June 6/Amt standing for gold in June rises again to 48.11 tonnes/Silver inventory at the SLV down to only 23 million oz in the registered (dealer ) category/Two more pols put the BREXIT GROUP largely in the lead/

Good evening Ladies and Gentlemen:

Gold:  $1,244.60 UP $4.50    (comex closing time)

Silver 16.42  up 8 cents

In the access market 5:15 pm

Gold $1245.20

silver:  16.45

i) the June gold contract is an active contract and the second biggest delivery month of the year following December. Friday night, the bankers first day delivery issuance to our longs to be settled on June 1 was huge: the number was  3,508 gold notices for 350,800 oz or 10.9 tonnes of gold. On day two, we had another huge number of gold notices filed at 2281 for 228100 oz or 7.09 tonnes of gold.On day 3,THURSDAY, we had another whopper of 1969 notices for 196,900 oz or 6.12 tonnes.FRIDAY, saw another huge 1026 notices filed for 102600 oz (3.19 tonnes). Then on Friday night we had a whopping 2981 notices filed for Monday totaling 2981 contracts for 298100 oz. Thus in 5 days a total of 11,765 notices have been filed for 1,176,500 oz or 36.59 tonnes. WHAT IS MORE FASCINATING WAS THE FRONT JUNE MONTH  INCREASED IN NET OI BY 678  CONTRACTS ON THURSDAY(67,800 OZ).  ON FRIDAY IT INCREASED BY 78 CONTRACTS OR 7800 OZ AND TODAY IT INCREASED BY 264 CONTRACTS OR 26400 OZ. THE ENTITY STANDING DOES NOT WANT FIAT AND IT SURE LOOKS LIKE A SOVEREIGN (CHINA) IS STANDING FOR GOLD.

Let us have a look at the data for today

.

Several months ago the comex had 303 tonnes of total gold. Today, the total inventory rests at 269.211 tonnes for a loss of 34 tonnes over that period

 

In silver, the total open interest FELL by 697 contracts DOWN to 194,908 DESPITE THE FACT THAT THE PRICE OF SILVER WAS UP by 34 cents with respect to FRIDAY’S trading.In ounces, the OI is still represented by just under 1 BILLION oz i.e. 0.974 BILLION TO BE EXACT or 139% of annual global silver production (ex Russia &ex China)

In silver we had 0 notices served upon for nil oz.

In gold, the total comex gold OI ROSE by a CONSIDERABLE 15,163 contracts UP to 496,259 as the price of gold was UP $30.30 with FRIDAY’S trading(at comex closing).

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

 

WITH RESPECT TO GLD

We had no changes in inventory at the GLD/Inventory rests at  881.44 tonnes

 

And now for SLV

We had no changes in inventory at the SLV/Inventory/Tonight it rests  at 337.299 million oz.

 

Both the GLD and SLV are massive frauds as they have no metal behind them!

.

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

1. Today, we had the open interest in silver FALL by 697 contracts DOWN to 194,908 as the price of silver was UP by 34 cents with FRIDAY’S trading. The gold open interest ROSE by 15,163 contracts UP to 496,259 as gold was UP $30.30.90 ON  FRIDAY.

(report Harvey).

 

2 a) Gold trading overnight, Goldcore

(Mark OByrne/

2b)  Gold trading earlier this morning;

(Mark OByrne and zero hedge)  OFF TODAY

 

 

(Harvey)

3. ASIAN AFFAIRS

i)Late  SUNDAY night/ MONDAY morning: Shanghai closed DOWN  BY 4.58 PTS OR 0.16% /Hang Sang closed UP 82.98 OR 0.40%. The Nikkei closed DOWN 62.20 POINTS OR 0.37% Australia’s all ordinaires  CLOSED UP 0.78% Chinese yuan (ONSHORE) closed UP at 6.5669 Oil FELL to 49.09 dollars per barrel for WTI and 50.16 for Brent. Stocks in Europe MIXED . Offshore yuan trades  6.5706 yuan to the dollar vs 6.5669 for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS) 

REPORT ON JAPAN  SOUTH KOREA AND CHINA

a) REPORT ON JAPAN

Hawkish member of the Bank of Japan, Takehiro Sato has just warned that Japan can face a shock similar to that experienced in 20003 with a collapsing bond market. He is worried about Japanese banks who have piled into Japanese 10 yr bonds despite a negative yield. Many financial institutions have bought 30 yr bonds seeking a positive yield.  Once Japan runs out of room to buy additional bonds in 2017, the rise in yields will bankrupt the banks.

( zero hedge)

b) REPORT ON CHINA

Goldman Sachs author Tang, discovers that the real figure for  Chinese Debt outstanding is far greater than anyone thought.  My using “money” instead of credit, he finds that last yr equiv of $3.8 trillion USA was issued approximately $.92 trillion grater than thought.

( zero hedge)

4. EUROPEAN AFFAIRS

Ai)Last night a new ITV poll was released and it downed that 45% of the voters seek a BREXIT and only 41% a BREMAIN. The pound tumbled from the 1.45 handle down into the 1.43 level.If UK leaves the EU, gold will certainly see a huge beneficiary!

( zero hedge)

Aii)Both sides go ballistic as Brexit odds hit record highs
(courtesy zero hedge)

 

ii)The Swiss voters got it right:  in a landslide vote 77% voted to reject helicopter money

( zero hedge)

iii)It is not just the USA that is seeing anti establishment parties win elections. In Italy the 5 star candidate takes the lead in the big mayoralty election in Rome:( zero hedge)

5.RUSSIAN AND MIDDLE EASTERN AFFAIRS

none today

6.GLOBAL ISSUES

none today.

7.OIL ISSUES

A good description of what is going to happen in the oil markets once Libya, Canada and Nigeria get their oil back on stream:

( Rakesh Upadhyay/OilPrice.com)

8.EMERGING MARKETS

VENEZUELA

i)Not good:  the Venezuela national guard now assaults members of the press covering the story on the devastation inside Venezuela

( zero hedge)

 

ii)Michael Snyder gives his 8 lessons of what we can learn from the complete Venezuelan meltdown:

9. PHYSICAL MARKETS

i)An extremely important interview of Andre Maguire. Andrew is seeing things at the LBMA similar to what I am witnessing at the comex:  basically they are out of gold/silver.He also states that the government in China has gone to the airwaves to tell citizens to buy gold. He is of the opinion that China has now put a floor on the price of gold and the resetting of the price higher is to occur shortly

( Kingworldnews/Andrew Maguire/GATA)

ii)The LBMA is supplying gold and silver data that is full of mistkaes.  Did you expect anything less?

( Ronan Manly/BullionStar)

iii)This is also a must read.  Greyerz indicates the true picture of the job numbers and it was awful.  If you include the 244,000 fictitious jobs created through the B/D plug and the 484,000 poor souls who left the job scene because there was not a job for them, then the total number of full time workers who do not have a job increased to 690,000

a must read..

( Von Greyerz/Kingworldnews)

USA STORIES WHICH MAY INFLUENCE THE PRICE OF GOLD/SILVER

i)Fixed income bond fund, Pine River is closing down and returning 1.6 billion dollars to customers as it cannot make money:

( zero hedge)

ii)Let’s close with this great piece from David Stockman who mocks Janet Yellen’s speech in Philadelphia today:

(courtesy David Stockman/ContraCORNER/)

 

Let us head over to the comex:

The total gold comex open interest ROSE to an OI level of 496,259 for a GAIN of 15,163 contracts AS THE PRICE OF GOLD WAS UP $30.30 with respect to FRIDAY’S TRADING.  WE HAVE ENTERED THE SECOND BIGGEST DELIVERY MONTH OF THE YEARTHAT IS JUNE, A VERY ACTIVE MONTH. 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. IN THE MONTH OF MAY THE LATER HAD STOPPED. DURING THE MAY WE DID WITNESS A GRADUAL RISE IN AMOUNT STANDING AND THE AMOUNT STANDING AT THE CONCLUSION OF THE MONTH FINISHED AT ITS ZENITH..  IN JUNE, ON FIRST DAY NOTICE WE HAVE CERTAINLY WITNESSED THE FORMER, A HUGE LOSS OF TOTAL OPEN INTEREST CONTRACTS FOR THE ENTIRE GOLD COMEX COMPLEX . IN A VERY SURPRISING TURN OF EVENTS  AGAIN TODAY, THE JUNE OPEN INTEREST ROSE WHICH CERTAINLY SUGGESTS A MAJOR ENTITY IS STANDING AND MOSTLY LIKELY A SOVEREIGN LIKE CHINA

The FRONT gold contract month of June saw it’s OI fall to 6683 for a loss of 762 contracts. We had 1026 notices filed on Friday, so we GAINED AGAIN 264 contracts or 26400 additional oz standing FOR METAL. The next active contract month is July and here we saw it’s OI FALL by 285 contracts DOWN to 2380. The next big active contract month is August and here the OI ROSE by 12,835 contracts UP to 358,270. The estimated volume today (which is just comex sales during regular business hours of 8:20 until 1:30 pm est) was POOR at 170,321. The confirmed volume  yesterday (which includes the volume during regular business hours + access market sales the previous day was very good at 256,834 contracts. The comex is not in backwardation.

