May 25/China again devalues and thus fires a warning shot to the USA not to raise rates/OIl is loading up on Chinese soil due to deals they made with poorer OPEC members/The iMF will not participate in the Greek bailout putting the rescue at risk!/Erdogan snubs the EU and now the risk of refugees flooding Europe increases dramatically/Nigeria’s finances in trouble and they are no doubt the next Venezuela/Emerging markets in turmoil due to higher uSA dollar and the resultant lower commodity prices/

Good evening Ladies and Gentlemen:

Gold:  $1,223.50 DOWN $5.40    (comex closing time)

Silver 16.26  UP 2 cents

In the access market 5:15 pm

Gold $1224.15

silver:  16.32

i) the May gold contract is a non active contract.  Yet we started the month with 5.67 tonnes of gold standing and it has increased every single day and today sits at 6.886 tonnes of gold standing:

The amount standing for gold at the comex in May is simply outstanding at 6.886 tonnes. The previous May 2015, we had only .08 tonnes standing so you can certainly witness the difference as the demand for gold by investors/sovereigns is on a torrid pace. This makes the excitement for June gold that much more intense as more players are refusing fiat and demanding only physical metal. I will be reporting daily as to how which is standing for delivery through the active month of June.  June is the second largest delivery month after December.

Despite the whacking of silver, it’s OI refused to decline like gold. Our bankers and the CFTC are “quite baffled” by this. We are now in our 6th year of high open interest in silver with a low price.  This has never happened before.

If I am a betting man, it looks to me like China is the long taking delivery in gold and they are the longs waiting patiently to strike in silver.

Let us have a look at the data for today


At the gold comex today we had a GOOD delivery day, registering 53 notices for 5300 ounces for gold,and for silver we had 5 notices for 25,000 oz for the non active May delivery month.

Several months ago the comex had 303 tonnes of total gold. Today, the total inventory rests at 249.98 tonnes for a loss of 53 tonnes over that period


In silver, the open interest ROSE by 101 contracts UP to 203,682 DESPITE THE FACT THAT THE PRICE OF SILVER WAS  DOWN by  17 cents with respect to YESTERDAY’S trading..In ounces, the OI is still represented by just over 1 BILLION oz i.e. .1.018 BILLION TO BE EXACT or 145% of annual global silver production (ex Russia &ex China)

In silver we had 5 notices served upon for 25,000 oz.

In gold, the total comex gold OI fell by a CONSIDERABLE 8,603 contracts DOWN to 542,958 as the price of gold was DOWN $22.90 with yesterday’s trading(at comex closing). They certainly got the liquidation in gold but not silver.




We had no change in gold inventory at the GLD  The inventory rests at 868.66 tonnes. .

We had no change in silver inventory at the SLV/Inventory rests at 335.739 million oz


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


1. Today, we had the open interest in silver RISE by 101 contracts UP to 203,682 as the price of silver was DOWN by 17 cents with YESTERDAY’S trading. The gold open interest FELL by 8,603 contracts as  gold was down $22.90 yesterday. Somebody big is standing FOR SILVER and surrounding the comex with paper longs ready to ponce once called upon to take out physical silver.I also believe that for the first time we are witnessing players wishing to stand for real physical in gold.  Gold investors, in the May contract month are refusing the tempting fiat offer as they want only physical.

(report Harvey).


2 a) Gold trading overnight, Goldcore

(Mark OByrne/off today

2b)  Gold trading earlier this morning;

(Mark O’byrne)


i)Late  TUESDAY night/ WEDNESDAY morning: Shanghai closed DOWN  BY 6.58 PTS OR 0.23%  /  Hang Sang closed UP 537.62 OR 2.71%. The Nikkei closed UP 258.59 POINTS OR 1.51% . Australia’s all ordinaires  CLOSED UP 1.45% Chinese yuan (ONSHORE) closed DOWN at 6.5616 .  Oil ROSE to 49.02 dollars per barrel for WTI and 49.20 for Brent. Stocks in Europe ALL IN THE GREEN . Offshore yuan trades  6.5645 yuan to the dollar vs 6.5616 for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS TO ZERO.



none today


i)Your big story of the month.  China has decided to deeply devalue the yuan (onshore) last night as they are acting ahead of the USA potential rate hike. They are quite happy with the slow devaluation of the yuan against all of the other currencies they put in their basket and now want to concentrate on the USA.  The most important point here:

The flip-flop is a sign of policy makers’ deepening wariness about how much money is fleeing China, a problem driven by its slowing economy. For now, at least, officials believe the benefits of freeing the yuan are outnumbered by the number of threats..”

No question we will see massive turmoil in all markets as Janet has to make a decision whether to raise rates

( zero hedge)


ii)When China gave loans to OPEC poor countries, the loans in dollars were collaterized with oil.  Now that oil is 1/3 the price, China is receiving massive amounts of oil to pay for the loans.  This is the reason for the huge number of ships carrying oil to China.  China now has to step up in the refining of this oil

( zero hedge)

iii)Not sure how this will help China as their 5 yr plan is to replace workers with robots. Foxconn has already replaced 60,000 workers with robots.  What happ when social unrest becomes dominant!( zero hedge)



i)The Eurogroup agrees to disburse 7.5 billion euros just enough to repay its creditors that it owes in July and August.  Nothing for Greece!

( zero hedge)


ii)Then bang! the IMF states that they are now not ready to add new funds to the Greek bail out as it stands.  They still insist on debt relief:

(courtesy zero hedge)


iii)The labour strikes that are hurting the oil land gas sector in France has now morphed to the nuclear power plants where all staff in the 19 plants will go on strike for 24 hours. They may see power outages!

( zero hedge)


As expected, Erdogan snubs the European refugee deal and will not take back any refugees.Europe is going to have so much fun with this!

( zero hedge)


Nigeria has pegged its NAIRA at 197 to 199 Naira to the dollar.  The 3 month forwards show the currency plummet to 291 Naira to the dollar. It sure looks like Nigeria will be the next nation after Venezuela to fail.

Also it looks like the Saudi real is also beginning to crack

( zero hedge)


Oil nears 50 dollars after a bigger an expected inventory drawdown and a big production cut.

(courtesy zero hedge)


Emerging market decouple from the USA market feeling the pain of the devaluation of the yuan, the rise in the USA dollar and the corresponding fall in commodity prices:

( zero hedge)


i)Citibank is the latest to the slapped on the wrist for manipulating markets.   Today it is the USA dollar swaps and Yen Libor.  It is impossible to not to manipulate gold and silver if you are manipulating the above

( zero hedge)


ii) First quarter in 2016 witnesses the highest silver maple sales ever! With silver in backwardation in London, with a high open interest in silver at the comex for 5 years, it is a complete wonder why the price of silver has been down for over 5 years.

( SRSRocco report)

iii) Now China wants to set prices for the world’s commodities replacing the USA.

This no doubt is a huge dagger into the heart of USA

( GATA/Bloomberg)

iv) In the first quater to stave off bankruptcy these bozos sold 1.38 million oz of gold

(43 tonnes)

( GATA/Bloomberg)


v)Famed economist Paul Brodsky claims that the entire global monetary system has devalued by 10% against gold:

( Paul Brodsky)


Bill Holter’s very important public commentary tonight is entitled




i)The drop in Tiffany shares shows a huge weakness in both USA consumer and the global consumer.  They just had the biggest drop in sales in the last 1 1/2 yrs.  They missed on earnings per share and most importantly they cut their guidance forward.

( zero hedge)


ii)This is huge!! USA Service PMI plunges by the most ever on record and that should put a damper on a 2nd quarter GDP rebound.  Please remember this:  in the USA service and the consumer is 70% of GDP

and Janet wants to raise rates?
( zero hedge)
iii)Today huge layoff news: Microsoft fires a huge 1850 workers, Intel cuts 350 and Shell terminates 2,20… and Janet is justified in raising rats as the economy is improving!!????
( zero hedge)

iv)This does not bode well for the election season:  violent protesters storm the Trump rally in New Mexico..a very ugly scene:

(courtesy zero hedge)
v) Not good for Hillary@!! In trouble with the state department with respect to record keeping
( zero hedge)

vi)DAVID STOCKMAN writes a terrific commentary on the state of the USA economy. The S and P earnings for the year (first quarter 2015 to first quarter 2016) had earnings of 87.00 dollars and thus a P/e of 23.9 totally unheard of. The real earnings of $87.00 equates to a high in 2007 before the crash and it has not gotten any better.  Now you will understand that all markets are totally manipulated

( David Stockman/ContraCorner)

vii)Let us close today’s commentary with this very interesting conversation between lead lawyer in the Madoff scandal and Greg Hunter

( Greg Hunter/USAWatchdog)

Let us head over to the comex:

The total gold comex open interest FELL to an OI level of 542,958 for a CONSIDERABLE LOSS of 8603 contracts AS  THE PRICE OF GOLD WAS DOWN $22.90 with respect to YESTERDAY’S TRADING.  We are now entering the NON active delivery month of MAY. For the past two years, we have strangely witnessed two interesting developments and we have generally seen two phenomena happen respect to the gold open interest:  1) total gold comex collapses in OI as we enter any delivery month  and 2) a continual drop in the amount of gold standing in that month as that month progresses. IT SURE SEEMS THAT THE LATER HAS STOPPED. ACTUALLY WE HAVE WITNESSING A GRADUAL RISE IN AMOUNT STANDING THROUGH THE MONTH.  THE MONTH OF May saw its OI fall by only 49 contracts DOWN to 71. We had 50 notices filed YESTERDAY so we GAINED ANOTHER 1 gold contract or an additional 100 oz will stand for delivery.We have started the month with 5.6 tones and gained in ounces standing everyday but one which remained neutral. The next big active gold contract is June and here the OI FELL by 53,603 contracts DOWN to 132,143 as those paper players that wished to stay in the game rolled to August AND THE REST EITHER STAYED PUT FOR NOW OR LEFT PERMANENTLY. The estimated volume today (which is just comex sales during regular business hours of 8:20 until 1:30 pm est) was excellent at 348,415. The confirmed volume  yesterday (which includes the volume during regular business hours + access market sales the previous day was EXCELLENT at 467,470 contracts if many rollovers. The comex is not in backwardation. We are LESS THAN ONE week away from first day notice for the huge June contract/May 31.2016.


Today we had 53 notices filed for 5,300 oz in gold.


And now for the wild silver comex results. Silver OI ROSE by  101 contracts from 203,581 UP to 203,682 as the price of silver was DOWN BY  17 cents with YESTERDAY’S TRADING. For the first time in over 2 years, we have not witnessed a liquidation of open interest as we ENTERED first day notice .  The next active contract month is May and here the OI FELL by 12 contracts DOWN to 588. We had 12 notices filed yesterday so we NEITHER LOST NOR GAINED ANY SILVER CONTRACTS   standing in this non-active delivery month of May. The next non active month of June saw its OI ROSE by 0 contracts UP to 657 OI. The next big delivery month is July and here the OI fell by 400 contracts DOWN to 133,775. The volume on the comex today (just comex) came in at 33,914 which is  GOOD. The confirmed volume YESTERDAY (comex + globex) was VERY GOOD at 47,004. Silver is  in backwardation up to June. London is in backwardation for several months.
We had 5 notices filed for 25,000 oz.

MAY contract month:

INITIAL standings for MAY

May 25.
Withdrawals from Dealers Inventory in oz   nil
Withdrawals from Customer Inventory in oz  nil  13,044.419OZ




Deposits to the Dealer Inventory in oz 31,936.63 OZ


Deposits to the Customer Inventory, in oz    163,166.25 oz

5,100 kilobars



No of oz served (contracts) today 53 contracts
(5,300 oz)
No of oz to be served (notices) 18 CONTRACTS

1800 OZ

Total monthly oz gold served (contracts) so far this month 2196 contracts (219,600 oz)
Total accumulative withdrawals  of gold from the Dealers inventory this month   nil
Total accumulative withdrawal of gold from the Customer inventory this month  365,954.4 OZ

Today we had 1 dealer deposits


i) into the dealer Brinks:  31,936.630 oz

total dealer deposit:  31,936.63 0z


Today we had 0 dealer withdrawals:

total dealer withdrawals:  nil oz


Today we had 1 customer deposit:

WHAT!!!!! Manfra only delivers one or two kilobars per month/why on earth did they bring in 5100 kilobars?

i) Into MANFRA: 163,965.000 oz  or (5100 kilobars)


Total customer deposits;   163,965.000 OZ  5100 kilobars

Today we had 2 customer withdrawals:

i) Out of JPM:  11,115.419 oz
ii) Out of SCOTIA: 1929.000  (60 KILOBARS)

total customer withdrawals: 13,044.419 OZ

Today we had 0 adjustment:


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 53 contracts of which 3 notices was stopped (received) by JPMorgan dealer and 0 notices were stopped (received)  by JPMorgan customer account. 
To calculate the initial total number of gold ounces standing for the MAY contract month, we take the total number of notices filed so far for the month (2196) x 100 oz  or 219,600 oz , to which we  add the difference between the open interest for the front month of MAY (71 CONTRACTS) minus the number of notices served upon today (53) x 100 oz   x 100 oz per contract equals 221,400 oz, the number of ounces standing in this non active month.  This number is huge for May. IT NOW SEEMS THAT THE AMOUNT STANDING FOR GOLD IN MAY WILL HOLD AND WITH THAT IT WILL BRING MUCH EXCITEMENT TO JUNE 
Thus the initial standings for gold for the MAY. contract month:
No of notices served so far (2196) x 100 oz  or ounces + {OI for the front month (71) minus the number of  notices served upon today (53) x 100 oz which equals 221,400 oz standing in this non  active delivery month of MAY(6.886 tonnes).
WE  gained 1 contract or an additional 100 oz will stand for delivery in this non non active month of May.  It is this continual increase in gold ounces standing that is driving our bankers crazy and the reason today for another raid on gold/silver TODAY.
Since the comex allows GLD shares to be used for settling, it may take quite a while for the physical gold to enter the comex vaults.  So far I have seen little evidence of any settling of contracts but I will continue to monitor it for you. 
We thus have 6.886 tonnes of gold standing for MAY and 21.612 tonnes of registered gold for sale, waiting to serve upon those standing.  The bankers are still doing their best in cash settling as there is not enough registered gold to satisfy those that are standing.
We now have partial evidence of gold settling for last months deliveries We now have 6.886 TONNES FOR MAY + 12.3917 tonnes (April) +2.2311 tonnes (March) + 7.99 (total Feb)- .940 (probable delivery on March 1) tonnes -.0434 tonnes (March 11,12,17,18) + March 31: 1.2470 and then  April 1,2: – .0006 tonnes  and last week April 16 .3203 and April 22 .(0009 tonnes) + april 29  .205 tonnes + May 5:  3.799 and May 6: 1.607 tonnes – MAY 12  .0003- May 18: 1.5635 tonnes-May 19/   2.535 tonnes  = 17.232 tonnes still standing against 21.612 tonnes available.
Total dealer inventor 694,831.053 tonnes or 21.612 tonnes
Total gold inventory (dealer and customer) =8,036,948.401 or 249.98 tonnes 
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 249.98 tonnes for a loss of 53 tonnes over that period. 
JPMorgan has only 22.79 tonnes of gold total (both dealer and customer)
JPMorgan now has only .900 tonnes left in its dealer account.
May is not a very good delivery month and yet 6.886 tonnes of gold is standing.  What is different from other months is that the bankers cannot offer any fiat to those standing. They want the real stuff. We are extremely close to the all time highs in both gold and silver OI.
And now for silver

MAY INITIAL standings

 May 25.2016

Withdrawals from Dealers Inventory nl oz
Withdrawals from Customer Inventory  5915.26 oz


Deposits to the Dealer Inventory nil oz
Deposits to the Customer Inventory  nil


No of oz served today (contracts) 5 CONTRACTS 

25,000 OZ

No of oz to be served (notices) 583 contracts

2,915,000 oz

Total monthly oz silver served (contracts) 2145 contracts (10,725,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month nil oz
Total accumulative withdrawal  of silver from the Customer inventory this month  9,764,650.1 oz

today we had 0 deposit into the dealer account

total dealer deposit:nil oz

we had 0 dealer withdrawals:

total dealer withdrawals:  nil

we had 0 customer deposits:


Total customer deposits: nil oz.

