Good evening Ladies and Gentlemen:
Here are the following closes for gold and silver today:
Gold: $1173.50 down $4.40 (comex closing time)
Silver: $15.67 down 7 cents (comex closing time)
In the access market 5:15 pm
The gold comex today had a good delivery day, registering 246 notices served for 24,600 oz. Silver comex registered 2 notices for nil oz.
Three months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 247.62 tonnes for a loss of 55 tonnes over that period.
In silver, the open interest fell by 671 contracts despite yesterday’s silver price rise of 8 cents. The OI refuses to go down despite raids. Somebody has extremely strong hands and are very patient. The total silver OI still remains relatively high with today’s reading at 149,149 contracts. The big December silver OI contract lost 10 contracts. It lowers to 25 OI contracts.
In gold we had a slight rise in OI with the fall in price of gold on Tuesday to the tune of $1.80. The total comex gold OI rests tonight at 375,212 for a gain of 476 contracts. The December gold OI rests tonight at 545 contracts losing 41 contracts.
TRADING OF GOLD AND SILVER TODAY
you have more important things to read instead of how gold/silver traded today.
Today, we had a huge loss in gold inventory of 11.65 tonnes at the GLD /Inventory 712.90 tonnes
In silver, a huge loss of 7.566 million oz in silver inventory/
SLV’s inventory rests tonight at 330.569 million oz
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: GOFO rates: OH OH!!
all rates moved in the negative direction. Now the one month GOFO two month GOFO and 3 month GOFO rates are negative and also moved much deeper into the negative. The 6th and 12 month GOFO also moved a little closer to the negative but still positive and out of 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. These rates are still fully manipulated. London good delivery bars are still quite scarce.
Dec 24 2014
1 Month Rate: 2 Month Rate 3 Month Rate 6 month rate 1 yr rate
-.09.% – .065 % -.04 % +. 023 .% +. 13750%
Dec 23 2014:
-.0625% -.035% -.01500 % +.03% +.1425%
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 today by 671 contracts from 374,716 up to 375,212 with gold down up by $1.80 yesterday (at the comex close). It seems that nobody left the gold arena with the constant raids orchestrated by the bankers. We are now into the big December contract month where the number of OI standing for the gold metal registers 545 contracts for a loss of 41 contracts. We had 41 delivery notices served yesterday so we neither gained nor lost any gold contracts standing for delivery in the December contract month. The non active January contract month rose by 33 contracts up to 476. The next big delivery month is February and here the OI rose to 224,242 contracts for a gain of 1 contract. The estimated volume today was poor at 29,680. The confirmed volume yesterday was also poor at 42,064 even although they had some help from our high frequency traders. The comex now has no credibility and many investors have vanished from this crooked casino. Today we had 246 notices filed for 24,600 oz .
And now for the wild silver comex results. Silver OI fell by 671 contracts from 149,820 down to 149,149 even though silver was up 8 cents yesterday. We are again losing more short covering from our bankers as the OI refuses to liquidate appreciably despite the low price of silver. The big December active contract month saw it’s OI lower by 10 contracts down to 25 contracts. We had 0 notices served upon on yesterday so we strangely saw another 10 contracts or 50,000 oz that will not stand and they rolled to a future month. This is highly unusual late in any delivery month. The estimated volume today was simply awful at 8,319. The confirmed volume yesterday was just as bad at 26,624. We had 2 notices filed for 10,000 oz today. It now seems that most of the volume at the comex is done off hours.
December initial standings
|Withdrawals from Dealers Inventory in oz||nil oz|
|Withdrawals from Customer Inventory in oz||nil oz ,|
|Deposits to the Dealer Inventory in oz||nil|
|Deposits to the Customer Inventory, in oz||nil oz|
|No of oz served (contracts) today||246 contracts(24,600 oz)|
|No of oz to be served (notices)||299 contracts (29,900 oz)|
|Total monthly oz gold served (contracts) so far this month||3082 contracts(308,200 oz)|
|Total accumulative withdrawals of gold from the Dealers inventory this month||153,424.154 oz|
Total accumulative withdrawal of gold from the Customer inventory this month
Today, we had 0 dealer transactions
total dealer withdrawal: nil oz
we had 0 dealer deposit:
total dealer deposit: nil oz
we had 0 customer withdrawal
total customer withdrawal: nil oz
we had 0 customer deposits:
total customer deposits; nil
We had 2 adjustments
i) Out of Brinks: 200.01 oz was adjusted out of the customer and this landed into the dealer at Brinks’
ii) Out of Manfra; 96.45 oz was adjusted out of the customer account and this landed into the dealer at Manfra
Today, 0 notice 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 246 contracts of which 242 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 December contract month, we take the total number of notices filed for the month (3082) x 100 oz to which we add the difference between the OI for the front month of December (545) minus the # gold notices filed today (246) x 100 oz = 338,100 the amount of gold oz standing for the December contract month.
Thus the initial standings:
3082 (notices filed for the month x 100 oz) + (545) the number of OI notices for the front month of December served upon – (246) notices served today equals 338,100 oz or 10.51 tonnes.
we neither gained nor lost any gold ounces standing for the December contract month.
Total dealer inventory: 770,687.631 oz or 23.971 tonnes
Total gold inventory (dealer and customer) = 7.961 million oz. (247.62) tonnes)
Several weeks ago we had total gold inventory of 303 tonnes, so during this short time period 55 tonnes have been net transferred out. We will be watching this closely!
This initiates the month of December for gold.
And now for silver
December silver: initial standings
|Withdrawals from Dealers Inventory||nil oz|
|Withdrawals from Customer Inventory||4,969.96 oz (Delaware )|
|Deposits to the Dealer Inventory||3,000.56 oz (Brinks)|
|Deposits to the Customer Inventory||599,097.9 oz (Delaware,HSBC,JPM)|
|No of oz served (contracts)||2 contracts 10,000 oz)|
|No of oz to be served (notices)||23 contracts (115,000 oz)|
|Total monthly oz silver served (contracts)||2935 contracts (14,675,000 oz)|
|Total accumulative withdrawal of silver from the Dealers inventory this month||1,594,966.8 oz|
|Total accumulative withdrawal of silver from the Customer inventory this month||7,579,647.1 oz|
Today, we had 1 deposits into the dealer account:
i) Into Brinks dealer: 3000.56 oz
total dealer deposit: 3000.56 oz
we had 0 dealer withdrawal:
total dealer withdrawal: nil oz
We had 3 customer deposits:
i) Out of Delaware: 1,999.200 oz (one decimal)
ii) Out of HSBC: 582,371.300 oz (one decimal)
iii) Out of JPMorgan: 14,727.400 oz (one decimal)
total customer deposit 599,097.9 oz
We had 1 customer withdrawal:
i) Out of Brinks: 3,000.56 oz
total customer withdrawal: 3000.56 oz
we had 0 adjustments
Total dealer inventory: 64.604 million oz
Total of all silver inventory (dealer and customer) 175.903 million oz.