Today we had a another monstrous 2981 notices filed for 298,100 oz in gold.(9.27 tonnes)

 

And now for the wild silver comex results. Silver OI FELL by 697 contracts from 195,605 DOWN to 194,908 DESPITE THE FACT THAT the price of silver was UP BY 34 cents with FRIDAY’S TRADING. The front month of June saw it’s OI fall by 1 contract down to 348. We had 0 notices filed yesterday, so we lost only 1  contract or 5,000 additional oz that will not stand for delivery. The next big delivery month is July and here the OI fell by 1,259 contracts DOWN to 119,391. The volume on the comex today (just comex) came in at 49,488 which IS VERY GOOD. The confirmed volume YESTERDAY (comex + globex) was huge at 67,994. Silver is not in backwardation . London is in backwardation for several months.
 
We had 0 notices filed for nil oz.
 

JUNE contract month:

INITIAL standings for JUNE

June 6.
Gold
Ounces
Withdrawals from Dealers Inventory in oz   1400.01 OZ

BRINKS

Withdrawals from Customer Inventory in oz  nil  70,081.110oz

HSBC, MANFRA

INCLUDES 7 KILOBARS

Deposits to the Dealer Inventory in oz NIL OZ

 

Deposits to the Customer Inventory, in oz    67,128.317 OZ

DELAWARE

JPM

 

No of oz served (contracts) today 2981 contracts
(298,100 oz)
No of oz to be served (notices) 3702 contracts

370,200 oz

Total monthly oz gold served (contracts) so far this month 11,765 contracts (1,176,500 oz)

(36.59 TONNES SO FAR)

Total accumulative withdrawals  of gold from the Dealers inventory this month   1400.01 OZ
Total accumulative withdrawal of gold from the Customer inventory this month  82,125.6 OZ
HUGE ACTIVITY AGAIN INSIDE THE GOLD COMEX TODAY

Today we had 0 dealer withdrawal

 

total dealer deposit:  NIL 0z

Today we had 0 dealer withdrawals:

total dealer withdrawals:  nil oz

 

Today we had 2 customer deposits:

i) Into DELAWARE: 3,573.822 oz

ii) Into JPMORGAN: 63,554.595 OZ

Total customer deposits;  67,128.317 OZ

Today we had 2 customer withdrawals:

I) OUT OF MANFRA:  225.05 OZ

II) OUT OF SCOTIA 70,081.110  (since Scotia did not receive this from anybody I will not account for it as a settlement)

total customer withdrawals:  70,306.16 OZ

Today we had 2 adjustments and they were dandies!

First adjustment:

AT the MANFRA facility: (INTO DEALER ACCT)

We had another 48,225.000 oz leave the customer and enter the dealer account at Manfra.

1500 KILOBARS)

AT the HSBC facility: (INTO DEALER ACCT)

we had 63,996.702oz leave the customer account and enter the dealer account at HSBC

Total amount entering the dealer:112,221.702 oz or 3.49 tonnes

 

Net to the dealer account: 3.49 tonnes

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 2981 contracts of which 1292 notices was stopped (received) by JPMorgan dealer and 872 notices was stopped (received)  by JPMorgan customer account. 
To calculate the initial total number of gold ounces standing for the JUNE contract month, we take the total number of notices filed so far for the month (11,765) x 100 oz  or 1,176,500 oz , to which we  add the difference between the open interest for the front month of JUNE (6683 CONTRACTS) minus the number of notices served upon today (2981) x 100 oz   x 100 oz per contract equals 1,546,700 oz, the number of ounces standing in this active month.  This number is EXTREMELY huge for JUNE.  THE AMOUNT STANDING FOR GOLD IN MAY HELD THROUGHOUT THE MONTH AND ACTUALLY INCREASED AS THE MONTH PROCEEDED. AND IT SURE LOOKS LIKE IT WILL HAPPEN AGAIN IN JUNE.  THE BANKERS JUST RECEIVED THEIR MINSKY MOMENT!! 
 
Thus the INITIAL standings for gold for the JUNE. contract month:
No of notices served so far (11,765) x 100 oz  or ounces + {OI for the front month (6683) minus the number of  notices served upon today (2981) x 100 oz which equals 1,564,700 oz standing in this   active delivery month of JUNE (48.11 tonnes).
WE GAINED 264 CONTRACTS OR AN ADDITIONAL 26,400 OZ  IS STANDING FOR THE PHYSICAL GOLD.
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 48.11 tonnes of gold standing for JUNE and 50.61 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 6.889 TONNES FOR MAY + 48.11 TONNES FOR JUNE + 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-May 27 .0185 – .024 TONNES MAY 31 -jUNE 4: .5044   = 64.813 tonnes still standing against 41.01 tonnes available.
 
Total dealer inventor 1,627,267.421 tonnes or 50.61 tonnes
Total gold inventory (dealer and customer) =8,655,140.067 or 269.211 tonnes 
 
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 269.211 tonnes for a loss of 34 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.
 
 end
HUGE ACTIVITY INSIDE THE SILVER COMEX AS WELL
And now for silver
 

June initial standings

 June 6.2016

Silver
Ounces
Withdrawals from Dealers Inventory nil oz
Withdrawals from Customer Inventory  945,425.665 oz

Scotia, BRINKS,

CNT

Deposits to the Dealer Inventory NIL
Deposits to the Customer Inventory   78,236.200 oz

JPM

No of oz served today (contracts) 0 CONTRACTS 

nil OZ

No of oz to be served (notices) 348 contracts

1,740,000 oz

Total monthly oz silver served (contracts) 202 contracts (1,010,000 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  12,093,183.5 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 1 customer deposit:

i) into JPM:  78,236.200 oz

Total customer deposits: 78,236.200 oz.

We had 3 customer withdrawals

ii) Out of Scotia: 78,236.04 oz

ii) Out of Brinks:  766,424.47

iii) out of CNT: 100,765.15

:

total customer withdrawals:  945,425.665 oz

 
 

 

 we had 1 adjustments

 

ii) Out of BRINKS;  25,246.200 oz was adjusted out of the dealer and this landed into the customer account of Scotia

 

WATCH FOR A RUN ON THE SILVER COMEX 
The total number of notices filed today for the JUNE contract month is represented by 0 contracts for nil oz. To calculate the number of silver ounces that will stand for delivery in JUNE., we take the total number of notices filed for the month so far at (202) x 5,000 oz  = 1,010,000 oz to which we add the difference between the open interest for the front month of JUNE (348) and the number of notices served upon today (0) x 5000 oz equals the number of ounces standing 
 
Thus the initial standings for silver for the JUNE contract month:  202 (notices served so far)x 5000 oz +{348 OI for front month of JUNE ) -number of notices served upon today (0)x 5000 oz  equals  2,750,000 of silver standing for the JUNE contract month.
We lost 1 contract or an additional 5,000 oz will not stand for delivery in this non active month of June.
 
Total dealer silver:  23.121 million  (RECORD LOW INVENTORY)
Total number of dealer and customer silver:   153.174 million oz
The total open interest on silver is NOW moving away from an all time high with the record of 207,394 being set May 18.2016. The registered silver (dealer silver) is NOW AT  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.
end
And now the Gold inventory at the GLD
June 6/no change in gold inventory at the GLD/Inventory rests at 881.44 tonnes
June 3/ We had two big  sized deposits of 4.46 tonnes early this morning and then another 6.24 tonnes late tonight/ new GLD total: 881.44 tonnes  (total: 10.7 tonnes)
June 2/no change in gold inventory at the GLD.Inventory rests at 870.74 tonnes
June 1.2016/ a good sized deposit of 2.08 tonnes/Inventory rests at 870.74 tonnes
May 31/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 868.66 TONNES
May 27/no change in gold inventory at the GLD/Inventory rests at 868.66 tonnes
May 26./no change at the GLD/Inventory rests at 868.66 tonnes
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 20/what!!!A MONSTER DEPOSIT OF :8.92 TONNES OF GOLD INTO THE GLD INVENTORY/AND WITH GOLD DOWN $2.80??/INVENTORY RESTS AT 869.26
May 19/ANOTHER HUGE DEPOSIT OF 4.46 TONNES OF GOLD INTO THE GLD/iNVENTORY RESTS AT 860.34 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
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

June 6.:  inventory rests tonight at 881.44 tonnes

end

Now the SLV Inventory
June 6/no change at the SLV/Inventory rests at 337.299 million oz/
June 3/ a huge deposit of 1.56 million oz was added to the SLV inventory/new inventory rests at 337.299 million oz
June 2/no change in silver inventory at the SLV/Inventory rests at 335.739 million oz
June 1/no change in silver inventory at hte SLV/inventory rests at 335.739  million oz
May 31/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 335.739 MILLION OZ
May 27/no change in silver inventory at the SLV/Inventory rests at 335.739 million oz/
May 26./ no change in silver inventory at the SLV/Inventory rests at 335.739 million oz
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 20/WE HAD A GOOD SIZED DEPOSIT OF 951,000 OZ INTO THE SLV/INVENTORY RESTS AT 336.024 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.
.
June 6.2016: Inventory 337.299 million oz
end

NPV for Sprott and Central Fund of Canada

will update on this site later tonight/

1. Central Fund of Canada: traded at Negative 3.7 percent to NAV usa funds and Negative 4.1% to NAV for Cdn funds!!!!
Percentage of fund in gold 61.8%
Percentage of fund in silver:37.8%
cash .+1.4%( June 6/2016). /
2. Sprott silver fund (PSLV): Premium RISES to +0.42%!!!! NAV (June 6.2016) 
3. Sprott gold fund (PHYS): premium to NAV  falls TO +1.55% to NAV  ( June 6.2016)
Note: Sprott silver trust back  into POSITIVE territory at +42% /Sprott physical gold trust is back into positive territory at +1.55%/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 +.42%.  Remember that Eric is to get 75 million dollars worth of silver in a new offering.
 
