge withdrawal of 1.227 million oz from the SLV/inventory rests at 316.348 million oz

Jan 9/a withdrawal of 848,000 oz from the SLV/Inventory rests at 317.575 million oz/

jan 8/no change in silver inventory at the SLV/Inventory rests at 318.423 million oz/

Jan 5/DESPITE NO CHANGE IN SILVER PRICING, WE HAD A HUGE WITHDRAWAL OF 2.026 MILLION OZ/INVENTORY RESTS AT 318.423 MILLION OZ.

Jan 4.2018/a slight withdrawal of 180,000 oz and this would be to pay for fees/inventory rests at 320.449 million oz/

Jan 3/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 320.629 MILLION OZ.

Jan 2/WITH SILVER UP DRAMATICALLY THESE PAST 4 TRADING DAYS, THE FOLLOWING MAKES NO SENSE: WE HAD A WITHDRAWAL OF 2.83 MILLION OZ FROM THE SLV

INVENTORY RESTS AT 320.629 MILLION OZ/

Dec 29/no changes in silver inventory at the SLV/inventory rests at 323.459 million oz/

Dec 28/DESPITE THE RISE IN SILVER AGAIN BY 13 CENTS, WE LOST ANOTHER 1,251,000 OZ OF SILVER FROM THE SILVER.

Dec 27/WITH SILVER UP AGAIN BY 17 CENTS, WE LOST ANOTHER 802,000 OZ OF SILVER INVENTORY/WHAT CROOKS/INVENTORY RESTS AT 324.780 MILLION OZ/

Dec 26/no change in silver inventory at the SLV./Inventory rests at 325.582

Dec 21/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 326.227 MILLION OZ/

Dec 20/INVENTORY REMAINS CONSTANT AT 326.337 MILLION OZ (COMPARE WITH GLD)

Dec 19/SILVER INVENTORY REMAINS CONSTANT AT 326.337 MILLION OZ

Dec 18.2017//SILVER INVENTORY CONTINUES TO REMAIN PAT./INVENTORY REMAINS AT 326.337 MILLION OZ/

INVENTORY RESTS AT 326.337 TONNES

Dec 15/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 326.337 MILLION OZ/

Dec 14/a small withdrawal of 377,000 oz and that usually means to pay for fees./inventory rests at 326.337 million oz/

Dec 13/no change in silver inventory at the SLV/Inventory rests at 326.714 million oz/

Dec 12/WOW!ANOTHER STRANGE ONE: SILVER HAS BEEN DOWN FOR 10 CONSECUTIVE DAYS, YET THE SLV ADDS ANOTHER 1.415 MILLION OZ TO ITS INVENTORY. IN THAT 10 DAY PERIOD, SLV ADDS 9.584 MILLION OZ/

INVENTORY RESTS AT 326.714 MILLION OZ

Dec 11/WOW!! ANOTHER STRANGE ONE: SILVER DESPITE BEING DOWN FOR 9 CONSECUTIVE TRADING DAYS ADDS ANOTHER 944,000 OZ TO ITS INVENTORY. FROM NOV 30 UNTIL TODAY SILVER HAS BEEN DOWN EVERY DAY. HOWEVER THE INVENTORY OF SILVER HAS RISEN 8.169 MILLION OZ.

Dec 8/A HUGE DEPOSIT OF 2.642 MILLION OZ/INVENTORY RESTS AT 324.355 MILLION OZ/

Dec 7/strange!! with the continual whacking of silver, no change in silver inventory at the SLV/Inventory rests at 321.713

Dec 6/no change in silver inventory at the SLV/Inventory remains at 21.713 million oz.

Jan 17/2017:
Inventory 316.348 million oz

end



6 Month MM GOFO
Indicative gold forward offer rate for a 6 month duration

+ 1.74%
12 Month MM GOFO
+ 2.06%
30 day trend

end
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News and Commentary

Gold prices inch up as dollar hits 3-yr lows (Reuters.com)

Dollar stoops to three-year low, euro shakes off Merkel coalition concerns (Reuters.com)

Gold rebounds and rises to $1340 as USD slides (FXStreet.com)

Bitcoin falls more than 7 percent as regulation worries mount (Reuters.com)

Up to 95 Percent of Cryptocurrencies ‘Will Drop to Zero’ – Analyst (SputnikNews.com)



Source: Sputnik

Video: BlackRock’s Hambro Sees Commodities Bull Run in 2018 (Bloomberg.com)

China Downgrades US Credit Rating From A- To BBB+, Warns US Insolvency Would “Detonate Next Crisis” (ZeroHedge.com)

After The Carillion Collapse: Who Is To Blame? (ZeroHedge.com)

Monetary Metals Holding Up Well Despite Suppression – GATA (CrushTheStreet.com)

SWOT Analysis: Will Higher Inflation Cause Gold Prices to Rise? (GoldSeek.com)

Gold Prices (LBMA AM)

17 Jan: USD 1,337.35, GBP 969.45 & EUR 1,092.48 per ounce
16 Jan: USD 1,334.95, GBP 970.38 & EUR 1,091.32 per ounce
15 Jan: USD 1,343.00, GBP 971.93 & EUR 1,092.93 per ounce
12 Jan: USD 1,332.90, GBP 978.75 & EUR 1,099.78 per ounce
11 Jan: USD 1,319.85, GBP 978.14 & EUR 1,104.45 per ounce
10 Jan: USD 1,321.65, GBP 976.96 & EUR 1,103.31 per ounce
09 Jan: USD 1,314.95, GBP 972.01 & EUR 1,102.19 per ounce

Silver Prices (LBMA)