The total number of notices filed today is represented by 2 contracts for 10,000 oz. To calculate the number of silver ounces that will stand for delivery in December, we take the total number of notices filed for the month (2935) x 5,000 oz to which we add the difference between the total OI for the front month of December (25) minus (the number of notices filed today (2) x 5,000 oz = the total number of silver oz standing so far in November.
Thus: 2935 contracts x 5000 oz + (25) OI for the November contract month – 2 (the number of notices filed today) =14,790,000 oz of silver that will stand for delivery in December.
We lost 50,000 silver ounces that will not stand for the December silver contract. These were obviously cash settled and then another purchase of a future contract.
for those wishing to see the rest of data today see:
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:
Dec 24.2014: wow!! somebody robbed the cookie jar/ we had a huge withdrawal of 11.65 tonnes from the GLD inventory/inventory at 712.90 tonnes. England must be bleeding badly!
Dec 23.2014; no change in gold inventory at GLD/724.55 tonnes
Dec 22.2014: no change in gold inventory at the GLD/724.55 tonnes
Dec 19.2014: a huge addition of 2.99 tonnes at the GLD/724.55 tonnes
Dec 18.2014: no change in inventory at the GLD/721.56 tonnes
Dec 17.2014: no change in inventory at the GLD/721.56 tones
Dec 16.2015 we lost 1.80 tonnes in tonnage at the GLD/721.56 tonnes
Dec 15.2014: we lost 2.39 tonnes of gold inventory at the GLD/Inventory at 723.36 tonnes
dec 12.2014: we had no change in gold inventory/GLD inventory 725.75 tonnes
Dec 11.2014: we had another addition of .95 tonnes of gold inventory at the GLD/Inventory 725.75 tonnes
dec 10.2014: we gained another 2.99 tonnes of gold at the GLD. If China cannot get its gold from London, then its only source will be the FRBNY.
Inventory: 724.80 tonnes
Dec 9.2014: we gained 2.69 tonnes of gold/inventory 721.81 tonnes
Dec 8.2014: we lost .900 tonnes of gold/inventory 719.12 tonnes
Dec 5.2014: no change in tonnage/720.02 tonnes
Dec 4 no change in tonnage/720.02 tonnes
Today, December 24 / we had a huge withdrawal of 11.65 tonnes of gold inventory from the GLD / 712.90 tonnes
inventory: 712.90 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 : 712.90 tonnes.
And now for silver (SLV):
Dec 24.2014: we had a huge loss of 7.566 million oz/inventory 330.569 million oz
Dec 23.2014: no change in silver inventory/338.135 million oz
Dec 22.2014: today we lost 862,000 oz of silver inventory from the SLV. this left late Friday night./Inventory 338.135 million oz
Dec 19.2014; No change in silver inventory at the SLV/Inventory 338.997 million oz.
Dec 18.2014: we lost 2.012 million oz of silver from the SLV vaults/inventory 338.997 million oz
Dec 17.2014: no change in silver inventory/SLV 341.009 million oz
Dec 16.2014/ no change in silver inventory/SLV 341.009 million oz
Dec 15.2014: we lost 1.341 million oz of silver at the SLV/Inventory 341.009 million oz
Dec 12.2014 no change in silver inventory at the SLV/Inventory at 342.35 million oz
Dec 11.2014: we lost 2.873 million oz of silver inventory at the SLV/Inventory 342.35 million oz
December 10.2014; no change in inventory/345.223 million oz
Dec 9.2014: no change in inventory/345.223 million oz
Dec 8.2014: no change in inventory/345.223 million oz
Dec 5/2014: no change in inventory/345.223 million oz
Dec 4/we lost another 2.204 million oz of silver/inventory 345.223 million oz
December 24/2014/a huge loss in silver inventory to the tune of 7.566 million oz at the SLV/inventory
registers: 330.569 million oz
And now for our premiums to NAV for the funds I follow:
Note: Sprott silver fund now for the first time into the negative 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 10.5% percent to NAV in usa funds and Negative 10.5 % to NAV for Cdn funds!!!!!!!
Percentage of fund in gold 61.8%
Percentage of fund in silver:37.6.%
( December 24/2014)
2. Sprott silver fund (PSLV): Premium to NAV falls to – 0.72%!!!!! NAV (Dec 24/2014)
3. Sprott gold fund (PHYS): premium to NAV falls to negative -0.66% to NAV(Dec 24/2014)
Note: Sprott silver trust falls into negative territory at -.72%.
Sprott physical gold trust is back in negative territory at -0.66%
Central fund of Canada’s is still in jail.
And now for your most important physical stories on gold and silver today:
Early gold trading from Europe early Wednesday morning:
Mark O’Byrne is off today/no report from Goldcore
(courtesy Mark O’Byrne/Goldcore)
Another excellent interview with Egon Von Greyerz. He tells us that Switzerland has imported 616 tonnes of gold from London and all of the imports are of the 400 oz London good delivery bars. He claims correctly that the Western central banks are running out of metal to supply India, Russia and China.
(courtesy Egon von Greyerz/Kingworldnews/Eric King/GATA)
New year will see massive money creation to avert deflation, von Greyerz says
11:10a ET Wednesday, December 14, 2014
Dear Friend of GATA and Gold:
Swiss gold fund manager Egon von Greyerz today gives King World News his predictions for 2015, and they include massive money creation by central banks to stave off deflation:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc
(courtesy Patrick Heller/Liberty coins)
Eagles not best way to own silver
The U.S. Mint charges $2 above the spot price when it sells regular silver American Eagle one-ounce coins to its handful of Authorized Purchasers. These APs are then responsible for the costs and logistics of picking up the coins at the West Point or San Francisco Mints. By the time most coin dealers get in a smaller supply of these coins from the larger wholesalers, retail customers could easily be paying $3-$4 per coin above the silver spot price to purchase a 500-coin box of silver Eagles.
At those premiums, retail buyers would now be paying 15-20 percent or more above the intrinsic metal value of silver Eagles.
These coins have been hugely popular, with combined mintages since the series debuted in 1986 of more than 200 million coins. In absolute terms, even the lowest-mintage 1996-dated coins cannot be called rare.