 
 

END

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

Trading in gold and silver overnight in Asia and Europe
Mark O’Byrne (Goldcore)  off today.

END

 

An extremely important interview of Andre Maguire. Andrew is seeing things at the LBMA similar to what I am witnessing at the comex:  basically they are out of gold/silver.He also states that the government in China has gone to the airwaves to tell citizens to buy gold. He is of the opinion that China has now put a floor on the price of gold and the resetting of the price higher is to occur shortly

(courtesy Kingworldnews/Andrew Maguire/GATA)

 

China putting floor under gold, Maguire tells KWN

Section:

8:26p ET Friday, June 3, 2016

Dear Friend of GATA and Gold:

As it increasingly encourages its people to buy gold, China is putting a floor under the gold market, London metals trader Andrew Maguire tells King World News today. Maguire adds that he thinks China may be preparing to announce a more accurate tonnage of its gold reserves, compiling gold now hidden among government institutions other than the central bank. An excerpt from the interview is posted at KWN here:

http://kingworldnews.com/alert-andrew-maguire-says-china-just-put-huge-f…

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org

 

END

 

The LBMA is supplying gold and silver data that is full of mistkaes.  Did you expect anything less?

(courtesy Ronan Manly/BullionStar)

 

 

Ronan Manly: LBMA gold and silver data is full of mistakes

Section:

10:45a ET Friday, June 3, 2016

Dear Friend of GATA and Gold:

Monetary metals researcher Ronan Manly shows today how recent statements by the London Bullion Market Association about world gold and silver production are full of mistakes, including the silliest arithmetical errors. Manly’s analysis is headlined “Apples and Oranges: An Update on LBMA Refinery Statistics and GFMS” and it’s posted at Bullion Star here:

https://www.bullionstar.com/blogs/ronan-manly/lbma-refinery-statistics-g…

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org

 

END

 

This is also a must read.  Greyerz indicates the true picture of the job numbers and it was awful.  If you include the 244,000 fictitious jobs created through the B/D plug and the 484,000 poor souls who left the job scene because there was not a job for them, then the total number of full time workers who do not have a job increased to 690,000

a must read..

(courtesy Von Greyerz/Kingworldnews)

 

Von Greyerz mocks U.S. employment reports

Section:

8p ET Sunday, June 5, 2016

Dear Friend of GATA and Gold:

Swiss gold fund manager Egon von Greyerz, interviewed by King World News, calls attention to the fraud of the U.S. government’s employment reports, which fail pathetically to make a declining workforce look good. There will be no return to worldwide growth, von Greyerz adds, until the unsustainable and ever-growing debt burden is liquidated. An excerpt from the interview is posted at KWN here:

http://kingworldnews.com/legend-warns-crisis-is-going-to-spread-like-wil…

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org

 

END

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

 
 

:

1 Chinese yuan vs USA dollar/yuan  UP to 6.5669 ( REVALUATION NORTHBOUND  /CHINA HAPPY CONCERNING USA DOLLAR DEVALUATION/OFFSHORE YUAN NARROWS TO 6.5706) / Shanghai bourse  CLOSED DOWN 4.58 OR 0.16%  / HANG SANG CLOSED UP 82.98 OR 0.40%

2 Nikkei closed DOWN 62.20 OR 0.37% /USA: YEN RISES  TO 107.14

3. Europe stocks opened MIXED  /USA dollar index UP to 94.26/Euro DOWN to 1.1333

3b Japan 10 year bond yield: FALLS  TO -.115%     !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 107.14

3c Nikkei now WELL BELOW 17,000

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

3e WTI::  49.09  and Brent: 50.16

3f Gold UP  /Yen DOWN

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

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 FALLS to 0.067%   German bunds in negative yields from 8 years out

 Greece  sees its 2 year rate RISE to 7.58%/: 

3j Greek 10 year bond yield FALL to  : 7.35%   (YIELD CURVE NOW COMPLETELY FLAT)

3k Gold at $1242.10/silver $16.44(7:45 am est) BROKE RESISTANCE AT 16.52 

3l USA vs Russian rouble; (Russian rouble DOWN 44 in  roubles/dollar) 65.74-

3m oil into the 49 dollar handle for WTI and 50 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.

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 109.08 DESTROYING WHATEVER IS LEFT OF OUR YEN CARRY TRADERS

30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF. It is not working: USA/SF this morning .9750 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1051 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.

3p BRITAIN IN LAST LEG OF ITS CAMPAIGN AS TO WHETHER EXIT THE EU.

3r the 8 Year German bund now  in negative territory with the 10 year FALLS to  + .067%

/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 1.717% early this morning. Thirty year rate  at 2.518% /POLICY ERROR)

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

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

Futures Flat Following Friday’s Jobs Fiasco: All Eyes On Yellen Again

Every ugly jobs report has a silver lining, and sure enough following Friday’s disastrous jobs report, global mining and energy companies rallied alongside commodities after the jobs data crushed speculation the Fed would raise interest rates this month.  “The disappointing U.S. jobs report on Friday means that a summer Fed rate hike is off the table,” said Jens Pedersen, a commodities analyst at Danske Bank. “That has reversed the upwards trend in the dollar, supporting commodities on a broader basis. The market will look for confirmation in Yellen’s speech later today.” While commodities benefited from USD weakness, the pound slumped following polls that showed Britons favor exiting the European Union. European stocks and U.S. stock index futures are little changed. Asian stocks rise.

Janet Yellen is speaking today at 12:30pm in Philadelphia, the last scheduled appearance by a central bank official before the next policy meeting concludes on June 15, and hopes are again high that she will provide some additional insight into what happens next. Considering just over one week ago she pushed the hawkish Fed case which has now disintegrated before everyone’s eyes, we would be skeptical. During her May 27 appearance, the Chair strongly hinted at a June rate move, sending summer rate hike odds to their highest yet. It did not last.

Yellen will have to backtrack now after the dismal payrolls report last week led markets to doubt whether the Fed will raise rates this year, let alone this month. To be sure, she has her usual excuse: “the Fed is data dependent”, and the data just fell out of the window.

According to Bloomberg, Yellen may need to update her tone slightly in response to renewed labor market uncertainty, perhaps softening or further qualifying her May 27 statement that an increase will probably be appropriate “in coming months.” Still, economists and strategists say it’s unlikely that she’ll give a more definitive timeline on when to expect the second hike in a decade. “We’re going to get a vague promise of future rate hikes that does not specify a date,” said Guy Lebas, chief fixed-income strategist at Janney Montgomery Scott LLC in Philadelphia, who expects a September increase. “You can’t claim data dependence, have the most recent data be what it was, and still take upward rate action.”

Meanwhile, markets are being pulled in different directions, with worries over a slowing U.S. economy and British polls weighing on some assets, while a weaker dollar and chances the Fed will keep interest rates lower for longer supporting others. Materials producers were the biggest gainers in both Europe and Asia as the Bloomberg Commodity Index headed for the highest close since October, with Brent crude above $50 a barrel and zinc extending its longest rally since 2013. Indonesia’s rupiah and Malaysia’s ringgit were the best performers among 31 major currencies after Friday’s U.S. payrolls report caused the Bloomberg Dollar Spot Index to tumble. The pound sank to a three-week low and Brexit concern also infected Spanish and Italian bonds and U.K. homebuilders.

“Stocks are flattish today because people are interpreting there won’t be a rate hike after the jobs report Friday and for me that’s very complacent because we shouldn’t forget the longer-term trend,” said Michael Woischneck, who oversees about 300 million euros ($341 million) at Lampe Asset Management in Dusseldorf, Germany. “Oil and commodities are better again and that’s also helping stocks, but it will be a very volatile week with the Brexit vote coming closer and closer.”

The Stoxx Europe 600 Index added 0.2 percent. Rio Tinto Group and Glencore Plc led a gauge of mining companies to the best performance of the 19 industry groups on the gauge as commodities surged. BP Plc pushed oil stocks higher as crude rebounded. The U.K.’s FTSE 100 Index climbed the most among major western-European markets, gaining 1 percent, as miners jumped and the pound weakened after the Brexit polls. Futures on the S&P 500 were little changed. Shares fell Friday after the disappointing U.S. jobs data cast doubt on the strength of the world’s biggest economy and on whether the Fed will raise rates at its next meeting. The MSCI Emerging Markets Index rose as much as 1 percent to a one-month high, advancing for a third day and climbing above its 50-day moving average. Benchmark gauges in Russia and the Philippines jumped over 1 percent. South Korea’s market is shut for a holiday.

Aside from the abovementioned Yellen speech, there is no macro data in the traditional post-payrolls weekly lull.