17 Jan: USD 17.21, GBP 12.49 & EUR 14.10 per ounce
16 Jan: USD 17.10, GBP 12.43 & EUR 13.99 per ounce
15 Jan: USD 17.12, GBP 12.58 & EUR 14.14 per ounce
12 Jan: USD 17.12, GBP 12.56 & EUR 14.12 per ounce
11 Jan: USD 17.01, GBP 12.64 & EUR 14.24 per ounce
10 Jan: USD 17.13, GBP 12.64 & EUR 14.27 per ounce
09 Jan: USD 17.05, GBP 12.60 & EUR 14.30 per ounce

Recent Market Updates

– Silver Prices To Surge – JP Morgan Has Acquired A “Massive Quantity of Physical Silver”
– London Property Crash Looms As Prices Drop To 2 1/2 Year Low
– Gold Bullion Up 1% In Week, Heads For 5th Weekly Gain As Bonds Sell Off
– Gold Prices Rise To $1,326/oz as China U.S. Treasury Buying Report Creates Volatility
– Gold Hits All-Time Highs Priced In Emerging Market Currencies
– World is $233 Trillion In Debt: UK Personal Debt At New Record
– 10 Reasons Why You Should Add To Your Gold Holdings
– Spectre, Meltdown Highlight Online Banking and Digital Gold Risks
– Palladium Prices Surge To New Record High Over $1,100 On Supply Crunch Concerns
– Gold Has Best Year Since 2010 With Near 14% Gain In 2017
– Happy 2nd Birthday Bail-in Tool! We Suggest Gold As The Perfect Gift
– 98,750,067,000,000 Reasons to Buy Gold in 2018
– Gold, Bitcoin and the Blockchain Replaces the Banks – Realists Guide To The Future



END



Another Bitcoin exchange closes after regulatory crackdowns

(courtesy zerohedge)
BitConnect Closes Exchange After State Crackdown Over Unregulated Sales

Following various red flags, including allegations by none other than the founder of Ethereum and Litecoin that it was running a Ponzi scheme, Bitcoin investment platform BitConnect announced it was closing the company’s cryptocurrency exchange and lending operation after receiving two cease-and-desist letters from state authorities for the unauthorized sale of securities and suffering from denial-of-service attacks.

In addition to offering cryptocurrency exchange services, BitConnect offered to let people receive interest on their digital coin balance by lending or investing their capital.

In a blog post – titled “Changes coming for the Bitconnect [sic] system – Halt of lending and exchange platform” posted on its website, the company said that is “closing the Bitconnect [sic] lending and exchange platform.”

It concluded that “This is not the end of this community, but we are closing some of the services on the website platform and we will continue offering other cyptocurrency [sic] services in the future.”



Both the Texas State Securities Board and North Carolina Secretary of State Securities Division warned that the firm isn’t registered to sell securities in those states, the company said on its website Tuesday. BitConnect offered to let people receive interest on their digital coin balance by lending or investing their capital.

According to the statement, the company will “continue offering other cryptocurrency services in the future.” The questionnable BitConnect X ICO – which was explicitly named in a cease and desist letter served by the Texas Securities Board – will remain “functional.” As Bloomberg notes, BitConnect’s token, BCC, was among the world’s top-20 most successful tokens until its price plunged 65 percent since Jan. 3, as the states announced the actions.

Launched a year ago, the coin still has a market cap of over $200 million, after taking a massive dip to $33, ot -87%, as per CoinMarketCap. By comparison, its value fluctuated around the $425 mark less than 10 days ago.

In addition to its legal trouble and inability to protect itself from continuous DDoS attacks, the company blamed the closing of its lending and exchange services on “bad press.” That is despite the fact that most of this bad press circulated around the severity of their legal troubles.

According to the Next Web, prior to the closure, “the shady Bitcoin investment scheme was mired in a litany of legal troubles, including cease and desist orders from the UK in November, as well as two more from from the US this month – one from the Texas Securities Board and one from the North Carolina Securities Division.”

Leading up to the announcement, BitConnect promoters suddenly began distancing themselves from the project. Coincidentally, the website was struggling with a series of server downtime – all of which began shortly after the cease and desist orders rolled in.

* * *

News of BitConnect’s closure, which were specific to what many had deemed a “shady business” hit on Tuesday afternoon and were widely anticipated by many in the business, and hit around the time the wave of cryptocurrency selling accelerated, briefly dragging bitcoin below $10,000.

It is unclear how much of the broader selloff was catalyzed by the news of BitConnect’s woes , but judging by the sharp rebound in bitcoin and its digital currency peers in the past hour, the market appears to be re-normalizing slowly, realizing that the crackdown against BitConnect is not a broader attack on the cryptocurrency space but merely removal of some of the better known “bad actors.”
END
As the criminal futures expired, so did the crypto carnage conclude as bitcoin soars back above 11,000.
(courtesy zerohedge)
Crypto-Carnage Concludes? Bitcoin Soars Back Above $11k As Futures Expire

Update 1715ET: As January Bitcoin Futures approached expiration…



So cryptocurrencies were suddenly bid…



As it seems the 9500 Bitcoin net speculative short position sparked a squeeze that ramped from below $9500 to over $11,500..



Update 1200ET: Bitcoin has rebounded over $1000 off its lows, breaking back above $10,000…



Having rebounded after the BitConnect headlines sent prices plunging, cryptocurrencies are more sedately limping lower this morning with Bitcoin dropping back below $10,000. The question on everyone’s mind, did the bubble just burst or do you BTFD?

It’s been an ugly week for cryptos…



With the heatmap a sea of red…



And Bitcoin back below $10,000:



down 50% from its all time highs.