It is possible to buy the old U.S. 90 percent silver dimes and quarters (and often half dollars) struck up to 1964 at a lower cost per ounce of silver content. Privately manufactured silver rounds and ingots in sizes of 1, 10, and 100 ounces can also be acquired for a lower premium than silver Eagles.
So, are silver Eagles a good way to purchase bullion-priced silver?
There are a number of hard money writers who consider the silver Eagles to be the best option for buyers. Others, including me, consider their premiums to be too much higher than other options to recommend them. You can’t have it both ways, so whose advice is sounder?
The silver Eagles have multiple advantages where it is an exact one troy ounce of pure silver issued by a reliable entity. It has legal tender status by having a $1 face value, which means that they can cross international borders almost everywhere around the globe without having to pay import taxes.
Do these advantages outweigh other options, where U.S. 90 percent silver coins do not come to an even ounce weight of silver per $1 of face value, or where the privately struck silver rounds and ingots are normally subject to import duties if they cross borders?
I place more emphasis on the cost per ounce of silver content, which is the main reason why I am not in favor of purchasing large quantities of silver Eagles as a way to own bulk silver. However, I realize that silver Eagles are beautiful works of art. Therefore, I don’t knock the idea of purchasing individual coins or even a roll or two to be part of a collection or to be given as gifts.
Instead, I favor lower-premium alternatives despite the popularity of silver Eagles, where my company alone has sold as many as 300,000 of these coins in a single year.
Many buyers of silver Eagles realize they are paying a higher price to acquire silver in this form versus lower premium options. A number of them have told me that they expect to be able to liquidate these coins at prices higher than what they would be paid for the rounds and ingots or U.S. 90 silver coins. If that is what really happens, then it is not such a downside risk purchasing silver Eagles today.
But – don’t count on being able to receive a payment per ounce of silver content any higher than you would be paid for the 90 percent silver Coins or rounds and ingots. Here is one example why I say this.
In late 1996, Warren Buffett’s Berkshire Hathaway purchased 129.7 million ounces of silver futures contracts due in March 1997. As the maturity date neared, Berkshire Hathaway stated that they intended to take physical delivery of all the contracts rather than simply rolling the contracts over into new paper contracts with maturity dates farther in the future.
This quantity of physical silver demand severely strained existing supplies. Before Berkshire Hathaway announced that they wanted physical delivery, the spot price of silver was about $6. At that level, we were paying the public 50 cents under spot for the private one-ounce silver rounds and ingots and 50 cents over spot for silver Eagles.
Demand for low premium silver that the refiners could melt and form into deliverable 1,000-ounce bars to fulfill Berkshire Hathaway’s contracts pushed up the silver spot price.
By March 1997, the spot price topped $7. When silver reached that level, we were still paying 50 cents per ounce under spot to purchase one-ounce silver rounds and ingots from the public. However, since the refiners had no interest in purchasing any product even at spot price (the price at which they were being paid for the 1,000-ounce bars), silver Eagles did not appreciate at all during this run-up in the spot price. When silver reached $7 per ounce, we were then paying 50 cents per ounce below the spot price to purchase silver Eagles.
In this instance, the spot price of silver rose about 14 percent. The price we were paying the public to purchase one-ounce rounds and ingots rose 18 percent. Yet, the price we were paying for silver Eagles was unchanged.
As demonstrated by this example, I don’t recommend the purchase of silver Eagles as a way to acquire a quantity of bullion-priced bulk physical silver.
Incidentally, the rumor that circulated afterwards was that Berkshire Hathaway granted an extra six months to the short-sellers of the silver contracts, but the sellers had to pay the company 50 cents per ounce for the additional time.
Patrick A. Heller was the American Numismatic Association 2012 Harry Forman Numismatic Dealer of the Year Award winner. He owns Liberty Coin Service in Lansing, Mich., and writes “Liberty’s Outlook,” a monthly newsletter on rare coins and precious metals subjects. Past newsletter issues can be viewed at http://www.libertycoinservice.com. Other commentaries are available at Coin Week (http://www.coinweek.com and http://www.coininfo.com). He also writes a bi-monthly column on collectibles for “The Greater Lansing Business Monthly” (http://www.lansingbusinessmonthly.com/articles/department-columns).His radio show “Things You ‘Know’ That Just Aren’t So, And Important News You Need To Know” can be heard at 8:45 a.m. Wednesday and Friday mornings on 1320-AM WILS in Lansing (which streams live and becomes part of the audio and text archives posted at http://www.1320wils.com).
More Coin Collecting Resources:
• Kick-start your coin collection with the Fundamentals of Coin Collecting set of essential resources and tools.
• Strike it rich with this U.S. coins value pack.
• Build an impressive collection with Coin Collecting 101.
Financial Fantasy Land Continues to Prevent Collapse-Bill Holter
Financial writer Bill Holter says the record stock market does not reflect reality. Holter explains, “This will go on until it doesn’t. Very quietly, this past week, they postponed the “Volcker Rules” for the banking system. The reason they did that is they can’t allow the Volcker Rule to come into place. That would require increased capital ratios. It would bring mark to market back. We live in a financial fantasy land, and they need to continue the fantasy to prevent collapse.”
The recent spending bill passed by Congress, which puts taxpayers on the hook for more than $300 trillion in future derivative losses, is another ominous sign financial trouble is coming. Holter contends, “It tells me that they know something. They know something we suspect, and they know something they don’t want to tell us. They know a crash is coming and they are preparing. For the Republicans to vote “yes” on this after they won a landslide election is throwing the voters under the bus. People voted for change and we got change, but it was change into a greater direction of taxpayers being screwed.”
So, how long can this “financial fantasy” last? Holter, who has more than 30 years experience on Wall Street and finance, says, “I have no idea. I say I have no idea because I would have thought a complete credit contraction and collapse would have and should have already occurred. The Federal Reserve with QE (money printing) and the Plunge Protection Team manipulating basically all markets have held it together. It is being held together with confidence and confidence alone. So, when will the wheels fall off of this thing? It could be tomorrow morning; it could be January 5th, the first trading day of 2015. It could be anytime, but it’s going to happen.”
On the new so-called trading “collars” on gold and silver prices, Holter says it is another tipoff on where the precious metals prices are going. Holter thinks, “It’s to prevent a disorderly rise and not a disorderly collapse in prices. How far can it go from here? It is $6 to $8 below the cost of production.”
On Holter’s outlook for 2015, Holter says, “I think there is going to be a reset of asset prices, a reset of currencies and a reset on the values of everything. I also think credit will actually seize up in and around this reset. What I really think you are going to see with a credit seizure is a problem with distribution. When I say distribution, look what happened this past week in Belarus. Because the Russian ruble collapsed, the Belarusians, because their currency is tied to the ruble, they went out and made a run on their banks and went into stores and took everything off the shelves. How are those shelves going to get restocked? They get restocked via use of credit. The entire distribution chain runs on credit, and if credit seizes or even hiccups, you could very well see a panic and shelves clean up lock, stock and barrel.” This same thing could happen in America, as Holter goes on to explain, “This is human nature. If you see a run on a bank or your ATM’s don’t work or your credit cards don’t work, people are going to take whatever cash they have and buy whatever they can.”
Holter closes by warning, “I suspect what is going to break are the derivatives, the $303 trillion in derivatives that the big banks have, and it will crash the world. This is not just a U.S. problem–this is an international problem. When this thing blows up, it will be unlike anything that has happened since the Great Depression and before. This will be the big one.”
Join Greg Hunter as he goes One-on-One with Bill Holter of Miles Franklin, who specializes in precious metals and global investment strategies.
(There is much more in the video interview.)
And now for the important paper stories for today:
Early Wednesday morning trading from Europe/Asia
1. Stocks mixed on major Asian bourses as the yen continues to fall to 120.43, a fall of 1 basis points.
1b Chinese yuan vs USA dollar/ yuan slightly strengthens to 6.2255
2 Nikkei up 219 points or 1.24%
3. Europe stocks mixed /Euro up/ USA dollar index down to 89.91/
3b Japan 10 year yield at .33% !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 120.43
3c Nikkei now above 17,000
3e The USA/Yen rate well above the 120 barrier
3fOil: WTI 55.95 Brent: 60.22 /all eyes are focusing on oil prices. This should cause major defaults.
3g/ Gold up/yen down;
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 Oil falls this morning for both WTI and Brent after rising on Rouble stability. It fell on huge inventory levels.
3k Greek second vote fails to elect a new president with 168 votes.
Needs 180 votes
3l China coming to the aid of cash strapped countries like Venezuela, Russia and Argentina
3m Gold at $1177 dollars/ Silver: $15.82
3n USA vs Russian rouble: ( Russian rouble slightly up in value) 54.68!!!!!! Russian currency stabilizies
4. USA 10 yr treasury bond at 2.28% early this morning. Thirty year rate well below 3% (2.87%!!!!)
5. Details: Ransquawk, Bloomberg/Deutsche bank Jim Reid
(courtesy zero hedge)/your early morning trading from Asia and Europe)
Even The Algos Are Looking Forward To Today’s Early Close
Today’s early close across markets likely means that the blow-off top multiple-expansion mania phase (because forward EPS estimates over the past couple – that means 2 to Janet Yellen fanatics – weeks have in fact declined) of 2014 may be coming to an end. However with already abysmal volumes literally grinding to an early halt at 1:15 pm Eastern today, and with a market as boring as this one, where any news is immediately interpreted as good, not matter how bad it actually is or how “revised” or “goal-seeked“, we may see futures, which already are trading some 4 points above fair value, successfully levitate by another 20 points and hit Goldman’s 2100 year end target – year-end for 2015 that is – one year ahead of time.
There has been no macro news in the overnight session to talk about, with Asian markets surging on the back of a decade-high US GDP print, which however even cursory 10 minutes analysis, reveals was what it was, thanks to the second consecutive retroactive revision of consumer income (lower) and spending (higher), with the resultant collapse in savings being “spent” mostly on Obamacare. How forced capital reallocation into a socialized-welfare program is bullish and the sufficient catalyst to push the DJIA over 18,000 will one day be clear, just not now.
With European markets either closed or facing early closures ahead of Christmas, as to be expected, price action has been particularly muted throughout the session, with a lack of pertinent newsflow to provide much in the way of traction. In terms of what is currently open, the FTSE 100 is trading in slight positive territory with Smith and Nephew (+8.6%) the notable gainer across Europe following renewed takeover talk from Stryker who may pay as much as a 30% premium. Elsewhere, there has not been anything of note to report, with fixed income markets relatively choppy and the Bund not open for trade.
FX markets saw the USD fail to hold onto its gains above the 90.00 level, with the level being breached to the upside yesterday for the first time since 2006, following the strong US GDP release. Elsewhere, overnight gains in JPY have been largely pared throughout the European session with nothing fundamental at play. In terms of levels to look out for, there is a USD 4.5bln option expiry in USD/JPY at 120.00, although considering we are currently 40 pips north of this handle, it is unlikely this expiry will provide much magnetism for price action.
In the oil market, yesterday’s post-close release of API inventory build data, which soared by 5.4 million barrels, trouncing expectations for a 2.5 million barrel decline, has put the energy complex on the back foot, and Brent was down 2% earlier, cutting yesterday’s GDP-inspired figures by more than half. According to Nordea Bank oil analyst Thina Saltvedt “Yesterday’s US GDP figures sparked a brief rally, but what the oil market is really waiting for is good economic news from China or evidence of oil supply growth falling and we are seeing neither of those.” Indeed.
On the holiday shortened docket today we have the release of US weekly jobs data and the weekly DoE report.
Bulletin Headline Summary from Bloomerg
- Islamic State militants in Syria shot down a warplane belonging to the U.S.-led coalition and detained its pilot, the Syrian Observatory for Human Rights and Al Jazeera television said
- Japan’s Abe appointed a former soldier and security veteran as his new defense minister, as he prepares to push through legislation to toughen the country’s military stance amid a dispute with China
- Ukraine says provocations by rebels are increasing in the country’s east, as armed groups attacked Ukrainian govt positions 25 times using mortars, rifles, shell grenades and artillery, National Security and Defense Council says in statement on its Facebook account
- Russia and the U.S. have halted all dialogue on missile defense, Russian Deputy Defense Minister Anatoly Antonov tells reporters; also said NATO building up forces on Russia’s border
- UBS is flagging risks from China’s $1t worth of unhedged foreign debt as forecasters see bets against the greenback unwinding in 2015
- Meredith Whitney’s hedge fund is being sued by its biggest investor, a fund connected to billionaire Michael Platt’s BlueCrest Capital Management, as demands to recoup money spill into court, according to people with knowledge of the dispute
- A police officer shot and killed a man in a St. Louis suburb late yesterday, setting off a new round of protests near Ferguson, where an August shooting sparked unrest over law-enforcement tactics that’s spread across the U.S.
- Sovereign yields mostly higher. Asian, European stocks mostly higher; U.S. equity-index futures gain. Brent crude and copper lower, gold little changed
US Economic Data:
- 7:00am: MBA Mortgage Applications, Dec. 19 (prior -3.3%)
- 8:30am: Initial Jobless Claims, Dec. 20, est. 290k (prior 289k)
- Continuing Claims, Dec. 13, est. 2.375m (prior 2.373m)
- 9:45am: Bloomberg Consumer Comfort, Dec. 21 (prior 41.7)
- 11:30am: U.S. to sell $29b 7Y notes
crude inventories rise which causes both WTI and Brent to fall in price today:
(courtesy zero hedge)
EIA December Crude Inventories Surge To Record Highs
WTI Crude is down over 3.5%, dropping back towards $55 – dismissing yesterday’s dead-cat-bounce deja vu – as EIA inventory builds more than expected at 7.27 million barrels (biggest build in 2 months to 6-month highs). This is the largest inventory for the time of year since records began. Of course, while energy stocks are fading broad equity indices do not care at all…
EIA Inventories rose most in over 2 months…
This is the highest inventory for December on record…
WTI Crude slipped once again back towards $55, remaining in the broad $54.50 to $59 range for now…
Energy stocks ripped yesterday… dropping now…
As I have speculated in the past, it seems that Russia had nothing to do with the downing of MH17
(courtesy zero hedge)
Russia Says It Has Evidence From Ukraine Military Defector Kiev Was Responsible For MH-17 Crash
Back in July it was all everyone could talk about: who shot down Malaysian Airlines flight MH-17 flying over east Ukraine? A hurriedly-prepared official report (by Western authorities) quickly put the blame on Russia, ignoring any suggestion the downing may have been the result of a Ukraine fighter jet, and said the catastrophe was the result of a Russian-made missile shot by Russian separatists. Then the story promptly disappeared. Russia, however, continued digging, and overnight, Russia’s Investigative Committee says it has uncovered evidence Ukraine was involved in the crash citing a military defector from the Ukraine.
The RIC said it interrogated a Ukraine military defector who has evidence that Boeing jet shot down in July may have been targeted by Ukrainian military SU-25 plane, according to website statement. The witness claims to have spoken to SU-25’s pilot, according to whom the SU-25 in question was carrying R-60 air-to-air missiles. The SU-25 returned to base after flight without its missiles. The pilot summarized that “MH-17 was in wrong place at wrong time.” Tell that to the families of over two hundred innocent casualties of war.
The Committee statement adds that Russia may provide witness state protection and that Russian investigators ready to share data with international crash investigators.
Some further details in AFP’s coverage of the topic: “The witness, who was not named, worked at an airfield in the Ukrainian city of Dnipropetrovsk where he claimed to have seen a warplane take off on July 17 with air-to-air missiles and return without them. An Investigative Committee statement said the testimony of the man “is important proof that Ukrainian military was implicated in the crash of the Boeing-777”.
The statement by investigators came the same day that Kiev and the separatists were to hold a new round of ceasefire talks, and shortly after Russian tabloid Komsomolskaya Pravda published an interview with the “secret witness” who said he worked at the airport on the day the Boeing 777 was downed.
The man, who was filmed by the newspaper with his back to the camera and even the back of his head blurred, said he saw a Sukhoi-25 jet take off armed with air-to-air rockets and return to the base without them.
“[The plane’s operator] could have launched them into the Boeing out of fear or revenge,” the witness said, identifying the pilot of the jet as having the surname Voloshin. “Maybe he mistook it for another plane.”
Komsomolskaya Pravda claimed the witness showed up at its office by himself and that his identity checks out, but did not identify him because his family is still in Ukraine.
The investigative committee said the man — who was now officially a witness — could be enrolled in a witness protection program.
Here is the full statement from the Investigative Committee, google translated:
Investigators last night they were able to meet with the Ukrainian military defector, who confirms that voluntarily left the military unit and moved into the territory of the Russian Federation.
He told investigators about the last days of service in one of the units of the Air Force of Ukraine. From the way he behaved, what facts the voice, the investigators did not have doubts in sincerity and awareness of the witness of the events that took place in the military unit.
From the testimony of the witness now, that in order to ensure its safety aliased, civil aircraft “Boeing 777” Flight MH-17 could be brought down by July 17 of this year, combat aircraft SU-25 Ukrainian Air Force, piloted by Captain Ukrainian Air Force pilot Voloshin. In this case, sortie was carried from the airport, stationed near the city of Dnipropetrovsk. it is at this airfield served as a witness. According to his testimony, he personally saw the plane before takeoff Voloshin was fused rockets “air-to-air” type R-60, which in normal conditions the implementation of sorties Su-25 do not fit. As the witness said, in a similar outfit aircraft simply was not necessary, as the representatives of the people’s militia armed with no aviation.
The witness immediately noticed that on his return to the airfield aircraft missiles in the equipment of the aircraft has no, and then he distinctly heard the words of the pilot Voloshin, said one of his colleagues: “He – the plane – was not at the time and in the wrong place.”
Those facts and information, which are located and which are clearly not being confused, the witness said, convince investigators that his testimony true, by the way, and confirmed research on polygraph. For the investigation of these readings are very important, and most importantly, that they coincide with the data that were available for investigators from other sources and confirm the fact of being in the air Ukrainian Su-25 during the crash “Boeing.” In particular, from the testimony of several witnesses – Ukrainian citizens living in the area of impact “Boeing 777”, it follows that shortly before the crash they saw in the sky in the vicinity of the passenger liner military aircraft.
Thus, the testimony of a witness are not the only one, but a very important proof that a collapse of the “Boeing” Ukrainian armed forces are involved.
As a witness may be in danger, the investigation decides whether to grant him state protection for the witness protection program.
Investigation Committee will be to continue to collect and analyze all the data about the crash. In this case, if the representatives of the international commission investigating the crash that actually interested in establishing the truth and turn to us, we are ready to provide all available materials.
The full interview that took place on Komsomolskaya Pravda with the alleged defector, along with supporting materials, can be found here. Sadly in the end this is just more verbal allegations and more “he said, she said” accusations, in what will almost surely remain an unresolved crash in which over 200 innocent people were the now deceased pawns in a lethal realpolitik game in which the cost of a human life is nothing.
Ukraine temporarily cuts off power to the Crimea:
(courtesy zero hedge)
Ukraine Temporarily Cuts Off Power To Crimea
While Ukraine continues to plead with the international community that the Russian annexation of Crimea is illegal and against all international norms and directives, and just after it voted to end its non-aligned status and work towards Nato membership, a move Russia’s Foreign Minister Sergei Lavrov called “counterproductive” and said it would boost tensions, overnight Kiev had little problems with leaving “its” population in the Black Sea peninsula in the dark on Christmas eve.
According to Reuters, Ukraine “temporarily” cut off power supplies to Crimea on Wednesday after the Russian-controlled peninsula failed to curb consumption as required due to a power crisis, the Ukrainian energy ministry said.
“Today electricity supplies to Crimea were shut off … just as would be done to any region of Ukraine,” a ministry representative told Reuters by phone. “Supplies will be restored as soon as they implement the set consumption regime.”
Energy Minister Volodymyr Demchyshyn subsequently told a government meeting supplies had resumed to Crimea, which was annexed by Russia in March, but still depends on Ukraine for power supplies.
This is what Crimea looked like in the aftermath of the blackout:
Ukraine’s move was clearly comparable to the “international community” cutting off North Korea’s internet: a demonstration of just how easily it can be done.
The good news: following the media reports, moments ago Bloomberg reported that power has been partially restored.
Did The Saudis And The US Collude In Dropping Oil Prices?
The oil price drop that has dominated the headlines in recent weeks has been framed almost exclusively in terms of oil market economics, with most media outlets blaming Saudi Arabia, through its OPEC Trojan horse, for driving down the price, thus causing serious damage to the world’s major oil exporters – most notably Russia.
While the market explanation is partially true, it is simplistic, and fails to address key geopolitical pressure points in the Middle East.
Oilprice.com looked beyond the headlines for the reason behind the oil price drop, and found that the explanation, while difficult to prove, may revolve around control of oil and gas in the Middle East and the weakening of Russia, Iran and Syria by flooding the market with cheap oil.
The oil weapon
We don’t have to look too far back in history to see Saudi Arabia, the world’s largest oil exporter and producer, using the oil price to achieve its foreign policy objectives. In 1973, Egyptian President Anwar Sadat convinced Saudi King Faisal to cut production and raise prices, then to go as far as embargoing oil exports, all with the goal of punishing the United States for supporting Israel against the Arab states. It worked. The “oil price shock” quadrupled prices.
It happened again in 1986, when Saudi Arabia-led OPEC allowed prices to drop precipitously, and then in 1990, when the Saudis sent prices plummeting as a way of taking out Russia, which was seen as a threat to their oil supremacy. In 1998, they succeeded. When the oil price was halved from $25 to $12, Russia defaulted on its debt.
The Saudis and other OPEC members have, of course, used the oil price for the obverse effect, that is, suppressing production to keep prices artificially high and member states swimming in “petrodollars”. In 2008, oil peaked at $147 a barrel.
Turning to the current price drop, the Saudis and OPEC have a vested interest in taking out higher-cost competitors, such as US shale oil producers, who will certainly be hurt by the lower price. Even before the price drop, the Saudis were selling their oil to China at a discount. OPEC’s refusal on Nov. 27 to cut production seemed like the baldest evidence yet that the oil price drop was really an oil price war between Saudi Arabia and the US.
However, analysis shows the reasoning is complex, and may go beyond simply taking down the price to gain back lost marketshare.
“What is the reason for the United States and some U.S. allies wanting to drive down the price of oil?” Venezuelan President Nicolas Maduro asked rhetorically in October. “To harm Russia.”
Many believe the oil price plunge is the result of deliberate and well-planned collusion on the part of the United States and Saudi Arabia to punish Russia and Iran for supporting the murderous Assad regime in Syria.
Punishing Assad and friends
Proponents of this theory point to a Sept. 11 meeting between US Secretary of State John Kerry and Saudi King Abdullah at his palace on the Red Sea. According to an article in the Wall Street Journal, it was during that meeting that a deal was hammered out between Kerry and Abdullah. In it, the Saudis would support Syrian airstrikes against Islamic State (ISIS), in exchange for Washington backing the Saudis in toppling Assad.
If in fact a deal was struck, it would make sense, considering the long-simmering rivalry between Saudi Arabia and its chief rival in the region: Iran. By opposing Syria, Abdullah grabs the opportunity to strike a blow against Iran, which he sees as a powerful regional rival due to its nuclear ambitions, its support for militant groups Hamas and Hezbollah, and its alliance with Syria, which it provides with weapons and funding. The two nations are also divided by religion, with the majority of Saudis following the Sunni version of Islam, and most Iranians considering themselves Shi’ites.
“The conflict is now a full-blown proxy war between Iran and Saudi Arabia, which is playing out across the region,” Reuters reported on Dec. 15. “Both sides increasingly see their rivalry as a winner-take-all conflict: if the Shi’ite Hezbollah gains an upper hand in Lebanon, then the Sunnis of Lebanon—and by extension, their Saudi patrons—lose a round to Iran. If a Shi’ite-led government solidifies its control of Iraq, then Iran will have won another round.”
The Saudis know the Iranians are vulnerable on the oil price. Experts say the country needs $140 a barrel oil to balance its budget; at sub-$60 prices, the Saudis succeed in pressuring Iran’s supreme leader, Ayatollah Ali Khamanei, possibly containing its nuclear ambitions and making the country more pliable to the West, which has the power to reduce or lift sanctions if Iran cooperates.
Adding credence to this theory, Iranian President Hassan Rouhani told a Cabinet meeting earlier this month that the fall in oil prices was “politically motivated” and a “conspiracy against the interests of the region, the Muslim people and the Muslim world.”
Some commentators have offered a more conspiratorial theory for the Saudis wanting to get rid of Assad. They point to a 2011 agreement between Syria, Iran and Iraq that would see a pipeline running from the Iranian Port Assalouyeh to Damascus via Iraq. The $10-billion project would take three years to complete and would be fed gas from the South Pars gas field, which Iran shares with Qatar. Iranian officials have said they plan to extend the pipeline to the Mediterranean to supply gas to Europe – in competition with Qatar, the world’s largest LNG exporter.
“The Iran-Iraq-Syria pipeline – if it’s ever built – would solidify a predominantly Shi’ite axis through an economic, steel umbilical cord,” wrote Asia Times correspondent Pepe Escobar.
Global Research, a Canada-based think tank, goes furtherto suggest that Assad’s refusal in 2009 to allow Qatar to construct a gas pipeline from its North Field through Syria and on to Turkey and the EU, combined with the 2011 pipeline deal, “ignited the full-scale Saudi and Qatari assault on Assad’s power.”
“Today the US-backed wars in Ukraine and in Syria are but two fronts in the same strategic war to cripple Russia and China and to rupture any Eurasian counter-pole to a US-controlled New World Order. In each, control of energy pipelines, this time primarily of natural gas pipelines—from Russia to the EU via Ukraine and from Iran and Syria to the EU via Syria—is the strategic goal,” Global Research wrote in an Oct. 26 post.
Poking the Russian bear
How does Russia play into the oil price drop? As a key ally of Syria, supplying Assad with billions in weaponry, President Vladimir Putin has, along with Iran, found himself targeted by the House of Saud. Putin’s territorial ambitions in the Ukraine have also put him at odds with US President Barack Obama and leaders of the EU, which in May of this year imposed a set of sanctions on Russia.
As has been noted, Saudi Arabia’s manipulation of the oil price has twice targeted Russia. This time, the effects of a low price have hit Moscow especially hard due to sanctions already in place combined with the low ruble. Last week, in an effort to defend its currency, the Bank of Russia raised interest rates to 17 percent. The measure failed, with the ruble dropping another 20 percent, leading to speculation the country could impose capital controls. Meanwhile, Putin took the opportunity in his annual televised address to announce that while the economy is likely to suffer for the next two years and that Russians should brace for a recession, “Our economy will get diversified and oil prices will go back up.”
He may be right, but what will the effect be on Russia of a sustained period of low oil prices? Eric Reguly, writing in The Globe and Mail last Saturday, points out that with foreign exchange reserves at around $400 billion, the Russian state is “in no danger of collapse” even in the event of a deep recession. Reguly predicts the greater threat is to the Russian private sector, which has a debt overhang of some $700 billion.
“This month alone, $30-billion of that amount must be repaid, with another $100-billion coming due next year. The problem is made worse by the economic sanctions, which have made it all but impossible for Russian companies to finance themselves in Western markets,” he writes.
Will it work?
Whether one is a conspiracy theorist or a market theorist, in explaining the oil price drop, it really matters little, for the effect is surely more important than the cause. Putin has already shown himself to be a master player in the chess game of energy politics, so the suggestion that sub-$60 oil will crush the Russian leader has to be met with a healthy degree of skepticism.
Moscow’s decision on Dec. 1 to drop the $45-billion South Stream natural gas pipeline project in favor of a new pipeline deal with Turkey shows Putin’s willingness to circumvent European partners to continue deliveries of natural gas to European countries that depend heavily on Russia for its energy requirements. The deal also puts Turkey squarely in the Russian energy camp at a time when Russia has been alienated by the West.
Of course, the Russian dalliance with China is a key part of Putin’s great Eastern pivot that will keep stoking demand for Russian gas even as the Saudis and OPEC, perhaps with US collusion, keep pumping to hold down the price. The November agreement, that would see Gazprom supply Chinese state oil company CNPC with 30 billion cubic meters of gas per year, builds on an earlier deal to sell China 38 bcm annually in an agreement valued at $400 billion.
“Russia will go down with the ship before ceding market share – especially in Asia, where Putin reaffirmed the pivot is real. Saudi Arabia and North America will have to keep pumping as Putin plans to uphold his end in this game of brinksmanship.”
French joblessness increases again. Now at 3.488 million pour souls without a job
(courtesy zero hedge)
Happy Holidays Hollande: French Joblessness Surges To Another New Record High
Having proclaimed the creation of jobs-jobs-jobs as his mandate when elected in 2012, Francois Hollande has so far overseen the loss of nearly 600,000 French jobs. At 3.488 million, French joblessness has never been higher (and French bond yields never lower) and has ben rising – practically unabated – for the 31 straight months since his ‘raise taxes on the wealth’ election (and 42 months straight overall).
The cries for lower rates and Sovereign QE remain but, we ask in a desperate plea for sanity, what is it that QE-driven lower-rates will do going forward that they have utterly failed to do for the last three-and-a-half years?
War of words In Greece ahead of the big vote on Dec 29.2014:
Greeks Used to Years of Chaos Dismiss Samaras’s Warnings
As Prime Minister Antonis Samaras’s political maneuvers to avoid early elections edge toward a dead end, his warning of turmoil risks falling on deaf ears among Greeks numbed by years of upheaval.
After losing a second vote in parliament yesterday on his candidate for a new president, Samaras needs to win over a dozen lawmakers before a final ballot on Dec. 29. Should he fail, the constitution dictates that elections must be called, with opposition party Syriza leading opinion polls.
“We’ve already been living through chaos for years now,” said Kostas Grekas, a 23-year-old computer-technology student in Athens who graduates next year. “I’d prefer there to be elections now so that Syriza gets in, just to break up the old party system and to see something different.”
Greece marked 2014 by exiting a six-year recession that cost the country about a quarter of its economic output and tripled theunemployment rate. While Samaras’s pitch is that a change of government would endanger the incipient recovery, Syriza promises to abandon austerity measures tied to the country’s international bailout.
Samaras, 63, garnered 168 votes out of 300 members of parliament to get approval for Stavros Dimas as the country’s largely ceremonial head of state. He needed 200 votes for victory and the threshold next week falls to 180 lawmakers.
In the third vote, “each MP will come face to face with the anguish of the Greek people and the interests of the nation,” the prime minister said after the result.
The prospect of early parliamentary elections has roiled financial markets in Greece, evoking memories of the height of the financial crisis in 2012 when the country’s euro membership was in jeopardy and Samaras took power after two knife-edge ballots in the space of six weeks.
Samaras says Syriza has revived the prospect of a euro exit, yet polls show the party would prevail in a vote. A survey by polling company Rass published on Dec. 21 showed Syriza ahead of Samaras’s New Democracy by 3.4 percentage points, albeit down from 5.3 points in November.
“Samaras has cried wolf too many times,” said Dimitrios Triantaphyllou, assistant professor in the international relations department at Kadir Has University in Istanbul. “Evoking the fear of euro exit may not work this time with lawmakers and voters.”
Greek bonds fell yesterday, with the yield on three-year notes rising 53 basis points to 10.19 percent while the 10-year benchmark (GGGB10YR) yield rose 15 basis points to 8.47 percent. The Athens Stock Exchange Index (ASE) dropped 1.7 percent.
The prime minister’s decision on Dec. 8 to bring forward the process of selecting a president triggered the worst stock-market selloff in 27 years earlier this month. The index is down 18 percent since then, led by banks.