Market Snapshot

  • S&P 500 futures up less than 0.1% to 2099
  • Stoxx 600 up less than 0.1% to 341
  • FTSE 100 up 0.8% to 6256
  • DAX up 0.2% to 10128
  • S&P GSCI Index up 0.9% to 377.4
  • MSCI Asia Pacific up 0.3% to 130
  • Nikkei 225 down 0.4% to 16580
  • Hang Seng up 0.4% to 21030
  • Shanghai Composite down 0.2% to 2934
  • S&P/ASX 200 up 0.8% to 5360
  • US 10-yr yield up 1bp to 1.71%
  • German 10Yr yield up 1bp to 0.08%
  • Italian 10Yr yield up 14bps to 1.47%
  • Spanish 10Yr yield up 5bps to 1.52%
  • Dollar Index up 0.09% to 94.11
  • WTI Crude futures up 1.1% to $49.16
  • Brent Futures up 1.1% to $50.21
  • Gold spot down 0.3% to $1,241Silver spot up less than 0.1% to $16.42

Top Global News

  • China Must Get ‘More Adept’ on Monetary-Policy Signals: Lew; China must improve monetary policy communication as it takes on an increasingly large role in the global economy, U.S. Treasury Secretary Jacob J. Lew said
  • Fed’s Rosengren Says Important to See If Weak Jobs Were Anomaly: Boston Fed head says May payrolls contrast with other data; FOMC voter still expects sufficient growth for gradual hikes
  • Fed’s Yellen speaks in Philadelphia at 12:30pm
  • Pound Tumbles, Volatility Jumps After Polls Show Brexit Momentum: ITV poll shows Brexit ahead 45% to 41%; TNS has 43% to 41%; one-month volatility at 7-year high before June 23 vote
  • U.S. Economy Projected to Expand This Year by Least Since 2012: uncertainty on the presidential election weighs on outlook, according to a survey of forecasters by the National Association for Business Economics
  • Clinton Wins Puerto Rico Democratic Primary, Nears Nomination: Democratic front-runner widens lead on rival Bernie Sanders
  • ASCO WEEKEND WRAP: AbbVie, Bristol, Lilly, Stemline May Move
  • Tesla Challenger in China Plans to Debut $106,000 E- Roadster: Qiantu Motor plans to start production in Suzhou by year-end; Tesla May Purchase Batteries From Samsung SDI, Nikkei Says
  • Paramount’s ‘Ninja Turtles’ Opens to Slow Sales Over Weekend: movie opened to disappointing weekend sales in N. American theaters
  • Apple May Get Breather on Sourcing Rules in India: Times
  • McKinsey Said to Have Built $5b Internal Investment Arm: FT

Looking at regional markets, Asia stocks traded mixed as the region digested Friday’s dismal NFP data and its implications for Fed policy. Nikkei 225 (-0.4%) significantly underperformed as the aforementioned data saw JPY strengthen firmly against the USD with USD/JPY briefly below 107.00. Conversely, material names elevated the ASX 200 (+0.8%) into positive territory as the softer greenback underpinned commodity prices. Hang Seng (+0.4%) and Shanghai Comp (-0.2%) saw choppy trade with sentiment clouded following a lacklustre CNY 40bIn liquidity injection, although downside across the Asia region was stemmed as the poor jobs data also dampened prospects of a sooner Fed hike. 10yr JGBs traded in positive territory as the lack of risk-appetite in Japanese equities fuels safe haven inflows benefiting bond prices.

Asian Top News

  • China’s Opening Bond Market a Threat to Hong Kong Connect Plans: HKEx bond link one of many ways to access China, says Haitong
  • Negative-Rate Job Half Done as Japan Banks Cut Bonds, Keep Cash: Banks’ JGB holdings drop 5.5% in April, as reserves rise 3.4%
  • Line Plans Year’s Biggest Tech IPO With Pitch to U.S. Investors: Japan’s messaging app to split IPO between Tokyo and New York
  • Temasek Unit Said to Plan Debt Tied to Private Equity Stakes: Astrea III plans to issue about $500 million notes in 4 parts
  • Lotte $4.9 Billion IPO Faces Fresh Setback on Bribery Probe: Korean prosecutors raid Hotel Lotte last week as part of probe
  • Stay or Go? Rajan’s Future Becomes Focus of India Rates Meeting: All 19 economists see RBI leaving rates unchanged Tuesday

European equities have also benefitted in the wake of Friday’s eventful NFP release, with indices spending most of the session higher, although coming off best levels as we move into mid-morning (Euro Stoxx: +0.1%), with material and energy names among the best performers. As such, FTSE is the best performing index, led higher by Anglo American, Rio Tinto and BHP Billiton. Fixed income markets have sustained the upside seen last week, with Bunds continuing to trade near all-time highs, albeit relatively contained on the day given the lack of European supply or data and with net supply relatively steady this week.

European Top News

  • German Factory Orders Declined in April on Weak Export Demand: orders fell 2% on month compared with estimated 0.5% drop
  • Rothschild & Co. Buying Martin Maurel to Expand in France: deal creates bank with EU34b under management; Rothschild & Co should keep CET1 capital ratio above 18%
  • Nestle Seeks China Turnaround Online as Competitors Abound: E-commerce business more profitable than other retail channels
  • Swisscom Gains as Swiss Vote Against Pay Cap for Top Management: country votes against new rules for government- owned companies
  • EON Can’t Please Everyone as Shareholders Meet for Spinoff Vote: utility needs 75% shareholder approval for Uniper listing

In commodities, the Bloomberg Commodity Index rose 1.1% putting it on course for the highest close since Oct. 22, as oil and metals advanced. Brent crude added 1.2 percent to $50.25 a barrel, after falling 0.7 percent last week as OPEC refrained from freezing output at a meeting in Vienna. The global oil surplus is shrinking faster than expected and has the potential to send prices as high as $60 a barrel this year, according to Ali Majed Al Mansoori, chairman of the Abu Dhabi Department of Economic Development. Saudi Arabia, the world’s largest exporter, raised pricing on most oil grades in July. Zinc climbed as much as 1.9 percent in London, rising for an eighth day to its highest level since July 2015, buoyed by speculation that mine supply cuts will lead to a worsening deficit. Nickel gained 2.3 percent and copper rose 0.9 percent. Iron-ore futures in Dalian jumped 2.7 percent after the first decline in Chinese port inventories in three weeks. Stockpiles fell 0.4 percent last week to 100.25 million metric tons, according to data compiled by Shanghai Steelhome Information Technology Co

In FX, the most notable mover as noted last night was the pound which tumbled to to $1.4390, near session lows, on an ITV opinion poll that found 45 percent of Britons backed the ‘Leave’ campaign, compared with the 41 percent who were for ‘Remain.’ The numbers were 43 percent for ‘Leave’ and 41 percent for ‘Remain’ in a TNS survey. “If there’s any one other currency investors may want to go short on besides paring long dollar positions that would be sterling,” said Vishnu Varathan, a Singapore-based economist at Mizuho Bank Ltd. “There’s a binary event risk of much greater proportions than just a policy move.” The Bloomberg Dollar Spot Index was up 0.2 percent, after tumbling 1.5 percent in the last session following the U.S. jobs report. Payrolls climbed by 38,000 in May, less than the most pessimistic estimate in a Bloomberg survey. The yen weakened 0.6 percent to 107.19 per dollar, after a 2.2 percent surge on Friday that marked its biggest gain since April. The euro fell 0.2 percent, after a 1.9 percent gain on Friday that was biggest jump of the year. The MSCI Emerging Markets Currency Index rose 0.9 percent. Indonesia’s rupiah climbed 1.6 percent, and Malaysia’s ringgit strengthened 1.2 percent. China’s yuan fell to its lowest level against a basket of peers since November 2014 after the central bank strengthened the fixing by less than expected following a slump in the dollar.

Bulletin Headline Summary from RanSquawk and Bloomberg

  • European equities trade modestly higher as participants await direction from the US in the wake of Friday’s NFP release and ahead of Yellen’s upcoming speech
  • Despite recovering throughout the European session, GBP was dealt a blow overnight as the latest batch of polls lean in favour of the leave camp
  • The rest of the session is light in terms of data, and will see all focus on the much anticipated speech from Fed’s Yellen this afternoon, which will garner even more attention in the wake of Friday’s jobs release
  • Treasuries rally in overnight trading while global equities are mixed and US dollar index rises as GBP drops as polls in Britain show majority now favor exit from EU.
  • Pablo Iglesias, leader of the Spanish anti-establishment party Podemos, said the concessions European Union leaders gave David Cameron to help keep the U.K. in the bloc were “shameful”
  • Being opaque has been paying off for Janet Yellen. That’s one reason not to expect razor-sharp clarity as she speaks in Philadelphia later on Monday
  • China must improve monetary policy communication as it takes on an increasingly large role in the global economy, U.S. Treasury Secretary Jacob J. Lew said in an interview ahead of talks in Beijing between the two countries
  • Banks known as primary dealers, which trade directly with the Federal Reserve and bid at U.S. debt auctions, have bought just 30 percent of the new securities this year, the smallest share on record, data compiled by Bloomberg show
  • Negative interest-rate stimulus is half working in Japan, as lenders cut government bond holdings by the most in almost three years, only to hoard proceeds at the central bank
  • German factory orders declined in April as demand for investment goods from outside the 19-nation currency region slumped. Orders, adjusted for seasonal swings and inflation, fell 2 percent from the prior month

DB’s Jim Reid concludes the overnight wrap

Just in case you haven’t seen the numbers from Friday payrolls were only 38k (vs. 160k expected and the lowest since September 2010) and were revised down 59k across the prior two months. Suddenly the  3-month average has fallen to 116k from 181k. As DB’s Joe LaVorgna points out this is the weakest growth since July 2012, a couple of months before QE3 started. The good news is that the unemployment rate fell to 4.7% from 5.0% (vs. 4.9% expected) but perhaps there’s an element that it’s getting more difficult to hire. We should also acknowledge that the Verizon strike would have impacted these numbers so June’s report will be important to see the impact reversed.

The weak report makes for an interesting appearance from Yellen tonight (5.30pm BST) as surely she can’t confidently signal a summer hike now? However she was relatively hawkish when she spoke 10 days ago at Harvard so will one number knock her back to her normal dovish leanings. The market has certainly voiced its opinion. We’ve had a big round trip in June and July hike expectations over the last month. Only 4 weeks ago the probabilities were 4% and 17%. They then climbed to a peak of 34% and 54% on May 24th before landing at 4% and 27% this morning.

