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Good evening Ladies and Gentlemen:
Here are the following closes for gold and silver today:
Gold: $1209.60 up $8.60 (comex closing time)
Silver: $16.58 up 16 cents (comex closing time)
In the access market 5:15 pm
The two big stories which will shape the paper world are the Greece crisis and the Ukraine crisis. Germany seems to have many doubts that Greece will carry out the reforms it promised and today, the BILD newspaper was urging parliamentarians to vote against the deal. Late in the day, we were told that Greece may default next week on the money it owes the IMF as the ECB refuses to let the country raise the treasury bill limit. This will be very interesting to watch!!
In the Ukraine, hyperinflation is getting a strong foothold. The Hryvnia in the black market is fetching 44 UAH to the dollar. Most of the retail stores have no goods to sell. The amount needed by the Ukraine has now surpassed 40 billion dollars. The IMF has now a dual problem: Greece and the Ukraine may default next week. How on earth can European sovereigns cough up the money that is owed to all of these institutions?
We have many stories on these two fronts for you tonight.
And now for gold/silver trading today.
Gold/silver trading: see kitco charts on right side of the commentary.
Following is a brief outline on gold and silver comex figures for today:
The gold comex today had a good delivery day, registering 95 notices served for 9500 oz. Silver comex registered 3 notices for 15,000 oz .
Three months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 259.32 tonnes for a loss of 44 tonnes over that period.
In silver, the open interest fell by 3,149 contracts as Wednesday’s silver price was down by 24 cents. The total silver OI continues to remain relatively high with today’s reading at 163,527 contracts. The front month of March contracted by only 13,581 contracts with only 1 day before first day notice.
Also the entire silver complex has not collapsed yet as is their usual procedure when we approach the first day notice for an active contract month. We had 3 notices served upon for 15,000 oz.
In gold we had a fall in OI even though gold was up by $4.10 yesterday. The total comex gold OI rests tonight at 396,876 for a loss of 2431 contracts. Today we had 37 notices served upon for 3700 oz.
Today, no change in gold inventory at the GLD/Inventory at 771.25 tonnes
In silver, /SLV we had no changes in inventory to the SLV/Inventory 325.734 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
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 fell by 2431 contracts today from 399,307 down to 396,876 as gold was down by $4.10 yesterday (at the comex close). The big February contract month is now off the board. The next contract month of March saw it’s OI fall by 158 contracts down to 444. The next big active delivery month is April and here the OI fell by 2895 contracts down to 261,261. The estimated volume today (which is just comex sales during regular business hours of 8:20 until 1:30 pm est) was awful at 88,653. The confirmed volume yesterday ( which includes the volume during regular business hours + access market sales the previous day) was poor at 116,735 contracts even with mucho help from the HFT boys. Today we had 95 notices filed for 9500 oz.
And now for the wild silver comex results. Silver OI fell by 3,149 contracts from 166,676 down to 163,527 as silver was down by 24 cents with yesterday’s trading. The bankers are still not able to shake many silver leaves from the silver tree. We did not get our usual collapse in OI as we enter first day notice. The non active contract month of February is now off the board. The next big active contract month is March and here the OI fell by only 13,581 contracts down to 11,004. First day notice for the gold and silver February contract months is tomorrow, Feb 27.2015 or 1 trading day away. The March OI is still extremely high and we will probably have around 25 to 30 million oz stand on first day notice. The estimated volume today was poor 33,131 contracts (just comex sales during regular business hours. The confirmed volume yesterday was excellent (regular plus access market) at 97,775 contracts. We had 3 notices filed for 15,000 oz today.
February final standings
|Withdrawals from Dealers Inventory in oz||nil oz|
|Withdrawals from Customer Inventory in oz||32.15 1 kilobar (Manfra)|
|Deposits to the Dealer Inventory in oz||nil|
|Deposits to the Customer Inventory, in oz||80,375.000 oz 2500 kilobars (JPMorgan,Scotia)|
|No of oz served (contracts) today||95 contracts (9500 oz)|
|No of oz to be served (notices)||96 contracts (9600 oz)|
|Total monthly oz gold served (contracts) so far this month||1174 contracts(117,400 oz)|
|Total accumulative withdrawals of gold from the Dealers inventory this month|
Total accumulative withdrawal of gold from the Customer inventory this month
Today, we had 0 dealer transactions
we had 0 dealer withdrawals:
total dealer withdrawal: nil oz
we had 0 dealer deposits:
we had 1 customer withdrawals
i) Out of Manfra: 1 kilobar or 32.15 oz
total customer withdrawal: 32.15 oz
we had 0 customer deposits:
total customer deposits; nil oz
We had 3 adjustment
i) Out of HSBC: 3,890.346 oz was adjusted out of the dealer and this landed into the customer’s account at HSBC.
ii) Out of Manfra: 2,462.505 oz was adjusted out of the dealer and this landed into the customer’s account at Manfra
iii) Out of Scotia: 9907.043 oz was adjusted out of the customer and this landed into the dealer account at Scotia.
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 95 contract of which 0 notices were stopped (received) by JPMorgan dealer and 95 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 (1174) x 100 oz or 117,400 oz , and that will be the final amount of gold ounces standings.
Thus the final standings:
1174 (notices filed for the month x( 100 oz) or 117,400 ounces standing for the February contract month.
We lost 1 contract or 100 oz that did not stand for delivery.
Total dealer inventory: 810,240.319 oz or 25.20 tonnes
Total gold inventory (dealer and customer) = 8.337 million oz. (259.32) tonnes)
Several weeks ago we had total gold inventory of 303 tonnes, so during this short time period 44 tonnes have been net transferred out. However I believe that the gold that enters the gold comex is not real. I cannot see continual additions of strictly kilobars.
And now for silver
February silver final standings
feb 26 2015:
|Withdrawals from Dealers Inventory||nil oz|
|Withdrawals from Customer Inventory||nil oz|
|Deposits to the Dealer Inventory||nil|
|Deposits to the Customer Inventory||nil oz ( Scotia)|
|No of oz served (contracts)||3 contracts (15,000 oz)|
|No of oz to be served (notices)||3 contracts (15,000 oz)|
|Total monthly oz silver served (contracts)||435 contracts (2,175,000 oz)|
|Total accumulative withdrawal of silver from the Dealers inventory this month|
|Total accumulative withdrawal of silver from the Customer inventory this month||6,014,677.4 oz|
Today, we had 0 deposit into the dealer account:
total dealer deposit: nil oz
we had 0 dealer withdrawal:
total dealer withdrawal: nil oz
We had 0 customer deposits:
total customer deposit: nil oz
We had 0 customer withdrawals:
total customer withdrawal: nil oz
we had 0 adjustments
Total dealer inventory: 67.514 million oz
Total of all silver inventory (dealer and customer) 176.895 million oz
The total number of notices filed today is represented by 3 contracts for 15,000 oz. To calculate the number of silver ounces that will stand for delivery in February, we take the total number of notices filed for the month (435) x 5,000 oz = 2,175,000 oz and that represents the final amount of silver ounces standing
Final standings for silver for the February contract month:
435 contracts x 5000 oz= 2,175,000 oz
we neither gained nor lost any silver ounces standing in this February contract month.
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:
Feb 26. no change in gold inventory at the GLD/Inventory at 771.25 tonnes
Feb 25. no change in gold inventory at the GLD/Inventory at 771.25 tonnes
Feb 24.2015: no change in gold inventory at the GLD/Inventory at 771.25 tonnes
Feb 23.2015: no change in gold inventory at the GLD/Inventory at 771.25 tonnes
Feb 20/we had another good addition of 1.79 tonnes of gold into the GLD. Inventory 771.25 tonnes
Feb 19/ a huge addition of 1.5 tonnes of gold into the GLD/Inventory 769.46
Feb 18/ a small withdrawal of .3 tonnes/no doubt to pay for fees/Inventory 767.96 tonnes
Feb 17/no changes in gold inventory at the GLD/Inventory 768.26 tonnes
feb 13. we another another withdrawal f 3.25 tonnes of gold from the GLD/Inventory 768.26 tonnes
Feb 12: we had a withdrawal of 1.8 tonnes of gold from the GLD/Inventory 771.51 tonnes
Feb 11.no change in gold inventory at the GLD/Inventory 773.31 tonnes
Feb 10 no change in gold inventory at the GLD/inventory 773.31 tonnes
Feb 9 no change in gold inventory at the GLD/Inventory 773.31 tonnes
feb 6/ no change in gold inventory tonight/inventory 773.31 tonnes
feb 5. we had another addition of 5.38 tonnes of gold to the GLD/Inventory tonight at 773.31 tonnes
Feb 4/2015; we had another addition of 2.99 tonnes added to the GLD inventory/Inventory tonight 767.93
Feb 26/2015 / no change in gold inventory at the GLD/
inventory: 771.25 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 : 771.25 tonnes.