Bitcoin broke its 100DMA – which has acted a broad support in the last year…



And Bitcoin Futures at the lowest since inception on heavy volume (note that Bitcoin spot topped as CBOE unleashed its futures contract)…

Notably – today is the expiration of the first CBOE Bitcoin futures contract. CFTC reports a 1907 contract net short position (around 9500 Bitcoin short) and one wonders what impact that is having on the market today)



Bitcoin is now flirting with the key 9,978 support level, which Goldman yesterday noted is critical for the future level of bitcoin. As Goldman’s chief technician wrote, “Watch for signs of a base ahead of 9,978. Setup weakens through 9,836. Turn neutral/cautious through 7,882.”



Which means buyers materialize or it’s all downhill from here.

* * *

Piling on, during his earnings call this morning, Bank of America customers are welcome to buy Bitcoin and other cryptocurrencies, just not through the lender’s Merrill Lynch unit, Chief Executive Officer Brian Moynihan said.

“We have limited our relationships and I think the thing speaks for itself,” Moynihan said Wednesday on a call with reporters after reporting fourth-quarter results.

“We’ve basically told people that they could buy it in other accounts, but not at Merrill Lynch. And so it’s just our view that customers should be careful here.”

Merrill Lynch told employees last month not to offer clients Grayscale’s Bitcoin Investment Trust, one of the few financial instruments directly holding the digital coin. Moynihan said Wednesday the bank is concerned with not being able to identify who’s buying and selling.

Which led Bloomberg to ask the question: Will the cryptocurrency go down as one of history’s most infamous bubbles, alongside tulipmania and the dot-com craze?

In a follow-up to our post from a month ago, Bloomberg looks at where we are now relative to ‘the big bubbles’…

As the chart shows, the cryptocurrency’s nearly 60-fold increase during the past three years was truly extraordinary.



The magnitude of Bitcoin’s boom (before it lost as much as 48 percent from its Dec. 18 high) suggests investors have reason to be worried.

However, Bulls say that Bitcoin’s boom is far from over, and that there’s more to analyzing a market than just measuring price gains. While the recent tumble has alarmed some investors, the cryptocurrency has bounced back from several previous swoons exceeding 50 percent. If Bitcoin did become a widely-accepted form of digital gold, as predicted by Cameron Winklevoss of Facebook fame, it could have a lot further to surge.

There’s also more than one way to slice a rally. On an annualized basis, Bitcoin’s three-year rise has been slower than the gains seen during several of history’s biggest manias — most notably the Mississippi and South Sea bubbles.

Still, skeptics abound.

Howard Wang of New York-based Convoy Investments LLC and Jeremy Grantham of GMO LLC have analyzed Bitcoin’s advance relative to past frenzies and concluded that it’s unsustainable. Grantham, who helps oversee about $74 billion as GMO’s chief investment strategist, summed up his concerns in a Jan. 3 letter to investors:

“Having no clear fundamental value and largely unregulated markets, coupled with a storyline conducive to delusions of grandeur, makes this more than anything we can find in the history books the very essence of a bubble,” he wrote.

However, as CoinTelegraph notes, although it’s not hard to find plentiful online resources asserting there’s no doubt Bitcoin is a huge bubble soon to burst, some people provide alternative views. One of them is Ben Davies, co-founder of another cryptocurrency called Glint. He thinks people are not looking at the bigger picture of Bitcoin, and that’s causing them to incorrectly see it as a bubble.

Davies also thinks the way people often compare Bitcoin to the bubble associated with tulip bulbs doesn’t hold water. He notes that although the prices of tulips soared then experienced a sharp downturn, that historic event is a “poor comparison.” He asserts the price increases associated with tulips were not similar to the cryptocurrency phenomenon.

However, even Davies admits Bitcoin “has all the hallmarks and antecedents that are the precursor to a bubble.”
A good summary of why silver will always be money
(courtesy James Rickards/Daily Reckoning)
Silver: Once And Future Money

Authored by James Rickards via The Daily Reckoning,

The Roman Republic and the later Roman Empire had gold coins called the aureus and solidus, but they also minted a popular silver coin called the denarius. One denarius was the daily wage for unskilled labor and Roman soldiers.

Of course, in the late Empire, the aureus, solidus and denarius were all debased by mixing the gold and silver with base metals. The decline of the Roman Empire went hand in hand with the decline of sound money.

In the early ninth century AD, Charlemagne greatly expanded silver coinage to compensate for a shortage of gold. This was successful in stimulating the economy of the predecessor of the Holy Roman Empire. In a sense, Charlemagne was the inventor of quantitative easing over 1,000 years ago. Silver was his preferred form of money.

Under the U.S. Coinage Act of 1792, both gold and silver coins were legal tender in the U.S. From 1794 to 1935, the U.S. Mint issued “silver dollars” in various designs. These were widely circulated and used as money by everyday Americans. The American dollar was legally defined as one ounce of silver.

The American silver dollar of the late eighteenth century was a copy of the earlier Spanish Real de a ocho minted by the Spanish Empire beginning in the late sixteenth century. The English name for the Spanish coin was the “piece of eight,” (ocho is the Spanish world for “eight”) because the coin could easily be divided into one-eighth pieces.

Until 2001 stock prices on the New York Stock Exchange were quoted in eighths and sixteenths based on the original Spanish silver coin and its one-eight sections.

Until 1935 U.S. silver coins were 90% pure silver with 10% copper alloy added for durability. After the U.S. Coinage Act of 1965, the silver content of half-dollars, quarters and dimes was reduced from 90% to 40% due to rising price of silver and hoarding by citizens who prized the valuable silver content of the older coins.