Interestingly risk assets in the US actually held up relatively OK by the end of play on Friday. The initial knee jerk reaction for the S&P 500 was to tumble -0.90% only to then steadily rise over the remainder of the session before finishing the day ‘just’ -0.29% lower. It was a similar story in credit where CDX IG was a couple of basis points wider initially before rallying back to finish pretty much flat. There was no such rebound for the US Dollar though with the Dollar index eventually ending -1.61%, the biggest one-day decline this year. It was one-way traffic for Treasuries too. 10y yields ended up at 1.700% and 10bps lower on the day, while 2y yields were down over 11bps to 0.774% and to the lowest level since mid-way through last month. Gold (+2.74%) snapped out of its recent funk in style for its strongest day since the 11th February.

This morning in Asia it’s fairly mixed for most regional bourses with the standout mover being in Japan again where a big rally for the Yen on Friday (+2.15%) has resulted in the Nikkei (-1.14%) and Topix (-1.17%) taking a steep leg lower this morning. Meanwhile the Hang Seng (-0.31%) is also lower this morning, while markets in China and Korea are little changed. The ASX (+0.85%) is the big outperformer this morning while US equity index futures are little changed.

Also attracting some headlines is over in the FX market where Sterling (-0.90%) has tumbled following further referendum polls over the weekend showing voters favouring leaving the EU. The poll run by YouGov for ITV had 45% voting to leave versus just 41% at remain, while a survey run by TNS had the split at 43% versus 41% in favour of leave. It’s worth noting that tomorrow evening we will see PM David Cameron and UKIP leader Nigel Farage take part in a live debate on Brexit with another debate (with speakers to be announced) scheduled for Thursday. Such has been the recent swings of late in polls that implied 1-month volatility in the GBP/USD pair has jumped to 21.5% this morning which is the highest now since February 2009.

Most of the other weekend newsflow has been a continuation of the fallout from Friday’s data, although one event worth highlighting is yesterday’s referendum in Switzerland on the unconditional basic income plan for all residents. The final results showed that 77% voted against the plan with just 23% favouring the introduction of a minimum income for all. The result won’t come as much of a surprise with the idea gaining little support amongst Swiss politicians or parties, but nonetheless the vote was closely watched internationally with the FT suggesting that local and national governments in Brazil, Canada, Finland, Netherlands and India are said to be debating the idea of a similar sort of basic income.

Switching back to Friday’s data and quickly recapping the rest of the May employment report. Average hourly earnings rose +0.2% mom in May which has had the effect of keeping the YoY rate unchanged at +2.5%. Average weekly hours were unchanged at 34.4hrs which was slightly disappointing given expectations were for a modest rise to 34.5hrs. The labour force participation rate dipped to 62.6% which was a decline of two-tenths and marks the second consecutive decline. Finally the broader U-6 measure of unemployment printed unchanged at 9.7% which is essentially where it has been for four months now.

Also contributing to the disappointing batch of releases on Friday was the ISM services reading which fell more than expected in May (-2.8pts to 52.9; 55.3 expected) with the reading now at the lowest level since February 2014. The employment component in particular (-3.3pts to 49.7) confirmed the weakness in the May payrolls number, while new orders (-5.7pts to 54.2) and business activity (-3.7pts to 55.1) components also softened. Elsewhere, there was a modest upward revision to the final services PMI (+0.1pts to 51.3), while the April trade deficit widened to $37.4bn from a revised $35.5bn.

We did get some initial reactions to Friday’s data from the Fed. Governor Brainard, a notable dove, was unsurprisingly the most cautious, saying that the report was ‘sobering’ and that ‘in this environment, prudent risk management implies there is a benefit to waiting for additional data to provide confidence that domestic activity has rebounded strongly and reassurance that near-term international events will not derail progress toward our goals’. Brainard also made further comments on the upcoming UK EU referendum vote, warning that while the economic effects are difficult to quantify for Brexit ‘we cannot rule out a significant adverse reaction to such an outcome in the near term, such as a substantial jump in financial risk premiums’.

Meanwhile, Cleveland Fed President Mester was a bit more upbeat in her post-payrolls comments on Friday. A more hawkish leaner usually, Mester said that she still believes a gradual upward pace of rate hikes is appropriate although that ‘when the rate hikes will occur and the slope of that gradual path is data dependent’. Mester added that the weak employment number had not changed her economic outlook. (HARVEY: IF SHE NUTS!!)

Over in Europe on Friday, the main take away from the price action was the reasonable underperformance for risk assets in the region. Indeed, unlike the rebound in the US the Stoxx 600 ended -0.89% as financials names dragged the index lower. It also capped what was a rough five days for European equities (-2.39%) following three straight weekly gains. Sovereign bonds were the big winners on Friday however. 10y Bund yields ended up nearly 5bps lower at 0.067% which is the lowest closing yield on record. That 0.049% intraday low struck back in April last year is suddenly well within sight again. Meanwhile 5y Bund yields tumbled even further into negative territory at -0.415%, while 8y (-0.202%) and 9y (-0.079%) yields all struck all time record lows.

Before we turn to the week ahead, there was actually some data in Europe to highlight on Friday which eventually got overshadowed by those across the pond. It was positive too with the final May composite PMI for the Euro area revised up 0.2pts to 53.1 following similar upward revisions for the manufacturing and services data. That composite level has been relatively stable for a few months now and our European economists noted that it is consistent with Euro area GDP growth of between +0.3% and +0.4% qoq in Q2.

 

END

ASIAN AFFAIRS

i)Late  SUNDAY night/ MONDAY morning: Shanghai closed DOWN  BY 4.58 PTS OR 0.16% /Hang Sang closed UP 82.98 OR 0.40%. The Nikkei closed DOWN 62.20 POINTS OR 0.37% Australia’s all ordinaires  CLOSED UP 0.78% Chinese yuan (ONSHORE) closed UP at 6.5669 Oil FELL to 49.09 dollars per barrel for WTI and 50.16 for Brent. Stocks in Europe MIXED . Offshore yuan trades  6.5706 yuan to the dollar vs 6.5669 for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS) 

FIRST  REPORT ON JAPAN  SOUTH KOREA AND CHINA

a) JAPAN ISSUES

Hawkish member of the Bank of Japan, Takehiro Sato has just warned that Japan can face a shock similar to that experienced in 20003 with a collapsing bond market. He is worried about Japanese banks who have piled into Japanese 10 yr bonds despite a negative yield. Many financial institutions have bought 30 yr bonds seeking a positive yield.  Once Japan runs out of room to buy additional bonds in 2017, the rise in yields will bankrupt the banks.

 

(courtesy zero hedge)

Bank Of Japan Board Member Warns Of “2003 Shock” Historic Bond Market Collapse

In a somewhat shocking break from the age-old tradition of lying and obfuscation, Bank of Japan policy board member Takehiro Sato raised significant concerns about global financial stability in a speech last week. In addition to raising concerns about Japanese economic fragility, Sato warned that due to the impact of negative interest rates, he “detected a vulnerability similar to that seen before the so-called VaR (Value at Risk) shock in 2003.”

Financial institutions are facing the risk of a negative spread for marginal assets due to the extreme flattening of the yield curve and the drop in the yield on government bonds in short- to long-term zones into negative territory. When there is a negative spread, shrinking the balance sheet, rather than expanding it, would be a reasonable business decision. In the future, this may prompt an increasing number of financial institutions to take such actions as restraining loans to borrowers with potentially high credit costs and raising interest rates on loans to firms with poor access to finance.

…a weakening of the financial intermediary functioning could affect the financial system’s resilience against shocks in times of stress. In addition, an excessive drop in bond yields in the super-long-term zone could also make the financial system vulnerable by increasing the risk of a buildup of financial imbalances in the system.

There is also the risk that financial institutions that have problems in terms of profitability or fiscal soundness will make loans and investment without adequate risk  valuation. From financial institutions’ recent move to purchase super-long-term bonds in pursuit of tiny positive yield, I detect a vulnerability similar to that seen before the so-called VaR (Value at Risk) shock in 2003.

Simply put, as Bloomberg notes, Sato is concerned the government bond market is heading for an historic collapse after 10-year yields plunged below zero, forcing banks to pile into super-long-term bonds in pursuit of tiny positive yields. This is creating huge concentrated positions with increasing duration risk (as we detailed previously), causing a vulnerability “similar to that seen before the so-called VaR (Value at Risk) shock in 2003,” when an initial jump in yields triggered a spectacular sell-off by breaching banks’ models for estimating potential losses.

The ripples from such a move – as we saw in Germany last year – would be unstoppable given the size, concentration, and leverage of the JGB market.

Chart: Bloomberg

end

b) REPORT ON CHINA

Goldman Sachs author Tang, discovers that the real figure for  Chinese Debt outstanding is far greater than anyone thought.  My using “money” instead of credit, he finds that last yr equiv of $3.8 trillion USA was issued approximately $.92 trillion grater than thought.

(courtesy zero hedge)

Goldman Finds That China’s Debt Is Far Greater Than Anyone Thought

EUROPEAN AFFAIRS

Last night a new ITV poll was released and it downed that 45% of the voters seek a BREXIT and only 41% a BREMAIN. The pound tumbled from the 1.45 handle down into the 1.43 level.If UK leaves the EU, gold will certainly see a huge beneficiary!