And now for silver (SLV):
Feb 26. no change in silver inventory at the SLV/Inventory at 725.734 million oz
Feb 25. no changes in silver inventory/SLV inventory at 725.734 million oz
Feb 24.we had an addition of 1.435 million oz of silver to the SLV/SLV inventory at 725.734 million oz
Feb 23 no change in silver inventory/324.299 million oz
Feb 20 no change in silver inventory/324.299 million oz
Fen 19/ we had a huge addition of 4.082 million oz of silver into the SLV/Inventory 324.299 million oz
Feb 18.2015/ no change in silver inventory at the SLV/Inventory at 320.327 million oz
Feb 17 no changes in silver inventory at the SLV/Inventory at 320.327 million oz
Feb 13 no change in silver inventory at the SLV/inventory at 320.327 million oz.
Feb 12 no change in silver inventory at the SLV/inventory at 320.327 million oz
Feb 11 no change in silver inventory at the SLV/inventory at 320.327 million oz
Feb 10 no change in silver inventory at the SLV/inventory at 320.327 million oz
Feb 9 no change in silver inventory/SLV inventory at 320.327 million oz
Feb 6 no change in silver inventory/SLV’s silver inventory at 320.327 million oz.
Feb 5.we had no change in silver inventory/320.327 million oz/
Feb 4/we had a small withdrawal of 136,000 oz of silver from the SLV vaults/Inventory/320.327 million oz
feb 3.2015: we had a good addition of 1.149 million oz of silver inventory/inventory 320.463 million oz
feb 26/2015 no changes/
SLV inventory registers: 325.735 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 6.4% percent to NAV in usa funds and Negative 6.2% to NAV for Cdn funds!!!!!!!
Percentage of fund in gold 61.0%
Percentage of fund in silver:38.6%
Sprott gold fund finally rising in NAV
2. Sprott silver fund (PSLV): Premium to NAV rises to + 3.09%!!!!! NAV (Feb 26/2015)
3. Sprott gold fund (PHYS): premium to NAV falls to +.28% to NAV(feb 26 /2015)
Note: Sprott silver trust back into positive territory at +3.09%.
Sprott physical gold trust is back into positive territory at +.28%
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 Thursday morning:
(courtesy Mark O’Byrne)
“Emperor Has No Clothes” – EU Warns of Debt Dangers Facing Ireland and EU
– High “structural” unemployment, high levels of public and private debt and a still vulnerable banking sector are weighing on the Irish economy
– Report further casts doubt on the “recovery” narrative being touted by governments, banks and vested interests across the world
– Levels of spin and denial not seen since before the crash of 2008
A report by the EU to be published today reviewing the economies of European countries has identified various problems in the most European economies – including Ireland.
In-depth reviews initiated by the European Commission (EC) found no “excessive macroeconomic imbalances” continue in 16 countries, identified in November as experiencing “macroeconomic imbalances”.
The EC on Wednesday sent a strong signal to Member States to carry out structural reforms and to continue consolidating their public finances.
High unemployment, high debt levels and “residual concerns” in the banking sector pose the greatest risk to Ireland’s economy. The significant dependence of SMEs on bank finance and still very high debt levels were also cited as concerns.
In December, Moody’s warned that Irish and European banks are vulnerable in 2015 due to weak macroeconomic conditions, unfinished regulatory hurdles and the risk of bail-ins according to credit rating agencies.
The report conflicts with the narrative put forth by the government and by economists working in the banking and finance sector and by other vested interests that the worst is over and Ireland is “in recovery.”
Ireland has been “in recovery” despite no notable decline in debt levels, no notable decrease in full time unemployment, an acceleration in home foreclosures, and public services like healthcare deteriorating in an unprecedented crisis.
The same narrative is being spun across Europe where the public is told that the “green shoots” of spring are here. Meanwhile state assets are flogged to favored corporations and the public are forced to pay stealth taxes and forced to pay again for utilities already provided for through taxes.
The ECB is about to begin an enormous money-printing scheme to kickstart the economy despite the fact that the same strategy failed in Japan and has yet to bear fruit in the U.S. Except in that it bolstered the stock markets which was of little consequence to much of the wider public but, oddly, happened to benefit the financial and banking sector enormously, once again.
Money printing is not the practice of a healthy economy. Money printing is an act of total desperation. Neither Ireland, nor anywhere else in the over-indebted Western world is “in recovery”. But it looks like wealth will continue to be extracted from the public on the pretext of recovery for as long as the charade can continue.
The report advises the Irish government to take “decisive action” to address the imbalances. We wonder what action the EU thinks is open to the government. High unemployment and private debt is not going to be eased by any government initiative other than lowering taxes.
Public debt problems can only be eased by raising taxes. Given that the entire banking system is insolvent the only action open to the government is to throw its weight – and our money – behind the banking system.
The report adds that Irish Water, the company overseeing the privatization of the water that Irish people already pay for through high taxes, may not pass a test by Eurostat, the EU statistics agency, to keep it off the government books.
This will put pressure on the government to cut other services, already woefully inadequate, to meet troika requirements on public spending.
Most likely undiscussed in the EU report is the role it has played in Ireland’s long, drawn-out recession. High taxes in Ireland are stifling economic activity and the ability of households to pay their debts.
These high taxes are a direct result of EU institutions bullying the Irish government into taking losses made by large European banks onto the back of Irish taxpayers.
While Ireland, the EU and the western world are in serious crisis one would never suspect as much when listening to the pronouncements of government officials, banks and other vested interests.
The cosy narrative of “recovery” should not be rocked by little boys pointing out “the Emperor has no clothes”!
The levels of spin and denial are reminiscent of the run-up to the 2007 crisis. We and many others were ignored for highlighting the dangers facing the Irish and global economy then and are being ignored again now.
When the inevitable occurred the same “experts” who ridiculed us insisted that nobody could have foreseen the crisis. The same looks likely to happen again.
We may be wrong this time – we seriously doubt that though.
However, prudence would dictate that the warnings of those with a proven track record – and who are not part of the political and financial establishment that bankrupted this country – should be carefully considered.
Must-read guide and research on bail-ins here:
Today’s AM fix was USD 1,220.00, EUR 1,073.66 and GBP 785.58 per ounce.
Yesterday’s AM fix was USD 1,206.50, EUR 1,062.06 and GBP 777.99 per ounce.
Gold rose 0.37% percent or $4.40 and closed at $1,204.60 an ounce on yesterday, while silver surged 1.79% percent or $0.29 closing at $16.54 an ounce.
Gold prices are up 1.3% in early European trade, pushing above the $1,218 per ounce mark. Gold snapped four days of losses yesterday and appears to be basing at the $1,200 level. Support was seen here in recent days despite the absence of Chinese demand.
Spot gold was up 1.1 percent at $1,217.95 an ounce in early London trading, after hitting a session high of $1,219.90.Singapore gold had threaded water prior to slight gains towards the end of the session. On the Comex, U.S. gold for April delivery climbed 1.3 percent to $1,217.40 an ounce.
Silver was up 1.6 percent at $16.78 an ounce. Spot platinum rose 1.5 percent at $1,185.99 an ounce, and palladium climbed 0.6 percent at $808.75 an ounce earlier touching $814.35 an ounce, its highest since January 14th.
Chinese buyers were notably active in both gold and silver overnight in Asia, MKS said in a note this morning. Premiums on the Shanghai Gold Exchange (SGE) remained firm around $4-$5 an ounce over the global spot price.
China’s gold imports from Hong Kong rose in January from the previous month, data showed today, reflecting increased demand ahead of the Lunar New Year. Net gold imports from Hong Kong climbed to 76.118 tonnes last month from a three month low of 71.381 tonnes in December.
Palladium hit its highest since mid-January this morning at $814.35/oz. Resistance is seen at its 200-day moving average at 814.40 and a close above this level could see a very sharp move to the upside.
Daily and Weekly Updates Here
for your interest
(courtesy Chris Powell/GATA)
Dollar Vigilante cites GATA in review of complaints about gold market rigging
4:45p ET Wednesday, February 25, 2015
Dear Friend of GATA and Gold:
In a review of complaints of manipulation of the monetary metals markets, Justin O’Connell of the Dollar Vigilante cites GATA Chairman Bill Murphy’s “groundbreaking” testimony to a hearing held by the U.S. Commodity Futures Trading Commission in 2010. O’Connell’s commentary is headlined “A Brief Recent History of Precious Metals Manipulation Investigations” and it’s posted at the Dollar Vigilante here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Koos Jansen on how gold was traded in secret:
(courtesy Koos Jansen)
Another piece of the puzzle
The more I read about it the more clear it becomes that the euro, at first a monetary block in Europe, was spawned right after the US abandoned gold in 1971. The European Community (EC) block was the biggest threat for the US hegemony in the seventies, if Europe would unite it could break the USD. Europe’s aggregated gold reserves were (and still are) greater than US holdings, a crucial reserve asset when fully utilized.