The new law signed by President Johnson in 1965 marked the end of true silver coinage by the U.S. Other legislation in 1968 ended the redeemability of old “silver certificates” (paper Treasury notes) for silver bullion.

Thereafter, U.S. coinage consisted of base metals and paper money that was not convertible into silver; (gold convertibility had already ended in 1933).

Let’s hope that the U.S. is not following in the footsteps of the Roman Empire in terms of a political decline coinciding with the substitution of base metals for true gold and silver coinage.



In 1986, the U.S. reintroduced silver coinage with a .999 pure silver one-ounce coin called the American Silver Eagle. However, this is not legal tender although it does carry a “one dollar” face value. The silver eagle is a bullion coin prized by investors and collectors for its silver content. But it is not money.

Who in their right mind would pay a full ounce of silver for goods or services worth only a buck?

In short, silver is as much a monetary metal as gold, and has just as good a pedigree when it comes to use in coinage. Silver has supported the economies of empires, kingdoms and nation states throughout history.

It should come as no surprise that percentage increases and decreases in silver and gold prices denominated in dollars are closely correlated.

Silver is more volatile than gold and is more difficult to analyze because it has far more industrial applications than gold. Silver is useful in engines, electronics and coatings.

Interestingly, gold is used very little other than as money in bullion form. Gold has some highly specialized uses for coating and ultra-thin wires, but these are a very small part of the gold market.

Both gold and silver are used extensively in jewelry. I consider jewelry to be “wearable wealth” and akin to bullion rather than a separate market segment.

Because silver has more industrial uses than gold, the price can rise or fall based on the business cycle independent of monetary considerations. However, over long periods of time, monetary and bullion aspects tend to dominate industrial uses and silver closely tracks its close cousin gold in dollar terms.

While gold and silver prices have a high correlation, the correlation is not perfect. There are times where gold outperforms silver and vice versa. Right now we are in a sweet spot for silver.

Gold is performing well, and silver is performing even better!



The latest data is telling me that silver prices are set to rally. This conclusion is based in part on a bull market thesis for gold.

Gold staged an historic rally from 1999 to 2011, from about $250 per ounce to $1,900 per ounce, a gain of about 900% in that twelve-year span. Since then, gold prices fell in a 50% retracement (using the 1999 base) and bottomed at around $1,050 per ounce in December 2015.

Secular bull and bear market tops and bottoms are difficult to see in real time, but they become apparent with hindsight. Gold gained over 23% in 2016-2017. From the perspective of early 2018, it is clear than the gold bear market ended over two years ago and a new multi-year secular bull market has begun.

Silver is not only along for the ride, it is showing even better performance than gold, albeit with greater volatility. Both the gold and silver rallies are based on a combination of supply/demand fundamentals, geopolitical pressures creating safe haven demand, and increasing inflation expectations as confidence in central banking and fiat money erodes.

In addition, silver has an excellent technical set-up right now. Precious metals analyst Samson Li writing in Thomson Reuters on January 2, 2018 offers this insight in the current technical trading position for silver:

Technically, silver is ripe for a major breakout to the upside in 2018. The CFTC figures Managed Money positions show that COMEX silver has been in a net short for three straight weeks since 12th December. This is not unheard of but is relatively rare for silver; the last time COMEX silver was net short was between the end of June and the first week of August 2015.

As investment sentiment can swing from one extreme to another, and given silver’s innate volatility, this net short position should point to the possibility of a sharp short-covering rally. Looking back at the corresponding period in 2015, silver price was trading at $15.61/oz on the 7th July, and it was the third consecutive week recording a net short position. Approximately a year later, silver was trading over $20/oz in July 2016…

[T]he current poor sentiment does suggest that silver could be one of the better performing precious metals in 2018, barring any crisis that could trump most of the commodities but gold.

The good news is that this secular rally in silver is in its early days. Recent gains will be sustained and amplified in the months and years to come.

Silver will outperform gold in the short-run, and shares in well-managed silver mining companies will do even better than silver.

Your early WEDNESDAY 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 UP AT 6.4348 /shanghai bourse CLOSED UP AT 8.07 POINTS 0.24% / HANG SANG CLOSED UP 78.66 POINTS OR 0.25%
2. Nikkei closed DOWN 83.47 POINTS OR 0.35% /USA: YEN FALLS TO 110.73

3. Europe stocks OPENED RED /USA dollar index RISES TO 90.72/Euro FALLS TO 1.2217

3b Japan 10 year bond yield: RISES TO . +.090/ GOVERNMENT INTERVENTION !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 110.73/ 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:: 63.48 and Brent: 68.74

3f Gold UP/Yen DOWN

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 DOWN for WTI and DOWN FOR Brent this morning

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund FALLS TO +.552%/Italian 10 yr bond yield UP to 1.989% /SPAIN 10 YR BOND YIELD UP TO 1.498%

3j Greek 10 year bond yield FALLS TO : 3.763?????????????????

3k Gold at $1336.00 silver at:17.19: 6 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 10/100 in roubles/dollar) 56.64

3m oil into the 63 dollar handle for WTI and 68 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/

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 110.73 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 0.9645 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1774 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 FALLING to +0.552%

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 2.559% early this morning. Thirty year rate at 2.8350% /

5. Details Ransquawk, Bloomberg, Deutsche bank/Jim Reid.

(courtesy Jim Reid/Bloomberg/Deutsche bank/zero hedge)
What Selloff: US Futures Rebound Sharply, Dow 26,000 Back On Deck

While global shares pulled back in early trading from record highs on Wednesday, U.S. equity index futures are staging another comeback and point to a higher open on Wednesday following a volatile day of trading Tuesday which saw the S&P 500 have its worst reversal in two years. Whether yesterday sharp drop in the S&P was due to fears of a government shutdown, which now appears less likely as another short-term spending bill appears imminent, or due to fears over what Steve Bannon may tell Mueller, it is now largely forgotten, and the S&P was up by 9 points, rising 0.3% from the Tuesday close and retracing much of the day’s selloff, once again approaching 2,800 in the cash index.