We had 1 customer withdrawals

i) out of CNT: 5,915.26 oz


total customer withdrawals:  5915.26  oz



 we had 2 adjustment

i) Out of CNT:

14,982.16 oz was adjusted out of the dealer and this landed into the customer account of CNT

ii) out of HSBC

10,263.45 oz was adjusted out of the customer and this landed into the dealer account of HSBC

The total number of notices filed today for the MAY contract month is represented by 5 contracts for 25,000 oz. To calculate the number of silver ounces that will stand for delivery in May., we take the total number of notices filed for the month so far at (2145) x 5,000 oz  = 10,725,000 oz to which we add the difference between the open interest for the front month of MAY (588) and the number of notices served upon today (5) x 5000 oz equals the number of ounces standing 
Thus the initial standings for silver for the MAY contract month:  2145 (notices served so far)x 5000 oz +{588 OI for front month of MAY ) -number of notices served upon today (5)x 5000 oz  equals 13,640,000 oz of silver standing for the MAY contract month.
Total dealer silver:  30.114 million
Total number of dealer and customer silver:   153.658 million oz
The open interest on silver is NOW AT CLOSE an all time high with the record of 207,394 being set May 18.2016. The registered silver (dealer silver) is close to multi year lows as silver is being drawn out and heading to China and other destinations. The shear movement of silver into and out of the vaults signify that something is going on in silver.
The reason for the raid today in both gold and silver is probably for the following 4 reasons:
1. The end of options expiry for comex today and beginning of OTC  options expiry and LBMA. the latter ends May 31.2016
2. the stranglehold on the May front gold contract month
2. the continued drama in high silver OI
4. potential problem for the bankers in June gold.
And now the Gold inventory at the GLD
May 25./no change in gold inventory at the GLD/Inventory rests at 868.66 tonnes
MAY 24/ a good sized withdrawal of 3.86 tonnes of paper gold from the GLD/Inventory rests at 868.66 tonnes
May 23./this is rather impossible: another huge deposit of 3.26 tonnes into the GLD with the price of gold down again today?/inventory rests at 872.52 tonnes
May 18 /no changes in inventory at the GLD/Inventory rests at 855.89 tonnes.
May 17/ we had a huge deposit of 4.76 tonnes of gold into the GLD/Inventory rests tonight at 855.89 tonnes/in the last two and 1/2 weeks we have added 50 tonnes of gold and this most likely was all paper gold addition..
May 16./ today we had no changes in inventory at the GLD/Inventory rests at 851.13 tonnes
May 13./another addition of 5.94 tonnes of gold into the GLD/Inventory rests at 851.13 tonnes
May 12/another huge deposit of 3.27 tonnes in gold inventory at the GLD/inventory rests at 845.19 tonnes
May 11/another huge deposit of 2.67 tonnes in gold inventory at the GLD/Inventory rests at 841.92 tonnes
May 10/Another huge deposit of 2.38 tonnes in gold inventory at the GLD/Inventory rests at 839.25 tonnes
May 9/Surprisingly we had another deposit of 2.68 tonnes of gold into the GLD with gold down!! Inventory 836.87 tonnes
May 4/ we had a small deposit of .6 tonnes of gold into the GLD/inventory rests at 825.54 tonnes
May 3/no change in gold inventory at the GLD/Inventory  rests at 824.94 tonnes
May 2/a hugechange in gold inventory at the GLD a deposit of 20.80/Inventory rests at 824.94 tonnes
April 29/no change in gold inventory at the GLD/Inventory rests at 804.14 tonnes
April 28/we gained 1.49 tonnes of gold at the GLD/Inventory rests at 804.14

May 25.:  inventory rests tonight at 868.52 tonnes


Now the SLV Inventory
May 25./no change in silver inventory at the SLV/Inventory rests at 335.739
MAY 24/no change in inventory at the SLV/Inventory rests at 335.739 million oz
May 23./we had a small withdrawal of 285,000 oz and that generally means payment of fees.Inventory rests at 335.739 million oz
May 19/no changes in silver inventory at the SLV/Inventory rests at 335.073 million oz
May 18/no changes in silver inventory at the SLV/Inventory rests at 335.073 million oz/
May 17/no change in silver inventory at the SLV/Inventory rests at 335.073 million oz/
May 16./no changes in silver inventory at the SLV/Inventory rests at 335.073 million oz
May 13./no change in silver inventory at the SLV/inventory rests at 335.073 million oz
May 12/no change in silver inventory/rests tonight at 335.073 million oz/
 May 11.2016/no change in silver inventory/rests tonight at 335.073 million oz/
May 10.2016/we had a huge withdrawal of 1.046 million oz in silver leaving the SLV,no doubt for Shanghai which lately has been gobbling up whatever inventory it could lay its hands on/Inventory rests at 335.073 million oz.
May 9. no change in silver inventory/rests at 336.119 million oz.
MAY 5.2016: NO CHANGE IN INVENTORY/rests tonight at 337.261 million oz
May 4/we had a good size withdrawal of 1.553 million oz from the SLV/Inventory rests at 337.261 million oz
May 3: we had another huge deposit of 1.807 million oz/inventory rests at 338.814 million oz
May 2/a huge in silver inventory at the SLV/a deposit of 1.49 million oz/Inventory rests at 337.007 million oz
April 29.2016/no change in silver inventory at the SLV/Inventory rests at 335.580
April 28/no change in silver inventory at the SLV/Inventory rests at 335.580 million oz
May 25.2016: Inventory 335.739 million oz

NPV for Sprott and Central Fund of Canada


1. Central Fund of Canada: traded at Negative 4.5 percent to NAV usa funds and Negative 4.8% to NAV for Cdn funds!!!!
Percentage of fund in gold 61.6%
Percentage of fund in silver:37.0%
cash .+1.4%( May 25/2016).
2. Sprott silver fund (PSLV): Premium falls  to -0.74%!!!! NAV (MAY 25.2016) 
3. Sprott gold fund (PHYS): premium to NAV  RISES TO +0.28% to NAV  ( MAY 25.2016)
Note: Sprott silver trust back  into NEGATIVE territory at -0.74% /Sprott physical gold trust is back into POSITIVE territory at +0.28%/Central fund of Canada’s is still in jail.
It looks like Eric Sprott got on the nerves of our bankers as they lowered the premium in silver to -0.74%.  Remember that Eric is to get 75 million dollars worth of silver in a new offering.


And now your overnight trading in gold,WEDNESDAY MORNING and also physical stories that may interest you:

Trading in gold and silver overnight in Asia and Europe
Mark O’Byrne (goldcore)

Gold and Silver “Bottom Is In” – David Morgan tells Max Keiser

“Gold and silver bottom is in”, renowned silver analyst David Morgan tells Max Keiser on the Keiser Report and warns about paper and digital proxies for money and gold. Morgan, also known as the ‘Silver Guru’ of the, talks to Max about the gold, silver and global bond markets and the ponzi scheme that are these markets.

Also covered in the show are central banks creating a financial and economic system not free for its participants, the end of hegemony spotted in the price of Russian bonds and the Bank of Japan failing, yet again, to get any sign of life from the Japanese economy.

Morgan warns about the importance of owning physical gold coins and bars rather than paper or digital proxies for bullion and money. He points out how gold investors lost money in the MF Global fiasco and were exposed by the ABN AMRO unallocated gold account fiasco.

ABN AMRO, the largest Dutch bank and one of the largest banks in Europe announced in a letter to clients in April 2013 that that it would no longer allow clients to take delivery of their precious metals including gold, silver, platinum, and palladium bullion coins and bars. Instead, they paid account holders in a paper currency equivalent to the current spot value of the precious metal.

Thus, instead of legally owning a risk free, physical asset (a bullion bar or a bullion coin), the bank’s clients were unsecured creditors and were exposed to the bank and the financial system – somewhat defeating the purpose of owning precious metals.

The move highlighted once again the importance of owning physical bullion either in your possession (be that be in a safe or vault in a house, in the attic, under the floorboards or elsewhere in your possession) or in a secure vault in a country that is stable and respects property rights.

As Morgan concludes the interview, he points out that gold and silver bullion is the

“Only money outside of the matrix, only money outside of the system and only money throughout 5,000 years of history that people trust … ”


Gold and Silver News
Gold hits 7-week low as Fed rate hike prospects boost dollar – Reuters
Venezuela’s Gold Holdings Contract 16% as Maduro Battles Crisis – Bloomberg
Gold Jewelry Sales in Hong Kong Face ‘Icy Winter’ on Tourist Downturn – Bloomberg
Gold Posts Longest Slump in Six Months on Fed Rate Signals – Bloomberg
Ancient ship found in desert — with gold aboard – WTSP

Global funds fear ‘summer of shocks’ despite boom in money growth – Telegraph
“The Endgame” For Druckenmiller – His Full ‘Apocalyptic’ Presentation – Zero Hedge
Delinquency Rates In U.S. Surge in 2016, Poised to Head Higher – Financial Sense
Forget a Dollar Collapse…Deflation Is a Much Bigger Threat to Your Wealth Right Now – Casey Research
Gold – Bullish Combination Could Prevail – Bullion Desk
Read More Here

Gold Prices (LBMA AM)
25 May: USD 1,220.75, EUR 1,094.77 and GBP 834.63 per ounce
24 May: USD 1,242.65, EUR 1,111.18 and GBP 852.71 per ounce
23 May: USD 1,250.40, EUR 1,115.84 and GBP 860.89 per ounce
20 May: USD 1,256.50, EUR 1,120.18 and GBP 862.75 per ounce
19 May: USD 1,253.75, EUR 1,117.74 and GBP 857.37 per ounce

Silver Prices (LBMA)
25 May: USD 16.27, EUR 14.55 and GBP 11.14 per ounce
24 May: USD 16.27, EUR 14.55 and GBP 11.14 per ounce
23 May: USD 16.31, EUR 14.55 and GBP 11.27 per ounce
20 May: USD 16.56, EUR 14.76 and GBP 11.35 per ounce
19 May: USD 16.60, EUR 14.81 and GBP 11.35 per ounce

Protecting_Your_Savings_in_the_Coming_Bail_In_Era_-_Copy-3.jpg Storing_Gold_in_Switzerland 7_Key_Storage_Must_Haves.png

Read Our Most Popular Guides in Recent Months



Citibank is the latest to the slapped on the wrist for manipulating markets.   Today it is the USA dollar swaps and Yen Libor.  It is impossible to not to manipulate gold and silver if you are manipulating the above

(courtesy zero hedge)

In Latest Market Rigging Settlement, Citi Fined $425MM For Manipulating Interest Rates

Another day, another too-big-to-fail bank gets slapped on the wrist after being busted for blatant rigging of the market. The CFTC Order finds that, beginning in January 2007 and continuing through January 2012 (the Relevant Period), Citibank on multiple occasions attempted to manipulate, and made false reports concerning, the U.S. Dollar International Swaps and Derivatives Association Fix (USD ISDAFIX), a global benchmark for interest rate products. Notably, while a handful of European banks have already settled criminal or civil claims tied to Libor rigging, Citi is the first U.S. bank to do so.

The CFTC Order requires Citibank to pay a $250 million civil monetary penalty and to immediately cease and desist from further violations of the Commodity Exchange Act.  Further, Citibank is required take specified steps to implement and strengthen its internal controls and procedures, including measures to detect and deter trading potentially intended to manipulate swap rates such as USD ISDAFIX and to ensure the integrity of interest-rate swap benchmarks.


“The CFTC’s order demonstrates that we will vigorously continue to investigate any efforts to manipulate financial benchmarks, and we will take action where possible to protect the integrity of these benchmarks,” said Aitan Goelman, the CFTC’s Director of Enforcement. Mr. Goelman further commented, “The terms of this settlement are intended to reflect all aspects of Citibank’s response to the investigation, including the evolving nature of its cooperation.”


Citibank’s Unlawful Conduct to Benefit Derivatives Positions


As the Order sets forth, Citibank attempted to manipulate USD ISDAFIX by making false USD ISDAFIX submissions.  According to the Order, on multiple occasions during the Relevant Period, Citibank, in its role as a panel bank, submitted a rate or spread higher or lower than the reference rates and spreads disseminated to the panel banks on certain days that Citibank had a derivatives position settling or resetting against the USD ISDAFIX benchmark, in an attempt to benefit that derivatives position.


The Order also finds that Citibank, on multiple occasions, attempted to manipulate USD ISDAFIX by bidding, offering, and executing transactions in targeted interest rate products, including swap spreads and U.S. Treasuries at or near the critical 11:00 a.m. fixing with the intent to affect the reference rates and spreads captured in the snapshot sent to submitting banks, and thereby to affect the published USD ISDAFIX.  As captured in electronic communications, Citibank traders boasted about “pushing out the isdafixing” or “push[ing]” the market, described USD ISDAFIX as being “suprising[ly] easy to push,” and explained the best way to “influence the set.”


The Order describes multiple examples involving these strategies for attempted manipulation and false reporting by Citibank during the Relevant Period.

Additionally, Citi faces fine for manipulating Yen Libor…


Citi issued the following statement:

These settlements represent a significant step for Citi in resolving its legacy benchmark rate investigations. In addition to adopting industry-wide reforms related to participation in benchmark rates, Citi has made substantial investments in its systems, controls and monitoring processes to better guard against inappropriate behavior.  


Our greatest priority is to ensure that we conduct business in keeping with the highest ethical standards. We continue to fully cooperate with pending investigations conducted by other agencies related to benchmark rate submissions.”

As they proudly note in the press release, with today’s actions, CFTC has imposed over $5.08 billion in penalties in 17 actions against banks and brokers to address rigging and manipulation in ISDAFIX, FX, and LIBOR benchmarks.

“Cost of doing business” is what we call that… you decide – basedon the spike in Citi’s stock – whether the market thinks this is a let-off or a real punishment…

First quarter in 2016 witnesses the highest silver maple sales ever! With silver in backwardation in London, with a high open interest in silver at the comex for 5 years, it is a complete wonder why the price of silver has been down for over 5 years.
(courtesy SRSRocco report)

Q1 2016 Canadian Silver Maple Sales Surge To Highest Record Ever

SRSrocco's picture

By the SRSrocco Report

The Royal Canadian Mint just published its Q1 2016 Report, and the silver bullion coin sales figures were stunning to say the least.  Not only did sales of Canadian Silver Maple Leafs surpass its previous record during the third quarter last year, it did so by a wide margin.

Why is this such a big deal?  Because Q1 2016 sales of Silver Maples topped the Q3 2015 record, without surging demand and product shortages.  Last year, there was a huge spike in silver retail investment demand due to the supposed “Shemitah” or the collapse of the broader stock markets.  Investors piled into silver in a big way as they perceived a year-end market crash was inevitable.