Soon after the inception of the Bretton Woods system in 1944 the US needed to suppress the price of gold because they printed far more dollars than they had gold to back it up, finally the suppression failed in 1968 when the London Gold Pool collapsed. What followed was a two-tier system; monetary gold was valued at a fixed price far below the free market price of gold.
The two-tier system created by the American monetary wizards was anything but sustainable; foreign central banks could buy gold at the US Treasury for dollars at a discount, subsequently selling the gold on the free market for a higher price, though the agreement was central banks would not trade with the private market.
Because the dollar was overvalued (against gold) European central banks exchanged billions of dollars for thousands of tonnes of gold, draining US gold reserves.
In 1958 the UK exchanged $900,000,000 dollars for 799 metric tonnes of gold at the US Treasury. From January to March 1965 France pulled 428 tonnes from the US, from April to June 1971 France got out 251 tonnes.
That’s when Nixon temporarily suspended convertibility of dollars into gold on August 15, 1971.
Next up for the US was to completely remove gold from the international monetary system. Having the dollar as the sole monetary anchor would ensure the US from world domination. Europe, on the other hand, tried to re-introduce gold into the system at the free market price.
In the next quotes we can read how Henry Kissinger, National Security Advisor and Secretary Of State at the time, was discussing the matter with his team.
Mr Enders to Mr Kissinger about the proposal (re-introduction of gold) from Europe (EC).
…Mr. Enders: Both parties [US and EC] have to agree to this. But it slides towards and would result, within two or three years, in putting gold back into the centerpiece of the system—one. Two—at a much higher price. Three—at a price that could be determined by a few central bankers in deals among themselves.
…They would determine the value of their reserves in a very small group.
Mr Kissinger: And we would be on the outside.
Mr. Enders: The policy we would suggest to you is that, (1), we refuse to go along with this—
…Secondly, Mr. Secretary, it does present an opportunity though—and we should try to negotiate for this—to move towards a demonetization of gold, to begin to get gold moving out of the system.
…It’s against our interest to have gold in the system because for it to remain there it would result in it being evaluated periodically. Although we have still some substantial gold holdings—about 11 billion—a larger part of the official gold in the world is concentrated in Western Europe.This gives them the dominant position in world reserves and the dominant means of creating reserves. We’ve been trying to get away from that into a system in which we can control—
…If they have the reserve-creating instrument, by having the largest amount of gold and the ability to change its price periodically, they have a position relative to ours of considerable power.
… I think we should look very hard … at very substantial sales of gold—U.S. gold on the market—to raid the gold market once and for all.
The US was against any form of European monetary cooperation. The next quotes are from a phone call between Kissinger and Under Secretary Simon:
K: … I’ve just been called to the President. Let me tell you — Shultz has sent me a copy of the cable that Volker gave him – that Volker sent him about the interventions, and he has asked for my views. I basically have only one view right now which is to do as much as we can to prevent a united European position without showing our hand.
S: Okay. Well, I interpret that as less intervention, which is a good idea, and I think George will be very happy with that comment. Do as much as we can to prevent a unified European position.
K: I don’t think a unified European monetary system is in our interest. I don’t know what you think for technical reasons, but these guys are now helping to put it to us.
In this political battle the US and Europe remained on speaking terms (both not showing their hand). But the EC was occasionally poking the US; if necessary they would trade gold in secret at the free market price.
1973 November 21, 16:14
1. IN A CONVERSATION WITH ECON MIN, FREYCHE, ECONOMIC AND FINANCIAL ADVISOR TO PRESIDENT POMPIDOU, SAID GOF FULLY UNDERSTANDS OUR VIEWS ON PURCHASES OF GOLD BY CENTRAL BANKS AT A PRICE ABOVE THE MONETARY PRICE. FREYCHE SAID THAT, ALTHOUGH THERE ARE PRESSING TECHNICAL REASONS WHY THE CENTRAL BANKS OF THE EC MIGHT WANT TO BUY AND SELL GOLD AMONG THEMSELVES AT A PRICE ABOVE THE MONETARY PRICE, THE GOF AS WELL AS ITS EC PARTNERS WERE VERY RELUCTANT TO DO THIS, PRIMARILY BECAUSE THEY
CONFIDENTIAL CONFIDENTIAL PAGE 02 PARIS 30004 211932Z
HAD NO DESIRE TO TAKE A STEP WHICH MIGHT BE INTERPRETED AS AN ATTEMPT TO CREATE A MONETARY BLOCK IN OPPOSITION TO OR RIVALRY WITH THE U.S. IN OTHER WORDS, HE SAID, FRANCE WAS HOLDING BACK FROM SUCH A DECISION BECAUSE OF A DESIRE TO DEMONSTRATE GOODWILL TOWARD THE U.S. NONETHELESS, HE CONTINUED, THE EC MIGHT EVENTUALLY BE FORCED TOTAKE THIS STEP. SIXTY-FIVE PERCENT OF ITALY’S RESERVES AND 40 PERCENT OF FRANCE’S WERE IN GOLD. IT WAS WELL KNOWN THAT NEITHER ITALY NOR FRANCE WAS WILLING TO PART WITH ANY OF THIS GOLD AT THE MONETARY PRICE WHEN THIS PRICE WAS SO MUCH LOWER THAN THE FREE MARKET PRICE. THUS, A LARGE PART OF THE RESERVES OF THESE TWO COUNTRIES WAS IN EFFECT FROZEN AND COULD NOT BE USED IN THE SETTLEMENTS AMONG THE “SNAKE” COUNTRIES REQUIRED TO MAINTAIN THE SNAKE.THIS, OF COURSE, WAS ONE OF THE REASONS WHY ITALY HAD SO FAR BEEN UNWILLING TO ENTER THE SNAKE. IF THIS PROBLEM BECAME SERIOUS ENOUGH SO THAT THE EUROPEAN CENTRAL BANKS FELT OBLIGED TO BEGIN EXCHANGING GOLD AMONG THEMSELVES AT A PRICE ABOVE THE MONETARY PRICE, FREYCHE SAID THAT THIS DECISION WOULD NOT BE TAKEN WITHOUT FULL PRIOR CONSULTATION WITH THE U.S. AUTHORITIES. HE ALSO SAID THAT EXCHANGES OF GOLD AT SUCH A PRICE WOULD BE RESTRICTED TO EC CENTRAL BANKS AND IT WAS POSSIBLE THAT THE PRICE AT WHICH THESE TRANSACTIONS WOULD BE CARRIED OUT WOULD BE KEPT SECRET.
2. COMMENT: FREYCHE’S CONCILIATORY ATTITUDE ON THIS MATTER IS WELCOME. NONETHELESS, WE BELIEVE, PARTICULARLY IN VIEW OF THE MANY PUBLIC STATEMENTS BY SENIOR FRENCH OFFICIALS ON RIGHT TO BUY AS WELL AS SELL GOLD AT MARKET PRICE, THAT FRANCE’S OBJECTIVE CONTINUES TO BE PRESERVATION OF SIGNIFICANT ROLE FOR GOLD IN MONETARY SYSTEM AND, IN THAT PERSPECTIVE, TO OBTAIN AGREEMENT WITH EUROPEAN PARTNERS TO SELL GOLD IN INTRA-EUROPEAN SETTLEMENTS AT VALUE NEAR TO MARKET PRICE. THIS BEING THE CASE, FREYCHE’S ASSURANCE NO SUCH DECISION WOULD BE REACHED WITHOUT PRIOR CONSULTATION WITH U.S. IS IMPORTANT AND USEFUL. IRWIN
Previously released historic documents
1974, March 6, Washington, US. Note From the Deputy Assistant Secretary of State for International Finance and Development (Weintraub) to the Under Secretary of the Treasury for Monetary Affairs (Volcker): GOLD AND THE MONETARY SYSTEM: POTENTIAL US–EU CONFLICT
E-mail Koos Jansen on: email@example.com
(courtesy Chris Powell/GATA)
U.S. government is authorized to rig all markets in secret, GATA secretary tells KWN
2:42p ET Thursday, February 26, 2015
Dear Friend of GATA and Gold:
Western governments are legally authorized to rig all markets in secret and as a result investigations of market rigging by the investment houses central banks use as intermediaries are not likely to produce anything, your secretary/treasurer tells King World News in an interview today.