Having retreated at the start of European trading, following declines in a number of Asian markets, Europe’s Stoxx 600 index erased its earlier drop and traded little changed, as U.S. futures pointed to stronger open – Dow Jones futures up 0.5% and the 26,000 is once again in sight, with European insurance and tech sectors leading the rebound, while media, banking and telecom sectors retreat. Also out of Europe, we got some final CPI prints:

EU Inflation Final MM (Dec) 0.4% vs. Exp. 0.4% (Prev. 0.1%)
EU Inflation, Final YY (Dec) 1.4% vs. Exp. 1.4% (Prev. 1.4%)

Asian equities stepped back from a record high as the region’s resource shares were knocked by falling oil and commodity prices, however, Chinese shares bucked the trend, climbing to a fresh record in Hong Kong. Australia’s ASX 200 (-0.5%) and Japan’s Nikkei 225 (-0.3%) were negative as losses in miners continued to weigh on Australia, while risk appetite in Japan remained sapped by the recent JPY strength. Elsewhere, Hang Seng (-0.4%) pulled back from yesterday’s record close and the Shanghai Comp. (+0.6%) bucked the trend after another firm liquidity effort by the PBoC, although a slump in Shenzhen stocks provided some mainland jitters as the ChiNext board for small cap and tech firms fell to its lowest since July after blockchain-related stocks tumbled in the wake of the crypto-chaos.



Finally, 10yr JGBs were subdued as prices failed to benefit from a broad risk-averse tone, while today’s Rinban announcement was also uneventful in which the BoJ maintained its purchase amounts in the belly to short-end.

The dollar DXY index rebounded from close to a three-year low, bounding away from 90.00 level for third successive day while Treasury yields rose as investors braced for Congressional talks to avert a government shutdown Friday. The loonie weakened a second day before a BOC rate decision due later Wednesday, while EM currencies traded in the red.

The euro slipped from a fresh cycle high, yet held comfortably above $1.22 even as ECB officials urged caution over the common currency’s strength. Overnight, a chorus of ECB speakers warned on the euro’s growing strength, with Constancio and Nowotny added to Villeroy’s comments yesterday, totaling three ECB speakers warning on EUR moves. Specifically, Nowotny said Euro exchange rate must be observed, while Constancio said he is worried EUR moves don’t reflect fundamentals; says changes to ECB’s forward guidance won’t be immediate.

Overall dollar weakness and growing optimism about the outlook of the European economy in 2018 has lent fresh legs to the euro’s rally after it gained more than 10 percent last year.

But the speed of the rise in the opening days of 2018 — up more than 3 percent in the last two weeks — has invited some comments from ECB officials this week, highlighting some growing concerns, according to analysts.

“The ECB is playing the good cop and the bad cop in terms of their comments over the euro but there is no doubt the currency’s rally has sowed the seeds of uncertainty in the ids of ECB policymakers,” said Viraj Patel, an FX strategist at ING in London.

The Canadian dollar traded at C$1.2452 per dollar off its three-month high of C$1.2355 hit on Jan 5. The Bank of Canada is seen as likely to raise its benchmark interest rate by 25 basis points to 1.25 percent later in the day, with analysts expecting three hikes this year.

Bitcoin extended its sharp tumble of the past 24 hours, skidding more than seven percent on Wednesday as investors were spooked by fears regulators might clamp down on the digital currency. The price of the world’s biggest and best known cryptocurrency fell to as low as $10,567 on the Luxembourg-based Bitstamp exchange.

In US Treasuries, the belly and long end of UST curve resume flattening with UST futures close to overnight lows after a large Aussie bond syndication. The UST/Bund spread widened 2.5bps, while a large number of BTP futures blocks sees Italy underperform versus rest of Europe. Crude futures push lower after Brent fails to hold above $70/bbl again, metals steady and the Bitcoin selloff continues if so far supported by the key $10k level.

Earnings are expected from Bank of America, Goldman Sachs and Alcoa. Federal Reserve is set to release its Beige Book, and macro data includes industrial production and manufacturing production

Market Snapshot

S&P 500 futures up 0.37% to 2,793.00
STOXX Europe 600 unchanged to 398.29
VIX
MSCI Asia Pacific down 0.09% to 182.66
MSCI Asia Pacific ex Japan down 0.02% to 594.11
Nikkei down 0.4% to 23,868.34
Topix down 0.2% to 1,890.82
Hang Seng Index up 0.3% to 31,983.41
Shanghai Composite up 0.2% to 3,444.67
Sensex up 0.8% to 35,060.64
Australia S&P/ASX 200 down 0.5% to 6,015.81
Kospi down 0.3% to 2,515.43
German 10Y yield fell 1.0 bps to 0.552%
Euro down 0.2% to $1.2238
Italian 10Y yield fell 3.1 bps to 1.703%
Spanish 10Y yield fell 0.6 bps to 1.496%
Brent Futures down 0.3% to $68.96/bbl
Gold spot down 0.2% to $1,335.53
U.S. Dollar Index up 0.3% to 90.63