During last August and September, some websites stated 2 month delivery wait times for certain products such as Silver Eagles and Silver Maples.  With the huge spike in demand, sales of Canadian Silver Maples reached 9.5 million oz (Moz) in Q3 2015.  Although, once investors became more relaxed as the broader markets turned around, demand for physical silver investment cooled down.  Thus, Silver Maple sales declined to 9.1 Moz in the last quarter of 2015.

However, something very interesting took place during the first quarter this year.  Sales of Silver Maples jumped to an all-time record high of 10.6 Moz:

Q1 2016 Silver Maple Sales

Actually, I was quite stunned by the figures published in the recent Royal Canadian Mint Report.  Sales of Silver Maples jumped 1.1 Moz in Q1 2016 vs Q3 2015, with no real spike in overall retail investment demand.  Which means, investors bought more Silver Maples in Q1 2016 than any other quarter in history.

Furthermore, if Silver Maple sales continue to be this strong, the Royal Canadian Mint is on track to sell over 40 Moz compared to the 34.3 Moz in 2015.  If Silver Eagle sales also continue on their strong trend of 1 Moz per week, the U.S. Mint could sell over 50 Moz of these coins.  Together, these two official mints could sell over 90 Moz of Silver Eagles and Maples in just one year.

This goes to show investors who are frustrated by the short-term price moves of gold and silver, that the market continues to purchase record volumes of these official coins… regardless.

I do believe the value of the precious metals will rise to levels much higher than we can imagine, but it will come when the Greatest Financial Paper Ponzi Scheme finally collapses.  So, it’s best to continue focusing on the fundamentals, rather than short-term price predictions.

Check back for new articles and updates at the SRSrocco Report.




In the first quater to stave off bankruptcy these bozos sold 1.38 million oz of gold

(43 tonnes)


courtesy GATA/Bloomberg)

Venezuela fights crisis with biggest sovereign gold sale since 2007


By Ranjeetha Pakiam and Eddie Van Der Walt
Bloomberg News
Wednesday, May 25, 2016

Venezuela held the biggest gold sale by a central bank in eight years as the country’s economic crisis deepened and the government faced concern that it may struggle to honor bond payments.

The country cut its gold reserves by 16 percent in the first quarter, following a 24-percent reduction in 2015, according to data from the International Monetary Fund. The quarterly sale was the largest by any central bank since Switzerland sold 3.2 million ounces in the third quarter of 2007. …

… For the remainder of the report:…




Now China wants to set prices for the world’s commodities replacing the USA.

This no doubt is a huge dagger into the heart of USA

(courtesy GATA/Bloomberg)


China wants to set prices for the world’s commodities


From Bloomberg News
Wednesday, May 25, 2016

China has put the world’s traditional financial centers on notice that it wants to develop its raw material markets as hubs for setting prices, seeking to marry the country’s commercial heft with a much greater say in determining how much commodities cost.

“We’re facing a chance of a lifetime to become a global pricing center for commodities,” Fang Xinghai, vice chairman of the China Securities Regulatory Commission, said at the Shanghai Futures Exchange’s annual conference in the city on Wednesday. “On the way to realize this goal, we’ll see very intense competition. We have the advantage of trading size and economic growth, but our legislation is still not sound and we lack enough talent.” …

… For the remainder of the report:…






Famed economist Paul Brodsky claims that the entire global monetary system has devalued by 10% against gold:

(courtesy Paul Brodsky)


Paul Brodsky: The monetary system has devalued 47% in 10 years


10a ET Wednesday, May 25, 2016

Dear Friend of GATA and Gold:

The world’s currencies have been steadily devaluing against gold over the last decade, economist and fund manager Paul Brodsky of writes in his new study, and he expects such devaluation to continue and increase under the coordination of monetary authorities, which will nevertheless pretend that they are doing no such thing.

In any such endeavor and all their other endeavors the monetary authorities will be powerfully assisted by the agreement of mainstream financial news organizations never to ask them any critical question about their largely surreptitious interventions in the markets.

Brodsky’s study is headlined “The Global Monetary System Has Devalued 47% over the Last 10 Years” and it’s posted at Zero Hedge here:…

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



A great article from Bill Holter

a public article!



(courtesy Bill Holter)

Have you ever wondered “who” would be blamed this time around?  To this point, we speak about the “Lehman moment” when we look back at 2008.  Of course it was not Lehman’s fault as they were forced, sacrificed or purposely destroyed, however you’d like to describe it.  The way I saw it, the banking system needed an injection of capital, cheap capital and lots of it.  The only way to get public funds was to “create” an emergency BEFORE the emergency became all engulfing, this is exactly what they did.
  Now, some eight years and multiple $trillions later we are facing another “liquidity crunch”.  It does not make sense that liquidity is scarce after all of the various QE’s but it is.  The credit markets are very thin and trading even small pieces of credit has become hard work.  The liquidity is just not there to support fully functional and liquid markets.  The question now becomes, which financial donkey will have the tail of failure pinned on them?
I believe we have been getting the answer over just the last few weeks.  My odds on guess is none other than Deutsche Bank, the largest or second largest derivatives monster on the planet.  They have settled several cases recently including Libor, stock manipulation and for manipulating the London gold and silver fixes.  I find it humorous as we were assured for so many years that gold and silver were THE ONLY things not being manipulated …how foolish of us to have thought such a thing? 
  As you know, DB is now offering 5% rates on 90 day money from it Brussels division.  This makes no sense at all since they should be able to raise money in credit markets or from the ECB directly for nearly 0% or even negative …but for some reason they cannot.  I have speculated Deutsche Bank has been “kicked out of the club” and their access to capital is being blocked.  This may or may not be true but would make sense since they have agreed to turn state’s evidence and rat on other firms misdoings.
The latest, DB had their credit rating downgraded yesterday to two notches above “junk” Deutsche Bank’s credit rating was downgraded to 2 notches above junk.  This will obviously make it even more difficult to raise capital and certainly increase their costs for capital.  I find this very curious because from a systemic standpoint, we now have a wobbling counter partner in the derivatives market with well over $50 trillion!  How comfortable can those be on the other side of derivatives with Deutsche Bank?  Are they (were they ever?) really “hedged” or not?  Without a doubt, it will be better not to find out but that is only wishful thinking.
Another aspect is from the judicial side, it now appears the courts are going to allow civil suits against the banks collectively based on criminal acts.  The obvious here is that the banks collectively do not have enough capital to settle all the claims that are sure to come.  What I am saying here is this, the old “pay to play” model which worked so well for so long may be breaking.  It may be that the “paying” part may end up as more expensive than the profits made from “playing”.
  All of which… which leads me to an important conclusion, the “banks”, collectively, need the system to come down and they need someone to blame.  The “someone to blame” part is obvious, but why do they need the entire system to come down?  Think about this, if the collapse is systemic then no one individually (except Deutsche Bank?) will have fingers pointed at them.  The next logical point is this, how will a court be able to find for plaintiffs if the banks are ALL broke?  Can you really squeeze blood from a stone?  And penalizing the banks, no matter what they did would certainly not be viewed as something “for the common good”. 
  Let’s face it, the system is coming down one way or the other.  If you cannot see this yet then all I can say is “you don’t know that you don’t know” and good luck to you.  If the banks have reached the point of no return, doesn’t it make sense to “control” the crash?  Or at least the narrative?  Doesn’t it make sense to be able to point a finger at one particular bank as the reason instead of admitting it is ALL the banks and the system itself that was flawed.  It will be very interesting to see how this exactly unfolds but my money is on Deutsche Bank as the Lehmanesque scapegoat!
Speaking of scapegoats, I am sure you saw the Senate vote last week that “sovereigns” (think Saudi Arabia) can be sued civilly.  The finger has been pointed at the Saudis for being complicit in 911.  The Saudi press returned volley yesterday by claiming the U.S. government was complicit themselvesSaudi Press Just Accused US Govt of Blowing Up World Trade Centers as Pretext to Perpetual War  .  I think what is being missed here is both the Saudis and the U.S. are moving away from the official (impossible) story.  Neither now claim that 19 Arabs did this on their own!
  Do you see the importance of this?  “Truth”, (uncovered in these small portions) is slowly coming out via “truth bombs”.  The official stories whether they be financial, political or geopolitical are having small shreds of truth added in.  As I have said all along, I believe we will see the mother of all truth bombs dropped by Mr. Putin with an absolutely “shocked” China looking in.  Any sort of truth bomb will have U.S. (Western) financial markets as the prime target…  Can Western markets even survive the real truth? 
  This has been a public article, if you enjoyed this and would like to see all of our work please click here to subscribe
Standing watch,
Bill Holter
Holter-Sinclair collaboration
Comments welcome

Your early WEDNESDAY morning currency, Asian stock market results,  important USA/Asian currency crosses, gold/silver pricing overnight along with the price of oil Major stories overnight




2 Nikkei closed UP 258.59 OR 1.57% /USA: YEN FALLS TO 110.22

3. Europe stocks opened ALL IN THE GREEN  /USA dollar index DOWN to 95.52/Euro DOWN to 1.1145

3b Japan 10 year bond yield: RISES   TO -.098%     !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 110.35

3c Nikkei now WELL BELOW 17,000

3d USA/Yen rate now well below the important 120 barrier this morning

3e WTI::  49.02  and Brent: 49.20

3f Gold DOWN  /Yen DOWN

3g Japan is to buy the equivalent of 108 billion uSA dollars worth of bond per month or $1.3 trillion. Japan’s GDP equals 5 trillion usa.

Japan to buy 100% of all new Japanese debt and by 2018 they will have 25% of all Japanese debt. Fifty percent of Japanese budget financed with debt.

3h Oil UP for WTI and UP for Brent this morning

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10 yr bund RISES to 0.180%   German bunds in negative yields from 8 years out

 Greece  sees its 2 year rate FALL to 7.46%/: 

3j Greek 10 year bond yield FALL to  : 7.16%   (YIELD CURVE NOW FLAT)

3k Gold at $1224.00/silver $16.31(7:45 am est) BROKE RESISTANCE AT 16.52 

3l USA vs Russian rouble; (Russian rouble UP 51 in  roubles/dollar) 65.71-

3m oil into the 49 dollar handle for WTI and 49 handle for Brent/

3n Higher foreign deposits out of China sees huge risk of outflows and a currency depreciation  (already upon us). This can spell financial disaster for the rest of the world/China forced to do QE!! as it lowers its yuan value to the dollar/expect a huge devaluation imminently from POBC.


30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF. It is not working: USA/SF this morning .9911 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1047 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.


3r the 8 Year German bund now  in negative territory with the 10 year RISES to  + .18%

/German 8 year rate negative%!!!

3s The Greece ELA NOW a 71.4 billion euros,

The bank withdrawals were causing massive hardship to the Greek bank. the Greek referendum voted overwhelming “NO”.  Next step for Greece will be the recapitalization of the banks and that will be difficult.

4. USA 10 year treasury bond at 1.87% early this morning. Thirty year rate  at 2.65% /POLICY ERROR)

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

(courtesy Jim Reid/Bloomberg/Deutsche bank/zero hedge)


Global Stocks, Futures Rally, Ignore Sharp Yuan Devaluation On Hopes Fed Is Right This Time

The single biggest event overnight was the PBOC’s devaluation of the Yuan to the lowest since March 2011, setting the fixing at 6.5693, the highest in over 5 years and in direct response to a stronger dollar, which however if one looks at the DXY remains well below the recent highs in the 100 range, suggesting for China this is only just beginning.

However, the fact that there was not more volatility in onshore and offshore overnight FX also comforted the market that at the same time as its was devaluing the PBOC was also intervening in the FX market, thus providing some assurance it would not allow runaway “risk off” sentiment prevail, nor would it promote another blitz round of capital outflows, leading to another gradual levitation in overnight risk.

Whether the PBOC is successful this time happens remains to be seen, but for now algos and traders decided to ignore the loud warning signal by China, and focused on oil instead which after yesterday’s sharp API inventory drop has pushed to fresh 7 month highs, higher by another 1% as the likely resumption of production by domestic producers is widely ignored. Instead, the market also focused on yesterday’s new home sales, a data point with a 15% interval of confidence, as confirmation that the US economy is back on the mend, and thus any imminent rate hike by the Fed would be justified… just like in December.

Trader sentiment confirmed as much: “Strong U.S. new home sales have added credence to the Fed’s claims that the U.S. economy may be strong enough for another rate hike in June or July,” said Angus Nicholson, a Melbourne-based market analyst at IG Ltd. “Japanese equities in particular are relishing the strong U.S. dollar.”

As a result, global equities rose to a two-week high amid increasing investor optimism that the world economy can withstand higher U.S. interest rates. Oil advanced and gold fell amid a retreat in the dollar. The MSCI All Country World Index climbed for a second day, European equities jumped, and futures signaled a higher opening for U.S. shares. Emerging-market stocks rose the most in six weeks, while South Korea’s won led currencies higher even as China set the yuan’s reference rate at the weakest level since 2011. Crude rallied above $49 a barrel as gold slid for a sixth day. Greek bonds increased, pushing the 10-year yield below 7 percent for the first time since November, after its creditors agreed to release bailout funds. The cost of insuring corporate debt against default fell to the lowest in almost a month.

Traders are now pricing in a one-in-three chance of higher borrowing costs in June. That’s up from 4 percent last Monday. July is the first month with more than even odds for a rate hike. Fed Chair Janet Yellen is scheduled to speak on Friday after European markets close.

While recently the market was spooked by the prospect of an imminent rate hike, as Bloomberg adds “improving confidence in financial markets is tempering anxiety over the Federal Reserve’s plans to raise U.S. interest rates, potentially as soon as next month.” Adding to the confidence, recent polls show growing support for the U.K. to remain in the European Union, the rally in commodities is damping the risk of deflation, and a measure of economic surprises in the world’s largest economies hit its highest level this year. Still, faith in global growth prospects has been easily shaken, with global equities failing to make any gains in 2016.

U.S. data is supporting the view that if we don’t see stellar growth, at least we don’t see a recession, and that’s a good thing,” said Michael Woischneck, who oversees about 300 million euros at Lampe Asset Management in Dusseldorf, Germany. “If the Fed has the chance to hike again then it should take this opportunity as the market is very prepared. We also have a deal for Greece that has helped perceptions change in the European market.”

The Stoxx Europe 600 Index added 1.1% in early trading, with almost all industry groups climbing. Carmakers, insurers and banks posted the biggest gains. The equity measure closed above its 50-day moving average on Tuesday for the first time after slipping below it earlier this month. That sends a short-term bullish signal in technical analysis, according to Saxo Bank A/S trader Pierre Martin.

The Hang Seng China Enterprises Index of mainland stocks listed in Hong Kong surged 2.8 percent, the most in more than a month. Benchmark gauges in South Korea, Taiwan, the Philippines, Russia and Dubai increased at least 1 percent.

Futures on the S&P 500 added 0.5 percent, indicating U.S. equities will extend gains after rising 1.4 percent on Tuesday. Investors will look to data on services output and house prices due Wednesday for signs of the health of the world’s biggest economy amid increasing bets that the Fed is confident enough to raise rates.

The yield on 10-year U.S. Treasuries increased by one basis point to 1.87 percent, matching its average level for 2016. The U.S. is selling $34 billion of five-year securities on Wednesday after investors snapped up a $26 billion auction of two-year notes on Tuesday, leaving primary dealers with the lowest award at a sale of the debt in data going back to 2003.

“The Treasury yield could end up a little bit above 2 percent” as the Fed raises rates, said Stephen Roberts, an economist at Laminar Group Pty, a Melbourne-based fixed-income adviser. “The U.S., of developed economies, has had the best of the economic recovery we’ve had since the global financial crisis.”