(courtesy zero hedge)

Cable Plunges After “Leave” Voters Overtake “Remain” In Latest Brexit Poll

END

Both sides go ballistic as Brexit odds hit record highs

(courtesy zero hedge)

UK PM Cameron Goes M.A.D. As Brexit Odds Hit Record High

Following the two polls overnight pointing to a significant lead for “leave” over “remain” in the Brexit vote, as we noted, cable tumbled and volatility premia spiked as Brexit odds surge to their highest yet. This pushed UK PM David Cameron into full panic mode, explaining that “we’re not scaremongering,” Cameron then said during an interview that Brexit would put a “bomb under our economy, and the worst thing is, we’d have lit the fuse ourselves.”

Vocal Brexit supporter, Boris Johnson warned today about the “triple whammy of woe” if Britain votes to remain…

The risks of remain are massive. Not only do we hand over more than £350 million a week to the EU, but if we vote to stay the British people will be on the hook for even more cash.

 

It is a triple whammy of woe: the eurozone is being strangled by stagnation, unemployment and a lack of growth, it could explode at any time and we will be forced to bail it out.

“The botched bureaucratic response to the migration crisis means the Eurocrats are demanding even more of our money. And now we find that there is a £20 billion black hole in the EU’s finances.

Brexit support has never been higher…

 

And cable has retested the lows of the cycle…

 

“Today’s move was a function of reality sinking in for overseas investors — the referendum will be a close outcome,” said Viraj Patel, a foreign-exchange strategist at ING Groep NV in London. “We’re probably seeing some of those long post-Brexit pound bets unwind.”

It appears even the bankers are starting to realize this event will be chaos… as Bloomberg notes,  U.K. politicians won’t be the only ones settling in for a long night as the polls close on June 23.

JPMorgan Chase & Co., Royal Bank of Scotland Group Plc, Morgan Stanley and Lloyds Banking Group Plc are among banks in London who plan to keep traders overnight to monitor the markets and handle client trades as results of the referendum on European Union membership trickle in, people with knowledge of the plans said. Currency traders, whose market stays open 24 hours, are among those most likely to remain in the office as they grapple with moves in the pound that have grown more volatile as the vote approaches.

 

Ironically, while senior bankers have warned that Brexit could reduce their numbers in the City of London, trading volumes around the vote may serve as a boon for struggling securities units. Currency trading revenue at the biggest investment banks fell 32 percent from a year earlier in the first quarter, part of a broader 28 percent drop in fixed-income revenue, according to Coalition Development Ltd.

“A volatile June driven by uncertainty around the U.K.’s EU referendum vote could help foreign-exchange revenues,” offsetting the normal seasonal slowdown, Kian Abouhossein, a bank analyst at JPMorgan, said in a note Monday.

Tags
The Swiss voters got it right:  in a landslide vote 77% voted to reject helicopter money
(courtesy zero hedge)

“Marxist Dream” Crushed – In Landslide Vote, Swiss Reject Proposal To Hand Out Free Money To Everyone

This weekend the Swiss population was called upon to make a historic decision, when Switzerland became the first country worldwide to put the idea of free money for everyone, technically known as Unconditional Basic Income (of CHF2,500 per month for every adult man and woman, and CHF625 for every child, for doing absolutely nothing) to a vote.

As reported previously, the outcome of this referendum would set a strong precedent and establish a landmark in the evolution of the debate of handing out free money in a centrally-planned world. And as predicted, based on early vote projections it has been a landslide decision against the “free lunch.”

die-schweizer-initiative-fuer
Opponents of the Swiss Basic Income Initiative demonstrate in front of parliament

According to BBC, some 78% of voters opposed the plan, a GFS projection for Swiss TV suggested. AFP adds that most Swiss vote in advance by post, so a large majority of ballots had already been counted, and gfs.bern put the margin of error at just plus/minus three percent.

Supporters said since work was increasingly automated, fewer jobs were available for workers. Switzerland is the first country to hold such a vote. No figure for the basic income had been set, but those behind the proposal suggested a monthly income of 2,500 Swiss francs (£1,755; $2,555) for adults and SFr625 for each child, reflecting the high cost of living in Switzerland. It is not clear how it would affect people on higher salaries.


Supporters of a basic income last month launched a giant poster campaign. The

poster unfortunately fails to ask “who is going to pay for it?”

“We are very happy,” Ralph Kundig, one of the lead campaigners, told the ATS news agency. Supporters threw a party in Lausanne to celebrate the 22 percent of votes they had garnered. “One out of five people voted for the unconditional basic income, so that is a success in itself,” Sergio Rossi, an economics professor and backer of the initiative, told ATS.

However, there was little support among Swiss politicians for the idea and not a single parliamentary party has come out in favour, but the proposal gathered more than 100,000 signatures and was therefore put to the vote under the Swiss popular initiative system.

Critics of the measure say that disconnecting the link between work done and money earned would be bad for society. But Che Wagner from the campaign group Basic Income Switzerland, says it wouldn’t be money for nothing. “In Switzerland over 50% of total work that is done is unpaid. It’s care work, it’s at home, it’s in different communities, so that work would be more valued with a basic income.”

Luzi Stamm, who’s a member of parliament for the right-wing Swiss People’s Party, opposes the idea.“Theoretically, if Switzerland were an island, the answer is yes. But with open borders, it’s a total impossibility, especially for Switzerland, with a high living standard,” he says.

“If you would offer every individual a Swiss amount of money, you would have billions of people who would try to move into Switzerland.”

Because, one you start handing out free lunches, everyone wants a piece of the pie…

Andreas Ladner, a political scientist at Lausanne University, told RTS the Swiss were “realistic” in their assessment of the UBI plan. Accepting that people can “be paid without having to work would have been a very big step” for the industrious Swiss, he said.

Critics have slammed the initiative as “a Marxist dream”, warning of sky-high costs and people quitting their jobs in droves, causing economic chaos.

The wording on the initiative was vague, asking for a constitutional change to “guarantee the introduction of an unconditional basic income” but with no mention of amounts.

Switzerland may be the first but it won’t be the last. The idea is also under consideration elsewhere. In Finland, the government is considering a trial to give basic income to about 8,000 people from low-income groups. And in the Dutch city of Utrecht is also developing a pilot project which will begin in January 2017.

* * *

Meanwhile, here are some recent thoughts on why the idea of a Free Lunch, old as time, will never work.

The Free Lunch – A Fantasy as Old as Methuselah

The promise of a free lunch is by no means a new thing in politics. Getting “something for nothing” is an age-old shiny trinket that has been dangled before the eyes of the public since time immemorial. In fact, it has appeared so excruciatingly often in our political history, for centuries on end, that one would think that it wouldn’t work anymore; not in 2016, surely. And yet it does. UBI is the proof that there are still people who choose to believe that “no strings attached” freebies and gifts are promises one can rely on and build an economy on, especially when they are coming from their government and rulers.

However, there are always some strings attached to such gifts and if history has taught us anything on this matter, it is the distinction between a gift and a bribe. Unsavory political ideologies and catastrophic cultural philosophies often tend to make their debut in front of the public hidden inside a Trojan gift horse. Unrealistic yet enchanting promises have always been a reliable political tool and it has never been a big strategic challenge to corrupt the people by granting the majority something that was stolen from minorities.

The Cultural Argument for Collectivism

Key figures of the pro-UBI camp take pride in claiming that the main motivation behind the campaign is not economic but cultural. They say this proposal aims to make people think about the nature of life and work, it is a way to liberate them from the jobs they don’t like but need, a status which the scheme’s advocates, quite unhistorically, equate to the indignity of slavery. On top of this,they claim, UBI will help society survive the imminent unemployment apocalypse: they believe that with the help of automation and artificial intelligence 50% of all the existing jobs will be taken over within the coming decade by computers and machines.

Such an argument might sound superficially rational, but it goes deeper than that: It presupposes that we as human beings see ourselves downgraded and equated to a machine, like just another cog that can be replaced at any time, in a system where man is literally defined as a human resource.

The truth is that it is indeed a cultural debate, far more than it is an economic one. The only conceivable aim of such a factually unhinged and unfounded proposal can be to gauge the mind-set of the Swiss people in this moment in time. The outcome of this referendum can provide a valuable insight into the Swiss mentality, and whether the Swiss  actually prefer collectivism over individualism. Such a signal could serve as cue for a further escalation of government empowerment: After all, the collapsing centralized system is bound to show symptoms of desperation by “doubling down” and accelerating and maximizing its centralization efforts. Thus focusing on the symptoms and secondary effects is futile; a real difference can only be made by addressing the root cause, the system itself.

Despite the economic non-sequiturs and the plain Utopianism that lie at the core of the idea of a Universal Basic Income, the concept seems to be gaining popularity worldwide. Canada is set to conduct an experiment with this idea later this year. The city of Utrecht in the Netherlands is launching a pilot program, Finland is planning a two-year trial and a British proposal is gathering interest, while the nonprofit group Give Directly will start providing a guaranteed income to 6,000 Kenyans this month in a decade-long scheduled program and track the results. The idea seems to be gaining traction due to the Western Left’s efforts, however the polls in Switzerland are painting a dramatically different picture: the UBI initiative is projected to suffer a crushing defeat.

A Bastion of Liberty

The Swiss have been voting counter-intuitively for years: When they held a referendum for or against six weeks of vacation, or when they were called upon to vote for an initiative advocating fewer working hours, or even when they made their choice on the issue of the minimum wage, they always delivered outcomes that seemed surprising to the rest of the West, especially the rest of Europe. Up to now, the Swiss have consistently rejected interference by the state when it came to such topics and have refused to grant more powers to their government. Even in recent years, when the trend in favor of aggressive state expansionism seems to be stronger than ever, Switzerland appears to still hold the line as the last bastion of liberty that remains standing.