Top Overnight News from Bloomberg

U.S. House Freedom Caucus’s Meadows: House doesn’t appear to have enough votes to pass current stopgap funding measure without Democratic support
Fed’s Kaplan (non-voter): base case is for 3 hikes this year; may need to be more aggressive to keep economy from overheating
ECB’s Nowotny: EUR appreciation is not helping; ECB has no exchange rate goal so we must only watch it in terms of economic developments
ECB’s Constancio: worried about sudden EUR moves that do not reflect fundamentals; changes to forward guidance will not be immediate
Robert Bogucki, who is the former head of New York foreign- exchange trading at Barclays Plc’s investment bank was charged for his alleged role in defrauding a client with a front-running scheme, the U.S. Justice Department said
Recent euro appreciation “is not helping,” ECB Governing Council member Ewald Nowotny tells reporters
Dallas Fed President Kaplan said he expects three rate increases this year, according to interview with WSJ
Euro zone Dec. F CPI unrevised y/y at 1.4%; Core CPI unrevised 0.9%



Asia’s major stock markets traded mostly negative following a weak performance in the US, where the main indices reversed from record levels on political concerns including the looming government shutdown deadline and reports that former Trump strategist Steve Bannon was subpoenaed by Special Counsel Mueller. Furthermore, some also suggested profit taking in overbought conditions after both the S&P 500 and DJIA notched historical feats at the open in which they briefly rose above the 2800 and 26000 levels respectively for the 1st time ever. ASX 200 (-0.5%) and Nikkei 225 (-0.3%) were negative as losses in miners continued to weigh on Australia, while risk appetite in Japan remained sapped by the recent JPY strength. Elsewhere, Hang Seng (-0.4%) pulled back from yesterday’s record close and the Shanghai Comp. (+0.6%) bucked the trend after another firm liquidity effort by the PBoC, although a slump in Shenzhen stocks provided some mainland jitters as the ChiNext board for small cap and tech firms fell to its lowest since July after blockchain-related stocks tumbled in the wake of the crypto-chaos. Finally, 10yr JGBs were subdued as prices failed to benefit from a broad risk-averse tone, while today’s Rinban announcement was also uneventful in which the BoJ maintained its purchase amounts in the belly to short-end.

Top Asian News

The Ex-Goldman Banker Who Quit to Take Over a Myanmar Empire
India Cuts Planned Extra Borrowing to $3.1 Billion; Bonds Climb
Philippines’ BPI to Raise up to 50B Pesos in Rights Offer
BOJ Could Cut Stimulus Without Sparking Rate Surge, Moody’s Says
India Is Said to Mull Selling HPCL at Not More Than 9% Premium
Third HNA Unit Halted From Trading, Pending ’Major Matter’

European equity markets are lower, echoing the tone seen in Asia and the US, with Informa (-8.6%) shares propping up the FTSE 100 after reports that the company is in talks to merge with UBM, whose shares are up 12.5%. Burberry (-8.1%) shares are also lower after a disappointing trading update although tech shares outperform, lifted by ASML (+4.6%) after the chipmaker reported better than expected profit.

Top European News

Juncker: Even if U.K. Leaves, We’d Facilitate Re- Accession
Heathrow Plans Sloping Runway to Cut Costs by $3.4 Billion
Melrose Makes Firm $10.2 Billion Offer to Acquire GKN



In FX, the ECB have continued to sound the alarm over the strengthening currency with Vice-President Constancio and Austrian Central Bank Governor Nowotny both echoing comments made yesterday by France’s Villeroy. Constancio said he is concerned about sudden movements that do not reflect fundamentals while Nowotny said the strengthening Euro is not helpful. The comments helped EUR/USD to session lows before finding support ahead of 1.2200 before today’s inflation data. Elsewhere, the USD has shown some signs of a recovery with USD/JPY approaching 111.00 and USD/CAD above 1.2450 ahead of the Bank of Canada decision

In commodities, WTI and Brent crude futures are both marginally lower in early European trade as markets look ahead to the weekly API inventory data (delayed to today following the MLK holiday). Gold and silver prices have generally tracked movements in the USD. Kuwait oil minister says compliance with production cuts stood at 125% in December; until now there is no plan or intention to exit the supply cut agreement. Niger Delta Avengers state that oil attacks are imminent.

Looking at the day ahead, there is the final revisions to the December inflation figures for the Euro area. The ECB’s Nowotny will speak at a conference in Vienna and BOE’s Saunders will also speak in London. In the US, the most significant release of note is the December IP print, while the January NAHB housing market index is also due. Late in the evening we’ll get the Fed’s Beige Book, while the Fed’s Evans and Mester are scheduled to speak shortly after. Bank of America and Goldman Sachs are due to report Q4 earnings.

US Event Calendar

7am: U.S. MBA Mortgage Applications, Jan. 12, no est., prior 8.3%
9:15am: U.S. Industrial Production MoM, Dec., est. 0.5%, prior 0.2%; Capacity Utilization, Dec., est. 77.4%, prior 77.1%
9:15am: U.S. Manufacturing (SIC) Production, Dec., est. 0.3%, prior 0.2%
10am: U.S. NAHB Housing Market Index, Jan., est. 72, prior 74
4pm: U.S. Total Net TIC Flows, Nov., no est., prior 151b; Net Long-term TIC Flows, Nov., no est., prior 23.2b

Central Banks

10am: Bank of Canada Rate Decision, Jan. 17, est. 1.25%, prior 1%
2pm: U.S. Federal Reserve Releases Beige Book
3pm: U.S. Fed’s Evans and Kaplan Speak on Economy and Monetary Policy
4:30pm: U.S. Fed’s Mester Discusses Monetary Policy Communication



DB’s Jim Reid concludes the overnight wrap

Talking of US equities, the melt up in the short-term continued at the open yesterday with the main indices cracking through 2,800, 26,000 and 7,300 for the first time and up around 1% at the very early session highs, partly supported by positive corporate results. However the rest of the day was spent reversing the moves and we closed -0.35%, -0.04% and -0.51% lower for the S&P 500, Dow and Nasdaq. The S&P’s intraday move of 1.41% was the largest seen since early December and the fifth highest change since December 2016. Within the S&P, losses were led by energy and materials stocks, in part as Brent crude oil retreated 1.58% yesterday, after rallying c40% from its recent lows in August. Further, GE’s shares also weakened -2.93% after announcing a $6.2bn charge related to its old portfolio of long term care insurance.