Markets snapshot

  • S&P 500 futures up 0.4% to 2083
  • Stoxx 600 up 0.9% to 347
  • FTSE 100 up 0.5% to 6168
  • DAX up 0.6% to 9899
  • S&P GSCI Index down 0.4% to 363.5
  • MSCI Asia Pacific up 1.5% to 127
  • Nikkei 225 up 1.6% to 16757
  • Hang Seng up 2.7% to 20368
  • Shanghai Composite down 0.2% to 2815
  • S&P/ASX 200 up 1.5% to 5373
  • US 10-yr yield up less than 1bp to 1.87%
  • German 10Yr yield down 1bp to 0.17%
  • Italian 10Yr yield down 3bps to 1.45%
  • Spanish 10Yr yield down 2bps to 1.56%
  • Dollar Index up 0.02% to 95.59
  • WTI Crude futures up 1% to $49.13
  • Brent Futures up 1% to $49.11
  • Gold spot down 0.5% to $1,222
  • Silver spot up 0.2% to $16.25

Top Global News

  • Microsoft May Cut 1,850 Jobs as Nadella Pares Phone Ambitions: Company will incur about $950 million in new charges. Last week Microsoft sold its feature phone business to FIH
  • Goldman Sachs Sees Malaysian Deals Evaporate Amid 1MDB Concerns: Once among top banks, Goldman was 18th in 2015 M&A rankings. U.S. authorities said to subpoena ex-Goldman banker in probe
  • CYBG Soars in London Trading as CEO Pledges to Eliminate Jobs: Clydesdale and Yorkshire bank owner to reduce expenses. Lender has gained more than 40% since its February IPO
  • Exxon, Chevron Oppose Environmental Drive to Cut Big Oil’s Reach: Shareholders will vote on limiting oil and gas exploration. Money saved would be paid to investors in dividends, buybacks
  • US Foods Seeks to Shake Off Failed Merger With $1 Billion IPO: Food distributor 1 of 2 national players in fragmented field. Owners KKR, CD&R don’t plan to sell shares in offering
  • China Said to Plan Asking U.S. on Timing of Fed Rate Increase: U.S.-China Strategic & Economic Dialogue set for June 6-7. China said to be preparing for potential market, yuan impact
  • U.S. Said to Investigate InBev Distribution Incentiv: Investigation over new incentives that encourage independent distributors to sell more of its own beer brands at expense of competing craft brews, Reuters reports, citing 2 unidentified people with knowledge.

Looking at regional markets, we start as usual in Asia where equities tracked the firm gains from Wall Street where strong New Home Sales data and advances in oil bolstered sentiment. Nikkei 225 (+1.6%) benefited from renewed press reports that Japanese PM Abe will delay the sales tax hike, while ASX 200 (+1.5%) was led higher by the uptick in energy in which WTI futures rose above USD 49/bbl to hit YTD highs. Chinese bourses conformed to the upbeat tone in the region with the Hang Seng (+2.8%) and Shanghai Comp (-0.2%) bolstered following another inter-bank liquidity injection and reports CSRC plans to open the futures market to investors abroad. 10yr JGBs traded higher despite the risk-on sentiment in the region, as the BoJ were in the market to purchase over JPY 1.2trl in government debt. BoJ Governor Kuroda stated the BoJ is to be mindful of the balance sheet and later added they will ease further if FX impacts price goal. Kuroda further stated that there is currently not a big risk of JGB yield volatility.

Asia Top News

  • China Weakens Yuan Fixing to Lowest Since 2011 as Dollar Climbs: Reference rate was lowered by 0.3% to 6.5693/dollar
  • Singapore Economy Gets Temporary Boost From Manufacturing: 1Q GDP +0.2% q/q vs est. +0.6%
  • Mitsubishi Motors Corrects Last Year’s Earnings on Data Scandal: Charge reflects costs to compensate owners, Japan govt
  • Toyota to Invest in Uber to Explore Ride-Share Partnership: Cos. enter into MOU

European equity markets have also carried through the overnight risk on sentiment to trade firmly in the green this morning (Euro Stoxx: +1.6%). Financials are among the best performers in Europe, particularly from the periphery given the overnight Greek deal. Elsewhere Marks & Spencer are the worst performers in Europe today after their pre-market earnings and trade lower by around 9%. Fixed income markets have seen Bunds initially fall in tandem with the surge higher in equities, with the German benchmark trading firmly below 163.50 before staging a recovery heading into the North American open . Meanwhile, in the wake of the aforementioned Greek deal, Eurozone periphery yields have declined, with the Greek 10Y below 7% for the first time since November’15.

Top European News

  • UniCredit CEO Departure Puts Focus on Bank’s Capital Strategy: Chairman Giuseppe Vita to lead search for new CEO, bank says. Marco Morelli was approached for the role, person says
  • Deutsche Bank Trading Woes Exposed in Slide Down Currency League: After topping Euromoney ranking for 9 years, lender slips to 4. Bank’s market share shrinks to 7.9%, from 14.5% a year earlier
  • Bayer Says It’s Confident It Can Meet Monsanto Deal Demands: German company says it will address finance, regulatory issues. Monsanto rejected $62 billion offer, which it said was too low
  • BASF Feels No Pressure as Rivals Plan $170 Billion of Deals: Chemical maker focused on operations, Asia chief Gandhi says. BASF’s strategy under CEO Bock has been consistent, he says
  • Apollo Said to Seek $3.5 Billion to Scoop Up Bad European Debt: No better time for credit investors as banks hampered: Black. Strategy to target bad loans held by institutions under stress
  • Greece Wins Pledge for Debt Relief as IMF Bows to Euro Proposal: MF makes ‘major concession’ in Eurogroup negotiations. First aid payment to be made in June to cover debt servicing
  • Brexit Vote Could Extend U.K. Austerity by Two Years, IFS Says: IFS says quitting EU might add 40 billion pounds to borrowing. Economic damage would dwarf savings on payments to EU budget
  • ECB Officials Say Euro Area Needs Coordinated Economic Policies: France’s Villeroy, Spain’s Linde comment at Madrid conference. Extraordinary monetary stimulus hasn’t yet restored inflation

In currencies, the biggest FX news overnight was China’s central bank weakened its currency fixing by 0.3 percent to 6.5693 per dollar, the lowest since March 2011.However, since the yuan in Hong Kong was little changed at 6.5650 and the onshore rate was down 0.05 percent to 6.5620, many have speculated that despite the sharp easing, the PBOC continues to intervene and will not the currency lead to a resumption in capital outflows. The Bloomberg Dollar Spot Index declined 0.1 percent, trimming this month’s advance to 3.4 percent. The yen was little changed near 110 versus the greenback after Goldman Sachs Group Inc. predicted the Japanese currency would slide 12 percent by this time next year.  The MSCI Emerging Markets Currency Index climbed 0.2 percent. The won rose 0.9 percent, boosted by optimism that strength in the U.S. economy will shore up demand for South Korean exports. Malaysia’s ringgit strengthened 0.6 percent and Russia’s ruble gained for a second day to a one-week high.  Forwards on the Nigerian naira soared as traders increased bets on Nigeria’s currency weakening, with rates on three-month contracts jumping 16 percent to 288 per dollar. The central bank voted to allow “greater flexibility” in the foreign-exchange market on Tuesday, signaling policy makers may abandon a currency peg they’ve held for 15 months.

In commodities, oil extended gains in New York from the highest closing price in seven months after U.S. industry data showed crude stockpiles declined, easing a glut. Inventories dropped by 5.14 million barrels last week, the American Petroleum Institute was said to report. Data from the Energy Information Administration Wednesday is forecast to show supplies fell. West Texas Intermediate rose 1.1 percent to $49.15 a barrel and Brent added 1.1 percent to $49.16. WTI closed at a premium to Brent Tuesday for the first time in almost two weeks. Gold dropped to the lowest level in almost seven weeks. Bullion for immediate delivery fell 0.5 percent to $1,220.81 an ounce. Most industrial metals declined, with nickel dropping 0.2 percent and aluminum losing 0.3 percent. Copper rose 0.6 percent to $4,630 a metric ton.


Bulletin Headline Summary From RanSquawk and Bloomberg

  • European equities followed suit from their US and Asian counterparts to trade higher across the board with news of a Greek deal and energy markets also guiding price action
  • GBP has once again been a key source of focus for FX markets with GBP/USD briefly breaking above 1.4650 before paring gains in recent trade
  • Looking ahead, highlights include BoC Rate Decision, US Trade Balance, Services PM! and DOE U.S. Inventories, Fed’s Harker, Kashkari and Kaplan
  • Treasuries little changed in overnight trading as global equities rally along with oil; Treasury auctions continue with sale of $34b 5Y notes, WI 1.41%; last sold at 1.41% in April, first tail by a 5Y auction since January.
  • Chinese officials plan to ask their American counterparts in annual talks next month about the chance of a Federal Reserve interest-rate increase in June, according to people familiar with the matter
  • The ECB expanded the size of its debt-buying program in April by a third to €80 billion ($89 billion) a month and appears to be running out of securities eligible under its own rules
  • ECB will aim to buy €5b-€10b worth of corporate bonds per month after it starts “small” in June, Reuters reports, citing several unidentified central bank people with knowledge of matter
  • Brazil bond investors are dialing back their optimism after newly appointed Finance Minister Henrique Meirelles acknowledged that the country’s fiscal problems are much worse than anyone had imagined
  • A meeting of euro-area finance ministers in Brussels paved the way for a €10.3 billion ($11.5 billion) aid payout to Greece but left important details to be hammered out after Germany’s federal election next year
  • Greece’s bonds advanced, pushing 10-year yield below 7% for the first time since November, was as high as 19% last July
  • Sovereign 10Y yields mixed; European, Asian equities higher; U.S. equity-index futures rise; WTI crude oil higher, precious metals mixed

DB’s Jim Reid concludes the overnight wrap

Although credit spreads are generally wider in May on the back of very strong issuance, a number of major equity bourses returned back to positive territory for the month yesterday. Indeed the S&P 500 (+1.37% yesterday, +0.52% MTD) and DAX (+2.18% yesterday, +0.18% MTD) were last positive for May on the 16th and the 10th respectively. The Stoxx 600 (+2.21%) actually went into positive territory (+0.77%) for first time this month following the biggest one day gain yesterday since April 13th. It was hard to pinpoint one particular trigger for yesterday’s rally but one theme which was constant on both sides of the pond was the strong performance for Banks. Indeed a contributor to this may have been some of the comments coming from ECB Supervisory Chief Daniele Nouy. Speaking at a conference in Madrid, Nouy made mention of the ECB still having a lot of work to do on addressing legacy assets and particularly non-performing loans but that the Bank ‘will fast come with certain proposals’. She also highlighted that she is comfortable with the current minimum capital requirements for banks in Europe. Indeed it was the peripheral bourses that outperformed yesterday with the FTSE MIB in particular rallying to the tune of +3.34% with the likes of Monte de Paschi, Banco Popolare, Intesa Sanpaolo and UBI up between 5% and 10%.

Some of the commentary also pointed towards the latest bumper housing data in the US as helping to nudge rate expectations and yields a little higher and so in turn lending a helping hand in the rally for financials. In fairness much of the rally had already occurred prior to the data but in any case it helped to consolidate gains and was perhaps just evidence that investors are becoming a little more comfortable with the prospect of a possible rate move this summer. New home sales rose an impressive +16.6% mom in April which compared to expectations of just +2.4%. As a result the annualized rate rose to 619k from 531k which is the highest since January 2008 while the monthly surge was actually the biggest since 1992. That helped the US Dollar to strengthen +0.70% relative to the Euro while 10y Treasury yields edged up just shy of 3bps (2y yields were up a less impressive 1bp). By the end of play the odds of a move in June are now 34% (from 32%) with July consolidating around 54%.

Meanwhile rising Oil prices did little to spoil the mood yesterday as WTI (+1.12%) ignored yesterday’s stronger Dollar and has in fact crept back above $49/bbl this morning (and testing the YTD highs) in Asia following a similar magnitude gain ahead of today’s US stockpile data. Elsewhere Gold (-1.75%) tumbled yesterday and is now down over 5% this month.

Before we look at how markets have followed up in Asia, there’s been some positive news to come out of the Eurogroup meeting overnight following 11 hours of talks with the announcement that Greece’s creditors have come to an agreement on allowing for the release of €10.3bn of aid as well as committing to debt relief in later years. It appears that it is the IMF which has backed down somewhat from its previous harder stance with the agreement that the Fund will continue to participate in the nation’s rescue package too. Greek press Ekathimerini is reporting that conditional debt relief is to be granted from 2018 while a statement from the Chair of the meeting, Eurogroup President Dijsselbloem, said that ‘we achieved a major breakthrough on Greece which enables us to enter a new phase in the Greek financial assistance programme’. The finer details should get debated today but so far it looks like there are valid grounds for optimism that this is a big positive step in the right direction.

Refreshing our screens this morning, the positive lead from the US and Europe yesterday has continued this morning in Asia where we’ve seen a decent rebound across the majority of bourses. The Hang Seng (+2.56%) is leading the way, while the Nikkei (+1.80%) is not far behind. In China the Shanghai Comp (+0.41%) and CSI 300 (+0.50%) are both higher while elsewhere the Kospi (+1.15%) and ASX (+1.73%) are also stronger. Credit markets are rallying too with the iTraxx Aus, Asia and Japan indices 3-5bps tighter. There’s also been some activity in FX markets this morning with the main news being that the PBoC has set the CNY fix at its weakest level since March 2011. Indeed the fix was set 0.34% weaker although the current spot rate this morning (around 6.562) is still below the levels reached in the volatile month of January when there was arguably alot more focus on where the PBoC was setting the reference rate for the currency.

Back to yesterday, there was actually a reasonable amount of focus on some of the other chatter coming from the ECB yesterday. Vice-President Constancio said that in his view it is still too early to start discussing further stimulus from the ECB as a response to more challenging financial conditions. Constancio said instead that he prefers to hold tight to wait and see what the effects are of the latest round of measures from the Bank. Meanwhile the ECB’s latest edition of its semi-annual Financial Stability Review showed that a rise in political risk ‘poses a challenge to fiscal and structural reform implementation and, by extension, public debt sustainability’. The review went on to show that this in turn could put renewed pressure on vulnerable sovereigns while potentially contributing to contagion and re-fragmentation in the Euro area.

Meanwhile, over in the UK a fresh EU UK referendum poll released late last night for the Times newspaper and run by YouGov showed an even running between the Remain and Leave camps at 41% each. The Bloomberg headline suggests that the poll covered the May 23rd and 24th period. The last YouGov/Times poll had been split at 44% to 40% in favour of Remain.

