Nov 19/GLD falls in inventory by 2.1 tonnes to 720.91 tonnes/SLV adds 2.396 million oz to its inventory/Gold and silver on a roller coaster ride today/Bankers defend their $1200 gold/Gold bulls defend $1180.00

My website is now ready but we still have to add a little  stuff to it.  You can find my site at the following url:

harveyorganblog.com

I will continue to send the  comex data down to my good friends at the Doctorsilvers website on a continual basis.

They provide the comex data. I also provide other pertinent data that may interest you. So if you wish you can view that part on my website.

Gold: $1193.60  down $3.10
Silver: $16.29  down 12  cents

In the access market 5:15 pm

Gold $1182.00
silver $16.15

Gold and silver had  a huge roller coaster ride today..

(described below)

The gold comex today had a poor delivery  day, registering  0 notices served for nil oz.

Silver comex registered 0 notices for nil oz.
A few months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 254.20 tonnes for a loss of 49 tonnes over that period. .

In silver, the open interest fell slightly  despite yesterday’s gain in price ( 12 cents).  It looks like we have a few nervous shorts in silver racing against the clock to cover some of their shortfall!! The total silver OI  remains extremely high with today’s reading  at 173,075 contracts. The big December silver OI contract marginally lowered to 71,638 contracts. The high December OI is huge news as those longs remain firmly planted ready to take on the bankers.

In gold we had a huge gain in OI as yesterday we saw a gain in price of gold to the tune of $13.60.  The total comex gold  OI rests tonight quite elevated at 459,657  for a gain  of a 2,651 contracts. The December gold OI rests tonight at 196,083 contracts which had a smallish contraction of 8606 contracts. We lost some of the paper longs into February .

In trading of the gold and silver today, gold started to rocket northbound during the early hours reaching its zenith at  3 am this morning at $1201.  Then gold started to swoon a little and by the time comex opened gold was trading at 1193. 00  Immediately gold was ready to take on the bankers as gold was again ready to test 1200 gold level.  However immediately after the second London fix, the bankers threw around 80 paper tonnes of gold which knocked gold down to $1176.00.  It was at this point that the gold bulls rejected the piercing of resistance level $1180 gold as gold hovered at this level for the next few hours and  then something  strange happened as a tremendous force of buying drove gold very close to $1200 again before the bankers knocked to down to close at $1193.60 at comex closing time. This is the first time in a row that the bankers have orchestrated a huge raid and all three times, outside day reversals drove gold in the opposite direction.  Only a sovereign could be that force.  It is now China/Russia against the USA bankers.  I will put my money on China/Russia.

In the access market, the bankers again used non backed gold contracts to force gold to settle at $1182.

Silver reached its pinnacle at exactly the same time 3 am reaching $16.45 upon which the bankers were not impressed and they whacked the metal all the way back to $15.93 level at around 10 am once the London fix was over.  However as opposed to gold, silver rose immediately at stayed around the 16 dollar mark only to join forces with gold when huge buying came into force.

Silver reached its high at around $16.45 at 12:30 pm est.

The bankers then tried to cool the jets of silver  (along with gold).  Silver settled at $16.29 at comex closing time.

In the access market it finished at $16.15

 

 

Here is Dave Kranzler of IRD, talking about the fraud orchestrated by the bankers on gold and silver:

 

Central Bank Intervention In Gold Strikes Again

 

.

I woke up this morning with a gut feeling that the precious metals market was about to be hammered on.  After all, we had 3 pretty good days in a row, something which must have horrified the Central Planners.   Gold was up over $1200 overnight until just after London a.m. “price fix.”  Have a look:

Untitled

As you can see, from 10:30 a.m. (EST) to 10:45, 2.8 million ozs of gold were dumped onto the Comex.  This forced a rapid $20 price plunge.  There were no apparent news or event triggers.  Zerohedge attributes the hit to the possibility that the Big Banks got ahold of the FOMC minutes early or the latest results from the Swiss gold referendum were leaked.  I say bullshit to both.

The price of gold never rallied on the possibility that the Swiss referendum would pass so why would it get hit if the referendum fails?  I have maintained all along that it will not pass because, regardless of the actual popular vote, the U.S. will work with the Swiss authorities – who openly oppose the referendum – to make sure the vote fails.

Gold was smashed because the sector began to gather momentum over the past 3 trading days and that momentum had to be crushed.  The western paper gold manipulators are getting squeezed by the physical market right now, per the highly negative LBMA GOFO rate:

Untitled

The GOFO rate is the cost for a gold/cash swap.  When it’s negative, it means that someone needs to borrow physical gold and will use cash to collateralize the loan.   A negative GOFO rate indicates extreme tightness in the physical gold bar market.  Not surprisingly, the LBMA has announced that it will stop publishing the GOFO rate in January.  Gee, I wonder why..

The GOFO – gold forward rate is -.24 for 1 month.  This is the most negative that it’s been since April 2000.   It’s negative out to 6 months right now, which is rare.  As you can see from the graph above, it rarely goes negative.  The huge spike into negative territory in 1999 was right around the time that Bank of England infamously announced that it was gong to unload 50% of its gold reserves, or 400 tonnes.   This was necessitated by a huge short squeeze in the physical gold bar market.

To put the 80 tonnes of paper gold dumped today into perspective, the latest gold warehouse report shows only 25 tonnes of physical gold classified as “registered,” or available to be delivered.  That’s if you trust the numbers and Ted Butler is the only analyst I know who does.  So more than 3 times the amount of available to deliver physical gold was unloaded in paper form on the Comex in the space of 15 minutes.

As of yesterday, there were still 570 tonnes of December paper gold open contracts (196,083 contracts).  If just 10% of these decided to stand for delivery, the Comex has a problem.  This especially true given the tight condition of the LBMA gold market right now.

So you can see the incentives in place for the Fed/Treasury to attack the gold market using paper.  India, China and Russia are currently removing more gold from the market than is produced every day.  The potential for massive short-squeeze is brewing.

 

 

end

 

Today, we had a loss of 2.10 tonnes of gold  gold Inventory at the GLD / inventory rests tonight at  720.91 tonnes.

In silver,  wow!! the SLV inventory rose by 2.396 million oz  tonight:

SLV’s inventory  rests tonight at 349.296 million oz.

 

 

end

 

 

We have a few important stories to bring to your attention today…

Let’s head immediately to see the major data points for today.

First:  Most GOFO rates: move again  deeper in backwardation!!

OH!!! OH!!

Most months basically moved deeper into backwardation

Now, the first 4 months of GOFO rates( one, two, three and six month GOFO) moved  deeply into the negative with the 6th month GOFO now negative again and in  backwardation. The front one month GOFO moved every so slightly towards the positive but still very deep into backwardation.  On the 22nd of September the LBMA stated that they will not publish GOFO rates. However today we still received today’s GOFO rates.

It looks to me like these rates even though negative are still fully manipulated.

London good delivery bars are still quite scarce.

The backwardation in gold is incompatible with the raid on gold . It does not make any economic sense.

Nov 19 2014

1 Month Rate: 2 Month Rate 3 Month Rate 6 month rate 1 yr rate

-.24.00%            -0.1675%           -0.1175%     – .0100%          + .1050%

Nov 18 .2014:

1 Month Rate 2 Month Rate 3 Month Rate 6 month Rate 1 yr rate

-.2175%         -.17%           -1175%           -0199%       +10750%

end

Let us now head over to the comex and assess trading over there today,

Here are today’s comex results:

The total gold comex open interest rose by a wide  margin of 2,651 contracts from 457,006 up to 459,657  with gold up by   $13.60  yesterday. I guess the bankers will continue to sell non backed paper on a continual basis whereupon major entities are taking on those bankers like today. It seems that we now have a major entity going after gold as well as silver.  The front delivery month is November and here the OI rose by 1 contract. We had 0 delivery notices filed  yesterday so we gained 1 contract or  100 additional gold ounces will stand for the November contact delivery month. The big December contract month  saw it’s Oi fall by a normal 8,606 contracts down to 196,083. Most of the selling  December longs  rolled into February.   The estimated volume today was weak at 114,262 .  Today the boys seemed a little timid providing the paper and counted on Bart’s boys (HFT) to carry the load. The confirmed volume yesterday was very good at 204,142.  Strangely on this 17th day of notices, we  had 0 notices filed for nil oz.

And now for the silver comex results.  The total OI fell sharply by a tiny 542  contracts from 173,617 up to 173,075 despite the fact that  silver was up 12 cents yesterday. It seems that judging from silver’s OI, our banker friends are still very nervous as they try to cover their massive shortfall in silver but to no avail as raids no longer work.   In ounces, the total OI   represents a total of 865 million oz or 123.6% of annual global supply.  We are now in the non active silver contract month of November and here the OI remained constant at 88. We had 0 notices filed yesterday so we neither gained nor lost any  silver contracts oz that will stand for the November contract month.  The big December active contract month saw it’s OI fall by only 6,601 contracts down to 71,638.   A normal contraction now is around  7,000 contracts per day  on a roll. The December contract month remains highly elevated for this time in the delivery cycle.  In ounces the December contract  is represented by 358 million oz or 51.1% of annual global production  (production = 700 million oz – China). The estimated volume today was poor at 30,104.  The confirmed volume yesterday  was huge at 61,790. (and OI drops?) We also had 0 notices filed  today for nil oz.