So what is so different about the Swiss then? Switzerland is indeed very different, because it became a nation by its peoples’ own will, based on limited government, strong private property rights and a direct democracy founded on the principles of subsidiarity. This has always required open dialogue and being exposed to different ideas and values: Vigorous debate itself leads to an enlightened society. Thus, the essential difference lies in the nation’s culture, mentality and philosophy.

The Swiss have grown up in an environment in which the people were always able to decide for themselves, but they also have a long tradition of doubt and of dissent. Every critical issue is discussed and decided by the people, the actions of government are subject to the judgment of and limited by the citizenry. All viewpoints are heard, even anti-establishment voices have their say, and critical thinking provides the basis for society’s future. However, this is only possible when people rely on their own mind to think about the issues individually and independently.

Switzerland is therefore quite a hostile terrain for those who wish to promote “free lunches” and “no strings attached” gifts. A long history of independent thinking, of consequential analysis and of government limitation, makes it very easy for the Swiss to see past the populism-fueled empty promises and the associated publicity stunts. The upcoming rejection of the UBI proposal on June the 5th will and should serve as a reminder that the Swiss still remain the exception to the rule.

 

END

 

It is not just the USA that is seeing anti establishment parties win elections. In Italy the 5 star candidate takes the lead in the big mayoralty election in Rome:

(courtesy zero hedge)

 

Anti-Establishment Revulsion Hits Italy As 5-Star Candidate Takes Lead In Rome Mayoral Election

Not only is support growing in the United States for candidates that are perceived to be ‘outside of the establishment’, and recently and very notably in Austria, Germany and France, but as of today, in countries such as Italy.

Millions of Italians went to the polls on Sunday to vote in local elections for new mayors and town councils in more than 1,300 cities, the results of which could shake up Italy’s political landscape. The elections include Italy’s biggest cities such as Rome and Milan, and come at a difficult time for Prime Minister Matteo Renzi, as the country faces weak economic growth, a banking sector on the verge of yet another major crisis, and an uptick in migration.

In the main battleground of Rome, the anti-establishment Euroskeptic 5-Star Movement candidate won the largest share of the votes in the first round of its mayoral election. Virginia Raggi, a 37-year old lawyer running as the upstart euroskeptic 5-Star Movement won 35.6% of the vote cast Sunday in Rome, while Roberto Giachetti, the candidate for Renzi’s Democratic party received just 24.7%. The two candidates will face a runoff on June 19 the WSJ reports. Locals are seeking new leadership that can pull the Italian capital out of a state of turmoil, as it has endured corruption allegations, poor management and political upheaval. Rome has been under special administration since former Mayor Ignazio Marino, a member of Renzi’s Democratic party, resigned last October over accusations of expense irregularities – the Democratic party has been weakened in Rome by a string of political scandals and by a major criminal investigation that uncovered ties between organized crime and City Hall Officials the WSJ adds.

If Raggi wins the second round, it would give the 5-Star Movement a major opportunity to prove its ability to govern. If it can manage to tame some of Rome’s problems, that would also boost the movement’s chances in the next national election. Polls already show that the 5-Star Movement is closing in on the Democratic Party.

Further signs of trouble for Renzi appeared in Naples and Turin. In Naples, the Democratic Party didn’t make it to the runoffs, while in Turin the Democratic Party will have to face the 5-Star Movement in the second round as well.

Renzi has staked his government on a positive outcome of a constitutional referendum that has been called for October, in which there will be a vote on whether to approve a plan to simplify Italy’s legislative process, reduce the senate’s powers and ensure more stable governments – if the referendum fails, Renzi has promised to resign, which would pave the way for early elections next year.

A negative outcome of the referendum would not only end Renzi’s tenure but also throw Italy into uncharted waters” said Wolfango Piccoli, co-president at London’s Teneo Intelligence.

* * *

We continue to get confirmation that it is not just US voters who have seemingly had enough of the politics as usual. As in Germany and Austria, there is a growing passion for citizens in Italy to do away with business as usual, for better or worse. We’ll be watching to see how this all plays out, and specifically if Renzi actually resigns should the referendum fail, as he said he would do.

Tags

EMERGING MARKETS

VENEZUELA

Not good:  the Venezuela national guard now assaults members of the press covering the story on the devastation inside Venezuela

(courtesy zero hedge)

Dangerous Situation: Venezuelan National Guard Assault Members Of The Press During Protests

During Thursday’s protest over food in Caracas, chaos erupted after supermarket shoppers were told that regulated goods they had expected to be available would not be up for sale. In a sign of just how bad things have gotten, at least 19 journalists were attacked while trying to cover the chaotic events Bloomberg reports.

Espacio Publico, a non-government organization that monitors freedom of expression said that the assaults include robberies by members of the National Guard and armed civilians.

We categorically reject the criminalization that the press is being subject to as they are held hostage, threatened and repeatedly intimidated by armed groups while they cover the street” the organization said in a separate statement.

Venezuela’s opposition is pushing for a recall referendum on Maduro’s rule to be held this year, and after the country’s election board known as CNE canceled a scheduled meeting to discuss the status of the request, the 2 million Venezuelans who had signed the petition calling for the recall were urged to march in order to “ratify” their signatures.

Jesus “Chuo” Torrealba, the executive secretary of Venezuela’s opposition alliance known as MUD said “we collected over 2 million signatures, and the CNE hasn’t yet said how the process will go. We already have five times the signatures needed to start the process.”

“There were some very rough hours today in downtown Caracas. Venezuela is a time bomb of social and economic discontent” he added.

Time bomb of social and economic discontent is an understatement…

8 Lessons That We Can Learn From The Economic Meltdown In Venezuela

END

BRAZIL

Trouble for the new leader of Brazil! Temer convicted of breaking election laws. Thousnads March for democracy in Brazil

(courtesy Common Dream/Knight)

 

Temer Convicted of Breaking Election Laws As Thousands March for Democracy in Brazil

More revelations of “oozing corruption” in interim president’s administration

Brazilian President Temer’s conviction “potently symbolizes the anti-democratic scam that Brazilian elites have attempted to perpetrate,” writes Glenn Greenwald. (Photo: Reuters/Ueslei Marcelino)

Upheaval in Brazil continued this week as a court handed down a conviction against right-wing president Michel Temer, who took over after the ouster of leftist president Dilma Rousseff, and banned him from running in elections for the next eight years.

A regional elections court in Temer’s hometown of São Paulo on Thursday “issued a formal decree finding him guilty and declaring him ‘ineligible’ to run for any political office as a result of now having a ‘dirty record’ in elections,” Glenn Greenwald reported in The Intercept.

The decision came less than three weeks after Temer oversaw what has widely been described as a “coup” to overthrow Rouseff, the recently re-elected Workers’ Party president.

“In the scope of the scheming, corruption and illegality from this ‘interim’ government, Temer’s law-breaking is not the most severe offense,” Greenwald notes. “But it potently symbolizes the anti-democratic scam that Brazilian elites have attempted to perpetrate. In the name of corruption, they have removed the country’s democratically elected leader and replaced her with someone who—though not legally barred from being installed—is now barred for eight years from running for the office he wants to occupy.”

As interim president, Temer has swiftly and openly transformed the formerly left-leaning and diverse Brazilian government into one pushing neoliberal, right-wing policies, helmed by an all-white, all-male cabinet. In the New Yorker, Jon Lee Anderson summarized a few of Temer’s decisions that have raised eyebrows worldwide:

He got rid of the Ministry of Women, Racial Equality, and Human Rights, ordering it to be subsumed into the Ministry of Justice—which he promptly handed over to Alexandre de Moraes, a former security official from São Paulo who is accused of deploying death squads to fight crime in that city. (His former office has denied the accusations.) This came at the same time as news of a horrifying case in which a sixteen-year-old girl in Rio de Janeiro was gang-raped by as many as thirty-three men, some of whom filmed their abuse and posted it to social media.

[…] Temer’s choice for agriculture minister, meanwhile, was a portly billionaire senator named Blairo Maggi, who cast the deciding vote in the Senate to unseat Rousseff. Maggi, the former governor of the state of Mato Grosso, made his fortune by cutting down millions of acres of Amazonian wilderness. In a 2007 piece for National Geographic, the journalist Scott Wallace wrote, “Maggi is ‘O Rei da Soja, King of Soy, the world’s largest single producer. Maggi acquired a less flattering honorific when Greenpeace gave him its Golden Chain Saw award in 2005.” For a number of years while he was governor, Mato Grosso led Brazil in deforestation. In 2010, Maggi was elected to the Senate, and, with the support of the powerful bancada ruralista, Brazil’s agribusiness lobby, he became the head of the environmental committee, where he helped push through a set of environmental regulations known as the Forest Code. Among other things, the Forest Code gave amnesty to landowners who had previously engaged in illegal wilderness clearances.

“The oozing corruption of Temer’s ministers has sometimes served to obscure his own,” Greenwald writes. “He, too, is implicated in several corruption investigations. And now, he has been formally convicted of violating election laws.”