Rounding off the other economic data that was released yesterday, in the US the only other release of note was the Richmond Fed manufacturing index for May which provided for further evidence of softness in the sector after dropping 15pts this month to -1 (vs. +8 expected). New orders were also down a significant 18pts. Prior to this in Europe, Germany had reported no change in its final Q1 GDP revision of +0.7% qoq. Meanwhile the May ZEW survey was released which revealed a 5.4pt increase in the current situation component to 53.1 (vs. 49.0 expected). The expectations survey however was down a disappointing 4.8pts to 6.4 (vs. 12.0 expected). It’s worth noting that our German Economists have now revised down their Q2 GDP forecast from 0.3% to 0.1% as they expect material payback for the Q1 strength. While they remain optimistic with regards to the labour market, they think that the impetus from low oil prices to real income is fading. In addition, the mild winter has allowed construction work to be pulled forward, albeit the payback might be limited by the strength of underlying construction demand.




i)Late  TUESDAY night/ WEDNESDAY morning: Shanghai closed DOWN  BY 6.58 PTS OR 0.23%  /  Hang Sang closed UP 537.62 OR 2.71%. The Nikkei closed UP 258.59 POINTS OR 1.51% . Australia’s all ordinaires  CLOSED UP 1.45% Chinese yuan (ONSHORE) closed DOWN at 6.5616 .  Oil ROSE to 49.02 dollars per barrel for WTI and 49.20 for Brent. Stocks in Europe ALL IN THE GREEN . Offshore yuan trades  6.5645 yuan to the dollar vs 6.5616 for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS TO ZERO.



none today/also no China stories


Your big story of the month.  China has decided to deeply devalue the yuan (onshore) last night as they are acting ahead of the USA potential rate hike. They are quite happy with the slow devaluation of the yuan against all of the other currencies they put in their basket and now want to concentrate on the USA.  The most important point here:

The flip-flop is a sign of policy makers’ deepening wariness about how much money is fleeing China, a problem driven by its slowing economy. For now, at least, officials believe the benefits of freeing the yuan are outnumbered by the number of threats..”

No question we will see massive turmoil in all markets as Janet has to make a decision whether to raise rates

(courtesy zero hedge)


Currency War Resumes – China Devalues Yuan To 5-Year Lows

After a brief hiatus from the ongoing currency wars, China fired another salvo at The Fed tonight by devaluing the Yuan fix to 6.5693 – its weakest against the USD since March 2011. After eight days higher in a row for The USD Index, it seems PBOC has turned its currency liberalization plan off, stabilizing the broad Renminbi basket (which has been steadily devalued) and turning its attention to devaluing against the USD. Having unleashed turmoil in August (pre-Sept FOMC) and January (post Dec rate-hike), it appears the rising rate-hike probabilities jawboned by The Fed are decidedly disagreeable to “authoritative persons” in China.

The Yuan Fix was driven down to March 2011 lows…


“It could be because the authorities want to alleviate some of the depreciation pressure before the Fed interest rate decision in June,” said Christy Tan, head of markets strategy at National Australia Bank Ltd. in Hong Kong. “If there are signs of panic dollar buying, the PBOC will step in.”

As it seems maintaining some ‘stability’ against the USD has lost its appeal as the USD surges once again…

What the chart above shows is that the Chinese currency (red) has been devaluing in an orderly and quiet manner for much of the year while maintaining the appearance of stability against the USD (blue). That appears to have changed now and the last time turmoil started to ripple through the CNHUSD markets – it didn’t stop until Tom Cook lied to Jim Cramer and The PPT rescued the world.

The irony of the apparent stability in the broad-based Renminbi basket (while devaluing against the USD) is that it comes after a desperate China has reportedly given up on its liberalization goals. As The Wall Street Journal notes,

Behind closed doors in March, some of China’s most prominent economists andbankers bluntly asked the People’s Bank of China to stop fighting the financial markets and let the value of the nation’s currency fall.

They got nowhere. “The primary task is to maintain stability,” said one central-bank official, according to previously undisclosed minutes of the meeting reviewed by The Wall Street Journal.

The meeting left little doubt China’s top leaders have lost interest in a major policy shift announced in a surprise move just nine months ago. In August 2015, the PBOC said it would make the yuan’s value more market-based, an important step in liberalizing the world’s second-largest economy.

In reality, though, the yuan’s daily exchange rate is now back under tight government control, according to meeting minutes that detail private deliberations and interviews with Chinese officials and advisers who spoke with The Wall Street Journal about the country’s currency policy.

On Jan. 4, the central bank behind closed doors ditched the market-based mechanism, according to people close to the PBOC. The central bank hasn’t announced the reversal, but officials have essentially returned to the old way of adjusting the yuan’s daily value higher or lower based on whatever suits Beijing best.

The flip-flop is a sign of policy makers’ deepening wariness about how much money is fleeing China, a problem driven by its slowing economy. For now, at least, officials believe the benefits of freeing the yuan are outnumbered by the number of threats… though we note that a 3% depreciation of the yuan could add $25.6 billion to Chinese companies’ annual interest payments on dollar debts, according to estimates by analysts at BNP Paribas.

So the question is – will the Yuan turmoil ripple through markets enough to spook The Fed once more and dissolve what little credibility they have left or will Janet and her henchmen stand up to the foreign forces, hike rates to spit their own face, and deal with the aftermath through some more Citadel-driven VIXtermination? With VIX futures near record shorts and S&P futures at their longest in almost 2 years – there’s not much easy leveraged money to squeeze there – like there was in August.

When China gave loans to OPEC poor countries, the loans in dollars were collaterized with oil.  Now that oil is 1/3 the price, China is receiving massive amounts of oil to pay for the loans.  This is the reason for the huge number of ships carrying oil to China.  China now has to step up in the refining of this oil
(courtesy zero hedge))

Why China Is Being Flooded With Oil: Billions In Underwater OPEC Loans Repayable In Crude

When the price of oil was above $100, many of the less developed oil exporting OPEC members decided to capitalize on the high price and cash out by taking loans using the precious liquid as collateral very much the same way corporate CEOs use their inflated stock (thanks to buybacks they authorize) to issue loans against said stock. And why not: even if the price of oil were to drop, they could just pump more until the principal is repaid. However, few oil exporters anticipated such an acute oil plunge in such as short time span, which resulted in the value of the collateral tumbling by 70%, and now find themselves have to repay the original loan by remitting as much as three times more oil!

According to Reuters, this is precisely what happened in the years preceding the great 2014-2015 oil bust: “poorer oil-producing countries which took out loans to be repaid in oil when the price was higher are having to send three times as much to respect repayment schedules now prices have fallen.”

As a result, the finances of countries such as Angola, Venezuela, Nigeria and Iraq have been crippled, in the process creating further division within the Organization of the Petroleum Exporting Countries.

But while these already poor and corrupt OPEC nations were the biggest losers, one country was a huge winner, the country that provided the billions in virtually risk-free, oil-collateralized loans to any country that requested them. China. The same China which has once again proven smart enough to not demand repayment in fiat but in physical commodities, be they oil, copper or gold.

Take Angola for example: Africa’s largest oil producer has borrowed as much as $25 billion from China since 2010, including about $5 billion last December, which according to Reutersforced its state oil firm to channel almost its entire oil output toward debt repayments this year. 

Or Venezuela: ever since 2007, China, which has become Venezuela’s top financier via an oil-for-loans program, has funneled an amazing $50 billion into the Chavez first and then Maduro regimes, in exchange for repayment in crude and fuel, including a $5 billion deal last September.  While details of the loans have not been made public, analysts from Barclays estimate Caracas owes $7 billion to Beijing this year and needs nearly 800,000 bpd to meet payments, up from 230,000 bpd when oil traded at $100 per barrel.

Oil pumps are seen in Lake Maracaibo, in Venezuela

Ecuador, one of OPEC’s smallest member countries, borrowed up to $8 billion from Chinese and Thai firms, repayable with oil, between 2009 and 2015, according to the national oil company

Many other countries have borrowed money from China (and others such as producers Exxon, Shell and Lukoil, as well as traders Vitol and Trafigura) and promised to repay in oil included Nigeria, Iraq, Venezuela and others.

Fast forward to today when Angola, Nigeria, Iraq, Venezuela and Kurdistan are due to repay a total of between $30 billion and $50 billion with oil, Reuters calculates. Repaying $50 billion required only slightly over 1 million barrels per day (bpd) of oil exports when it was trading at $120 per barrel but with prices of around $40, the same repayment would require exports of over 3 million bpd.

This is terrible news for all the indebted exporters because not only do they now have to pump three times as much just to repay the same loan, they have little if anything left over to fund critical budget needs and certainly nothing left over to invest.

“All of those oil nations – Angola, Nigeria, Venezuela – have taken money for survival but haven’t got any money left for investments. That is very damaging to their long-term growth prospects,” said Amrita Sen from Energy Aspects think-tank. “People tend to look at current production volumes but if you have committed your entire production to China or other buyers under loans – then you cannot invest to keep growing and won’t benefit from higher prices in the future.”

While the poorer OPEC exporters find themselves pumping unprecedented amount just to stay afloat, the rich OPEC producers have understandably stayed away from debt: according to Reuters, OPEC’s Gulf Arab members – Saudi Arabia, the United Arab Emirates, Kuwait and Qatar – have very few joint ventures with oil companies, do not have pre-payment deals with China and do not need to borrow from trading houses.

And so, while Saudi Arabia saw every dollar from its oil sales going to state coffers, the poorer members had a large part of their oil revenue eaten up by debts – read China – leaving no money to invest in infrastructure and field development. As a result, Nigeria and Venezuela are now facing steep production declines at a time when Saudi Arabia is preparing to further ramp up supplies as it invested heavily in new fields.

This curious dynamic explains two things:

  • First, it gives another reason why OPEC is effectively defunct as a result of Saudi Arabia’s resistince to reduce output. Quite simply, the lack of debt means it is able to use the money for development and reinforce its dominant position in oil markets. Nigeria and Venezuela, meanwhile, are desperate for a deal that would reduce output and push up prices to help them invest in oil fields and repay fewer barrels to creditors. “It may ultimately be mounting supply disruptions in stressed states, rather than collective cartel action, that causes an accelerated market rebalancing,” RBC Capital’s head of commodity strategy Helima Croft said.
  • Second, and maybe even more important, it explains why China suddenly finds itself flooded with so much oil, the country has unleashed its teapot refining army into overdrive. More importantly, it may shift the entire dynamic of China’s soaring imports on its head, because according to Reuters, the reason why China is being flooded with oil has little to do with a surge in demand, but because OPEC exporters are forced to ship far greater amounts of crude to China!

In fact, so great is the amount of oil headed to China, that Bloomberg wrote a story todayshowing how just like in the case of tankers parked off Singapore, China is simply unable to process all the oil. To wit:

In late February, the tanker Jag Lok loaded oil from Equatorial Guinea in western Africa and set sail for the Chinese port of Qingdao, the gateway to the world’s newest buyers of crude, a journey of more than 12,000 nautical miles. After reaching its destination in early April, the ship churned in circles for 20 days before it got a chance to deliver its cargo. That’s because the port in Shandong province was struggling to handle a record number of vessels arriving to supply the privately held refineries called “teapots” that dot the region, ship-tracking data compiled by Bloomberg show.

What is ironic is that Bloomberg, as one would expect before reading the Reuters piece, confuses cause and effect, and attributes the surge in Chinese oil traffic to soaring demand, when in reality much of it is about exporters seeking to repay their debt to Beijing as fast as possible.

The backup illustrates the challenges facing the independent refiners, which have emerged as a bright spot of rising demand amid a global glut. The processors are forecast by ICIS-China to purchase a combined 1 million barrels a day of crude from overseas this year, up from 620,000 barrels in 2015. While small individually, together they account for almost a third of China’s refining capacity. Any curb on imports would threaten oil’s rebound from a 12-year low, according to Nomura Holdings Inc. and Samsung Futures Inc.

What curb on imports? China is getting millions in barrels of oil for free, which is why it is ramping up refining production to unprecedented levels! The Bloomberg punchline:

From being dependent on state-owned energy giants for their feedstock needs as little as a year ago, teapots are now driving Chinese crude purchases after the government allowed them to buy overseas supplies directly. As of end-February, 27 of the companies had received or applied for annual import quotas totaling 89.5 million metric tons, or about 1.8 million barrels a day, according to Zhang Liucheng, chairman of the China Petroleum Purchase Federation of Independent Refinery, a group of 16 processors.

Total purchases from overseas into the world’s second-largest oil user climbed to a near record 7.96 million barrels a day in April, while shipments to Qingdao surged to unprecedented levels in April.

And much of this traffic may have nothing to do with current Chinese purchases, but everything to do with tens of billions in loans China has issued in prior years which are only now being repaid in the form of what is effectively free oil.

The question then, regardless of whether China is buying oil now, or is simply taking delivery for oil as collateral on loans made in prior years, as accurately laid out by Bloomberg is just how much oil can China process. The answer is that China is rapidly reaching its refining capacity, due to both structural bottlenecks as well as prices:

With infrastructure not developing as fast as oil purchases, imports are at risk of slowing because of the ship traffic and lack of storage capacity, according to BMI Research. Concern about the creditworthiness of companies with no prior experience in international trade is also deterring some sellers. Slowing refining profits mean the plants may have to cut processing rates, weakening their appetite for cargoes from overseas, while the implementation of higher fuel quality standards could force some of them to shut.

“Teapot buying could slow due to logistical constraints which are already stretched to their limits,” said Nevyn Nah, a Singapore-based analyst at consultant firm Energy Aspects Ltd.

Weakening margins are likely to have a stronger impact on independent refineries in China and this will lead to lower crude imports,” said Hong Sung Ki, a senior analyst at Samsung Futures Inc. in Seoul. “That will result in a downward revision for China demand and this will inevitably have a negative impact on oil prices.”

The summary is fascinating: China is being flooded with oil, on one hand due to ongoint purchases, but to a large extent because its oil-exporting counterparts (who need to remain on good terms with lender of last resort China) are scrambling to repay their Chinese loans by shipping out record amount of oil in the direction of China, so much so that even China’s infrastructure can no longer handle the inbound traffic. As Bloomberg notes, “ships continue to be held up at Qingdao. At least 16 oil tankers with capacity to carry 21.2 million barrels have stayed near the port for more than 10 days over May 1-23. Half of them were there for more than a month.”

How this unprecedented dynamic plays out, is at this point impossible to predict, but with such dramatic pockets of zero-sum inefficiency, where half of OPEC-loss is China’s gain, we eagerly look forward to the conclusion and how it will impact the price of oil.




Not sure how this will help China as their 5 yr plan is to replace workers with robots. Foxconn has already replaced 60,000 workers with robots.  What happ when social unrest becomes dominant!

(courtesy zero hedge)

China Is Executing To Plan: Foxconn Replaces 60,000 Workers With Robots


Last month we discussed the fact that officials had approved the latest Five Year Plan for China’s economy. The ultimate goal of the plan is to overtake Germany, Japan, and the United States in terms of manufacturing sophistication by 2049, the 100th anniversary of the founding of the People’s Republic of China.

To make that happen, the government needs Chinese manufacturers to adopt robots by the millions. It also wants Chinese companies to start producing more of these robots, , and to enable that there is an initiative making billions of yuan available for manufacturers to upgrade to technologies including advanced machinery and robots.

The manufacturing hub for the electronics industry, Kunshan, in Jiangsu province is proving that that initiative is well underway. As the South China Morning Post reports, thirty five companies, including Apple’s key supplier Foxconn, spent a total of 4 billion yuan on artificial intelligence last year, and more companies are going to follow suit.

Spurred by the initiative and a desire to cut down on labor costs, Foxconn has reduced its workforce by a whopping 60,000 people thanks to the introduction of robots. Foxconn’s headcount went from 110,000 down to 50,000 (adding to the mass layoffs that we have warned will cause further social unrest in China).

We’re not sure how all of this will play out in the grand scheme of the Five Year Plan that was put together, but what is clear is that China is wasting no time in executing the early stages of the plan.

That is just the beginning.

The transition from human to robot workers may upend Chinese society. Some displaced factory workers could find employment in the service sector, but not all of the 100 million now employed in factories will find such jobs a good match. So a sudden shift toward robots and automation could cause economic hardship and social unrest. “You can make the argument that robotic technology is the way to save manufacturing in China,” says Yasheng Huang, a professor at MIT’s Sloan School of Management. “But China also has a huge labor force. What are you going to do with them?”