The likelihood of more political upheaval has served as a warning to companies banking on the recovery taking hold after Greece brought its finances under control.
While the government plans to run a balanced budget next year, the increase in borrowing costs since the yield on 10-year bonds fell to as little as 5.52 percent in September means the country still needs a precautionary credit line.
“What could put Greece in danger is the wrong handling of the situation by the political system,” said Andreas Andreadis, president of the Association of Greek Tourism Enterprises, whose industry represents about a sixth of the economy. “Greek politicians should start dealing with the situation with some sort of consensus, common understanding and cooperation.”
Samaras needs the support of independent lawmakers and smaller parties to defy the odds in the vote next week.
In a move to appease opponents ahead of yesterday’s ballot, he proposed a compromise in an unexpected national television address on Dec. 21. He offered to broaden his coalition government and hold elections toward the end of next year instead of mid-2016 when the current government’s term expires. His overture was immediately rejected.
Christina Papagianni, a 55-year-old home-maker in Athens, welcomes the chance to change the government, though said she still expects politicians to reach an agreement.
“I don’t see how things can get any better from here,” she said. “It would be good for there to be elections and for them all to go, but they’ll find a way to avoid that. They buried Greece deep into the ground. I’d vote Syriza just to see what they can do, but they’re all the same.”
Your more important currency crosses early Wednesday morning:
Eur/USA 1.2199 up .0025
USA/JAPAN YEN 120.43 up .250
GBP/USA 1.5536 down .0025
USA/CAN 1.1599 down .0020
This morning in Europe, the euro is up , trading now just below the 1.22 level at 1.2199 as Europe reacts to deflation and announcements of massive stimulation. In Japan Abe went all in with Abenomics with another round of QE purchasing 80 trillion yen from 70 trillion on Oct 31. He now wishes to give gift cards to poor people in order to spend. The yen continues to trade in yoyo fashion. This morning it settled down in Japan by 25 basis points and settling well above the 120 barrier to 120.43 yen to the dollar. The pound is down this morning as it now trades just below the 1.56 level at 1.5536.(very worried about the health of Barclays Bank and the FX/precious metals criminal investigation/Friday night a new separate criminal investigation on gold,silver oil manipulation). The Canadian dollar is up today trading at 1.1599 to the dollar.
Early Wednesday morning USA 10 year bond yield: 2.28% !!! up 2 in basis points from Tuesday night/
USA dollar index early Wednesday morning: 89.91 down 16 cents from Tuesday’s close
The NIKKEI: Wednesday morning up 219 points or 1.24
Trading from Europe and Asia:
1. Europe stocks are mixed
2/ Asian bourses mixed … Chinese bourses: Hang Sang in the red ,Shanghai in the green, Australia in the green: /Nikkei (Japan) cgreen/India’s Sensex in the red/
Gold early morning trading: $1177.00
Closing Portuguese 10 year bond yield: 2.71% up 1 in basis points from Tuesday
Closing Japanese 10 year bond yield: .33% !!! down 1 in basis points from Tuesday
Your closing Spanish 10 year government bond, Wednesday ,up 6 in basis points in yield from Tuesday night.
Spanish 10 year bond yield: 1.73% !!!!!!
Your Wednesday closing Italian 10 year bond yield: 1.99% up 5 in basis points from Tuesday:
trading 26 basis points higher than Spain:
IMPORTANT CLOSES FOR TODAY (1:30 pm est)
Closing currency crosses for Wednesday night/USA dollar index/USA 10 yr bond:
Euro/USA: 1.2202 up .0028
USA/Japan: 120.46 down 0.213
Great Britain/USA: 1.5552 up .0031
USA/Canada: 1.1628 up .0009
The euro rose a bit in value during the afternoon , and it was up by closing time , finishing well just above the 1.22 level to 1.2202. The yen was up in the afternoon, ans it was up by closing to the tune of 21 basis points and closing well above the 120 cross at 120.46. The British pound gained considerable ground during the afternoon session and it was up on the day closing at 1.5552. The Canadian dollar was well down in the afternoon and was down on the day at 1.1628 to the dollar.
Currency wars at their finest today.
Your closing USA dollar index: 89.90 down 16 cents from Tuesday.
your 10 year USA bond yield , up 4 in basis points on the day: 2.26%!!!!
European and Dow Jones stock index closes:
England FTSE up 11.75 or 0.18%
Paris CAC down 19.12 or 0.44%
German Dax off
Spain’s Ibex up 4.10 or 0.04%
Italian FTSE-MIB off
The Dow: up 6.04 or 0.03%
Nasdaq; up 8.05 or 0.17%
OIL: WTI 55.85 !!!!!!!
Closing USA/Russian rouble cross: 53.51 strengthened by 1 rouble per usa dollar.
And now for your more important USA economic stories for today:
Your trading today from the New York:
Premature Extrapolation: Did The Santa Claus Rally Come Too Soon?
Even CNBC has grown apathetic at the all-time-higherest moves in stocks…
Another day, another rally, another BTFD in Biotechs (why? because they are down, durr), and another record-er-est high in stocks… This is the strongest 6-day rally since July 2010
Did The Santa Claus Rally Already Happen?
But it ended ugly… with the S&P red!!
Stocks rolled over after the 7Y Auction surprised with its resilience amid low liquidity…
As Biotechs bounced…
Algos got confused at the esrly close in Europe… and took a while to catch on to how strong the auction was…
Russell 2000 hitting new highs as HY and HYG are not…
But healthcare (which includes Biotechs) is the laggard along with Energy so far this week as Utes lead the way…
Treasuries rallied back late today to unchanged after early weakness (chatter of rate lock hedges ahead of exuberance-based HY issuance coming next week sent rates up)… following today’s auction
And then there’s this…
The USD slipped lower on the day…
Crude slipped back below $56 – down 3% on the day…
Despite USD weakness, commodities slipped lower in general…
the flattening of the yield curve, means recession:
(courtesy zero hedge)
US Yield Curve Collapses To 6.5 Year Lows
As yields across the Treasury complex continue to rise this week – amid desks complaining of no liquidity at all (and following yesterday’s weak auction) – the yield curve (5s30s) has collapsed to 108bps, its flattest since June 2008. 2s30s continues to slide also (at 212bps) almost eerily perfectly tracking the plunge in the curve of the early 2000s…
5s30s hits flattest since June 2008…
As 2s30s tracks eerily close to the mid 2000s cycle…
tick-for-tick and level-for-level… we are sure this will end well!
That is all for today.
I wish you all a very Merry Christmas
and a safe one at that, and then I will see you Friday night
bye for now