I have been corrected on the first day notice.  It will be on Friday, Nov 28.2014 the day after Thanksgiving. That will be exciting as nobody will be around.We thus have 6 more  comex sessions.

Data for the November delivery month.

November initial standings

Nov 19.2014

Gold

Ounces

Withdrawals from Dealers Inventory in oz nil
Withdrawals from Customer Inventory in oz 32,935.900 oz (HSBC,Scotia)includes 900 kilobars
Deposits to the Dealer Inventory in oz nil
Deposits to the Customer Inventory, in oz nil
No of oz served (contracts) today  0 contracts(nil oz)
No of oz to be served (notices) 20 contracts (2000 oz)
Total monthly oz gold served (contracts) so far this month  1392 contracts  (139,200 oz)
Total accumulative withdrawals  of gold from the Dealers inventory this month    80,623.1  oz

Total accumulative withdrawal of gold from the Customer inventory this month

 565,588.6 oz

Today, we had 0 dealer transactions

total dealer withdrawal:  nil   oz

total dealer deposit:  nil oz

we had 2 customer withdrawal:

i)  Out of HSBC:  28,935.900 oz  (900 kilobars)

ii) Out of Scotia:  4,000.000 oz (exactly to 3 decimals)

how can this be possible?

we had 0 customer deposits:

 

total customer deposits : nil  oz

We had 0 adjustments:

Total Dealer inventory: 868,910.561 oz or   27.02 tonnes

Total gold inventory (dealer and customer) =  8.172 million oz. (254.20) tonnes)

Several weeks ago we had total gold inventory of 303 tonnes, so during this short time period 49 tonnes have been net transferred out. We will be watching this closely!

Today, 0 notices was 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 contracts  of  which 0 notices were stopped (received) by JPMorgan dealer and 0  notices were stopped (received) by JPMorgan customer account.

To calculate the total number of gold ounces standing for the November contract month, we take the total number of notices filed for the month (1392) x 100 oz to which we add the difference between the OI for the front month of November (20) – the number of gold notices filed today (0)  x 100 oz  =  the amount of gold oz standing for the November contract month.

Thus the  initial standings:

139,200  (notices filed today x 100 oz + (  20) OI for November – 0 (no of notices filed today)= 141,200 oz or 4.39 tonnes.

We gained 100 oz of gold standing for the November contract month.

And now for silver

Nov 19/2014:

 November silver: initial standings

Silver

Ounces

Withdrawals from Dealers Inventory  602,665.13  oz  (CNT)
Withdrawals from Customer Inventory 158,117.915 oz
(,Scotia, CNT,Delaware)
Deposits to the Dealer Inventory nil
Deposits to the Customer Inventory 1,084,875.600 oz (CNT,Scotia)
No of oz served (contracts) 0 contracts  (nil oz)
No of oz to be served (notices) 88 contracts (440,000 oz)
Total monthly oz silver served (contracts) 156 contracts 780,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month  1,383,689.0 oz
Total accumulative withdrawal  of silver from the Customer inventory this month 7,505,950.4 oz

Today, we had 0 deposits into the dealer account:

 total dealer deposit: nil oz

 

 

we had 1 dealer withdrawal:

 

i) Out of CNT:  602,665.13 oz

total  dealer withdrawal: 602,665.13  oz

We had 3 customer withdrawals:

i) Out of CNT:  40,208.85 oz

ii) Out of  Delaware:  14,687.705 oz

iii) Out of Scotia:  103,220.96  oz

total customer withdrawal  158,117.515  oz

We had 2 customer deposits:

i) Into Scotia:  488,472.100 oz

ii) Into CNT:  596,403.500 oz

total customer deposits: 1,084,875.600      oz

we had 1 adjustment

 

Out of the Delaware vault:

 

72,532.413 oz was adjusted out of the customer and this landed into the dealer account of Delaware/

Total dealer inventory:  64.820 million oz

Total of all silver inventory (dealer and customer)   178.329 million oz.

The total number of notices filed today is represented by 0 contract or nil 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 (156 ) x 5,000 oz to which we add the difference between the total OI for the front month of November88) minus  (the number of notices filed today (0) x 5,000 oz =   the total number of silver oz standing so far in November.

Thus:  156 contracts x 5000 oz  +  (88) OI for the November contract month – 0 (the number of notices filed today)  = amount standing or 1,220,000 oz of silver standing.

we neither gained nor lost any silver ounces standing today.

It looks like China is still in a holding pattern ready to pounce when needed.

For those wishing to see data on the currencies and bourse closings you can see it on my site at harveyorgan.wordpress.com

 

 

end



The two ETF’s that I follow are the GLD and SLV. You must be very careful in trading these vehicles as these funds do not have any beneficial gold or silver behind them. They probably have only paper claims and when the dust settles, on a collapse, there will be countless class action lawsuits trying to recover your lost investment.

There is now evidence that the GLD and SLV are paper settling on the comex.



***I do not think that the GLD will head to zero as we still have some GLD shareholders who think that gold is the right vehicle to be in even though they do not understand the difference between paper gold and physical gold.  I can visualize demand coming to the buyers side:


i) demand from paper gold shareholders

ii) demand from the bankers who then redeem for gold to send this gold onto China

 

vs no sellers of GLD paper.

 

 

And now the Gold inventory at the GLD:

 

Nov 19.2014: we lost 2.1 tonnes of gold/Inventory back to 720.91 tonnes.  No doubt physical gold is heading to China.

Nov 18.2014: no change in inventory/ Inventory level 723.01 tonnes

Nov 17.2014; we had a huge addition of 2.39 tonnes of gold added to the GLF inventory/inventory rests tonight at 723.01 tonnes. They may be running out of metal to give China!!!

Nov 14. we had no change in gold inventory at the GLD/inventory 720.62 tonnes

nov 13. we lost another 2.05 tonnes of gold at the GLD/Inventory at 720.62 tonnes

Nov 12.2014; we lost another 1.79 tonnes of gold at the GLD/Inventory at 722.67 tonnes

This gold left the shores of England and landed in Shanghai.

Nov 11.2014: we lost another 0.900 tonnes of gold at the GLD/Inventory 724.46 tonnes

Nov 10. we lost another 1.79 tonnes of gold at the GLD/Inventory 725.36 tonnes

Nov 7 wow!! we lost another huge 5.68 tonnes of gold at the GLD/inventory 727.15 tonnes

Nov 6.2014: we had another huge withdrawal of 2.99 tonnes of gold. Inventory 732.83 tonnes

This gold is also heading to Shanghai.  If I was a shareholder of GLD I would be quite concerned as there will be no real gold inventory left per outstanding shares.

Nov 5 we had another huge withdrawal of 3.000 tonnes of gold.  This gold will be heading to Shanghai/GLD inventory 735.82 tonnes

Nov 4.2014: a huge withdrawal of 2.39 tonnes of gold/GLD inventory/738.82 tonnes

Nov 3.2014: no change in gold inventory at the GLD/741.21 tonnes

Oct 31.2014: no change in gold inventory at the GLD despite the raid/inventory at 741.21 tonnes

October 30.2014: we had another 1.2 tonnes of gold leave the GLD and heading to Shanghai/Inventory 741.21 tonnes

October 29.2014: we had another .99 tonnes of gold removed from the GLD/inventory 742.40 tonnes

Today, Nov 19. a loss of 2.1 tonnes of gold  inventory

inventory: 720.91 tonnes.

The registered  vaults at the GLD will eventually become a crime scene as real physical gold  departs for eastern shores leaving behind paper obligations to the remaining shareholders.   There is no doubt in my mind that GLD has nowhere near the gold that say they have and this will eventually lead to the default at the LBMA and then onto the comex in a heartbeat  (same banks).

GLD :  720.91 tonnes.

It has been pointed out that John Paulson owns 13.4 million oz or  323 tonnes. He thus owns almost 45% of the entire GLD.

He is a solid supporter of gold and has so far refused to liquidate any of his gold. I am sure that this will be a problem for our bankers if they continue to sell physical gold to China as at some point the shorts will have to supply the real metal as the GLD will be void of gold along with the Bank of England.

 

 

end

 

 

 

And now for silver:

 

Nov 19.2014: a huge addition of silver inventory to the tune of 2.396 million oz/inventory 349.296 million oz

Nov 18.2014; no change in silver inventory  346.90 million oz

Nov 17.2014 .SLV inventories remain constant tonight at 346.90 million oz

Nov 14.2014; wow!! we had an addition of 2.012 million oz into the SLV/inventory at 346.900 million oz

Nov 13. no change in silver inventory at the SLV/344.888 million oz.

Nov 12.2014: no change in silver inventory at the SLV/inventory rests tonight at 344.888 million oz.  And please note that gold leaves GLD/silver does not.  Why? there is no physical silver at the SLV..just paper obligations.

Nov 11.2014: no change in silver inventory at the SLV/inventory rests tonight at 344.888 million oz.

Nov 10/ we had an addition of 1.438 million oz of silver into inventory at the SLV/Inventory 344.888 million oz  (again note the difference between gold and silver)

Nov 7/ 2014/no change in silver inventory/inventory rests at 343.45 million oz.  (please note the difference between silver (SLV) and gold  (GLD)

Nov 6.2014: no change in silver inventory/(as of 6 pm est) inventory rests at 343.45 million oz.

Nov 5  today, the total silver inventory drops of 2.074 million oz/SLV inventory: 343.45 million oz

Nov 4.2014: wow!! we had another addition of 1.151 million oz of silver inventory/SLV inventory rises to 345.524

Please note the difference between GLD and SLV.  The GLD has physical gold to send on its way to Shanghai/SLV has no silver to offer to the participants to give to various players..

Nov 19.2014  an addition of 2.396 million oz of silver inventory at the SLV/349.296 million oz

Note the difference between GLD and SLV.  GLD falls in inventory and SLV rises. Why? because SLV has no physical silver for the participants to raid to supply mints and China.

 

end

 

 

 

And now for our premiums to NAV for the funds I follow:

Note:  Sprott silver fund now deeply into the positive to NAV

Sprott and Central Fund of Canada.
(both of these funds have 100% physical metal behind them and unencumbered and I can vouch for that)

1. Central Fund of Canada: traded  at Negative 10.4% percent to NAV in usa funds and Negative   10.6% to NAV for Cdn funds!!!!!!!

Percentage of fund in gold  61.5%

Percentage of fund in silver:38.00%

cash .5%


( Nov 19/2014)   

2. Sprott silver fund (PSLV): Premium to NAV rises to positive 4.18% NAV (Nov 19/2014)  

3. Sprott gold fund (PHYS): premium to NAV  falls to negative -0.38% to NAV(Nov 19/2014)

Note: Sprott silver trust back hugely into positive territory at 4.18%.

Sprott physical gold trust is back in negative territory at  -0.38%

Central fund of Canada’s is still in jail.

 

 

end

 

 

And now for your most important physical stories on gold and silver today:

Early gold trading form Europe early Tuesday morning:

 

the following is huge!!  Why on earth would Putin broadcast what he is doing with gold?

 

(courtesy Goldcore/Mark O’Byrne)

 

Gold Rises After Unusual Russian Central Bank Gold Buying Announcement

Published in Market Update  Precious Metals  on 19 November 2014

By Mark O’Byrne

 

Russia’s central bank bought about 150 metric tons of the metal this year, announced Governor Elvira Nabiullina yesterday. The pronouncement immediately created buying in the market, prompting gold to rise to a two week high at $1,200 an ounce.

Head of Russian Central Bank Elvira Nabiullina -Jr/Bloomberg

Russia’s central bank Governor Elvira Nabiullina told the lower house of parliament about the significant Russian gold purchases. She is an economist, head of the Central Bank of Russia and was Vladimir Putin’s economic adviser between May 2012 to June 2013.

This announcement is unusual and to our knowledge has not happened before. The announcement by the Russian central bank governor was likely coordinated with Putin and the Kremlin and designed to signal how Russia views their gold reserves as a potential geopolitical and indeed financial and currency war weapon.

Gold currently constitutes for around 10% of the bank’s gold and forex reserves, she added. Official purchases were about 77 tons in 2013, International Monetary Fund data show.

MARKET UPDATE
Today’s AM fix was USD 1,200.75, EUR 957.61 and GBP 766.08 per ounce.
Yesterday’s AM fix was USD 1,202.00, EUR 959.68 and GBP 767.81 per ounce.

Gold climbed $10.40 or 0.88% to $1,196.80/oz yesterday. Silver rose $0.06 or 0.37% to $16.22/oz.
Gold remained firm at $1,200 an ounce as the market digested very robust Russian central bank demand and announcement and await next week’s Swiss gold referendum and later today, the U.S. Federal Reserve minutes at 1900 GMT.

If the Fed increases interest rates it could hurt non-interest-bearing gold in the short term. However rising interesting rates are more bearish for stocks and bonds as was seen in the rising interest period of the 1970s when gold prices surged.

The Swiss gold referendum is around the corner on November 30th and if passed this could force the Swiss National Bank to keep 20% of its holdings in gold bullion, force the SNB to repatriate gold holdings and end all gold sales.

The dollar hit a seven-year high against the yen today. Silver was up 0.5%  at $16.24 an ounce. Spot platinum was up 0.5% at $1,206.65 an ounce, while spot palladium was flat at $769.98 an ounce.

Shares fell in Europe and Asia on Wednesday while the dollar rose broadly, hitting a new seven-year high against the yen, as investor nervousness on the diverging outlooks for the world’s major economies.

The dip in gold prices has spurred purchases from Asia. Trading volumes on the Shanghai Gold Exchange’s (SGE) benchmark bullion spot contract jumped this week and India’s imports surged in October.

Russian President Vladimir Putin holds a gold bar while visiting an exhibition at Russia’s Far Eastern gold mining center of Magadan November 22, 2005. Putin on Tuesday supported the idea of boosting the share of gold in Russia’s central bank reserves, which are the largest of any country outside Asia. (Photo: REUTERS/ITAR-TASS/PRESIDENTIAL/)

The International Monetary Fund said the latest figures showed an almost double jump over the country’s registered purchases of 77 tonnes in 2013. It said that historically, Russia started buying gold again since the end of September, perhaps at an initial 35 tonnes.

Nabiullina, who said the bank’s total foreign reserves is made up 10 percent of gold, likewise told the Russian parliament on Tuesday there is no need to place restrictions on gold exports. A number of lawmakers had proposed to put a moratorium on the exports of the safe haven yellow metal so the country would be able to secure enough gold amid the sanctions it is experiencing.

Buy Gold Bars in the Safest Way and at the Lowest Prices

 

end

 

I am again sending down to you the big story of yesterday just in case you missed it..namely the disappearance of gold from the central vaults of the Ukraine

 

(courtesy Chris Powell/GATA)

 

 

One way or another, Ukraine’s gold reserves have gone away

Section:

1:23p ET Tuesday, November 18, 2014

Dear Friend of GATA and Gold:

Zero Hedge reports today that one way or another, Ukraine’s gold reserves have disappeared:

http://www.zerohedge.com/news/2014-11-18/ukraine-admits-its-gold-gone

A report about their supposed removal from Kiev in the dead of night last March is posted at GATA’s Internet site here:

http://www.gata.org/node/13754

The refusal of the gold-vaulting Federal Reserve Bank of New York to disclose to GATA in March whether it had taken custody of the Ukrainian reserves is here:

http://www.gata.org/node/13761

The U.S. State Department never responded to GATA’s inquiry.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

 

 

end

 

At least somebody here is trying to promote their industry not like the deadbeat gold/silver miners

 

(courtesy London’s Financial times)

 

 

 

 

Platinum miners realize that their metal is money

Section:

Maybe gold miners will figure it out for their own metal eventually as well.

* * *

Platinum Producers Launch Trade Body to Attract Asset Investors

By Arthur England
Financial Times, London
Tuesday, November 18, 2014

JOHANNESBURG, South Africa — The world’s top platinum producers have joined forces to launch an industry promotional body on Tuesday in an effort to increase demand for the precious metal as an investment asset.

The World Platinum Investment Council will be based in London and funded by Anglo American Platinum, Impala, Lonmin, and three smaller mining companies.

The launch comes at a time when the industry is grappling with rising costs and a weak price environment, which is in part blamed on oversupply in the market coupled with increased recycling. …

… For the remainder of the report:

http://www.ft.com/intl/cms/s/0/cb2a1b7e-6e44-11e4-bffb-00144feabdc0.html

 

 

end

 

A huge story on the German gold repatriation with none other than Peter Boehringer the leader of the campaing to repatriate German gold.  He tells that the movement to repatriate is strong as its citizens do not want gold on foreign soil  Peter believes the USA gold has been sold off.

 

(courtesy Peter Boehringer/Kingworldnews/Eric King)

 

 

 

 

German gold repatriation movement is going strong, Peter Boehringer tells KWN

Submitted by cpowell on Wed, 2014-11-19 04:54. Section: 

11:55p ET Tuesday, November 18, 2014

Dear Friend of GATA and Gold:

Contradicting propaganda from mainstream financial news organizations, German Precious Metals Society founder Peter Boehringer, a leader of Germany’s gold repatriation movement, tells King World News tonight that the movement is going strong and that citizen action will return the nation’s gold reserves to its own soil. An excerpt from the interview is posted at the KWN blog here:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/11/19_I…

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

 

 

end

 

I am glad that we are getting some traction after Bill Holter’s open letter to the industry last month:

 

(courtesy Jim Otis/GATA)

 

Jim Otis: An open letter to monetary metals mining executives

Submitted by cpowell on Wed, 2014-11-19 04:59. Section: 

12:01a ET Wednesday, November 19, 2014

Dear Friend of GATA and Gold:

In an essay posted at Kitco, blogger Jim Otis itemizes the simple ways monetary metals mining companies could fight suppression of the price of their product in the futures markets. Otis’ advice is headlined “An Open Letter to Mining Company Executives” and it’s posted here:

http://www.kitco.com/ind/Otis/2014-11-14-An-Open-Letter-to-Mining-Compan…

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

end
Late in the morning with gold in the dumpster:
(courtesy zero hedge)

Gold & Silver Surge, Recover Swiss Gold Poll Losses As EURCHF Hits Lows

 

 

It appears the FX and Precious Metals markets have as much faith in the pre-Swiss Gold Referendum polls as the Scots did before their referendum. The clearly leaked results sparked considerable weakness in gold and silver (and EURCHF surge), but once the data was released, markets began to creep back – perhaps questioning the plausibility of such a big swing in such a short amount of time. This surge was also helped by some unusually frank comments on Russian gold buying from the Russian Central Bank.  Gold, Silver, and EURCHF have all recovered the moves with the latter pressing towads cycle lows…

 

 

And EURCHF has roundtripped to cycle lows…

 

Charts: Bloomberg

 

end

 

(courtesy Ben Davies/Kingworldnews/Eric King/Gata)

 

Gold is being pounded to discourage support for Swiss initiative, Davies tells KWN

Section:

4:41p ET Wednesday, November 19, 2014

Dear Friend of GATA and Gold:

British fund manager Ben Davies tells King World News today that the recent pounding on gold is part of central bank efforts to deter Swiss voters from supporting the gold initiative that will be decided at referendum on November 30. But Davies adds that the risk and reward factors are now more favorable for gold than for any other investment. An excerpt from the interview is posted at the KWN blog here:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/11/19_M…

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

 

Koos Jansen speculates on the reason for the gold sales from the Washington accord of 1999:

 

(courtesy Koos Jansen)

 

 

 

Koos Jansen: Why did European central banks sell gold?

Section:

10:53a ET Wednesday, November 19, 2014

Dear Friend of GATA and Gold:

Focusing on the Netherlands Central Bank’s reduction of its gold reserves, Bullion Star market analyst and GATA consultant Koos Jansen asks why the European central banks sold (or purported to sell) so much gold from the announcement of the Washington Agreement on Gold in 1999 through 2010, when such sales stopped almost completely. Jansen cites a comment by the Dutch treasury secretary in 2011 in support of his speculation that the gold sales may have been intended to help redistribute amd equalize official gold reserves around the world.

This is exactly what the U.S. economists and fund managers Paul Brodsky and Lee Quaintance speculated in 2012 — that central banks were moving their gold around so that nations would be better prepared for a complete resetting of the world financial system, in which gold would play an important part for building confidence:

http://www.gata.org/node/11373

Of course on a planet with actual financial journalism, mainstream news organizations would question central banks about this — and about everything else central banks do. Since we’re living on Earth, Jansen’s citing the Dutch parliamentary archive and posing the question it suggests will have to suffice today. His commentary is headlined “Why Did European Central Banks Sell Gold?” and it’s posted at Bullion Star here:

https://www.bullionstar.com/blog/koos-jansen/why-did-european-central-ba…

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

 

 

Another important commentary from Bill Holter
today
(courtesy Bill Holter/Miles Franklin)
Why don’t you believe them?
David Cameron, Prime Minister of Britain wrote an article which was published in The Guardian yesterdayhttp://www.theguardian.com/commentisfree/2014/nov/16/red-lights-global-economy-david-cameron .  The headline “Red lights are flashing on the global economy” in my opinion is very true  what he followed the headline with was not.  In this article which was penned after leaving the G-20 summit, Mr. Cameron went on to mostly tell the truth about the global woes but was very careful to exclude Great Britain.  To me, this sounded like some sort of “whistle stop” campaign about how well Britain is being managed and their risk is the possibility of being tipped over by global events.
  “Well managed” he purports?  This is not even close to being so and the “austerity” he speaks of is only a pipe dream and no longer even an option.  I would ask him a few questions were he willing to take any, such as “didn’t Britain try austerity for 6 months or so only to find out it cannot be implemented without an economic and financial implosion”?  I might even ask him how he feels now that Britain sold 60% of their gold reserves at the worst prices possible since 1979 …but that wouldn’t be a gentlemanly question would it?
  In any case, let’s look at the headline ..”red lights are flashing on the dashboard of the global economy”.  This is true nearly all over the world.  As a matter of fact, the “engine” for global growth just announced one of their diesel tanks as empty.  It’s been discovered that China’s “shadow banking system” had a huge increase in bad debthttp://www.zerohedge.com/news/2014-11-16/chinas-shadow-banking-grinds-halt-bad-debt-surges-most-decade.  Understand that this is not the “core” banking system but this did add to China’s growth acting as an afterburner of hot and easy credit.  A reversal of this credit will surely drag on the economy and will probably even surprise the complacent as to where it shows up.  “Where” being further news on hypothecated, re hypothecated and re re re hypothecated commodities.  We still don’t know fully how the warehouse frauds uncovered earlier in the year will fall, a decline in credit from the shadow banking system can only reveal more fraud!
  So David Cameron “covered his butt” with the headline, when the time comes he can now say “I told you so, you should have listened to me”.  Unlike David Cameron who is still in office and trying to cover his reputation, there are two ex U.S. government officials who are and have been telling you the truth for years, Paul Craig Roberts and David Stockman.  Mr. Roberts was asst. Treasury Secretary from 1975-1978 and David Stockman was the Director of OMB under Reagan.  When I read or first heard their opinions I can remember thinking “WOW, this guy is from the government and telling the truth!”.  This is still so today and both of these men seem to be getting louder and much more urgent in their warnings.  Neither hedges nor flip flops in their opinions which I respect as much as I do their logic.  They have been and are telling you the absolute truth and doing so in my opinion out of pure “character”!  They both say “it’s over” from a mathematical standpoint, I don’t understand why anyone even questions what they say?
  Another ex “federal” employee who has been boisterous lately is Alan Greenspan.  I have recently written how he is out selling books and trying to clean up his legacy.  Part of this has been to admit gold in fact is money, it is better than any fiat ever and that there will be “great financial difficulties” at some point.  Mr. Roberts and Mr. Stockman, unlike Alan Greenspan, are not out on the speaking circuit trying to clean up their legacies, they are firmly and cleanly intact.  They I believe are trying to help anyone who would listen while Alan Greenspan’s motive in my opinion is one of “don’t blame me, I warned you”.
  There are others of course but these four will suffice for what I am trying to get across to you.  “why don’t people believe them”?  Yes I know, if you are reading this then you probably do believe them but why don’t the masses?  I have an opinion on this, I think most people know “something” is wrong, VERY wrong.  Many don’t really know what it is and wouldn’t really understand it unless handed to them on a platter.  Most people are not “wired” to understand economics or finance.  Some, many, are just too worn down by daily life to bother “figuring it out” while others (MANY) just want to bury their heads in the sand …because the truth is just too ugly to bare!
  I do understand the concept of the masses being slowly and methodically being “dumbed down” over the years.  Notice I used the word “methodically” which in my mind includes “intent”.  I say this because a knowledgeable and well informed population is hard to pull the wool over their eyes …a dumbed down population on the other hand will (has) stand by and accept things the “way they are”.  This is important because our “money” system is fake and fraudulent, sadly only one or two out of 100 in the West understands this.  The rest of the world still “gets it” which is why Western vaults are being raided by Eastern buyers.
  Once all is said and done, the majority in the West will finally get it but unfortunately this will be too late.  I have always said that “one second too late is equal to a lifetime”, unfortunately this is the case.  “We” cannot save the masses as they will not listen for whatever their personal reasons.  What we can do is try.  I would urge anyone reading this to pass my writings along to friends and loved ones that you care about.  When you come across Paul Craig Roberts or David Stockman’s writings or anyone else “who makes sense” …forward it!  Yes I know, you have tried this and either lost friends or became the “black sheep fool of the family”.  All you can do is try!  Time is very short now, we know this because the Achilles Heel, gold supply, has become very tight.  We know this because even career politicians like David Cameron have told you.  We know this because many Western nations have already proposed and signed “bail ins” where bank balances will be stolen upon the financial collapse.  We know this for so many various reasons, not the least of which is your own common sense.
  To finish, I want to link to Mr. Roberts and Stockman’s latest work.  Does it sound like things are a “little bad”?  Or does it sound like the system is hopelessly broken?  Please understand this if nothing else,  Stockman and Roberts have no ax to grind whatsoever. They worked in government during a time when “serving your country” was still the mindset.  Please read their latest,  http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/11/15_David_Stockman_On_Monetary_Breakdown_%26_Skyrocketing_Gold.html   and   http://www.paulcraigroberts.org/2014/11/14/global-house-cards-paul-craig-roberts/     these are their honest opinions!  It’s over …and only a matter of time until our world reflects this fact!  Regards,  Bill Holter
end

And now for the important paper stories for today:

Early Wednesday morning trading from Europe/Asia

1. Stocks  down with major  Asian bourses   with a  lower yen  value falling to 117.58

1b Chinese yuan vs USA dollar  (yuan weakens) to 6.14084

2 Nikkei down 55 points or 0.32%

3. Europe stocks mixed  /Euro rises/ USA dollar index up at 87.65.

3b Japan 10 year yield at .48% (Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 117.68

3c  Nikkei now above 17,000

3e  The USA/Yen rate crosses back over the 117 barrier

3fOil:  WTI  74.82   Brent:    79.00 /all eyes are focusing on oil prices.  A drop to the mid 60′s would cause major defaults.

3g/ Gold up/yen down;  yen well above 117 to the dollar/at fresh 7 year lows.

3h/ Japan is to buy the equivalent of 108 billion usa dollars worth of bonds per MONTH or $1.3 trillion

Japan’s GDP equals 5 trillion usa/thus bond purchases of 26% of GDP

3i  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 (see Von Greyerz)

 

3j  Japanese GDP plummets/sales tax hike will no doubt be delayed and

Snap election  called. Stimulus of 26 billion usa to be initiated.

3k  Chinese home sales suffer/iron ore plummets as does copper

3l Gold at $1199.50 dollars/ Silver: $16.26

4.  USA 10 yr treasury bond at 2.34% early this morning.
5. Details:

Ransquawk/Bloomberg/Deutche bank/Jim Reid
(courtesy zero hedge/your early morning trading from Asia and Europe)

 

 

 

All Eyes On The Freefalling Yen Which Just Plunged To Fresh 7 Year Lows

Tyler Durden's picture

Submitted by Tyler Durden on 11/19/2014 06:55 -0500

Once again all eyes are on the carry-trade driving Yen, whose avalance into oblivion is picking up speed, and where the formerly unimaginable USDJPY level of 120 aspresented here in September, is now looking like this week’s business, with the only question how long until Albert Edwards’ next target of 145 is hit leading to nuclear currency warfare between Japan, Korea, China and ultimately, the US and Europe. Unfortunately, for Japan, at this point the terminal currency collapse will do nothing to incrementally boost exports or its economy, and the former Japan finmin was on the tape warning again that the Japanese recession will persist as USDJPY over 115 is now hurting Japan, something which should by now have been clear to most.

Then again with a money-printing Keynesian lunatic in charge, for whom there is now no turning back, Japan really has no options. The good news, at least for the US which is now openly pulling the strings behind Japan’s monetary policy, is that the soaring Yen will continue to drag correlation algos higher, and send the S&P500 to fresh all time highs even as the Japanese economy is devastated.

In other news, the much hyped Stock Connect between China and Hong Kong is a dud with volumes plunging and CLSA calling it a ghost traing. According to Bloomberg, about 2.6 billion yuan, or 20%, of the 13 billion yuan northbound daily quota was taken on day 3 of the link vs 100% and 37% on the 2 opening days. Of the Shanghai connect stocks, 242 were up, and 249 down; of the Hong Kong connect stocks only 81 were up, while 159 down.

Worse, the commodity rout continues, with the slide in iron ore prices has been a particular focus in the commodity complex with Dalian iron futures hitting a second consecutive record low as data in China continues to fail to impress. Nonetheless, precious metal prices have continued to see support with spot gold managing to break out of its tight overnight range to touch the USD 1,200/oz level

European equities enter the North American crossover mostly in the green after picking up off their worst levels which were seen earlier in the session following overnight weakness in Asian equities and pulling back some of yesterday’s gains. In terms of the rebound, nothing fundamental has been attributed the move higher, although it does coincide with the Gilt-led softness seen in fixed income products following the less dovish than expected BoE minutes release, which also saw short-sterling reverse its earlier flattening pattern. Despite the upside for European stocks, the FTSE 100 trades in the red as the continuing decline in iron prices has placed weight on the mining-heavy FTSE index, with names such as Rio Tinto and Antofagasta seeing a bout of underperformance.

Bulletin Headlines Summary

  • GBP/USD pulls off session lows following a less dovish than anticipated BoE minutes release, which has also placed pressure on fixed income products.
  • European equities trade mostly in the green with no sustained direction, although the FTSE 100 underperforms as Iron ore miners continue to feel the squeeze of the slide in iron ore prices.
  • Looking ahead, attention turns towards the release of US housing starts, building permits, DoE crude oil inventories and of course the FOMC minutes release.
  • Treasuries decline with core euro zone sovereigns amid heavy corporate issuance calendar and as investors awaits release of minutes from Fed’s October meeting.
  • Bank of England policy makers voted 7-2 to keep the key interest rate at a record low this month as some of the majority began to raise concerns about potential inflation pressures
  • Obama plans to issue a reprieve for undocumented immigrants whose children were born in the U.S., part of an order that would shield between 4m and 5m from deportation, according to people familiar with the proposal
  • Prime Minister Shinzo Abe invoked the American Revolution in calling a snap election and shelving a further increase in a tax that sank Japan into recession
  • BOJ’s Kuroda secured a wider majority today and warned inflation could fall below 1% after the world’s third- largest economy slid into recession
  • Keystone XL pipeline backers came up one vote short in the Senate and vowed to try again in January, when they expect to have enough support to send a bill to Obama
  • Sovereign yields mostly higher. Asian stocks mostly lower. European stocks gain, U.S. equity-index futures lower. Brent crude and gold higher, copper falls

One of the more notable movers in FX markets has been GBP following the BoE minutes. Despite residing at session lows in anticipation of an overtly dovish release, GBP saw a sharp move higher as the report revealed a 7-2 split and was not as dovish as some had expected. More specifically, particular focus was paid on comments that a tighter labour market is likely to lead to wage growth soon and the fact that the MPC majority said there is a risk of inflation overshooting the 2% target. Furthermore, CAD has continued to weaken with weakness being attributed to the failure of the Keystone pipeline bill to be passed in the Senate which would have seen the construction of an oil pipeline from Canada to US gulf refineries. Additionally, the decline in iron ore prices has filtered through to FX markets, with AUD seen lower throughout overnight and European trade with yesterday’s jaw-boning of the AUD and cross-related selling in AUD/JPY also placing further weight on the Antipodean currency. Elsewhere, overnight, USD/JPY broke back above 117.00 to trade at its highest since

COMMODITIES

The slide in iron ore prices has been a particular focus in the commodity complex with Dalian iron futures hitting a second consecutive record low as data in China continues to fail to impress. Nonetheless, precious metal prices have continued to see support with spot gold managing to break out of its tight overnight range to touch the USD 1,200/oz level. In the energy complex, despite opening lower following last nights API inventories which revealed a build of 3700k vs. Prev. drawdown of 1500k, energy prices have ebbed higher throughout European trade as participants look ahead to today’s DoE inventories with the headline expected to reveal a drawdown of 1500k, a number which is higher than initially forecasted.

 

DB’s Jim Reid Concludes the Overnight Recap

So after much excitement yesterday following Prime Minister Abe’s snap election announcement, sales-tax delay and planned stimulus package all eyes have turned to the BoJ meeting this morning. In terms of the headlines, as expected QE has remained steady at ¥80tn annually with the board having voted 8-1 in favour. After last month’s 5-4 vote it seems consensus has been built around the new measures which will be a relief to policy makers, especially after the measures announced this week. Taking a closer look at the details, the central bank notes that the outlook in Japan’s economy is ‘expected to continue its moderate recovery trend, and the effects including those of the subsequent decline in demand following the front-loaded increase prior to the consumption tax hike are expected to dissipate gradually’. CPI is expected to remain at the current level for the time being whilst there is some mention that QQE is so far exerting its intended effects with the Bank expected to continue with stimulus for as long as necessary to achieve the 2% target. The result is certainly a positive for Kuroda following what was largely a split decision last month on extending QE. The press conference takes place as we go to print so this is worth keeping an eye on for Kuroda’s take on this week’s fiscal events.

In terms of how markets are reacting post BoJ, the Nikkei is currently trading -0.14% having opened around +0.7% stronger and then declining to trade -0.3% lower post the decision. The JPY has weakened a further 0.37% versus the Dollar to now trade at 117.29 and mark a seven year low. Elsewhere bourses are mixed around Asia. The CSI 300, Hang Seng and Kospi are +0.11%, -0.41% and -0.01% respectively.

As well as the BoJ news to digest today, we’ve also got the FOMC minutes to look forward to later. It’s easy to make an argument either way with regards to what we might expect. On the one hand, we could make a case that the details could be something of a non-event with the focus shifting immediately to the December meeting. On the other hand DB’s Joe Lavorgna summed it up well at the start of the week, commenting that the statement from the October 28th- 29th meeting was notably more hawkish than expected, particularly with regards to the economy and upgrading its assessment of the labour market. Joe also mentions the lack of commentary around a stronger dollar or recently tightening financial conditions, so conceivably these could be mentioned. All in all the key will be whether the minutes rubber stamp the edging up in hawkishness or whether it will throw the doves an olive branch.

Whilst on the US, the S&P 500 continues to extend its record closing highs (+0.51%) after trading in a relatively narrow range over the past week. As well as being supported from the positive tone extending from Abe’s announcement, macro data did little to dampen sentiment. The NAHB housing market index surprised to the upside with the 58 print ahead of expectations of a 55 reading. Digging deeper into the details, all three subcomponents of the index – present conditions, expectations and buyers traffic – rose along with gains in all four regions of the country to cause the index to print just short of September’s post recession high (59). Our US colleagues point out that the NAHB series leads housing construction by around six months and so they expect a marked improvement in residential construction over the next couple of quarters, boosting total housing-related spending which they feel is enough to sustain a 3%-plus real GDP growth over next year. – a pretty bold call. Meanwhile the PPI reading for October was relatively strong. The headline (+0.2% mom) reading and ex. food and energy print (+0.4% mom) beat expectations of -0.1% and +0.1% respectively. Away from the macro prints, the Fed’s Kocherlakota was in the press once again, this time commenting that the Fed is risking its credibility by not acting aggressively enough to bring inflation back up to its 2% target. He also reiterated that inflation will not rise back to this target until 2018 with the potential for a turnaround in inflation through 2015 ‘very unlikely’. Treasuries were generally stronger across the board, the 10yr rallying 2bps whilst the DXY closed down 0.33% at the end of play.

Turning our focus to Europe yesterday, the Stoxx 600 closed +0.61% and the Euro rallied +0.67% versus the Dollar following an unexpectedly stronger German ZEW survey print with the 11.5 reading (0.5 expected) marking the first rise in German investor confidence for eleven months. Closer to home, UK CPI data was largely in line. The +1.3% yoy headline figure a touch higher than the +1.2% consensus although the core print came in slightly under expectations at +1.5% yoy (vs. +1.6% yoy expected). DB’s George Buckley noted that despite yesterday’s print showing a slight rise, he is revising his forecasts down to +0.9% by year end, rising to +1.6% in 2015 and then +1.9% in 2016, highlighting in particular that December will be a likely flashpoint for the CPI given the +6.4% rise in household energy bills last year not being repeated and thus taking 0.3% off the headline rate. Interestingly George also points out a move in sterling could take over three years to fully impact CPI inflation, suggesting that the annual rise in Sterling to peak in July this year will likely impact CPI towards the end of 2016. Elsewhere the RPI print came in line at +2.3% yoy whilst PPI input was softer at -8.4% yoy (-8.3% yoy expected). Gilts closed flat and elsewhere 10y Bunds ended 0.5bp firmer. Credit markets generally underperformed, Xover finished 4bps wider over the day although we highlight that this was perhaps due to more technical factors around significant new issuance. New issuance in the US market is also causing some indigestion.

Just wrapping up the market moves yesterday, WTI and Brent extended declines, down 1.68% and 1.21% respectively and have continued to trade weaker overnight. Ahead of the OPEC meeting next week, the FT has reported the apparent lack of consensus between members which is underlying the struggles the group is facing given surging US output. In terms of an outcome for the meeting, a disagreement between members is surely a worst case scenario so it will be interesting to see if we hear any of the major producers align comments in the mean time.

In terms of the highlights today, we kick off in Europe this morning with the September construction output print (market looking for +1.5% mom) along with current account data whilst later in the day we expect to hear from the ECB’s Praet speaking on the ‘long-term financing of the economy’ in Frankfurt. As well as this, we will be keeping an eye on the BoE’s November minutes today. Over in the US and away from the highlighted FOMC minutes we have October building permits and housing starts data (DB expecting 1.1m versus 1.025m consensus) and the MBA’s new mortgage applications. Given the strong NAHB print yesterday it will be interesting to see whether today’s housing data confirms the trend.

end

During the night we learn that Chinese home prices are in a deep slump and with this, we get iron ore prices plummeting.  Remember that the Chinese banking sector needed iron ore plus copper and other commodities as collateral to finance construction of homes etc
(courtesy zero hedge)

 

China Home Price Slump Sends Iron Ore Plunging To 2009 Lows (-50% In 2014)

Tyler Durden's picture

Iron Ore prices crashed below the critical $70/mt level overnight, lows not seen since the bottom in 2009, as China’s home prices fell for the second month in a row, accelerating losses. Average property prices across China dropped 2.6% YoY in October (a bigger drop than September’s 1.2% YoY slip) with only 1 out of 70 cities seeing any positive price change (Zhengzhou +0.2% MoM). What is perhaps most entertaining is the 38.6% YoY rise in new home starts China just experienced – the biggest jump ever – as the first sign of demand (or hint from PBOC that they would ‘help’ with mortgages) and supply floods the market. The ‘market’ appears not to believe the hype.

China home prices continue to slide…

With 69 of 70 cities seeing falling prices…

Source: @M_McDonough

And that led to more weakness in Iron Ore (and copper) prices…

which is ironic because the Chinese homebuilders went crazy in October increasing new home starts by 38.6% YoY in October…!!

That will not end well.

 

 

end
We brought to your attention  (UKTelegraph) that China was unloading excess steel onto the uSA market.  Obama responded by introducing huge tariffs which certainly caused the Chinese to be angry at the uSA.  Maybe another reason for China to mount an attack on the comex for our two precious metals: silver and gold?
(courtesy zero hedge/Bloomberg)

Crashing Steel Prices Lead To Largest Chinese Bankruptcy, “Will Be Followed By Others”

With growth rates for steel products at or near record lows and prices for end-product having plunged to record lows, it is little surprise that the Steel industry would provide the largest Chinese bankruptcy yet in this cycle.As Bloomberg reports, unlisted Haixin Iron & Steel – which halted production and defaulted on CNY3 bn in March – has started bankruptcy proceedings. Having spent 8 months hoping for the government bailout that every Western onlooker believes is every firm’s god-given right, a reorganization application for the Wenxi, Shanxi province-based company (with $1.7 billion of total debt) was accepted by the Yuncheng City Intermediate People’s Court. This is just the start as “Haixin Group’s bankruptcy will be followed by others,” according to researcher Mysteel.com’s Chief Analyst Xu Xiangchun.

 

Output growth (or degrowth) of Steel product is near record lows and still prices are crashing…

As Bloomberg reports,

Haixin Iron & Steel Group, an unlisted Chinese steelmaker that halted production in March because of a capital shortage, started bankruptcy proceedings, making it the largest mill in the nation to enter the procedure.

 

A reorganization application for the Wenxi, Shanxi province-based company was accepted by the Yuncheng City Intermediate People’s Court, according to a statement posted on chinacourt.org, a government site that lists legal proceedings. Creditors are required to claim their rights by Feb. 22, the statement said.

 

China’s slowing economy and the country’s measures to tackle pollution are taking a toll on its steelmakers already plagued by industry overcapacity. Haixin Group’s bankruptcy will be followed by others, according to researcher Mysteel.com Chief Analyst Xu Xiangchun.

 

“Instead of reorganization efforts conducted by local governments, this is an inevitable trend that China will take more ailing steel mills to the courts to protect creditors,” Xu said by phone from Beijing.

 

 

Haixin Group has 10.5 billion yuan of debt, compared with 10.1 billion of assets, the official Xinhua News Agency reported yesterday, citing “public data.”

*  *  *
But apart from the entire Steel industry being on the verge of bankruptcy… China is doing great!

“There has to be a restructuring of the Chinese steel industry,” Eder said.

 

“The iron-ore producers are getting more and more aware that their growth expectations have to be redefined. There are enormous over-capacities and more is coming on stream. This will increase the pressure.”

*  *  *

Think it’s irrelevant – of course you do – except the yield on 3.50% govt bond due October 2015 up 5 bps to 3.660%; headed for biggest daily increase in 1-year sovereign yield since July 21, according to data compiled by Bloomberg.

*  *  *

But what should be really worrisome is the potential forglobal contagion (as Bloomberg adds),

It’s a big change. Every year for the past decade, China has added new mills with the capacity to exceed the annual production of Germany, the largest steelmaker in Europe. The surge in new blast furnaces created a consumption vortex, swallowing half the world’s iron ore and creating unprecedented wealth from Australia’s Pilbara region to Brazil’s Amazon basin. That gravy train, generating annual iron-ore sales of about $160 billion last year, is slowing.

 

The major flaw of producers of iron ore, the most traded commodity after oil, is they tend to be “over-bullish,” said Kirill Chuyko, head of equity research at BCS Financial Group in Moscow.

 

“Humans make mistakes,” said Chuyko, who thinks peak steel has been reached. “Chinese demand is going south.”

Surprise!! Artificially low rates and money-printing has led to massive mal-investment and the blowback is beginning

Mining giants have wagered $120 billion on belief that steel production in China won’t peak until as late as 2030. As the price of the key steelmaking raw material continued its descent to a five-year low today,it increasingly looks like they got that wrong. It’s a miscalculation that could have huge consequences for companies led by BHP Billiton Ltd. (BHP) and Rio Tinto Group.

 

“I’ve always taken the view that the miners had the best intelligence on this as large investment decisions are based on it,” Richard Knights, a mining analyst at Liberum Capital Ltd. said by phone. “But if they get it wrong by a just a small margin, that has major implications for profitability and the share price for years to come.”

*  *  *

end

What a farce!!  the Central Bank of Japan warns Abe over fiscal responsibility?..
(courtesy zero hedge)

Bank Of Japan Warns Abe Over “Fiscal Responsibility” While Monetizing All Its Debt

If one were to look up the definition of hypocrisy, the image of BoJ head Kuroda should be front-and-center.Having tripled-down on his money-printing and ETF-buying largesse just last week, he came out swinging last night at the government’s fiscal irresponsibility blasting Abe’s policies by saying Japan’s fiscal health “is the responsibility of parliament and the government, not an issue for the central bank to be held responsible for.” Aside from the fact that he is directly monetizing all JGB issuance – thus enabling Abe’s arrogant fiscal stimulus plan (by issuing 30Y and 40Y debt), Bloomberg notes that“Kuroda is making it crystal clear the government has to tackle the debt problem and if fiscal trust is lost that’s not going to be on the BOJ.” The world has truly gone mad.

 

Seemingly paying the same lip-service as Bernanke and Yellen in the US and Draghi in Europe, BoJ’s Haruhiko Kuroda is carefully positioning the blame for lack of growth and economic chaos on the government’s lack of growth-oriented policies… and not the central bank’s enabling experiments… (via Bloomberg)

Bank of Japan chief Haruhiko Kuroda emphasized the onus is on the government to strengthen its finances after Prime Minister Shinzo Abe postponed a sales-tax hike and outlined plans to boost fiscal stimulus.

 

“It’s the responsibility of parliament and the government, not an issue for the central bank to be held responsible for,” Kuroda said when asked about risks to Japan’s fiscal health. The BOJ’s job is to achieve its inflation target, he said at a press conference in Tokyo.

 

Kuroda’s repeated comments at a press conference today on the importance of fiscal discipline indicate the governor is unhappy and may signal a change in strategy, said Credit Suisse Group AG economist Hiromichi Shirakawa.

 

 

“Kuroda is making it crystal clear the government has to tackle the debt problem and if fiscal trust is lost that’s not going to be on the BOJ,” said Shirakawa, a former BOJ official. “This is true, but he used to highlight that the BOJ and the government were working together. Abe might have created an enemy by postponing the sales-tax hike.”

*  *  *

So when Japan finally goes entirely tits-up, we now know, it was all Abe’s fault… and nothing to do with reckless money-printing and leveraged buying of the nation’s stocks by a maniacal central banker…

Is this not the same as a price-cutting drug dealer blaming the drug-addicted customer for not being able to afford better drugs?

 

 

 end
Putin is becoming more and more of a leader and doing the right things despite sanctions against him.
(courtesy Bloomberg)

Putin Said to Stun Advisers by Backing Corruption Crackdown

 

 

by Evgenia Pismennaya and Irina Reznik  Nov 18, 2014 4:00 PM ET


Vladimir Putin
 sat motionless as the minister, seizing on the Russian leader’s first major meeting with his economic team in months, itemized the challenges.

A recession is imminent, inflation is getting out of hand and the ruble and oil are in freefall, Economy Minister Alexei Ulyukayev told Putin, according to people who attended the meeting at the presidential mansion near Moscow in mid-October. Clearly, Ulyukayev concluded, sanctions need to be lifted.

At that, Putin recoiled. Do you, Alexei Valentinovich, he asked, using a patronymic, know how to do that? No, Vladimir Vladimirovich, Ulyukayev was said to reply, we were hoping you did. Putin said he didn’t know either and demanded options for surviving a decade of even more onerous sanctions, leaving the group deflated, the people said.

Days later, they presented Putin with two variants. To their surprise, he chose an initiative dubbed “economic liberalization,” aimed at easing the financial burden of corruption on all enterprises in the country, the people said. It was something they had championed for several years without gaining traction.

The policy, which Putin plans to announce during his annual address to parliament next month, calls for a crackdown on inspections and other forms of bureaucratic bullying that cost businesses tens of billions of dollars a year in bribes and kickbacks, the people said. It entails an order from the president to end predatory behavior, with prosecution being the incentive for compliance, they said.

“Wastefulness, an inability to manage state funds and even outright bribery, theft, won’t go unnoticed,” Putin said at a meeting with supporters in Moscow yesterday.

Government Infighting

Russia’s growing isolation over its support for the separatist rebellion in Ukraine has created a divide among competing factions within Putin’s inner circle. One group, the “siloviki,” is dominated by men who share Putin’s background in the security services and reject U.S. hegemony. They’ve held the upper hand over another bloc, centered around Prime Minister Dmitry Medvedev, that favors less state control over the economy, according to five officials close to the president.

Putin’s spokesman, Dmitry Peskov, said he wasn’t aware of any specific “liberalization plan” and declined to comment on what the president plans to say in his address to parliament.

“We are constantly and purposefully cutting the bureaucratic burden on businesses,” Peskov said by phone. Ulyukayev declined to comment through his press service.

Putin’s Choice

Putin’s backing of the program marks a revival of sorts for the Medvedev faction, which advocates closer integration with the U.S. and Europe, a process now derailed by sanctions, as the path most beneficial to the country. This group, which includes Ulyukayev, had been sidelined since February, when the overthrow of Ukrainian President Viktor Yanukovych, Russia’s ally, spurred the siloviki to organize the annexation of Crimea.

Putin chose the corruption crackdown policy over the other option presented by his economic team: the “mega-projects” program. That path would further enrich two of his closest allies, billionairesGennady Timchenko and Arkady Rotenberg, by transfering huge sums of money to contractors.

With sanctions hurting more than anticipated, declaring a war on corruption is an “obvious” course of action and a sign of desperation, said Boris Makarenko, deputy director of the Center for Political Technologies in Moscow.

‘New Reality’

“Such measures are alien to the mentality of the government bureaucracy, whose natural instinct is to go for more of the same, more regulation, more squeezing revenues from businesses,” Makarenko said.

It was only in September and October that officials and executives fully realized that sanctions will be in place for a long time and that urgent measures are needed to limit the damage, according to Sergey Dubinin, the former central bank governor who is now chairman of state-run VTB Group, Russia’s second-largest bank.

“They were hoping the sanctions were temporary,” Dubinin said in an interview in the Russian capital. “Now they’ve woken up to the new reality.”

The call to action was triggered by the “shocking devaluation” of the ruble, which unfolded as the closure of foreign financial markets coincided with falling prices for oil, the country’s largest export, Dubinin said. That has sparked a cash crunch for companies that have $44 billion of debt due by year’s end, according to central bank estimates.

Oil Burden

Putin said last week Russia is prepared to withstand a “catastrophic” slump in oil prices. Brent, a benchmark for more than half of the world’s crude, has plunged 30 percent since the end of June. The ruble has declined the same amount against the dollar this year, the most of 24 emerging-market currencies tracked by Bloomberg.

Before the first round of sanctions were imposed in March, the government did a good job of creating a “favorable external environment” for Russian companies, even though corruption and other internal pressures remained burdensome, said Sergei Vasilyev, deputy head of state development bank VEB.

“Now the external environment has become very difficult, so we need to liberalize the internal environment to create better conditions for economic agents,” Vasilyev said. “Liberalization can help offset adverse external conditions without increasing the tax burden.”

Former Finance Minister Alexei Kudrin, who sits on the president’s Economic Council, said a successful campaign against extortion would be akin to cutting taxes without further weakening public finances. Corruption is one of the greatest obstacles to growth and if Putin pushes the policy with the same vigor he pursues security issues, the impact on the economy may be profound, Kudrin said in an interview.

Official Swindlers

“The key driver for the development of the country is citizens’ confidence in the economy,” Kudrin said. “The first thing to do is to limit the number of control and supervisory functions of the state. Authorities simply have to stop going to enterprises to swindle money. We have to limit fire, sanitary and technical inspections.”

In 2008, when Putin swapped jobs with Medvedev for four years, businesses were paying more than $200 billion a year in bribes, Moscow-based research group Indem said in a report that year, using data from prosecutors. Most Russians say corruption has only gotten worse since, according to a survey published byTransparency International.

A crackdown on inspections, if done right, could have an “immediate impact” on the economy, said MDM Bank (MDMB) Chairman Oleg Vyugin, who served as first deputy head of the central bank from 2002 to 2004. As it is now, law-enforcement agencies have a simple business model: the more they inspect, the more they earn, Vyugin said in an interview.

‘Economic Freedom’

“The economic powers of the Investigative Committee, the Prosecutor General’s Office and the police must be curbed,” Vyugin said. “This is the only way to convince people that it’s possible to develop a business here.”

There’s an irony about the U.S. and European sanctions that isn’t lost on the members of Putin’s economic team. While the penalties have pushed foreign investors away, they’ve also become the catalyst for meeting one of their key demands — rooting out corruption.

One of the major debates about the new program now is what to call it because Putin thinks “Economic Liberalization” sounds too western, according to one of the people who attended last month’s policy meeting. The frontrunner is “Economic Freedom” and everyone is praying he doesn’t change his mind, the person said.

To contact the reporters on this story: Evgenia Pismennaya in Moscow at epismennaya@bloomberg.net; Irina Reznik in Moscow at ireznik@bloomberg.net

 

 

end
Oh my goodness, another banker dead:
(courtesy zero hedge)

Senior Citi Banker Found Dead In Bathtub With Slashed Throat

The dust has barely settled on the latest high profile banker suicide in which Deutsche Bank’s associate general counsel, and former SEC regulator, Charlie Gambino was found dead, having hung himself by the neck from a stairway banister, and here comes the latest sad entrant in the dead banker chronicles of 2014 when earlier today, the Post reports, a Citigroup banker was found dead with his throat slashed in the bathtub “of his swanky downtown apartment, authorities said Wednesday.”

More:

Shawn D. Miller, Citigroup’s managing director of environmental and social risk management, was discovered around 3 p.m. Tuesday by a doorman in the Greenwich Street building, law enforcement sources said. “We are deeply saddened by this news and our thoughts are with Shawn’s family at this time,” said a statement sent out by Citigroup.

Bloomberg adds that “a 42-year-old man was found unconscious yesterday in the bathtub of his Greenwich Street apartment in lower Manhattan with a neck laceration and later pronounced dead, the New York Police Department said in a statement.”

Medics declared him dead after responding to an emergency call about 3:11 p.m. and an investigation to determine the cause of death is continuing, police said.

 

Miller advised executives and clients on sustainability matters, including environmental and social policies related to industries including mining and renewable energy, according to his LinkedIn profile. He helped oversee the development and implementation of policies in more than 100 countries.

 

“We are deeply saddened by this news and our thoughts are with Shawn’s family at this time,” Danielle Romero-Apsilos, a spokeswoman for the New York-based bank, told Bloomberg an e-mailed statement.

However, unlike previous more “clearcut” suicides, this time there may have been foul play: the Post adds that “there was no knife recovered at the scene, leading officials to suspect the death was not a suicide, and they were trying to determine who had access to his apartment.”

Miller did well: “one-bedroom apartments at the building are listed at more than $1 million.”

An online profile under the man’s name calls him a “pioneer in sustainable finance” and a specialist in emerging markets at the International Finance Corp., part of the World Bank. Several former colleagues told The Post that Miller was well-liked.

It was unclear why the doorman checked his apartment.

Miller’s LinkedIn profile is shown below:

end
And now your closing data for today from early morning until tonight:
Your more important currency crosses early Wednesday morning:

Eur/USA 1.2514 up .0064

USA/JAPAN YEN  116.68  up  .040

GBP/USA  1.5653  up .0017

USA/CAN  1.1287   down .0009

Eur/USA 1.2514 up .0064

This morning in  Europe, the euro is down, trading now well above  1.25 level at 1.2514 as Europe reacts to deflation and announcements of massive stimulation. Abe went all in with Abenomics with another round of QE purchasing 80 trillion yen from 70 trillion on Oct 31. And now he wishes to give gift cards to poor people in order to spend. The yen reversed like a yoyo last night as the world reacts to its crumbling GDP. It finally settled   in Japan down 4  basis points and settling above the 116 barrier to  116.68 yen to the dollar.  The pound is well up  this morning as it now trades well below  the 1.57 level at 1.5653.(very worried about the health of Barclays Bank and the FX/precious metals criminal investigation).  The Canadian dollar is up again today trading at 1.1287 to the dollar.

 Early Wednesday morning USA 10 year bond yield:  2.34% !!!  up 4  in  basis points from  Tuesday night/

USA dollar index early Wednesday morning:  87.61 down 31 cents from Tuesday’s close

end

The NIKKEI: Wednesday morning up 370 points or 2.18% (Abe’s helicopter route to provide free cash)

Trading from Europe and Asia:
1. Europe  all in the green

2/    Asian bourses all in the red except Japan      / Chinese bourses: Hang Sang  in the red, Shanghai in the red,  Australia in the red:  /Nikkei (Japan) green/India’s Sensex in the red/

Gold early morning trading:  $1200.00

silver:$ 16.26

Closing Portuguese 10 year bond yield:  3.13% down 2 in basis points on the day

 Closing Japanese 10 year bond yield:  .51% up 3 basis point from Tuesday.(scary!!)

Your closing Spanish 10 year government bond Wednesday/ up 1   in basis points in yield from Tuesday night.

Spanish 10 year bond yield:  2.13% !!!!!!

Your Tuesday closing Italian 10 year bond yield:  2.33% par  in basis points:

trading 20 basis points higher than Spain:

 IMPORTANT CLOSES FOR TODAY

Closing currency crosses for Wednesday night/USA dollar index/USA 10 yr bond:

Euro/USA:  1.2560 up .0028

USA/Japan:  17.83 up .960 !!!!

Great Britain/USA:  1.5693  up .0073

USA/Canada:  1.1328 up .0009

The euro rose nicely in value during this afternoon’s  session,  and it was up  by closing time , closing well above the 1.25 level to 1.2560.  The yen was down  badly during the afternoon session, and it lost 96 basis points on the day closing well above the 117 cross at 117.83.   The British pound gained back more  ground   during the afternoon session and it was up on the day closing  at 1.5693.  The Canadian dollar was up   in the afternoon but was down on the day at 1.1328 to the dollar.

Currency wars at their finest today.

Your closing USA dollar index:   87. 59  down 33 cents  from Monday.

your 10 year USA bond yield , down 1   in basis points on the day: 2.32%

European and Dow Jones stock index closes:

England FTSE down 12.53 or 0.19%

Paris CAC  up  3.81 or 0.09%

German Dax up 16.27 or 0.17%

Spain’s Ibex up 56.10 or  0.54%

Italian FTSE-MIB up  26.07    or 0.14%

The Dow: down 2.00 or .01%

Nasdaq; down 26.53   or 0.57%

OIL:  WTI 74.5.02  !!!!!!!

Brent: 78.47!!!!

end

And now for your big USA stories

 

 

Today’s NY trading:

 

(courtesy zero hedge)

Fed Warning Sends Small Caps Red For 2014

Tyler Durden's picture

The word “volatile” comes to mind when reflecting on today’s cross-asset class action. US equities dumped into and beyond the US open, decoupling entirely from JPY carry, only to reverse perfectly at the European close and recover all the way back to USDJPY right as the FOMC minutes hit. A kneejerk sent stocks higher but that quickly decoupled also and stocks fell. Small Caps underperformed and are back in the negative year-to-date. Treasury yields were volatile, ramping higher into the US open, rallying post, then whipsawing on FOMC minutes to close 3-4bps higher on the day.The USD was flat on the day despite the surge in USDJPY back above 118. Commodities were a mess with a big dump on Swiss Gold polls, rip higher on Russian buying rumors and dropped again on FOMC (oil and copper followed suit).HY Credit was “bidless” and continues to decouple from stocks (along with VIX). The Dow was levitated back into the green to close

On the day, Russell 2000 underperformed… and they tried their best to get The Dow green to prove how The Fed is right…

 

The Russell 2000 was down 1.8% this week, down 1.5% today, and had limped ungraciously back into the red for the year. before bouncing back into the FOMC Minutes release. Since then, it retreated rapidly and is now once again negative for 2014… which is odd given everyone proclaiming growth is back and the domestic economic exposure bias of small caps over big caps…

 

JPY Carry has decoupled…

 

HY Credit notably decoupling from stocks still

As Brean Capital’s Peter Tchir notes:

I have said since it happened it was particularly focused on the high yield market which had gone bidless and rather than finding real clearing levels they did the QE trick (it was more about hy then stocks). Today they admit the market was right to take their reaction as stepping in when vol increased. By adding the statements about misimpressions today they are resetting the Yellen put – to a lower strike. The bad thing is hy is weak again and it isn’t just shale and CCC that is going bidless – there is almost a daily blow up now whether here or in Europe.

And VIX continues to decouple…

 

 

Across the asset classes, quite a volatile day…

Commodities all broke aroun 1030ET when rumors of the Swiss poll results started…

 

Charts: Bloomberg

 

 

end

 

After the FOMC minutes were released which basically said nothing except that stocks will not be rescued, saw that USA/Yen cross rise over 118.00.  This is extremely inflationary to Japan and once 120 is hit, you will see countries in that region devalue their currency in order to trade.  This will set off a huge bout of global deflation (lack of demand)

 

(courtesy zero hedge)

 

USDJPY Hits 118 – Abe’s Worst Nightmare: Weaker Currency, Weaker Stocks

 

Having kneejerked higher, stocks read the most important section of the FOMC Minutes – that they will not be rescued next time – and decided it was time to take some off. This is clearly not acceptable and so USDJPY was leveraged ever higher and just broke 118.00. The problem is… US and Japanese stocks are entirely decoupled from this surge in the momentum igniter…

The JPY ignition is not working…

In Japanese stocks…

 

And US…

 

Since the FOMC Minutes…

 

Charts: Bloomberg

 

end

 

 

 

 

That is all for today

 

 

 

I will see you Thursday night

bye for now

Harvey,

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2 comments

  1. Congratulations Harvey for your new website. I am really glad you are back, finally ! Your daily posts were missing a lot. And it’s great you are publishing through WordPress! Many thanks for your work. – Sylvain, from CanadaNewsLibre.com

    Like

  2. I Love your work
    Great to see you back

    Like

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