For now, that question remains unanswered, but that won’t stop from unleashing the biggest robotic revolution seen in recent years.

In an effort to minimize the social unrest that is already taking place, the country has said that as much as $23 billion will be set aside to cover the layoffs in the coal and steel sectors as it tries to cut down on overcapacity – we’re eager to find out how much will be set aside for workers that are being displaced by these robots.




The Eurogroup agrees to disburse 7.5 billion euros just enough to repay its creditors that it owes in July and August.  Nothing for Greece!

(courtesy zero hedge)



Eurogroup Agrees To Disburse €7.5BN To Greece Which Will Be Used To Repay Creditors

Once upon a time, markets trembled when Greek bailout implementation headlines were announced, which is what just happened if slightly ahead of our forecast schedule…

Kazimir Says Eurogroup Meeting Won’t Be an Easy One: translation – Greece will agree to everything some time around 4am

… and this time nobody cares. Well maybe the Greeks do, but by now even they realize that most of the “money” they receive will be used to repay creditors and especially the ECB, and they will see virtually none of it.

So, for them, or anyone else who cares, here are the key headlines and details as they come in. Few surprises from what had been leaked previously.


* * *


* * *


* * *


* * *

According to Bloomberg, the First set of measures includes:

  • Smoothening the EFSF repayment profile under the current weighted average maturity
  • Use EFSF/ESM diversified funding strategy to reduce interest rate risk without incurring any additional costs for former program countries
  • Waiver of the step-up interest rate margin related to the debt buy-back tranche of the 2nd Greek program for the year 2017
  • “Decision on the smoothening of the EFSF repayment profile and the reduction of interest rate risks should be taken as a matter of priority”

For the medium term, the Eurogroup expects to implement a possible second set of measures following the successful implementation of the ESM program:

  • Abolish the step-up interest rate margin related to the debt buy-back tranche of the 2nd Greek program as of 2018
  • Use of 2014 SMP profits from the ESM segregated account and the restoration of the transfer of ANFA and SMP profits to Greece (as of budget year 2017) to the ESM segregated account as an ESM internal buffer to reduce future gross financing needs.
  • Liability management – early partial repayment of existing official loans to Greece by utilizing unused resources within the ESM program to reduce interest rate costs and to extend maturities
  • If necessary, some targeted EFSF reprofiling (e.g. extension of the weighted average maturities, re- profiling of the EFSF amortization as well as capping and deferral of interest payments) to the extent needed to keep GFN under the agreed benchmark in order to give comfort to the IMF and without incurring any additional costs for former program countries or to the EFSF

For the long term, the Eurogroup also agrees on a contingency mechanism on debt which would be activated after the ESM program to ensure debt sustainability in the long run in case a more adverse scenario were to materialize

  • Such mechanism could entail measures such as a further EFSF reprofiling and capping and deferral of interest payments

Eurogroup mandated finance ministry officials from the currency bloc “to verify in the next few days the full implementation of the outstanding prior actions,” for the conclusion of the Greek bailout review, according to e-mailed statement following meeting of euro area finance ministers in Brussels.

EWG of finance ministry officials have been mandated to verify “in particular the corrections to the legislation on the opening up of the market for the sale of loans, and on the pension reform, as well as the completion of all prior actions related to the government pending actions in the field of privatization

Following full implementation of all prior actions and subject to the completion of national procedures, governing bodies of the euro area’s crisis fund ESM will approve EU10.3b disbursement of bailout loans to Greece

  • First sub-tranche of EU7.5b to cover debt servicing needs and to allow a clearance of an initial part of arrears as a means to support the real economy
  • “Subsequent disbursements to be used for arrears clearance and further debt servicing needs will be made after the summer”
  • “Disbursements for arrears clearance will be subject to a positive reporting by the European Institutions on the clearance of net arrears”

Eurogroup “recalls” Greece’s medium-term primary budget surplus target of 3.5%/GDP as of 2018

Ministers set benchmark of Greek debt sustainability:

  • Country’s gross debt financing needs, or GFN, “should remain below 15% of GDP during the post program period for the medium term, and below 20% of GDP thereafter”

* * *

And again, here is the punchline:


First sub-tranche of EU7.5b to cover debt servicing needs and to allow a clearance of an initial part of arrears as a means to support the real economy

In other words, virtually all the €7.5 billion Greece just got as part of its first tranche… will promptly be used to repay its creditors, as has been the case from day one

* * *

The short summary: Greece has promised to implement even more Draconian measures (which may or may not happen) in order to get money that was already promised to it, while the Eurogroup disburses just enough cash to cover the immediate funding needs of the creditors with a little left over to pay for government arrears while demanding even more austerity; future tranches may or may not be paid out if Greece complies with its promises (which will not happen) and meanwhile the Eurogroup says it may someday provide debt relief, once Greece ends its bailout program… which will never happen.



Then bang! the IMF states that they are now not ready to add new funds to the Greek bail out as it stands.  They still insist on debt relief:

(courtesy zero hedge)


IMF “Not Ready” To Add Funds To Greek Bailout As It Stands, Needs More Debt Relief Details

Just when the Greek debt deal appeared certain even if as we reported last night, virtually all the funds from the approved first tranche would go to repaying creditors, the IMF, which has been pushing for more debt relief since last summer, appears read to pull the plug again, following a report that the IMF isn’t officially endorsing the latest Greek debt deal until the board approves new loan program, and according to AFP, the IMF is not ready to add funds to the Greek bailout as it stands now.

IMF says not ready to add funds to Greece bailout as it stands now

As Bloomberg adds, citing an IMF official says on conference call with reporters, that the IMF board should be able to consider new program by end of year.

IMF will be seeking more details on debt relief by European creditors and fund will analyze whether Greek debt is sustainable.

Most troubling is the warning that the IMF may come to a conclusion that latest debt-relief measures aren’t sufficient.

Jeroen Dijsselbloem, the Dutch politician leading the Eurogroup, claimed to have brokered a compromise between Germany and the IMF. He has he proposed a three-stage plan:

Short-term: Athens receives funds to reduce its debt and payment terms are adjusted.
Medium-term: Greece would receive longer grace and payment periods.
Long-term: There could be more far-reaching, though unspecified, measures.

And with Short- and Medium-term solutions now in doubt… again; Saxo Groups’s Stephen Pope asks,What about the long-term?

 What I want to know is, what about the third leg of the agreement? What are the more far-reaching, though unspecified, measures?


Where are the discussions about what Greece will do in terms of further privatisation? This has been the most aggravating issue for the creditors as Greece has simply dragged its feet on this matter for the past six years.


Privatisation of public companies contributes to the reduction of public debt. It releases the state from paying subsidies, other transfers or state guarantees to state-owned enterprises. It is a key catalyst for increasing the efficiency of companies and the competitiveness of the economy as a whole, while attracting foreign direct investment.


It helps countries pay back their debt, improves efficiency and effectiveness, and therefore would boost economic growth.


This idea is often challenged by the left and one favoured argument is that sales of state-owned assets during recession have consistently failed to raise expected revenues.


It was Greece that predicted it could raise €50bn but has so far raised a paltry €3.5bn. This is not just a result of selling at a time of recession, but also comes down to the fact that Athens delayed the process of privatisation for too long and was eventually seen as a distressed seller.


An asset is only worth what a buyer will pay, not what a seller would like.


Greece has simply wasted time, opportunity and money just as the troika are showing their plan for what it is worth. The Greeks will never repay their debt, nor will the economy be reformed…but the Eurozone will pick up the tab as a price worth paying.


The 2010 plan to preserve the Eurozone as a financial “lobster pot” with no exit has now morphed into something very different. The scheme now being hatched is to use Greece as a useful defence for the ”not in my backyard” Europeans against the thousands of helpless refugees.

The labour strikes that are hurting the oil land gas sector in France has now morphed to the nuclear power plants where all staff in the 19 plants will go on strike for 24 hours. They may see power outages!
(courtesy zero hedge)

France Goes Dark? Staff In 19 French Nuclear Power Plants To Go On Strike Tomorrow

Following strikes over the unpopular French labor reform, that started over the weekend and crippled the French refining industry leading to gasoline shortages and rationing, things are about to get far more serious for the country whose economy has already been threatened with a sharp slowdown as a result of a relentless wave of labor unrest. According toReuters, staff in France’s 19 nuclear plants – which by definition we assume is essential – have voted to go on strike on Thursday as part of protests over a labour reform, according to a CGT union official.

While industry experts say planned strikes are unlikely to provoke blackouts because of legal limits on strike action in the nuclear industry and France’s ability to import power from neighbouring countries, it would not be at all surprising to see the opposite outcome.

“It will start tonight at 2100 (1900 GMT) and last 24 hours,” CGT spokesman Laurent Langlard told Reuters on Wednesday. “Our goal is not to bring down the network,” general secretary of the CGT-Energie de l’Aube, Arnaud Pacot, told Francetv Info. On the other hand, considering that France derives about 75 percent of its electricity from nuclear energy, it is difficult to envision a different outcome.

Cooling towers of the Electricite de France (EDF)
nuclear power station at Nogent-Sur-Seine

Once stopped, a nuclear reactor would take 3 to 5 days to restart. A spokesman for EDF [French electricity provider] told AFP that it was “difficult” to predict the consequences of such a move.

CGT (General Confederation of Labor) is a national trade union center, one of the five key unions in France. Trade unions in France are known to have strong support among workers, and are able to mobilize employees very rapidly.

The announcement comes amidst a major fuel crisis that is hitting the country due to a massive strike. As of Monday, about 1,600 gas stations were running out of fuel, six out of eight oil refineries were blocked, and five out of around 100 fuel depots affected. French motorists have been queuing in panic to fill up their tanks at service stations that still operate.

The French authorities began by saying there is no fuel crisis in the country, but then France’s oil industry federation admitted that they had started using strategic oil reserves against the refinery blockade.

The reserves would last for three months, Union Francaise des Industries Petrolieres (UFIP) President Francis Duseux told RMC radio.



As expected, Erdogan snubs the European refugee deal and will not take back any refugees.Europe is going to have so much fun with this!

(courtesy zero hedge)


Erdogan Halts European Refugee Deal After Merkel Snub, Says Turkey Has Other Options

Following Monday’s news that that EU, via Angela Merkel, had suspended plans to extend visa-free travel with Turkey, a public slap in the face of Turkey’s president Recep Erdogan who had expected the deal to be ratified due to his threat of “unleashing” millions of refugees back into Europe, we said that “the question is whether the infuriated Turkish leader will resort to making good on his threat, and once again send out countless refugees along the Balkan route whose end destination is well-known: the wealthy countries of Central Europe.”

Overnight we got a partial answer when Erdogan said that Turkey would not take any steps regarding the implementation of migrant readmission until progress was made on visa liberalization. He also said funds that the EU had promised to pay Ankara for taking back refugees had not been paid. In other words, the deal that had halted the influx of refugees into not only Germany but all of Europe is suddenly in limbo as Turkey will no longer accept European refugees as per the deal agreed upon last month.


Turkey added it is not worried if a decision cannot be reached, with Ankara’s new EU affairs minister saying that the EU was not the “sole option.”  Omer Celik, who recently replaced Volkan Bozkir in the cabinet named by new Prime Minister Binali Yildirim, said he also wanted the EU to drop its double standards regarding the fight against terrorism.

In short, as expected Turkey is not only calling time on the refugee deal but is also threatening to go with other alternatives.

Turkey’s refusal to change its anti-terrorism laws has been a sore point regarding relations with the EU. Ankara says they cannot be changed due to the threat posed by Islamic State terrorists and Kurdish militants. However, critics of Erdogan, along with human rights organizations, have accused the Turkish government of using the terror laws as an excuse to carry out a military crackdown against Kurds in the restive southeast of the country.

Even Germany has become worried about the hard line taken by Erdogan, with Chancellor Merkel concerned about the country’s slide from democracy after the decision to strip MPs of legal immunity.  “I’ve made this clear in the conversation today that I also think we need an independent judicial system, we need independent media and we need a strong parliament,” Merkel said after holding talks with Erdogan in Istanbul on Monday.

Meanwhile, the person who has most to lose should the Turkish refugee deal unwind, Angela Merkel, who has seen her popularity in the polls tumble as a result of her handling of the immigrant influx, said he is not concerned. As RT writes, “German Chancellor Angela Merkel says she is not worried about the migrant pact between the EU and Turkey, though she admitted more time was needed to reach an agreement. Meanwhile, Ankara says it has alternatives to the EU if a deal cannot be reached.”

“I am not concerned, we just need more time,” Merkel told reporters on Wednesday, as cited by Reuters, after a cabinet meeting just outside Berlin.

She should be: As Bloomberg Richard Breslow writes:

“the threat to Europe, however, remains.


A day after German Chancellor Merkel returned from Istanbul in a desperate attempt to salvage the refugee deal so important to European unity, Turkey’s Foreign Minister said all agreements with the EU could be suspended. This followed an Erdogan adviser saying the joint customs union was at risk. Give us what we want or else. Truth is, right now, Europe needs Turkey more than Turkey needs Europe.


It may not be a coincidence that while Turkey’s markets were celebrating yesterday, the euro was getting pasted. What happens in Turkey, doesn’t stay in Turkey.”

As of this moment the refugee deal is in limbo. If and when it is cancelled outright, Europe’s immigrant related problems will come back with a vengeance.



Nigeria has pegged its NAIRA at 197 to 199 Naira to the dollar.  The 3 month forwards show the currency plummet to 291 Naira to the dollar. It sure looks like Nigeria will be the next nation after Venezuela to fail.

Also it looks like the Saudi real is also beginning to crack

(courtesy zero hedge)


Nigeria Currency Devaluation Looms As FX Forwards Crash To Record Lows

Despite US equity investors’ exuberance over bouncing crude oil prices, the world’s crude producers continue to suffer and while Venezuela is in the headlines every day (having already collapsed into chaos), Nigeria appears the nearest to that abyss next. Having urged investors “don’t panic” last year, and seeing dollar reserves drying up rapidly earlier this year, recent “lies” about the nation’s statistics have raised fears of a looming devaluation as FX forwards have crashed to 291 Naira to the dollar (current peg is 199).

As Bloomberg notes, traders boosted bets Nigeria’s currency will tumble after policy makers said they would allow greater flexibility in the foreign-exchange market.

Rates on three-month naira-dollar forward contracts jumped 20 percent to a record 297 per dollar, suggesting investors see the currency close to that level at the end of the period.


The central bank has pegged the naira at 197-199 since March 2015 amid a plunge in oil prices that contributed to the economy contracting in the first quarter.


In early May, officials began a “policy review” suggesting a devlauation possible and then a week ago the central bank voted for “more flexibility in exchange rate” dynamics…

The result – a collapse in 3m Naira forwards to a record low implying a 50% devaluation from the official peg


As we previously warned,defending one’s currency is a losing game as not only Argentina most recently, but the Swiss National Bank most infamously, will admit.

As African central banks place restrictions on access to their dollars, while burning through these reserves to support their currencies, they are also storing up longer-term troubles. “Few investors will want to put money into a country at an official exchange rate that is not set by the market and which is not seen as sustainable in the long run,“ said Charles Robertson, global chief economist at investment bank Renaissance Capital.”

For now Africa has avoided the “hyperinflation monster”, the result of an all too predictable scarcity of dollars, however the countdown is on and with every passing day that oil prices do not rebound, the inevitability of a full-on continental currency collapse, with hyperinflation and social unrest to follow, becomes increasingly more likely.