On the same day Temer was convicted, suspended president Dilma Rousseff joined 5,000 women marching for women’s rights and democracy in Rio de Janiero:

Pro-democracy and anti-Temer protests have flooded the streets in cities throughout the country since Rousseff’s ouster:

Greenwald also discussed the United States’ involvement in Rousseff’s impeachment in a video published Friday by The Intercept, observing that WikiLeaks had published diplomatic cables showing Temer secretly meeting with officials in D.C. in 2006 and 2007, and that impeachment proponent Senator Aloysio Nunes met with officials and lobbyists close to Hillary Clinton in Washington in the days following his vote to impeach Rousseff.

A government overthrow in Latin America “cannot happen without U.S. approval,” Greenwald argued. “If the U.S. was supporting democracy, the impeachment would not have happened.”

Moreover, “it’s always true that the U.S. government strongly prefers right-leaning governments than left-leaning ones in South America,” Greenwald said. “Why? It’s obvious: right-leaning governments tend to help the international banks, Wall Street, hedge funds, international capital.”

Indeed, on Thursday the Financial Timesreported that investors around the world were “rooting” for Temer’s administration.

 

end

 

OIL ISSUES

A good description of what is going to happen in the oil markets once Libya, Canada and Nigeria get their oil back on stream:

 

(courtesy Rakesh Upadhyay/OilPrice.com)

 

Does Iran Have The Upper Hand In OPEC Oil War

Submitted by Rakesh Upadhyay via OilPrice.com,

Traditional rivals, Saudi Arabia and Iran, continue to fight to prove their supremacy in OPEC. Neither gives up an opportunity to hurt the other, whenever and wherever they can, and oil seems to be their favourite playground.

With Saudi Arabia scuttling any chances of a production freeze in Doha in April, Iran has followed suit by thwarting attempts by Saudi Arabia to introduce a production ceiling on OPEC production in Thursday’s meeting held in Vienna.

Iran, which is close to its pre-sanction levels of production, had earlier agreed to discuss being part of any production freeze after it reached its desired output. However, in yesterday’s meeting, Iran refused to adhere to any production ceiling, which led to OPEC abandoning the idea.

Iran has been a dark horse since the lifting of sanctions, increasing its market share quickly to the surprise of many investors.

Iran has resorted to offering large discounts to its Asian customers, undercutting the Saudi and Iraqi prices to levels not seen since 2007-2008 in order to regain their market share, reports Reuters.

Iran shipped 2.3 million b/d in April 2016, the highest level since 2012. These figures are 15 percent higher than the International Energy Agency (IEA) forecast. Iran has been successful in its strategy until now, but increasing its market share further might prove difficult.

Meanwhile, Saudi Arabia is attempting to cement its market share in the wake of this increased production from Iran and Iraq. Though Saudi Arabia is attempting to transition away from being an oil-dependent economy, its transformation depends on the successful listing of Saudi Aramco.

As part of its preparation for the listing, Aramco is gaining market share and improving its efficiency, according to its chief executive, Amin Nasser.

“We are preserving our market share, which continues to increase year-on-year,” he said in the interview. “This year, as last year, it is increasing. Our market share is picking up,” he added, without giving figures, reportsReuters.

Ian Bremmer, the president of political risk consultancy Eurasia Group, told Reuters that the Saudi’s were planning to increase production by close to 1 million b/d after speaking with executives and a member of the Saudi ruling family.

The struggle for supremacy between the two nations doesn’t show any signs of abating, and there is no clear winner in this showdown.

Though Saudi Arabia has large reserves, it is burning them at a fast rate. On the other hand, experts believe that the Iranian economy is better equipped to withstand lower oil prices because its economy is more diversified and has an educated and hardworking population.

Emad Mostaque, a strategist with the London-based research consultancy Ecstrat, echoed a similar view. He said that Iran is better equipped to cope with the long-term upheaval because it is less dependent on oil than Saudi Arabia, having raised more through general taxation than through oil duties last year, reports Fortune.

The fight between the two for supremacy in the Middle East region is unlikely to end anytime soon. Currently, supply outages to the tune of 3.5 million b/d are supporting the oil prices by creating a balance between demand and supply.

Once Nigeria, Libya, and Canada resume pumping at their normal levels, the effects of the struggle between Iran and Saudi Arabia will be felt. If both increase production, the world will be awash with oil, pulling prices back to the mid $30/barrel levels.

 end

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

Euro/USA   1.1333 DOWN .0033 ( STILL REACTING TO USA FAILED POLICY

USA/JAPAN YEN 107.14  UP 0.656 (Abe’s new negative interest rate (NIRP), a total DISASTER/SIGNALS U TURN WITH INCREASED NEGATIVITY IN NIRP/JAPAN OUT OF WEAPONS TO FIGHT ECONOMIC DISASTER

GBP/USA 1.4394 DOWN.0105 (HUGE THREAT OF BREXIT)

USA/CAN 1.2958 UP  .0031

Early THIS MONDAY morning in Europe, the Euro FELL by 33 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 4.58 PTS OR 0.16% / Hang Sang CLOSED UP 82.98 OR  0.40%   / AUSTRALIA IS HIGHER BY 0.78%/ EUROPEAN BOURSES ARE MIXED  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 MONDAY morning: closed DOWN 62.20 OR 0.37% 

Trading from Europe and Asia:
1. Europe stocks MIXED AS  THEY START THEIR DAY

2/ CHINESE BOURSES / : Hang Sang CLOSED UP 82.98 PTS OR 0.40% . ,Shanghai CLOSED DOWN 4.58 OR 0.16%/ Australia BOURSE IN THE GREEN: /Nikkei (Japan) CLOSED IN THE RED /India’s Sensex IN THE RED

Gold very early morning trading: $1241.00

silver:$16.38

Early MONDAY morning USA 10 year bond yield: 1.717% !!! UP 2 in basis points from FRIDAY night in basis points and it is trading WELL BELOW resistance at 2.27-2.32%. The 30 yr bond yield RISES to 2.518 PAR in basis points from FRIDAY night. (SPREAD GOES AGAINST THE BANKS)

USA dollar index early MONDAY morning: 94.26 UP 22 CENTS from FRIDAY’s close.(Now below resistance at a DXY of 100.)

This ends early morning numbers MONDAY MORNING

END

And now your closing MONDAY NUMBERS

Portuguese 10 year bond yield:  3.20% UP 4 in basis points from FRIDAY

JAPANESE BOND YIELD: -0.115% DOWN 2  in   basis points from FRIDAY

SPANISH 10 YR BOND YIELD:1.52%  UP 5 IN basis points from FRIDAY

ITALIAN 10 YR BOND YIELD: 1.47  UP 14 IN basis points from FRIDAY

the Italian 10 yr bond yield is trading 5 points lower than Spain.

GERMAN 10 YR BOND YIELD: 0.086% UP 2  IN BASIS POINTS ON THE DAY

END

 

IMPORTANT CURRENCY CLOSES FOR MONDAY

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

 

Euro/USA 1.1369 UP .0004 (Euro =UP 4 basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/reacting to dovish YELLEN/ANOTHER FALL IN USA;YEN CROSS TODAY

USA/Japan: 107.41 UP .928 (Yen DOWN 93 basis points )

Great Britain/USA 1.4454 DOWN.0045 ( Pound DOWN 45 basis points/(HUGE BREXIT CONCERN)

USA/Canada 1.2815 DOWN 0.01166 (Canadian dollar UP 117basis points EVEN THOUGH OIL  IS RISING (WTI AT $49.74).

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

This afternoon, the Euro was UP by 4 basis points to trade at 1.1369

The Yen FELL to 107.41 for a LOSS of 93 basis points as NIRP is STILL a big failure for the Japanese central bank/

The pound was DOWN 45 basis points, trading at 1.4454( BREXIT FEARS INCREASE )

The Canadian dollar ROSE by 117 basis points to 1.2815, WITH WTI OIL AT:  $49.74

The USA/Yuan closed at 6.5644 RISING WITH THE USA DEVALUATION

the 10 yr Japanese bond yield closed at -.115% DOWN 1 1/2   IN BASIS  points in yield/

Your closing 10 yr USA bond yield: DOWN 1  IN basis points from FRIDAY at 1.722% //trading well below the resistance level of 2.27-2.32%)

USA 30 yr bond yield: 2.55 UP 3 in basis points on the day ( HUGE POLICY ERROR)

BANKS NEED THE LONGER BOND HIGHER IN YIELD: INSTEAD THE SPREAD LESSENS.

Your closing USA dollar index, 93.91 DOWN 13 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 MONDAY

London:  CLOSED UP 43.37 OR 0.70%
German Dax :CLOSED UP 17.82 OR 0.18%
Paris Cac  CLOSED UP 1.60  OR 0.04%
Spain IBEX CLOSED UP 21.20 OR 0.25%
Italian MIB: CLOSED UP 179.91 OR 0.74%

The Dow was UP 113.27.  points or 0.18%

NASDAQ UP 26.20 points or 0.53%
WTI Oil price; 49.74 at 4:30 pm;

Brent Oil: 50.49

USA DOLLAR VS RUSSIAN ROUBLE CROSS:  65.27 (ROUBLE UP 3/100 ROUBLES PER DOLLAR FROM YESTERDAY) EVEN THOUGH THE PRICE OF BRENT FELL AND WTI FELL

TODAY THE GERMAN YIELD RISES TO 0.087  FOR THE 10 YR BOND

.

END

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:

WTI CRUDE OIL PRICE 5 PM:49.69

BRENT: 50.47

USA 10 YR BOND YIELD: 1.736%

USA DOLLAR INDEX: 94.01 DOWN 3 cents

END

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

Trading Today in Graph form;  VERY IMPORTANT FOR YOU TO VIEW ALL THE CHARTS TODAY

 

(courtesy zero hedge)

 

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