Elsewhere, the VIX jumped 14.76% higher to 11.66 – the fourth highest close since mid-September, while Bitcoin dropped c23% yesterday, weighed down by concerns of potential regulatory crackdowns. The crypto currency is partly recovering this morning, but is still down c41% since its recent high of $18,675 back in mid-December.

Turning to government bonds, core European 10y bond yields were 2-3bp lower (Gilts -2bp; Bunds -2.5bp), in part following a slightly dovish Reuters report where three unnamed sources noted the “ECB is unlikely to ditch a pledge to keep buying bonds at its meeting next week”. Although Reuters also noted that “any fundamental change to guidance was likely to come later, with the March meeting, when policymakers get updated forecasts….seen as a more likely option”. From where we were a week ago this is still more hawkish. Elsewhere, the UST 10y yields fell 1bp.

Staying on the topic of QE, the ECB’s Villeroy noted “we are predictable as to the direction of our policy and the sequencing, but we’re not pre-committed in terms of precise timing”, with the final outcome contingent on the progress on inflation. Further, he added “we did not say anything about what will happen after September, and our monetary policy is not driven by market expectations”. Elsewhere, he noted the recent change in the Euro is a “source of uncertainty which requires monitoring with regard to its possible downward effects on imported prices”.

Following on, the Bundesbank’s Weidmann noted the markets expectation that ECB interest rates won’t rise before the middle of 2019 “seems to be grosso modo in line with the current forward guidance of the government council”. On QE, he seems to have softened his stance a little, noting “if the positive development continues, it would be logical not to make substantial purchases beyond those already decided upon”.

This morning in Asia, markets have followed the US lead and are trading modestly lower. The Nikkei (-0.27%), Kospi (-0.40%) and Hang Seng (-0.37%) are all lower, with the latter weighed down by energy and discretionary consumer stocks. Turning to other markets performance from yesterday, European bourses were mixed but little changed with the Stoxx (+0.13%) and DAX (+0.35%) up modestly, while the FTSE fell 0.17% weighed down by energy and mining stocks. In contrast to the VIX, the Vstoxx was up only 2.5% to 11.35.

However the US only dipped into negative territory after Europe went home. Turning to currencies, the Euro initially weakened on news of a setback to Germany’s coalition talks but strengthened c0.6% post Weidmann’s comments to close broadly flat, along with Sterling. In commodities, precious metals softened slightly (Gold -0.12%; Silver -0.93%) while other base metals were broadly lower (Zinc -0.1%; Copper -1.3%; Aluminium -1.64%).

Away from markets, our team in China have published a summary of the 16th dbAccess China Conference which featured 27 speakers presenting their views on China’s economy from different perspectives. Some of the key takeaways include: i) China’s economic growth will slow in 2018 as policymakers shift focus to growth quality, ii) but GDP will likely be revised up in 2019 as a result of the economic census. This could provide room for lower growth in the next few years while maintaining the goal to double GDP by 2020, iii) monetary policy will remain tight and fiscal policy will tighten. Local governments will face tight constraints on its financing platforms and PPP projects, iv) real estate market will cool down and smaller real estate developers will face tight financing pressures and v) supply-side reform will continue its momentum in 2018, while SOE reform may gradually gain speed. For more details, please refer to their report.

In Germany, there was a setback to its efforts to form the next coalition government. Yesterday, the Berlin branch of the SPD voted against (21-8) the preliminary accord between Ms Merkel’s bloc and the SPD. As a reminder, votes at the SPD’s regional branches are non-binding and the larger branch of North Rhine-Westphalia which accounts for c25% of the votes remains undecided.

Nonetheless, it does partly illustrate the division within the party ahead of the crucial vote this Sunday where c600 SPD delegates will be attending. Elsewhere, the caucus chief of Ms Merkel’s CDU party Volker Kauder noted formal coalition talks between the two sides after SPD’s approval can be done fairly quickly, he said “there doesn’t have to be so much to be negotiated that we can’t achieve in two weeks”.

In the US, efforts to avoid a partial government shutdown from this Friday are still evolving, with Republican leaders weighing a move to extend the deadline until 16 February with the proposed measure not expected to include the DACA program. The main points of contention include lifting automatic budget caps on government spending, resolving the status of deferred action protections for undocumented immigrants who arrived in the US as children (the DACA program), and funding of the Children’s Health Insurance Program (CHIP).

Further, there is also the issue of securing enough votes in the Senate where the Republican may need 9 votes from the Democrats to pass a spending bill. Finally onto Brexit, the BOE’s deputy governor Sam Woods noted that the inclusion of UK based financial services firms in free trade deals with the EU post Brexit “is entirely technically feasible”, with a potential agreement “within a three year period from now”. Elsewhere, the EU side may still be hoping for a reversal of Brexit, with the EU Council President Tusk noting “if the UK government sticks to its decision to leave, Brexit will become a reality…unless there is a change of heart among our British friends” and “….our hearts are still open (to Britain)”, while the EC Chief Juncker said “our door still remains open”.

Before we take a look at today’s calendar, we wrap up with other data releases from yesterday. In the US, the January empire manufacturing index was below expectations at 17.7 (vs. 19), with the decline mainly due to an increase in inventories. Notably, the prior reading was upwardly revised by 1.6 and the sixmonth- ahead indices for general business conditions, capex and employment all strengthened this month.

In the UK, the December headline CPI was in line at 0.4% mom, but the core CPI was lower than expected at 2.5% yoy (vs. 2.6%) – the first monthly decline since June. Elsewhere, both the December core PPI and RPI was above market expectations, at 2.5% yoy (vs. 2.3%) and 4.1% yoy (vs. 3.9%) respectively. In Germany and Italy, the final readings for the December inflation were both unrevised at 1.6% yoy and 1% yoy respectively.

Looking at the day ahead, there is the final revisions to the December inflation figures for the Euro area. The ECB’s Nowotny will speak at a conference in Vienna and BOE’s Saunders will also speak in London. In the US, the most significant release of note is the December IP print, while the January NAHB housing market index is also due. Late in the evening we’ll get the Fed’s Beige Book, while the Fed’s Evans and Mester are scheduled to speak shortly after. Bank of America and Goldman Sachs are due to report Q4 earnings.






3. ASIAN AFFAIRS

i)Late TUESDAY night/WEDNESDAY morning: Shanghai closed UP 8.07 points or 0.24% /Hang Sang CLOSED UP 78.66 pts or 0.25% / The Nikkei closed DOWN 83.47 POINTS OR 0.35%/Australia’s all ordinaires CLOSED DOWN 0.51%/Chinese yuan (ONSHORE) closed WELL UP at 6.4348/Oil UP to 63.48 dollars per barrel for WTI and 68.74 for Brent. Stocks in Europe OPENED ALL RED. ONSHORE YUAN CLOSED UP AGAINST THE DOLLAR AT 6.4348. OFFSHORE YUAN CLOSED DOWN AGAINST THE ONSHORE YUAN AT 6.4364 //ONSHORE YUAN MUCH STRONGER AGAINST THE DOLLAR/OFF SHORE SLIGHTLY WEAKER TO THE DOLLAR/. THE DOLLAR (INDEX) IS MUCH STRONGER AGAINST ALL MAJOR CURRENCIES. CHINA IS VERY HAPPY TODAY.(GOOD MARKETS )

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This is quite a hit: USA banks over $1 billion on the big European Steinhoff collapse
(courtesy zerohedge)
US Banks Lose Over $1 Billion On Steinhoff Collapse

It’s not just the ECB that was humiliated for holding Steinhoff bonds: so were all major US banks.

As we have documented this earnings season, one after another major US bank, from JPM, to Citi, to Bank of America and Goldman reported that they have suffered direct losses in the hundreds of millions on their exposure to the scandal-plagued company.

According to a Bloomberg summary, the 4 of the biggest US banks have revealed more than $1 billion in mark-to-market losses and charge-offs on margin loans and other debt tied to the embattled South African retailer in their Q4 results. Citigroup was at the top, with $370 million in losses, followed by Bank of America Corp.’s $292 million, JPMorgan with $273 million and Goldman with $130 million.



“Once in a while, something doesn’t turn out the way we want because that’s what the definition of taking risk is,” Bank of America CEO Brian Moynihan told reporters Wednesday, saying the incident wouldn’t change the lender’s risk appetite.

To an extent the losses and charge-offs were expected: one month ago we reported that global banks were on the hook for some $21 billion as part of the Steinhoff implosion. What is surprising, however, is seeing just how substantial the losses are when flowing through the P&L, and also how profound the artificial sense of security created among the banking community, in this case thanks to the ECB also being on the hook for losses due to its purchases.

The bigger question is what happens if and when other fallen angels suffer the same fate as Steinhoff, are downgraded from Investment Grade to junk, and are kicked out of the ECB’s balance sheet, forcing US banks to take losses as they did with Steinhoff.

How much of a problem will this be for Draghi, and US commercial banks? As we showed last month, Using S&P’s historical rating transition matrices, BofA estimates that €7bn of corporate bonds that the ECB own will end up as Fallen Angels prior to maturity (by bonds impacted, this is equivalent to €38bn of total outstanding debt). The chart below shows that over the last decade, the price drop severity of Fallen Angels has been declining. But if the ECB become a motivated seller of downgraded credits, we feel this dynamic could reverse.



In conclusion, and in Bank of America recently warned, credit investors should anticipate more pronounced price drops in names that migrate from IG to HY next year.

“After all, there may now be a big buyer (ECB) behind some of these credits that chooses to become a seller upon downgrade.”

The silver lining – if only for deep junk investors – is that Falling Knives, and further bank losses, may soon produce a source of technically cheap BBs for yield-starved investors to mull over. Then again, if for whatever reason the rug is pulled out from under the junk bond market, suddenly everything else will be surprisingly cheap too.
5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

A good look at the Ukrainian/Russia and USA situation with respect to the Crimea and Donbass that may trigger a cold war

(courtesy Turd Ferguson/TFMetalsReport)

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Dollar Plunges To Weakest Since 2014 – Cable, Euro, Gold Surge

Another day, another drop for the dollar index…





To its lowest level since Dec 2014…

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Thanks Harvey Always Good <3 https://www.silverdoctors.com/tag/harvey-organ/
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MMgys

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