Worse, Africa is just the start: while the manifestations will differ, the mechanics of the dollar shortage, which we recently quantified in the trillions of dollars, are universal, and should the Fed’s rate divergence path with the rest of the world continue pushing the USD ever higher, soon this USD-shortage will escape the confines of the world’s poorest continent and make landfall somewhere where it will be far more difficult to ignore the adverse consequences of the global commodity collapse and the Fed’s monetary policy.

Finally, we note that Saudi Riyal forwards have started to crack lower also… which would indeed be a black swan event…

Your rating: None Average: 5 (2 votes)


Emerging market decouple from the USA market feeling the pain of the devaluation of the yuan, the rise in the USA dollar and the corresponding fall in commodity prices:

(courtesy zero hedge)

Emerging Markets Turmoil Signal Pain Ahead For US Stocks

Follow EM or not? That is the big question that BofAML asks as once again Emerging Market stocks are decoupling (lower) from an exuberant US equity market.

After a big rally in risk assets today the S&P 500 is up and credit tighter (CDX IG)/ higher (CDX HY) relative to the levels on May 16th – the day before speeches by Fed officials and later the FOMC minutes re-priced the probably of a June rate hike materially higher. After today’s strong new home sales report and a decline in Brexit risks (GBP up 1.0%), the implied probability of a June rate hike increased further to 34%, the dollar rallied (DXY dollar index is up 0.4%), 5s30s Treasury curve flattened by 1.5bps and financials outperformed (up 1.55% vs. 1.37% increase for the S&P 500).

However, we are seeing the same decoupling between US and EM stocks that that turned out a leading indicator for the decline in US risk assets in August last year and again in December/January this year…

As we noted last night, we suspect this is China-driven volatility rippling through from EM equities and FX inevitably spreading to US equity markets through various carry trades.

So the question is – will the Yuan turmoil ripple through markets enough to spook The Fed once more and dissolve what little credibility they have left or will Janet and her henchmen stand up to the foreign forces, hike rates to spit their own face, and deal with the aftermath through some more Citadel-driven VIXtermination? With VIX futures near record shorts and S&P futures at their longest in almost 2 years – there’s not much easy leveraged money to squeeze there – like there was in August.

Soon you will need a wheelbarrow to cart around your money.  The problem with that is that if you park your money while asking if the store will accept currency thieves will steal the wheelbarrow and leave the money behind.
(courtesy zero hedge)

This Is The Maximum Amount Of Cash You Can Take Out At A Venezuela ATM

s Bloomberg’s Nathan Crooks demonstrates, this is the maximum amount of money one can take out from a Venezuela ATM each day.


For those wondering, the fistful of cash is worth about $25.

The good news: those locals lucky enough to still have money in a Venezuela bank don’t need a wheelbarrow to carry it.

The bad news: those same locals soon will.




Oil nears 50 dollars after a bigger an expected inventory drawdown and a big production cut.

(courtesy zero hedge)

WTI Crude Nears $50 After Bigger Than Expected Inventory Draw, Production Cut

The July WTI contract neared $50 for the first time since early November ahead of this morning’s DOE data, extending gains from last night’s API-reported biggest draw since 2015 (which we warned seemed like catch up from a big build last week). DOE confirmed the big draw with a 4.22mm drop in inventories (less than API’s 5.13 but more than 2mm expected) and further an even bigger draw at Cushing. Gasoline saw an unexpected build as Distillate inventories fell for the 6th week in a row. Production fell for the 18th week in a row, holding at Sept 2014 lows. Crude’s reaction was chaotic, testing up over $49.60 and down to a $48 handle.



  • Crude -5.137mm (-2mm exp)
  • Cushing -189k (-400k exp)
  • Gasoline +3.06mm (-1.5mm)
  • Distillates -2.92mm (-750k exp)


  • Crude -4.22mm (-2mm exp)
  • Cushing  -649k (-400k exp)
  • Gasoline  +2.04mm (-1.5mm)
  • Distillates -1.28mm (-1m exp)


Production – down for the last 18 weeks – is hovering at its lowest since Sept 2014 (though some context is in order – at around 8.8m bbl/day, it is still up 60-70% from pre-2011 levels)


The reaction…total chaos…


After nearing $50…


Since the last time WTI traded at $50, the rest of the curve has collapsed amid aggressive hedging…


Bear in mind, seasonally, the trend is for a draw in May. In fact May of 2015 saw one of the biggest draws of all time at -16.4 million. How did 2015 end?


Charts: Bloomberg


Your early morning currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings/WEDNESDAY morning 7:00 am




USA/CAN 1.3112 UP .0015

Early THIS WEDNESDAY morning in Europe, the Euro ROSE by 10 basis points, trading now WELL above the important 1.08 level FALLING to 1.1367; Europe is still reacting to deflation, announcements of massive stimulation (QE), a proxy middle east war, and the ramifications of a default at the Austrian Hypo bank, an imminent default of Greece, Glencore, Nysmark and the Ukraine, along with rising peripheral bond yield further stimulation as the EU is moving more into NIRP, and NOW THE USA’S NON tightening by FAILING TO RAISE THEIR INTEREST RATE / Last night the Shanghai composite  CLOSED DOWN BY 6.58 PTS OR 0.23% / Hang Sang CLOSED UP 537.62 OR  2.71%   / AUSTRALIA IS HIGHER BY 1.45%(RESOURCE STOCKS DOING BETTER / ALL EUROPEAN BOURSES ARE ALL IN THE GREEN   as they start their morning/

We are seeing that the 3 major global carry trades are being unwound. The BIGGY is the first one;

1. the total dollar global short is 9 trillion USA and as such we are now witnessing a sea of red blood on the streets as derivatives blow up with the massive rise in the rise in the dollar against all paper currencies and especially with the fall of the yuan carry trade. The emerging market which house close to 50% of the 9 trillion dollar short is feeling the massive pain as their debt is quite unmanageable.

2, the Nikkei average vs gold carry trade ( NIKKEI blowing up and the yen carry trade HAS BLOWN up/and now NIRP)

3. Short Swiss franc/long assets blew up ( Eastern European housing/Nikkei etc.

These massive carry trades are terribly offside as they are being unwound. It is causing global deflation ( we are at debt saturation already) as the world reacts to lack of demand and a scarcity of debt collateral. Bourses around the globe are reacting in kind to these events as well as the potential for a GREXIT>

The NIKKEI: this WEDNESDAY morning: closed UP 258.59 OR 1.51% 

Trading from Europe and Asia:

2/ CHINESE BOURSES / : Hang Sang CLOSED UP 537.62 PTS OR 2.71% . ,Shanghai CLOSED  DOWN 6.58 OR 0.23%/ Australia BOURSE IN THE GREEN: /Nikkei (Japan) CLOSED IN THE GREEN /India’s Sensex IN THE GREEN

Gold very early morning trading: $1224.00


Early WEDNESDAY morning USA 10 year bond yield: 1.87% !!! UP 1 in basis points from TUESDAY night in basis points and it is trading WELL BELOW resistance at 2.27-2.32%. The 30 yr bond yield RISES to 2.65 UP 1/2 in basis points from TUESDAY night. (SPREAD GOES AGAINST THE BANKS)

USA dollar index early WEDNESDAY morning: 95.52 DOWN 7 CENTS from TUESDAY’s close.(Now below resistance at a DXY of 100.)

This ends early morning numbers WEDNESDAY MORNING


And now your closing WEDNESDAY NUMBERS

Portuguese 10 year bond yield:  2.96% DOWN 7 in basis points from TUESDAY

JAPANESE BOND YIELD: -0.083% UP 2 in   basis points from TUESDAY

SPANISH 10 YR BOND YIELD:1.47%  DOWN 7 IN basis points from TUESDAY

ITALIAN 10 YR BOND YIELD: 1.35  DOWN 7 IN basis points from TUESDAY

the Italian 10 yr bond yield is trading 12 points lower than Spain.





Closing currency crosses for WEDNESDAY night/USA DOLLAR INDEX/USA 10 YR BOND YIELD/3:30 PM

Euro/USA 1.1162 UP .0028 (Euro =UP 28 basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/reacting to dovish YELLEN/ANOTHER FALL IN USA;YEN CROSS TODAY

USA/Japan: 110.23 UP 0.068 (Yen DOWN 6 basis points )

Great Britain/USA 1.4702 UP.0091 Pound UP 91 basis points/

USA/Canada 1.3065 DOWN 0.0063 (Canadian dollar UP 63 basis points with OIL RISING a BIT(WTI AT $49.65).


This afternoon, the Euro was UP by 28 basis points to trade at 1.1162

The Yen FELL to 110.23 for a LOSS of 7 basis points as NIRP is STILL a big failure for the Japanese central bank/

The pound was UP 91 basis points, trading at 1.4702 (LESS BREXIT FEARS)

The Canadian dollar ROSE by 63 basis points to 1.3065, WITH WTI OIL AT:  $49.65

The USA/Yuan closed at 6.5608

the 10 yr Japanese bond yield closed at -.083% UP 2 IN BASIS  points in yield/

Your closing 10 yr USA bond yield: UP 1  IN basis points from TUESDAY at 1.866% //trading well below the resistance level of 2.27-2.32%)

USA 30 yr bond yield: 2.665 UP 2 in basis points on the day ( HUGE POLICY ERROR)


Your closing USA dollar index, 95.36 DOWN 23 IN CENTS ON THE DAY/4 PM

Your closing bourses for Europe and the Dow along with the USA dollar index closing and interest rates for WEDNESDAY

London:  CLOSED UP 43.59 OR 0.70%
German Dax :CLOSED UP 147.90 OR 1.47%
Paris Cac  CLOSED UP 50.12  OR 1.13%
Spain IBEX CLOSED UP 206.90 OR 2.32%
Italian MIB: CLOSED UP 297.42 OR 1.66%

The Dow was UP 145.46  points or 0.82%

NASDAQ UP 33.84 points or 0.70%
WTI Oil price; 49.65 at 4:30 pm;

Brent Oil: 49.83






This ends the stock indices, oil price, currency crosses and interest rate closes for today

Closing Price for Oil, 5 pm/and 10 year USA interest rate:


BRENT: 49.90

USA 10 YR BOND YIELD: 1.873%

USA DOLLAR INDEX: 95.38 down 19 cents


And now your more important USA stories which will influence the price of gold/silver




The drop in Tiffany shares shows a huge weakness in both USA consumer and the global consumer.  They just had the biggest drop in sales in the last 1 1/2 yrs.  They missed on earnings per share and most importantly they cut their guidance forward.

(courtesy zero hedge)


Tiffany Shares Slide After Biggest Sales Drop In 6 Quarters, EPS Miss, Guidance Cut

Iconic jeweler Tiffany reported Q1 earnings which continued the recent slide in top and bottom line on the back of a clearly weaker domestic and global consumer, and which not only missed the top and bottom line, printing at $891.3MM (exp. 914.9MM) and $0.64 (exp. $0.68), respectively, but also reported a steep drop in same store sales which tumbled 9% in Q1, double the 4.6% expected drop, and also slashed guidance, expecting full year 2017 EPS to be down in the mid-single digits, compared to its previous guidance which expected earnings to stay flat or fall by up to mid-single digit in percentage terms.

Sales at the jeweler’s stores open for more than a year fell 10 percent in the Americas region in the first quarter ended April 30. Analysts on average had expected a 9.1 percent decline, according to research firm Consensus Metrix. Tiffany’s net income fell 16.6 percent to $87.5 million, or 69 cents per share.

The 7.4% drop in total revenue was the steepest sales drop in six quarters. Once again the company blamed a stronger dollar for discouraging tourists from buying its high-end jewelry, even though the dollar was notably weaker Y/Y in the first quarter, as the company does not even bother to pull up a stock chart.

The Company’s reported net sales reflect either a translation-related benefit from strengthening foreign currencies or a detriment from a strengthening U.S. dollar. Internally, management monitors and measures its sales performance on a non-GAAP basis that eliminates the positive or negative effects that result from translating sales made outside the U.S. into U.S. dollars

GAAP Sales decline in the upper single digits in every single market except Japan, where Tiffany saw a 8% boost.

While many, especially the Fed which is said to hike as soon as next month, tout an imminent consumer recovery, Tiffany did not see it. Here is its full outlook:

Management is now forecasting full year earnings per diluted share in 2016 to decline by a mid-single-digit percentage from 2015’s adjusted earnings per diluted share (which excluded loan impairment and certain staffing and occupancy charges – see “Non-GAAP Measures”). Management also expects diluted EPS in the second quarter to decline by a similar rate as occurred in the first quarter. The forecast is based on the following full year assumptions, which are approximate and may or may not prove valid: (i) worldwide net sales declining by a low-single-digit percentage from the prior year; (ii) worldwide gross retail square footage increasing 2%, net through 11 openings, 6 relocations and 10 closings; (iii) operating margin below the prior year’s 19.7% (excluding the prior year’s charges – see “Non-GAAP Measures”) due to an expected increase in gross margin more than offset by SG&A expense growth; (iv) interest and other expenses, net unchanged from 2015; (v) an effective income tax rate slightly lower than the prior year; (vi) a modest year-over-year strengthening of the U.S. dollar; (vii) net inventories unchanged from the prior year; (viii) capital expenditures of $260 million; and (ix) free cash flow (net cash provided by operating activities less capital expenditures) of at least $400 million.

According to Reuters, Tiffany’s reluctance to offer promotions has been turning away thrifty shoppers, while a stronger dollar has made purchases more expensive for tourists.

“We faced numerous challenges, including continued pressure from foreign tourist spending in Europe, the U.S. and Asia, particularly in Hong Kong,” Chief Executive Frederic Cumenal said.

Shares of the company, whose “Blue Book” collection was flaunted by actress Cate Blanchett on the Oscar red carpet this year, fell 4.5% to $61 in premarket trading on Wednesday.

This is huge!! USA Service PMI plunges by the most ever on record and that should put a damper on a 2nd quarter GDP rebound.  Please remember this:  in the USA service and the consumer is 70% of GDP
and Janet wants to raise rates?
(courtesy zero hedge)

US Services PMI Tumbles, Misses By Most On Record “Dealing Blow To Q2 Rebound Hopes”

After a brief dead cat bounce, the US services economy has tumbled back to 3-month (near 7 year) lows, missing expectations by the most on record. With the slowest pace of hiring since Dec 2014 (signalling a mere 128k rise in payrolls for May), business optimism plunged to record lows (since the survey began in Oct 2009).

When hope fades…

May data highlighted a renewed fall in business optimism across the service economy. Reflecting this, the balance of service sector firms forecasting a rise in business activity over the year-ahead eased to its lowest since the survey began in October 2009.

Anecdotal evidence suggested that uncertainty related to the presidential election and concerns about the general economic outlook had continued to weigh on business confidence.

Commenting on the flash PMI data, Chris Williamson, chief economist at Markit said: 
A deterioration in the survey data for May deal a blow to hopes that the US economy will rebound in the second quarter after the dismal start to the year. 
“Service sector growth has slowed in May to one of the weakest rates seen since 2009,and manufacturing is already in its steepest downturn since the recession. 
“Having correctly forewarned of the near-stalling of the economy in the first quarter, the surveys are now pointing to just 0.7% annualised GDP growth in the second quarter,notwithstanding any sudden change in June. 
“A deteriorating order book situation and waning business optimism have meanwhile led to a further pull-back in hiring as companies scaled down their expansion plans. The surveys are signalling a non-farm payroll rise of just 128,000 in May. 
With no sign of any growth rebound and the labour market cooling, only one of the Fed’s three tests for a June rate hike – rising price pressures – is passed according to the PMI data. However, with prices rising largely on the back of higher oil prices rather than a fundamental improvement in demand, it seems that even core inflationary pressures remain subdued.”