Elaborating, your secretary/treasurer recalls the single hearing given to GATA consultant Reginald Howe’s gold market-rigging lawsuit in U.S. District Court in Boston in November 2001, at which an assistant U.S. attorney asserted that the U.S. government has the power under the Gold Reserve Act of 1934 to rig the gold market through intervention by the U.S. Treasury Department’s Exchange Stabilization Fund, a hearing about which your secretary/treasurer reported here:
The Treasury Department acknowledges its authority for secret market rigging here:
The interview’s excerpt is posted at the KWN Internet site here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
(courtesy Bill Holter/Miles Franklin)
Before getting to the topic of “all in!”, I have a story for you which may be of interest. All the way back in 2002, I travelled out to Colorado Springs for the shareholder meeting of a very small and obscure royalty company named Golden Cycle Gold. While there, we did a tour of the Cripple Creek mine and its operations. The nearby town, Victor, looked nearly like a ghost town 30 miles off the beaten path. The only industry was the mining operation and a little bit of tourism. During my trip, I met a long time Director of the Golden Cycle Gold Company, “Frank,” he had a different view of economics than almost anyone I knew. He believed the U.S. was bankrupting the country with armaments manufacturing, just as did the old Soviet Union and that the U.S. would eventually meet the same economic fate during a currency collapse of the dollar, as had happened to the ruble. ..
And now for the important paper stories for today:
Early Thursday morning trading from Europe/Asia
1. Stocks mixed on major Asian bourses / the yen rises to 118.77
1b Chinese yuan vs USA dollar/ yuan slightly strengthens to 6.2586
2 Nikkei up 200.59 or 0.95%
3. Europe stocks all up // USA dollar index up to 94.34/
3b Japan 10 year yield huge fall to .34%/ (Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 118.77/everybody watching the huge support levels of 117.20 and that level acting as a catapult for the markets.
3c Nikkei now above 17,000/
3e The USA/Yen rate still below the 120 barrier this morning/
3fOil: WTI 50.24 Brent: 61.85 /all eyes are focusing on oil prices. This should cause major defaults as derivatives blow up.
3g/ Gold up /yen up;
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 up this morning for WTI and Brent
3k waiting important USA CPI number
3l Greek 10 year bond yield :8.97% (up 50 basis points in yield)
3m Gold at $1218.00. dollars/ Silver: $16.84
3n USA vs Russian rouble: ( Russian rouble up 1 1/4 per rouble / dollar in value) 60.68!!!!!!. Ukraine’s UAH:28.53 official rate up 5 UAH from Wednesday night/but black market 39.00 to the dollar.
3 0 oil into the 50 dollar handle for WTI and 61 handle for Brent
3p gold reacts to comments by Chinese chairman LI for more fiscal stimulus and dovish comments from Yellen
3Q SNB (Swiss National Bank) still intervening again driving down the SF/window dressing/Swiss rumours of intervention to keep the soft peg at 1.05 Swiss Francs/euro and major support for the Euro.
3r USA justice department investigating 10 major USA banks in the manipulation of gold and silver pricing
3s Negative German 5 year bond yield for first time.
3t Greek economic minister and energy minister plan to block privatization/(good for them)
4. USA 10 yr treasury bond at 1.95% early this morning. Thirty year rate well below 3% (2.55%!!!!)/yield curve flattens/foreshadowing recession
5. Details: Ransquawk, Bloomberg/Deutsche bank Jim Reid
(courtesy zero hedge)/your early morning trading from Asia and Europe)
Stocks Resume Rise To New Records As US Prepares For First Annual Deflation Since 2009
Following a quiet overnight session in which the main event appears to be a statement by Chinese premier Li for more active fiscal policy, which has pushed the metals complex higher, although technically every other asset class as well, with US equity futures set to open in fresh record high territory, even as 10Y yields around the world continue to decline, attention today will fall on the CPI print due out shortly, because if consensus is correct, January will be the first month this decade when US inflation posts a negative print, mostly due to the delayed effect of sliding commodity prices.
As Deutsche recaps, the most important number today is the headline CPI where the headline YoY rate is predicted to be negative by the market (-0.1%) for the first time since 2009. Over this period the YoY rate stayed negative for 8 months. However before this we hadn’t seen a full year decline since August 1955. So these continue to be unusual times and with very few predicting inflation successfully over the last few months or even years it is hard to say with certainty where the bottom will be and how steep a recovery we’ll see. The Fed are amongst those who have not predicted inflation very well and the main issue with a rate rise this summer is that it appears based on faulty forecasts of a recovery in CPI-measured inflation. In other words, a few months before what may be the first US rate hike for a new generation of traders, the US is set to print its first annual deflation since Lehman, transitory or not.
European equities trade in positive territory with today’s session being particularly light in terms of macro newsflow. Nonetheless, on a sector specific basis, energy names initially led the way higher for Europe after WTI crude futures managed to hold above USD 50bbl after breaking above the handle yesterday. However, heading into the North American crossover, basic material names jumped to the top of the pile as precious metals managed to extend on their recent gains. In fixed income markets, Bunds saw an early bout of strength as European equity futures came off their best levels, with the Mar’15 future printing a fresh contract high in the wake of yesterday’s substantial gains. Elsewhere, Portugal was the latest nation to see their 10yr yield break below 2% for the first time with Italian, Dutch and Irish 10yr paper already printing record lows this week. Nonetheless, volumes for the Bund remain relatively light with participants awaiting key tier 1 data release from the US at 1330GMT.
Hang Seng (+0.5%) and Shanghai Comp (+2.1%) outperformed on speculation of further PBoC easing measures, after Chinese Premier Li called for more active economic policy. However, gains for the Hang Seng were trimmed after S&P lowered their 2015 Chinese GDP growth forecast to 6.9% from 7.1%. Nikkei 225 (+1.08%) posted fresh 15-yr highs underpinned by JPY weakness, of note S&P reduced Japan’s 2015 GDP growth forecast to 0.7% from 1.3%.
Overnight, AUD was dragged lower after Q4 Australian Capex data (Q/Q -2.2% vs. Exp. -1.6% (Prev. 0.2%) saw a 2nd consecutive decline. This prompted markets to push ahead expectations for a 25bps RBA rate cut next week, with odds now at 53% vs. 38% before today’s data. Nonetheless, AUD was granted some reprieve heading into the European open following the upside in metals markets, this also benefited CAD with USD/CAD slipping below 1.2400. Elsewhere, NZD was able to hold onto its gains following its surprise trade surplus, while the fall in US yields saw USD/JPY break below its 50DMA seen at 118.79.
In commodity markets, spot gold has risen throughout the session with the yellow metal breaking above its 100DMA at USD 1216.29/oz as USD continued to weaken in the wake of Fed Chair Yellen’s more dovish than expected 2-day testimony and calls by Chinese premier Li for more active fiscal policy. Subsequently copper traded higher overnight and is on track for its best month in nearly 2½ years, while Dalian iron ore futures were also supported in tandem with the gains seen across metals amid USD weakness. In the energy complex, both WTI and Brent crude futures trade relatively unchanged with WTI managing to hold above the key USD 50/bbl level following yesterday’s DoE inventory report which although showed a larger build than expected, the figure was relatively in-line with the latest API report.
In Summary: European shares are near their session high with the basic resources and chemical sectors outperforming and media, utilities underperforming. The Italian and Spanish markets are the best-performing larger bourses, Swiss the worst. The euro is little changed against the dollar. German 10yr bond yields fall; Spanish yields decline. Commodities gain, with WTI crude, natural gas underperforming and copper outperforming. U.S. jobless claims, continuing claims, Bloomberg consumer comfort, CPI, FHFA house price index, Kansas City Fed index, durable goods orders, capital goods orders due later.
In addition to the inflation data, we’ve got durable goods orders, capital goods order, jobless claims, FHFA house price index and the Kansas City Fed manufacturing activity print to keep us busy.
- S&P 500 futures up 0.2% to 2114.2
- Stoxx 600 up 0.4% to 388.2
- US 10Yr yield down 2bps to 1.94%
- German 10Yr yield down 4bps to 0.29%
- MSCI Asia Pacific up 0.5% to 146.9
- Gold spot up 1% to $1217.1/oz
- Asian stocks rise with the Shanghai Composite outperforming and the Sensex underperforming.
- MSCI Asia Pacific up 0.5% to 146.9
- Nikkei 225 up 1.1%, Hang Seng up 0.5%, Kospi up 0.1%, Shanghai Composite up 2.2%, ASX down 0.6%, Sensex down 0.9%
- Euro down 0.02% to $1.1359
- Dollar Index down 0.01% to 94.21
- Italian 10Yr yield down 11bps to 1.35%
- Spanish 10Yr yield down 12bps to 1.26%
- French 10Yr yield down 5bps to 0.56%
Bulletin Headline Summary from Bloomberg and RanSquawk
- A rise in metal prices has provided a boost to European equities in what has been a session relatively void of macro newsflow so far
- The move higher in metal prices has seen AUD pare overnight losses, with CAD also benefiting, dragging USD/CAD below 1.2400
- Looking ahead, the main focus for today’s session will come at 1330GMT/0730CST with the release of US CPI, Durables, Weekly Jobs and Canadian CPI
DB’s Jim Reid concludes the overnight recap:
Just when you thought it was safe to look at other things, the Greece saga continues to generate interesting headlines. An area that we highlighted earlier in the week that continues to simmer is the tension within the current government itself following the accepted reform proposals. Yesterday we heard in the UK Telegraph that the economy minister Stathakis plans to block a potential privatisation of strategic assets. Specifically Stathakis was quoted as saying ‘we will cancel the privatisation the Piraeus Port’ and that ‘it will remain permanently under state majority holding’. Meanwhile the energy minister, Lafazanis, was quoted as saying that ‘there will be no energy privatisations’. The same article also noted that during a 12-hour closed-door crisis meeting for the government yesterday, the group’s left platform were said to have voiced their anger over the weekend’s news with an MP quoted as saying that ‘a lot of SYRIZA MP’s are very troubled by the deal and they are being pretty open about it’. The ongoing state of the relationship between members will clearly be an important issue to keep an eye on given the need for the refined reform proposals to pass through Greek parliament
Quickly turning to trading in Asia this morning, bourses are largely trading firmer as we go to print. The Nikkei (+0.75%), Hang Seng (+0.76%) and Shanghai Composite (+1.39%) are all higher. The Kospi (-0.08%) is a touch lower. Just on China, our China economist Zhiwei Zhang yesterday previewed the upcoming annual meeting of the National People’s Congress (NPC) which is due to start March 5th. Zhiwei believes that the government will likely cut the growth rate for China to ‘around 7%’ from ‘around 7.5%’. At the same time he sees the government as possibly increasing the fiscal budgetary target and cutting the M2 growth target. Zhiwei believes that the policy tone will not be a huge surprise and these targets have been discussed since late 2014. Rather the tone is to allow slower growth and to broadly maintain the current policy stance. He does believe however that policy and growth targets are inconsistent and that the downward pressure on growth is at its highest since 2008. Zhiwei reiterates his view that there are rising risks of a mini-hardlanding in 2015 and that the economy continues to face a fiscal shock. Our colleagues believe that their 7% GDP forecast faces downside risks as a result of policy easing happening too late and growth remaining weak in the second half of this year.
Back to markets yesterday, it was fairly subdued on the whole with the US in particular appearing to be in a holding pattern between Yellen’s talks and today’s inflation data. In terms of price action, the S&P fell from its all-time highs to close -0.08% although in reality it traded in a narrow range for much of the day. There were similar subdued moves in Treasuries with the 10y benchmark yield finishing 1.1bp lower at 1.969%. The Dollar meanwhile closed weaker with the DXY finishing 0.30% lower. Oil markets did however give a boost to equity markets as the energy component finished +0.42%. Both WTI (+3.47%) and Brent (+5.06%) took a sharp leg higher after recent weakness following reports on Bloomberg that the Saudi Arabian oil minister commented that demand is still growing.
Closer to home, bourses in Europe were generally softer although like US equities, they also traded in a fairly subdued manner. The Stoxx 600 (-0.13%) and CAC (-0.09%) finished lower although the DAX (+0.04%) closed a touch higher. Bonds markets were firmer however with 10y yields in both Germany (-4.9bps) and France (-3.9bps) closing lower. Amazingly we also saw yesterday that Germany issued 5y Bunds at a negative yield for the first time on record. According to the FT, Germany managed to issue €3bn of the bonds at a yield of -0.08%. If you came down from Mars you wouldn’t believe this was possible the day after we at DB raised our 2015 German GDP forecast from 1.4% to 2%. In fact the German yield curve is now trading in negative territory until the 7y maturity mark – which itself is also close to dipping below 0%.
Away from the obvious focus on the CPI print in the US this afternoon, focus this morning in Europe will likely be on consumer confidence and employment data in Germany. As well as this, we’ve also got money supply data due in the Euro-area and retail sales out of Italy. Over in the UK, the preliminary Q4 GDP will keep us busy and at the same time we’ll receive various confidence indicators for the Euro-area. It’s no less busy in the US this afternoon. As well as inflation data, we’ve got durable goods orders, capital goods order, jobless claims, FHFA house price index and the Kansas City Fed manufacturing activity print to keep us busy.
Not only is there anger inside the Syriza party for their submission to the EU, but today, Merkel faces huge dissent as well!!
Merkel Faces Stepped-Up Dissent on Greek Bailout in Party
Bloomberg) — Chancellor Angela Merkel faces increased dissent as her governing coalition prepares to extend Greece’s bailout, backing her policy of keeping the euro area intact.
While senior lawmakers say almost all of Merkel’s Christian Democratic bloc will back the four-month reprieve for Greece in a lower-house vote on Friday, 22 of the 311 caucus members opposed the measure in a straw poll Thursday, nine more than voted against passage of Greece’s second bailout in 2012.
Goading them on was Alternative for Germany, the anti-euro party that’s won seats in four German state parliaments since August and is seeking to boost its national standing on the back of dissatisfaction with euro-area bailouts. Party co-leader Bernd Lucke urged Christian Democratic lawmakers to shun party discipline and vote their conscience on Friday.
“It’s a problem” for the Christian Democrats, Gero Neugebauer, a political analyst at Berlin’s Free University, said by phone. Lawmakers who disagree with Merkel’s bailout policies are looking at regional elections down the road, and the aid “is against their convictions as well,” he said.
Opponents include Wolfgang Bosbach, a six-term Christian Democratic lawmaker who chairs the interior affairs committee who says he’s flirting with ending his parliamentary career after consistently opposing bailouts. Hans Michelbach of the Bavaria-based Christian Social Union says he’ll refuse to back Merkel for the first time because it’s illusory to think the rescue will work. Both have been lawmakers since 1994. Peter Ramsauer, a CSU lawmaker and former transportation minister under Merkel, also said he’ll vote against the extension.
“Lawmakers are called upon to make up their own minds” whether aid to Greece should be extended, Lucke said in an interview. One reason is that a third bailout for Greece “is unavoidable as long as the country stays in the euro and the rescue policies don’t change,” he said.
Even so, Merkel regularly ranks as Germany’s most popular politician in polls after she contributed the biggest share to euro-area bailouts since 2010. Euro-area governments on Tuesday gave Greek Prime Minister Alexis Tsipras time to sell his policy program to creditors, extending the financial lifeline of the bloc’s most indebted country through June 30.
Twenty-two Christian Democratic lawmakers voted against continued aid in the straw poll and five abstained, Sebastian Hille, a CSU spokesman, said by phone. The Social Democrats, Merkel’s junior coalition partner, support aid to Greece in return for reform commitments. Merkel’s government controls 504 of the 631 lower-house seats.
Bild, Germany’s most-read daily newspaper, denounced the government’s support for Greece on Thursday and splashed the word “Nein” — German for “no” — across its editorial page, urging readers to take photos of themselves holding it.
Germany and Finland, core critics of Tsipras’s effort to break free from fiscal austerity, are crucial to the proposed extension since it requires a vote by lawmakers. While failure to win parliamentary approval for the program would risk halting the flow of aid to Greece, even lawmakers who voted against past bailouts acknowledge they don’t have the support to block the extension. The Dutch government said Monday it won’t seek parliamentary approval.
Then the German newspaper the BILD has a message for Greece: No
(courtesy zero hedge)
“NEIN” – Germany’s Bild Has A Message For Greece: “No More Billions For Greedy Greeks”
One day ahead of a key vote in the German Bundestag whether to ratify the 4-month Greek bailout extension, the biggest-selling, mass-market newspaper (or tabloid as some call it) with a circulation of 2.5 million, Bild, has made it very clear just how it feels about the latest Greek can kicking event.
The campaign hardly needs much explanation: the statement in German written just below the “Nein”, and across a blue and white background matching the Greek flag, says “No more billions for greedy Greeks.”
As part of its campaign, Bild is encouraging readers to take selfies holding the page up and send them in for publication. As Telegraph reports, selfies of readers brandishing the “Nein!” had already begun flooding in on Thursday morning, with many holding it up in their offices or outside their homes.
Lars Riiser, a banker had stuck it to the window of his office on the upper floors of one of Frankrfurt’s skyscrapers, with a view of Germany’s financial capital behind.
Another man, Steffen Beier, brandished it out of the window of his car. Some readers took the selfie holding up iPads showing the headline instead of a newspaper.
As noted above, the publicity stunt comes ahead of a vote that will seek to pass the proposed Greek reforms. Earlier today, it was reported that at least 22 MPs in Merkel’s Christian Democrat party are unhappy with the deal, and indicated that they intend to defy the party whip and vote against it. As the Telegraph notes, “there is no chance of the deal being defeated, because Mrs Merkel’s coalition has a huge majority of several hundred, but so many defection from her own party would be a symbolic blow.”
And while the topic of endless Greek bailouts is a very sensitive one for Germany, with public opinion polarized whether Greece whould be the receipient of what Germany sees as endless taxpayer funding, at least one entity has so far voiced against the Bild slam, when moments ago the German Association of Journalists called on the “Boulevard media” to stop the campaigneering, arguing that Bild has crossed the line into political campaign by urging readers to pose with their “Nein” poster ahead of tomorrow’s Bundestag vote. The DJV added in the words of the Guardian, that “it is ethically questionable to vilify a whole nation for the fiscal mistakes of their politicians.”
Will it make a difference? For now the Bild campaign seems to be achieving its intended goal in the process once again making a mockery of the European “Union”
This is not good for Greece as they suffered a huge loss of over 12.2 billion euros in deposits as Greeks removed the money from the banks and either sent them over to a safe haven or stuffed it into their mattress. No doubt in February another 10 billion euros of deposits left the banking system. Remember that Greece has non performing loans at 40%. Thus it has no equity buffer to absorb these deposit losses which thus makes all the Greek banks totally insolvent. Greece will need at least 40 billion euros to replace this money. Where on earth will they obtain these funds?
(courtesy zero hedge)
Greece Suffers Biggest Bank Run In History: January Deposits Plunge To 2005 Levels
One of the biggest question marks surrounding the Greek negotiation and ultimately, bailout extension, was just how panicked was the Greek population and domestic corporations. Recall that as explained previously, the tension boiled down to this: the Troika did everything in its power to accelerate the bank run in order to crush any negotiating leverage Varoufakis may have; Greece on the other hand was desperate to make its cash drain appear far better than rumored.
Moments ago the Bank of Greece presented its latest, January, deposit data. And it’s a doozy: following a record €12.2 billion monthly outflow, greater in absolute and relative terms than anything experienced during any of the previous Greek crises and bailouts, the total amount of Greek corporate and household deposits has now tumbled to just €148 billion, down 7.7% from the month before, and down 10% since November. This number is in line with some of the more pessimistic expectations, and brings the total cash holdings at Greek banks to the lowest level since August 2005.
What’s worse is that the outflow has most certainly continued in February, when according to rumors another €10 billion or more may have been withdrawn. And while the new FinMin is desperate to make it seem that now that Greece has a can kicking bailout extension “deal” the bank run has stopped, this is very much in doubt.
One thing is certain: Greek banks, already crushed by record NPLs somewhere in the 40% range, and without any equity buffer, are now all, without exception, dead banks walking following this latest cash rush. And absent another bailout – one which S&P calculated in October will need to fund Greece with more than €40 billion in additional cash – and one which will come with even more draconian conditions, we simply don’t see how Greece gets away from its current “self-reinforcing feedback loop” predicament without Cyprus-style capital controls.
Anti=government rallies start and the first turns ugly!
(courtesy zero hedge)
Full Circle: The First Anti-Government Protest In Greece Turns Ugly
Athens: first anti-gov’t protest by far-left ANTARSYA turns ugly
The first anti-government rally in Athens turned ugly as anti-authoritarian protesters started to smash the windows of a pastry shop and two jewelry shops and put two vehicles and several garbage bins on fire.
According to latest information, there was no intervention by riot police although squads were standing near by.
Earlier KTG wrote:
The first anti-government protest has been launched in Athens on Thursday afternoon. A month after the left-wing/nationalist SYRIZA-Independent Greeks coalition took office, a week after the Eurogroup agreement in Brussels.
With anti-EU banners and red party flags, members of Anticapitalist Left Cooperation for the Overthrow(ANTARSYA) took to the streets in downtown Athens to protest the extension of continuation of loan agreements and Varoufakis’ Reform List with “austerity measures.”
picture via @MakisSinodinos
ANTARSYA calls for defaulting on Greece’s debt, and nationalization without compensation of major industries, banning of lay-offs, the disarmament of the police, full political and social rights for immigrants.
Although ANTARSYA is not successful in parliamentary elections it does manage to win seats in municipalities since 2010. In January elections, ANTARSYA received 39,411 votes (0.64% of the overall vote).
For tomorrow, Friday, the Greek Communist party KKE has called for a anti-government protest against austerity and the loan agreements. According to KKE, Varoufakis’ Reforms list contains “all the measures adopted by the capital, the governments and the EU against the workers.”
In Greek Parliament KKE holds 15 seats.
KKE is against the €uro, the European Union, and against everything and everyone in general. It vehemently rejected any offer form SYRIZa for coalition government. It is the party of eternal opposition.
PS I f you ask me, when Nea Dimokratia and PASOK and Potami will launch anti-government protests all I can tell you: not for the time being.
Then late tonight at 6:30 PM EST: Greece states that it may default on the IMF loan next week. The ECB is dead set against raising the amount of Greek treasury bills to be raised and they refuse to hand over the 2 billion euros of income that the bankers have earned buying Greek bonds.
Ladies and Gentlemen..grab your popcorn..this will be exciting to watch!
(courtesy zero hedge)
Greece Warns It May Default On IMF Loan Next Week
Now that the Greek tragicomedy of the new government “threatening” to leave the Eurozone if it doesn’t get its way, has been postponed for a few weeks, if not months, we can go back to the biggest story involving Greece, one we first covered in October of 2014, when we said that Greece needs about €43 billion through the end of 2015 to cover its funding needs. Earlier today, the broader market finally woke up to precisely this problem for Greece, when MarketNews reported that Greek creditors are now contemplating a third bailout which could be as large as €30 billion.
Of course, the only “use of proceeds” of this bailout would be to cover prior financing obligations: maturities and interest on pre-existing debt. None would actually go to the Greeks themselves; however a third bailout would certainly come with even more draconian conditions and terms that would make the current Greek “austerity” measures seem like a walk in the park.
So now that the Greek topic is back to overall debt sustainability, a few hours ago Greece Kathimerini reported that the Euro Working Group “discussed Greece’s imminent funding problems on Thursday amid mounting concern about how the country will meet its obligations in the next months.”
This follows a suggestion earlier in the day by the Greek Minister of State for Coordinating Government Operations Alekos Flambouraris that “Greece might delay payment to the International Monetary Fund if it cannot find the necessary money.”
According to Kathimerini calculations, Greece is due to pay the IMF 1.6 billion euros next month but Flambouraris said that Athens might ask to delay this payment for two months. “Greece has a total of 7.27 billion euros in obligations next month of which 4.6 billion euros is in treasury bills that are due to be rolled over. The government’s first T-bill issue will have to take place by Thursday as 1.6 billion euros has to be rolled over the next day.”
One possible solution is for the Troika, pardon, Institutions to raise the €15 billion limit on T-bill issues, a request which however the ECB has so far rejected.
But wait, how does a country “delay” a payment on a debt obligation, especially when it is due to the very IMF that has over the past year refused to even consider lending Greece any more money (apparently all of its spare cash goes to Kiev these days)?
Well, it doesn’t. Back to Kathimerini which reports that “the possibility of Greece postponing the repayment of any debt tranches to the International Monetary Fund is seen as “exceptionally complicated” with “many obstacles,” according to officials familiar with the subject. They stress that such a move would constitute a “clear default,” with consequences for a large number of other loans Greece has received.”
A delayed IMF loan repayment would generate multiple consequences, which market professionals estimate would have a negative impact on Greece and its economy, as when the Fund lends money to a country it is always the first to be paid back. If a country forfeits a repayment, this is considered a credit event, or default.
Wait, so, after all the drama of the past month, and all the posturing by the once-proud new Syriza government whose spine, leverage and confidence have since been crushed, Greece may actually have no money to pay the IMF with? Well, yes, because remember: the biggest problem – as explained yesterday – that has always faced Greece, is not its massive debt load, but the reason why Greece accumulated this massive debt load in the first place: its chronic inability to collect taxes!
“Greeks consider taxes as theft,” said Aristides Hatzis, an associate professor of law and economics at the University of Athens. “Normally taxes are considered the price you have to pay for a just state, but this is not accepted by the Greek mentality.”
And that’s the whole problem in a nutshell.
So when is the Greek drama set to make a surprise come back appearance?
Greece is due to pay the IMF 310 million euros on March 6, 350 million on March 13, 580 million on March 16 and another 350 million on March 20.
We suggest readers grab a seat and some popcorn on any of those days, because the inevitable day when Greece finally runs out of not just its own but other people’s money, may arrive as recently as one week from today.
And now for our second country in severe trouble: Ukraine
Today, the official rate went to 33.75 UAH per dollar and in the black market which is probably the correct rate: 44 UAH per dollar.
They are threatening to halt all currency trading!!
(courtesy zero hedge)
Ukraine To Halt Currency Trading Again Any Minute
With Prime Minister Yatsenyuk putting his foot down and squeezing the central bank to lift capital controls, Ukraine’s currency is totally collapsing this morning. Up over 5 handles to a fresh record low of 33.75/USD, we suspect currency trading will be halted any minute. While we discussed the endgame for Ukraine last night, on the street, things are dire with ATM lines, shelves emptied, and local currency exchanges marking up levels dramatically more than the ‘official’ rates…
The ‘independent’ Central Bank halted currency trading, and then the government screamed…
“I learned this morning on the Internet that the National Bank of Ukraine has, as usual on its own without any sort of consultations, made the decision to close the interbank currency market, which will absolutely not add to the stability of the national currency that the national bank is responsible for. This situation has a very complex and negative influence on the country’s economy,” Ukrainian Prime Minister Arseniy Yatsenyuk said.
And it was unhalted… and this happened… UAH collapsed…
The picture is significantly worse on the street…
Mariupol exchangers Today the dollar has broken another record. Buy 1 dollar for 44 hryvnia can sell for 32 hryvnia, according to the city’s website 0629.com.
Related to this is a panic in the city – in many shops in the city are buying cereals, flour, sugar. By the way, the price of sugar already reached 18 hryvnia per kilogram. “Soon people will buy cookies to drink tea without sugar,” – joked seller.
broke the record and the cost of a liter of gasoline – more than 26 hryvnia per liter of A-95.
According to experts, now the price rise for imported goods and products. For example, the city has increased dramatically the cost of a kilogram of herring – up to 60 hryvnia. For the same money you can buy a kilo of meat.
It is noteworthy that the dollar in Kiev a little different – there you can buy a dollar for 36 hryvnia, but also to sell for 32 hryvnia. According to the workers exchangers, such a situation has developed in Mariupol for the area ATO.
with lines at the ATMs
and empty shelves…
as Ukrainians try to get rid of Hryvnia for real goods.
oh!! let’s get the Russians angry at us!!
(courtesy zero hedge)
Provocation? NATO Conducts Military Maneuvers 300 Yards From Russia’s Border
When a Russian bomber flew over international waters some 25 miles off the southwest tip of England last week, UK Defense Secretary Michael Fallon called Russia “a real and present danger.” The UK government scrambled jet fighters to meet the Russian aircraft as a show of force.
Said Secretary Fallon of the incident, “NATO has to be ready for any kind of aggression from Russia, whatever form it takes.” He added that, “NATO is getting ready,” warning particularly that Russia may soon move to invade the Baltic countries of Estonia, Latvia, and Lithuania.
Reading the feverish Twitter feed of NATO’s Supreme Allied Commander Europe, Gen. Phil Breedlove, one would get the impression that NATO is already at war with Russia. Fighter jets sit menacingly atop aircraft carriers as the General beams about NATO member countries’ commitment to contribute to the fight.
The message is clear: Russia is about to attack!NATO has, for no understandable reason, found itself in Russia’s crosshairs. NATO cannot figure out how it is that Russia could possibly feel threatened by its actions, which, unlike Russia’s are not in the slightest provocative.
Russian military plane over international waters 25 miles from the UK coast is “real and present danger” to NATO. Yet…
Yet yesterday US combat vehicles conducted a military parade and show of military force in Estonia just 300 yards — yards! — from the Russian border. That is just over 60 miles from downtown St. Petersburg.
Here is dramatic video of NATO’s military display just three football fields from Russia:
This is not a provocation, we are to believe. This is not a “real and present danger” to Russia. NATO is exempt from the rules it imposes on its enemies.
In the Guardian’s review of a new book by Politics professor George Sakwa, the current fallout from a near quarter century of post-Cold War NATO policies is perfectly captured:
The hawks in the Clinton administration ignored all this, Bush abandoned the anti-ballistic missile treaty and put rockets close to Russia’s borders, and now a decade later, after Russia’s angry reaction to provocations in Georgia in 2008 and Ukraine today, we have what Sakwa rightly calls a “fateful geographical paradox: that Nato exists to manage the risks created by its existence”.
That line bears repeating: “Nato exists to manage the risks created by its existence.”
Brazil, Russia and China’s confidence levels all drop dramatically as the world finances crumble;
(courtesy zero hedge)
Brazil Consumer Confidence Collapses To Lowest. Ever.
It appears all the emerging/emerged economies of the world that are supposed to be the dynamic growth engines to lead the world to escape velocity are, well, not. Perhaps no better example is Brazil where hyper-growth expectations have disappeared into a black hole as business and consumer confidence collapsed this week to historical lows. As Goldman noted, “This poses major headwinds for private consumption and overall activity in the coming months.”
As Goldman summarizes:
According to the monthly FGV Index, consumer confidence (CC) posted a large 4.9% mom sa decline in February, adding to the even larger 6.7% mom sa decline recorded in January. The overall consumer confidence index is now at its lowest level since the index started to be reported in September 2005. Furthermore, consumer confidence is currently 34% below the April 2012 peak and 26% below the average of the last five years.
The index measuring current conditions declined by a very large 7.0% mom sa in February (following a 8.6% mom sa decline in Jan) and the index measuring expectations declined 4.2% mom sa (-6.2% mom sa in Jan). The two sub-indices are now below the levels sees during the 2008-09 global economic and financial crisis and also at historical lows (for the series that started in September 2005).
In addition, business confidence in the construction sector declined 6.9% mom sa February (-27.3% yoy) adding to the 6.2% mom sa drop recorded in January. The headline index is now below the 100 threshold since October and at the lowest level since the index started to be reported (July 2010). The index measuring current conditions declined a very large 9.7% mom sa in February (-32.1% yoy) and the index measuring expectations declined 4.6% mom sa (-23.3% yoy).
Finally, as reported yesterday, business confidence in the industrial sector declining a sizeable 3.1% mom sa in February and is currently 22% below the January 2013 peak. The index measuring current conditions declined 1.7% mom sa in February and the index measuring expectations fell a large 4.8% mom sa.
Business and consumer confidence remains very depressed given the anticipation of policy tightening, rising inflation, rising taxes, rising interest rates, significant increases in utility and transportation tariffs, deteriorating labor market conditions, and more exigent credit conditions. This poses major headwinds for private consumption and overall activity in the coming months.
* * *
But it’s not just Brazil…
And Russian even worse…
Oil related stories
Early this morning oil falls back into the 49 handle for WTI:
(courtesy zero hedge)
WTI Follows Algo-Idiot-Inventory Template: Slides Back Below $50
Yesterday we exposed the deja vu-ness of the API vs DOE inventory price moves in WTI. Today we begin to get some confirmation as a growing divergence between excess supply (and weak demand) for WTI and rising demand for Brent push the spread over $11 and the contango above $2…
Your more important currency crosses early Thursday morning:
Eur/USA 1.1340 down .0024
USA/JAPAN YEN 118.77 down .048
GBP/USA 1.5508 down .0018
USA/CAN 1.2458 up .0025
This morning in Europe, the euro is down, trading now well below the 1.14 level at 1.1340 as Europe is supported by other nations keeping the Euro afloat, Europe reacts to deflation, announcements of massive stimulation, the Greek crisis. In Japan Abe went all in with Abenomics with another round of QE purchasing 80 trillion yen from 70 trillion on Oct 31. The yen continues to trade in yoyo fashion as this morning it settled up again in Japan by 5 basis points and settling well below the 120 barrier to 118.77 yen to the dollar. The pound was down this morning as it now barely trades just above the 1.55 level at 1.5508.(very worried about the health of Barclays Bank and the FX/precious metals criminal investigation/Dec 12 a new separate criminal investigation on gold,silver oil manipulation and now the HSBC criminal probe). The Canadian dollar was well down again reacting to the slightly higher oil price and is trading at 1.2458 to the dollar. It seems that the 4 major global carry trades are being unwound. (1) The total dollar global short is 9 trillion USA, and as such we now witness a sea of red blood on the streets as derivatives blow up with the massive rise in the dollar against all paper currencies.We also have the second big yen carry trade unwind as the yen refuses to blow past the 120 level.(3) the Nikkei vs gold carry trade. (4) short Swiss Franc/long assets (European housing), the Nikkei, etc. These massive carry trades are terribly offside as they are being unwound. It is causing deflation as the world reacts to a lack of demand. Bourses around the globe are reacting in kind to these events as well as the potential for a GREXIT.
The NIKKEI: Thursday morning : up 200.59 points or 1.08%
Trading from Europe and Asia:
1. Europe stocks all in the green
2/ Asian bourses mixed … Chinese bourses: Hang Sang in the green ,Shanghai in the green, Australia in the red: /Nikkei (Japan) green/India’s Sensex in the red/
Gold very early morning trading: $1218.00
Early Thursday morning USA 10 year bond yield: 1.95% !!! down 2 in basis points from Wednesday night/
USA dollar index early Thursday morning: 94.34 up 12 cents from Tuesday’s close.
This ends the early morning numbers, Thursday morning
And now for your closing numbers for Thursday:
Closing Portuguese 10 year bond yield: 1.87% down 15 in basis points from Wednesday
Closing Japanese 10 year bond yield: .34% !!! par in basis points from Wednesday
Your closing Spanish 10 year government bond, Thursday down 11 in basis points in yield from Wednesday night.
Spanish 10 year bond yield: 1.28% !!!!!!
Your Thursday closing Italian 10 year bond yield: 1.35% down 11 in basis points from Wednesday:
trading 7 basis points higher than Spain.
IMPORTANT CURRENCY CLOSES FOR TODAY
Closing currency crosses for Thursday night/USA dollar index/USA 10 yr bond:
Euro/USA: 1.1195 down .0169
USA/Japan: 119.37 up .549
Great Britain/USA: 1.5407 down .0119
USA/Canada: 1.2516 up .0035
The euro fell like a stone this afternoon but it was down hugely on the day by 169 basis points finishing the day just below the 1.12 level to 1.1195. The yen was down badly in the afternoon, and it was down by closing to the tune of 55 basis points and closing just above the 119 cross at 119.37. The British pound lost a lot of ground during the afternoon session and was down on the day closing at 1.5407. The Canadian dollar was down again today as oil price was down badly. It closed at 1.2516 to the USA dollar
As explained above, the short dollar carry trade is being unwound, the yen carry trade , the Nikkei/gold carry trade, and finally the long dollar/short Swiss franc carry trade are all being unwound and these reversals are causing massive derivative losses. And as such these massive derivative losses is the powder keg that will destroy the entire financial system. The losses on the oil front will no doubt produce many dead bodies. The last asset still rising are the stock exchanges.
Your closing 10 yr USA bond yield: 2.03 up 6 in basis points from Wednesday
Your closing USA dollar index: 95.27 up a huge $1.06 on the day.
European and Dow Jones stock index closes:
England FTSE up 14.35 points or 0.21%
Paris CAC up 28.40 or 0.58%
German Dax up 116.92 or 1.04%
Spain’s Ibex up 90.00 or .81%
Italian FTSE-MIB up 227.89 or 1.04%
The Dow:down 10.15 or 0.06%
Nasdaq; up 20.75 or 0.42%
OIL: WTI 48.83 !!!!!!!
Closing USA/Russian rouble cross: 60.63 up almost 3/4 roubles per dollar on the day.
closing UKrainian UAH: (hryvnia) 33.80 UAH to the dollar. However real rate (the black market) is around 44 UAH per dollar.
Since November the currency has lost more than half its value.
And now for your more important USA economic stories for today:
Your New York trading for today:
Crude Carnage Sends Stocks Lower Despite Last-Hour Buying-Panic
For all the clever chaps claiming stability in oil, we have one message after today’s bloodbathery…
Following the same template as last week, crude oil dumped after the pump post-DOE inventories and collapsed to a $47 handle briefly – erasing all February’s gains…
AAPL also had a tough day to start with… before it announced a media day in March (who could have expected that?) which sent the algos into a frenzied panic-buying meltup…
Neither of which helped stocks as it appeared the supposedly “good” data – specifically a notable MoM rise in real wages – sparked fears that it was exactly the excuse that Yellen and The Fed (as various speakers today confirmed) need to remove patient in March and hike in June… “good” news indeed was bad news for stocks… but as soon as 1500ET struck – with absolutely no news whatsoever – stocks decided it was ramp time…
Nasdaq and Small Caps just exploded once AAPL started moving and the last hour was just crazy – as every index moved in perfect sync…
Here is the last hour of trading in US equity markets today… make sense? These are equity portfolios containing extremely varied sets, weights osectors individual entities… and yet they float perfectl;y higher in sync on a sea of seemingly endless margin…
Seems like oil was the driver today…
On the week, the last hour buying panic was all about geting the S&P 500 into the red for the week…
With stocks and bonds recoupling…
And bad news for bonds…
And sent the USDollar soaring… to its highest since September 2003
EURUSD broke 1.12 briefly – how much further does it have to fall?
Despite the USD strength, gold, silver and more so copper gained on the day as oil prices collapsed…
The bankers need inflation to try and bury their huge debts. They do not like this:
(courtesy zero hedge)
US Posts First Negative Inflation Print Since Lehman On Gas Price Plunge
Submitted by Tyler Durden on 02/26/2015 08:52 -05
As previewed earlier today, January CPI data was historic in that, 6 years after Lehman, the US just reported its first negative headline CPI print, with overall inflation, or rather deflation, in January coming at -0.1%, in line with expectations, and down from the 0.8% in December. On a monthly basis, CPI tumbled by 0.7% from December, driven almost entirely by collapsing energy prices. Excluding the Great financial crisis, one has to go back a few years to find the last time the US posted annual headline deflation…. all the way back to August 1955, or just about the time Marty McFly was trying not to dance with his mother.
Here is the culprit for the plunge: “The energy index fell 9.7 percent as the gasoline index fell 18.7 percent in January, the sharpest in a series of seven consecutive declines. The gasoline decrease was overwhelmingly the cause of the decline in the all items index, which would have risen 0.1 percent had the gasoline index been unchanged. The fuel oil index also fell sharply, and the index for natural gas turned down, although the electricity index rose.”
However it wasn’t just energy deflation: “The food index was unchanged in January, with the food at home index falling for the first time since May 2013.”
So much for the good news: the bad news is that away from crashing energy prices, Americans continued to pay more for all other goods and services, with Core CPI rising 0.2%, more than the 0.1% expected, and in line with the revised December data:
The index for all items less food and energy rose 0.2 percent in January. The shelter index rose 0.3 percent, and the indexes for personal care, for apparel, and for recreation increased as well. The medical care index was unchanged, while an array of indexes declined in January, including those for household furnishings and operations, alcoholic beverages, new vehicles, used cars and trucks, airline fares, and tobacco.
Some more on the core data series:
The index for all items less food and energy increased 0.2 percent in January. The shelter index increased 0.3 percent, with the rent and owners’ equivalent rent indexes both rising 0.2 percent and the index for lodging away from home rising 1.3 percent. The personal care index rose 0.6 percent in January, its largest increase since the inception of the index in 1999. The apparel index rose 0.3 percent, and the recreation index increased 0.2 percent. The index for medical care was unchanged in January, with the index for medical care services rising, but the medical care commodities index falling. Several indexes posted modest declines in January. The index for household furnishings and operations fell 0.2 percent, and the indexes for new vehicles and for used cars and trucks both fell 0.1 percent. The index for alcoholic beverages fell 0.3 percent, as did the index for airline fares. The tobacco index also declined, falling 0.2 percent after rising in December.
The index for all items less food and energy has risen 1.6 percent over the past 12 months, the same figure as for the 12 months ending December. The index for shelter has risen 2.9 percent over the span, and the indexes for medical care, for new vehicles, and for alcoholic beverages are among those that have also increased. Indexes that have declined over the past year include those for used cars and trucks, airline fares, household furnishings and operations, and apparel.
And back to the headline data: “The all items index declined 0.1 percent over the last 12 months, the first negative 12-month change since the period ending October 2009. The energy index fell 19.6 percent over the span, with the gasoline index down 35.4 percent. The food index rose 3.2 percent, and the index for all items less food and energy increased 1.6 percent”
Initial jobless claims surge the most since 2013 surpassing 313,000
(courtesy BLS/zero hedge)
Initial Jobless Claims Surge Most Since 2013
After last week’s holiday-shortened exuberance over initial jobless claims, this week’s slam back to reality is quite a shock to the “everything is awesome” crowd.Initial jobless claims jumped 31,000 to 313,000 – the biggest percentage rise since December 2013. Continuing claims dropped modestly but remain up around 3.5% over the last quarter – near the worst since 2009.
Trend has changed…
Continuing claims dropped modestly this week but the quarterly trend has shifted…
We will see you on Friday.
bye for now