Today huge layoff news: Microsoft fires a huge 1850 workers, Intel cuts 350 and Shell terminates 2,20… and Janet is justified in raising rats as the economy is improving!!????
(courtesy zero hedge)

In Today’s Layoff News: Microsoft Fires 1,850; Intel Cuts 350; Shell Terminating 2,200

How do you know the Fed is justified in hiking again, the economy is recovering, and the market are zooming higher? One hint is the just announced thousands in layoffs in both the energy and tech sector,among which are Shell, which announced it would layoff 2,200 jobs; Microsoft reporting it would cut 1,850; and Intel terminating up to 350 jobs in Germany.

The details:

Shell Cuts 2,200 More Jobs, Bringing Total Losses to 12,500

  • Co. to make additional 2,200 job cuts by end of 2016, according to e-mailed statement.
  • Brings total number of staff and direct contractor roles leaving Shell from start of 2015 to the end of 2016 to at least 12,500
  • Will reduce size of the organization supporting U.K. and Ireland upstream business by ~475 people
  • “These are tough times for our industry and we have to take further difficult decisions to ensure Shell remains competitive through the current, prolonged downturn,” Paul Goodfellow, Shell’s vice president for U.K. & Ireland, says in statement

Microsoft Unveils as Many as 1,850 Job Cuts, Phone Unit Charge, Microsoft to take $950m impairment and restructuring charge.

  • Charge includes $200m for severance payments: statement
  • CEO Satya Nadella pares back the company’s ambitions in smartphones
  • About 1,350 jobs will be cut in Finland, base of the handset business co. acquired from Nokia in 2014
  • Further details to be released with 4Q earnings in July

Intel to Cut 300-350 Jobs in Germany, WirtschaftsWoche Says

  • No forced redundancies are planned, WirtschaftsWoche says, citing unidentified co. employees.
  • Job-cut program to be in place by end of June
  • Co. also to close site in Ulm
  • Co. employs about 3,500 staff in Germany
  • Note April 20: Intel to Cut 12,000 Jobs, Forecast Misses Amid PC Blight


A very important commentary as to whether the USA will raise rates.  In a nutsehll it is up to China.  If we continue to see the yuan fall, then the USA will not raise!
(courtesy zero hedge)

Will The Fed Hike In June? It’s All In The Hands Of China Now, Deutsche Bank Explains

Over the weekend, Deutsche Bank’s chief credit strategist Dominic Konstam released a report in which as we documented, he explained his reasons why “the market is not ready for a June hike.” This was his key point:

The operative question is whether markets are sufficiently calm for the Fed to use the June 2016 meeting to pave the way for a July hike.


We think the answer is no because the issue is not just the timing of a single hike toward some static goal for rate level in 2017. What is at issue is the existence of some Shanghai “accord” whereby global policymakers have agreed explicitly or implicitly that excessive dollar strength is counterproductive and that policymakers should shift their focus to domestic demand and structural reform within an environment of dollar stability, at least through the next G20 in early autumn. If there is no accord then divergent monetary policy could drive the dollar stronger, restarting among other things speculation against CNH versus the dollar rather than CNY versus the entire CNY basket with now very familiar results: reserve loss exacerbating higher Fed expectations for US rates, and downward pressure on risk assets with a non-trivial chance that China might devalue and, worse yet, do so in a lumpy fashion.

He added that “the risk case is then that an overly aggressive Fed would push real yields up and breakevens down, thus undermining risk assets generally.

So far, following a renewed media barrage explaining just like in December, how the economy and markets are far more stable than they appear, the market has taken the Fed’s renewed allegedly hawkish bias in stride.

However that may change. Recall that just last week we showed a chart from Bank of America which dubbed it the Fed’s “Nightmarish Merry-Go-Round”, which showed clearly and simply how the Fed is trapped in a feedback loop with the market.

This is what BofA said: “By some accounts the Fed is stuck in an adverse feedback loop. They want to raise interest rates so they can “reload” their policy ammunition, but the markets won’t let them. The chart of the day illustrates this nightmarish merry-go-round: the Fed threatens to hike, markets tank, the Fed delays the hike, the market recovers and the cycle repeats. The end result is repeated delays and very little actual policy tightening.”

Today, it is the turn of DB’s Chief Economist Peter Hooper to discover just this diagram, which he takes on in a note titled “Financial conditions feedback loop unlikely to stay Fed’s hand.” In it he says what is effectively the same, namely that the anticipation of future Fed rate hikes is sufficient to tighten financial conditions (read a market drop) to the point where a Fed itself is unable to proceed with an actual monetary tightening.

This is what how Hopper summarizes the BofA chart:

The recent drumbeat of hawkish commentary from the Fed, along with last week’s release of the minutes from the April FOMC meeting, has triggered a sharp re-pricing of expectations for Fed rate hikes by the market. While the market was only pricing about 4% odds of a rate increase in June less than two weeks ago, those odds now stand close to one-third.


It is believed that this shift in rhetoric toward a more hawkish message will ultimately be self-defeating. By signaling rate hikes, interest rates adjust higher, the dollar strengthens, and risk assets may come under pressure. This produces tighter financial conditions, which ultimately prevent, or at least limit, the eventual rate increase. This natural tightening of financial conditions in response to rate hikes is expected.


But there are reasons to believe that this negative feedback loop may be more severe in the current environment: a stronger dollar is likely to increase pressure on China’s currency and weigh on commodity prices, thereby re-introducing the key elements of stress that led to a sharp tightening of financial conditions earlier this year. If this view is correct, the scope for further rate increases by the Fed is reduced.

There is, however, one loophole: if the Fed’s hawkish bias is also accompanied by stronger economic data.

What does this mean for the Fed? If the Fed adopts a hawkish message in the absence of better macro data, a negative feedback loop from market pricing to financial conditions may very well limit the ultimate tightening the Fed can undertake. On the other hand, if the Fed is data dependent, and hikes only when the data warrants, a tightening of financial conditions should not prevent the Fed from hiking in the coming months. Indeed, recent experience suggests that financial conditions can ease even as the market prices more rate hikes from the Fed.

At this point the question emerges: is yesterday’s unexpectedly good housing data sufficient to offset not only ongoing manufacturing sector deterioration, but as today’s Services PMI revealed, a sharp contraction in the service sector as well, one which would likely lead to just a 120,000 NFP print for the month of May.

DB also notes that it is not just domestic data: a question is what happens externally, something we touched upon overnight.

To be sure, this relatively benign view of financial conditions could be upset by shocks from China, for example, as was the case earlier this year, which could again raise uncertainty and tighten financial conditions sufficiently to delay rate increases by the Fed. And other factors could still prevent a hike – the rebound in the data remains tentative and may reverse and geopolitical risks, namely Brexit, also loom large.

DB then provides the example of the October 2015 case study:

Relevant for the current environment is the experience in late October 2015, when the Fed sent a clear signal that they expected to hike at the next FOMC meeting in December 2015. Similar to recent experience, the market was pricing low odds for a rate hike at the next meeting (December at the time), and the Fed felt the need to use a verbal “sledgehammer” to jolt market pricing to be more consistent with the Fed’s own expectations. This experience bares close resemblance to the recent stream of hawkish messages from Fed members and the April 2015 FOMC minutes that again provided a jolt to market pricing.


In the weeks following the October 2015 FOMC meeting, financial conditions continued to ease as the market began to price a significantly higher near-term path for the Fed (Chart 7). Financial conditions then held steady through November and into early December while market pricing for the Fed reached a plateau. However, financial conditions then began to tighten ahead of the December FOMC meeting, and plummeted through mid-February. At the same time, the market revised down its expectations for Fed rate hikes.



It is important to recognize the role of other factors during this period. First, financial conditions began to tighten following the announced liquidation of Third Avenue’s high-yield Focused Credit Fund on December 9, 2015. The event led to a substantial widening of credit spreads and was associated with deteriorating risk sentiment. Second, financial conditions only tightened sharply as China’s devaluation at the start of the New Year set off a renewed round of global risk-off.


Data may have also played a role during this period. US data surprises reached a local peak near zero in mid-November, and then began to deteriorate sharply, as US data missed expectations on balance (Chart 8). This deterioration continued through mid-February, as data for the first quarter once again signaled a slowdown in the US economy.


To be sure, the sharp re-pricing of the market’s Fed expectations led to a stronger dollar which added pressure to China’s currency. In this sense, the China devaluation in early 2016 can be viewed as (at least partially) a lagged result of the adjustment in market expectations. However, the closure of the Third Avenue fund appears to have been driven more by idiosyncratic factors, rather than directly tied to the Fed’s signal of upcoming rate hikes.


The takeaway for the current experience is that the magnitude of the tightening of financial conditions observed earlier this year was at least partially due to other factors – the liquidation of a high-yield fund and weakening US growth momentum likely contributed. However, the prospects for another shock from China as the dollar strengthens on the back of the Fed re-pricing, suggests that financial conditions, and thus the future path for Fed rate hikes, will not be immune to this re-pricing.

In other words, just as we said last week, it’s all up to China…

Looks like its up to China again to derail the Fed’s June rate hike plans

… the same China which demonstratively devalued the Yuan last night to the lowest level since 2011, however stepped in the market to stabilize the selloff, suggesting it is not fully focused on preventing a Fed rate hike.

Which brings us to DB’s conclusion:

The evolution of financial conditions will be critical for whether the Fed will be able to raise rates in the coming months. Our analysis finds evidence that a negative feedback loop does exist between the market’s expectations for the Fed and financial conditions. However, we believe that, absent a shock from China in the months ahead – which is clearly difficult to predict – it is unlikely that a negative feedback loop that tightens financial conditions will prevent the Fed from hiking.

In other words, just like in early 2016 when the Fed’s relent was driven by Chinese or as the Fed put it “global” conditions, so this time any potential delay in either the June or July rate hike (subsequent rate hikes get too close to the presidential election to make a comfortable extrapolation), will be entirely in the hands of Beijing. Or as some would note, the Federal Reserve of the US is now entirely a puppet of China.

Which brings us back to the rumored “Shanghai Accord” and the all important question: did the Fed co-ordinate the June (or July) rate hike with Beijing back in February?

We will find out over the next few days. If the USD keeps rising and the Yuan keeps probing multi-year lows, all that would take to derail the Fed’s hawkish intentions is one session in the which the PBOC does not step in to stabilize the CNY selloff, in the process sending risk assets plunging and once again making a rate hike impossible for Yellen.

This does not bode well for the election season:  violent protesters storm the Trump rally in New Mexico..a very ugly scene:
(courtesy zero hedge)

Violent Protesters Storm Trump Rally In New Mexico; Throw Rocks, Bottles At Riot Police

A calm protest quickly turned violently chaotic at a Donald Trump rally yesterday in Albuquerque, New Mexico. Protesters started to gather around 4pm in what until then was a low key protest: they chanted anti-Trump slogans, held anti-Trump signs and waved Mexican flags before the demonstration descended into chaos with some protesters standing on top of police cars, at which point all hell broke loose.

Protesters began to throw water bottles and yell profanity and aggressive taunts; the scene then quickly escalated to what one police officer called “the gauntlet of hate.”

Parents escorted scared kids past the chaos, and eventually police even set up a mounted horse unit to deter the crowds. However this was not enough, as protesters eventually began to riot. Rocks and bottles were thrown at police, and the protesters were eventually able to break through barriers, allowing them to rush the entrance of the convention center, at which point the riot police responded with tear gas.

According to CNN, his supporters chanted “build that wall” during his rally on Tuesday in Albuquerque where a little less than half of the population is Hispanic or Latino.

“Watching thugs (and) punks in Albuquerque – en route to California. They don’t even know what they are protesting,” Trump aide Dan Scavino said on Twitter.

As vendors fled, protesters grabbed merchandise and set things on fire the Albuquerque Journal reports.

The chaos got so out of control, local police eventually had to call in reinforcements from around the state in order to deal with the protesters, whose numbers swelled to over 600 according to estimates.

By 11:30pm, police in riot gear were continuing to patrol the streets, but the scene had returned to normal at that point.

Not good for Hillary@!! In trouble with the state department with respect to record keeping
(courtesy zero hedge)

Hillary In Trouble: State Department Says Clinton Did Not Comply With Federal Record Policies

In a surprising reversal, what many thought was impossible, namely the State Department cracking down on its former head and Democratic presidential frontrunner, Hillary Clinton, seems all too possible following news that the State Department Insecptor General audit has faulted Hillary Clinton, other secretaries of state for poorly managing electronic communications.

As Politico reports, the State Department inspector general concluded that Hillary Clinton did not comply with the agency’s policies on records, according to a report released to lawmakers on Wednesday that also revealed that Clinton and her top aides chose not to cooperate with the review.

The agency on Wednesday released the long-awaited report to Capitol Hill, copy of which was obtained by POLITICO, providing just the latest turn in the headache-inducing saga that has dogged Clinton’s campaign.

While the report concludes that the agency suffers from “longstanding, systemic weaknesses” with records that “go well beyond the tenure of any one Secretary of State,” it specifically dings Clinton for her exclusive use of private email.

“Therefore, Secretary Clinton should have preserved any Federal records she created and received on her personal account by printing and filing those records with the related files in the Office of the Secretary,” the report states. “At a minimum, Secretary Clinton should have surrendered all emails dealing with Department business before leaving government service and, because she did not do so, she did not comply with the Department’s policies that were implemented in accordance with the Federal Records Act.”

The report states that its findings are based on interviews with current Secretary of State John Kerry and his predecessors – Madeleine Albright, Colin Powell and Condoleezza Rice, but that Clinton and her deputies declined the IG’s requests for interviews.

Cheryl Mills, Jake Sullivan, and Huma Abedin are among those who did not cooperate with the investigation.

The IG report is just one of many fronts that still exist in the email scandal. Clinton also faces an ongoing FBI investigation into the setup of the private server that she used for official State Department business during her four years in the Obama administration, and various Freedom of Information Act lawsuits are working their way through the courts.

Needless to say, the report will only provide more ammunition for Donald Trump, who has already been seizing on the persistent controversy, which first emerged in March of last year, as he tries to further undermine the trustworthiness of “Crooked Hillary,” as he calls her.

Clinton and her allies contend she did nothing illegal by choosing to set up a private email server and account at her Chappaqua, New York, home, and that she was not trying to evade public records requests. Instead, Clinton has said she was motivated by the desire for convenience, though she has conceded it was not the best choice.

One again wonders if there is a quiet press behind the scenes to push for Bernie Sanders, or even Joe Biden at the Democrat convention if enough dirty laundry piles up against Hillary, who it is no secret has had a rocky relationship with many of the current Democrat power elite.

DAVID STOCKMAN writes a terrific commentary on the state of the USA economy. The S and P earnings for the year (first quarter 2015 to first quarter 2016) had earnings of 87.00 dollars and thus a P/e of 23.9 totally unheard of. The real earnings of $87.00 equates to a high in 2007 before the crash and it has not gotten any better.  Now you will understand that all markets are totally manipulated
(courtesy David Stockman)
(courtesy Greg Hunter/USAWatchdog)



  1. john Fisher · · Reply

    has anyone have the problem of formatting being lost with Firefox but not with IE?
    Did you find a solution?


  2. raymikeva · · Reply

    Thanks for pointing out the Firefox formatting problem. I had just about given up on trying to decipher these posts. Now, I can open IE and read it! I’m not a big fan of IE, but I confess to being a fan of Harvey; so I will make the sacrifice until Harvey figures it out. Keep up the good work, Harvey!


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: