August 15/The farce continues; a huge “paper gold” withdrawal of 12.17 tonnes/and yet 0 oz of silver leaves the SLV/Over 43.6 tonnes of gold standing for August/Japan has a terrible 2nd quarter GDP number/In a big alert the Justice dept finds evidence of criminal behaviour with respect to the Chrsyler emissions: this may bring them down!/ Erdogan turns to Russian and then states he may release all of the migrant to Europe/

 

Gold:1340.30 UP $4.30

Silver 19.82  UP  15  cents

In the access market 5:15 pm

Gold: 1339.50

Silver: 19.84

.

For the August gold contract month,  we had a small sized 44 notices served upon for 4400 ounces. The total number of notices filed so far for delivery:  12,824 for 1,282,400 oz or  tonnes or 39.8880 tonnes.  The total amount of gold standing for August is 43.7 tonnes.

In silver we had 0 notices served upon for nil oz. The total number of notices filed so far this month:  274 for 1,370,000 oz.

 

I would like to point out to you that we are coming up to the  big event where the yuan is to be included in the SDR’s on September 30.  The inclusion will dilute the use of the USA dollar and that is becoming quite problematic for our banking crooks.

 

I would also like to point out to you that the banking west is totally paying no attention to the higher Shanghai gold fix.  China is now putting its foot down that it wants to set the price of gold namely because it is the real market for gold not the paper sham of the west. Our bankers, realizing the yuan inclusion is rapidly coming to fruition, is doing everything in their power to keep the paper game of gold alive and that is why they are whacking gold whenever they can and that is during the “paper gold time  zones” .e. past noon when London is put to bed and in the access market where it is strictly paper.  However once 4 am rolls around  (Shanghai physical fix) gold reaches its pinnacle.

Ladies and Gentlemen: the war is on for the supremacy of the gold market: China vs the USA

Let us have a look at the data for today

.

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In silver, the total open interest FELL BY A LARGE 1,512 contracts DOWN to 206,816 AND  MOVING AWAY FROM ITS AN ALL TIME RECORD AS  THE  PRICE OF SILVER FELL  BY 31 CENTS WITH FRIDAY’S TRADING.In ounces, the OI is still represented by just over 1 BILLION oz i.e. 1.034 BILLION TO BE EXACT or 148% 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 FELL 1,892 contracts as the price of gold FELL by $6.70 FRIDAY. The total gold OI stands at 570,101 contracts.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD

we had a huge change in GLD/, a massive withdrawal of 12.17 tonnes

Total gold inventory rest tonight at: 960.45 tonnes

SLV

we had no changes in the SLV, /   THE SLV/Inventory rests at: 351.765 million oz.

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

1. Today, we had the open interest in silver FELL by 3,864 contracts DOWN to 208,328 as price of silver FELL BY 31 cents with FRIDAY’S trading.The gold open interest FELL 2,355 contracts DOWN to 571,993 as the price of gold FELL by $6.70 WITH FRIDAY’S TRADING.

(report Harvey).

 

2 a) Gold/silver trading overnight Europe, Goldcore

(Mark OByrne/zerohedge

 

3. ASIAN AFFAIRS

i)Late  SUNDAY night/MONDAY morning: Shanghai closed UP 74.53 POINTS OR 2.44%/ /Hang Sang closed UP 165.60 points or 0.73%. The Nikkei closed DOWN 50.36 POINTS OR 0.30% Australia’s all ordinaires  CLOSED UP 0.16% Chinese yuan (ONSHORE) closed DOWN at 6.6498/Oil rose to 44.69 dollars per barrel for WTI and 47.52 for Brent. Stocks in Europe:  in the GREEN . Offshore yuan trades  6.64831 yuan to the dollar vs 6.6498 for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS HUGELY AS  MORE USA DOLLARS ATTEMPTS TO LEAVE CHINA’S SHORES  

REPORT ON JAPAN  SOUTH KOREA AND CHINA

a) REPORT ON JAPAN

i)The Yen remains basically unchanged with the report of a big 2nd quarter GDP miss from Japan.  Business spending reports a huge drop and worse of all: exports slide

Another indicator as to global growth as this once big engine for goods supplying the rest of the world is faltering;

( zero hedge)

ii)This is what a failed state looks like:  the Bank of Japan by next year will be the top shareholder of 55 companies:

(courtesy zero hedge)

b) REPORT ON CHINA

China is hoarding cash at the fastest pace since 2008. Basically there is nothing to invest in so they hoard cash:

( zero hedge)

4 EUROPEAN AFFAIRS

i)German bank Rauffeisen has had enough and will now charge customers who deposit over 100,000 euros into their bank:

(courtesy zero hedge)

ii)GREECE

Greece is heading for a wealth tax!..as authorities ask Greece to delare all assets!

(courtesy zero hedge)

 

iii)The USA justice department finds evidence of criminal wrongdoing in the Volkswagen diesel emissions.  Shocking! and yet they cannot find any criminal activity with respect to Hillary:

( Wall Street Journal and special thanks to Robert H for sending me this alert)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

( Asian Times/Bhadrakumar/)

ii)Then we learn that Turkey is threatening to reopen the refugee floodgates to Europe. This is a no brainer to Erdogan having crossed the line over to Russia:

( Michael Krieger/Liberty Blitzkrieg blog)

6.GLOBAL ISSUES

Dominic Konstam comments that a shock is needed to collapse all markets, and force a real panic to change the financial structure of the globe.  Only one problem:  the panic will surely destroy Konstam’s employer:  Deutsche bank:

( zero hedge)

7.OIL ISSUES

i)Putin spoils the party after he denies an output freeze at OPEC talks:

( zero hedge)

8.EMERGING MARKETS

(courtesy zero hedge)

9.PHYSICAL STORIES

i)A great interview of John Embry by Egon Von Greyerz as they discuss gold/silver as being undervalued assets against overvalued financial assets.
(courtesy Egon Von Greyerz/John Embry/GATA)

ii)A terrific commentary from Chris Powell discussing the trading of gold/silver lately and the blatant manipulation (whacking of our precious metals) during the last 5 days.(Chris Powell/GATA)

iii)The value of all negative yielding bonds has now risen from 13 to 13.4 trillion equiv. USA

( Robin Wigglesworth/London’s Financial Times)

10.USA STORIES WHICH MAY INFLUENCE THE PRICE OF GOLD/SILVER

i)A terrific commentary on the plight of North American Life Insurers has they have to deal with a huge $13.4 trillion of negative interest rates.  The search for yield is causing them to seek higher risk assets and this is an accident waiting to happen: e.g. the huge amount of energy assets that they have invested in only to see the price of oil collapse!

( zero hedge)

 

ii)The all important New York manufacturing index falls into contraction again;

( zero hedge)

Let us head over to the comex:

The total gold comex open interest FELL TO AN OI level of 570,101 for a LOSS of 1892 contracts AS THE PRICE OF GOLD FELL BY $6.70 with YESTERDAY’S TRADING..   We are now in the active month of AUGUST. As I stated this month : “Somebody big is continually standing for the gold metal and continues to do so in August in the same manner as we witnessed in May,  June and July  whereby the front delivery month increases in OI standing for metal or a slight contraction We will no doubt see increases in amount standing in August and probably we will surpass the amount standing on first day notice.  The  big active contract month of August saw it’s OI FALL by 1127 contracts DOWN to 1256,  We had 1101 notices filed upon yesterday so we LOST A TINY 26 contracts or an additional 2600 oz will not stand for delivery in August AND THESE GUYS WERE PROBABLY CASH SETTLED FOR A FIAT BONUS. The next contract month of Sept saw it’s OI fall by 141 contracts down to 5,072.The September contract STILL remains extremely elevated and we may have another of those high deliveries rare for a non active month.The next active delivery month is October and here the OI fell by 424 contracts down to 46,566. The estimated volume today (which is just comex sales during regular business hours of 8:20 until 1:30 pm est) was POOR at 125,451.  The confirmed volume  yesterday (which includes the volume during regular business hours + access market sales the previous day was GOOD at 261,499 contracts.The comex is not in backwardation.
Today, we had  44 notices filed for 4400 oz in gold
And now for the wild silver comex results. Total silver OI FELL by 1512 contracts from 208,328 DOWN TO 206,816 with the FALL in price of silver to the tune of 31 cents.  We are moving away from the all time record high for silver open interest set ON Wednesday AUGUST 3: (224,540). The non active month of August saw it’s OI RISE BY 9 CONTRACTS UP TO 199. We had 0 notices served yesterday so we gained 9 contracts or an additional 45,000 oz will stand in this non active delivery month of August. The next big active month is September and here the OI fell by ONLY 2343 contracts down to 108,939  and that would alarm our bankers to no end. The volume on the comex today (just comex) came in at 49,081 which is very good and small rollovers..The confirmed volume yesterday (comex + globex) was HUGE at 87,813 with tiny rollovers.. Silver is not in backwardation. London is in backwardation for several months.
We had 0 notices filed for today for nil oz
INITIAL standings for AUGUST
 August 15.
Gold
Ounces
Withdrawals from Dealers Inventory in oz   nil OZ
Withdrawals from Customer Inventory in oz  nil
229,075.75 oz
HSBC
Manfra
incl 7000 kilobars HSBC
Deposits to the Dealer Inventory in oz nil
Deposits to the Customer Inventory, in oz 
nil
No of oz served (contracts) today
44 notices 
4400 oz
No of oz to be served (notices)
1212 contracts
(121,200 oz)
Total monthly oz gold served (contracts) so far this month
12,824 contracts (1,282,400 oz)
(39.8880 tonnes)
Total accumulative withdrawals  of gold from the Dealers inventory this month   NIL
Total accumulative withdrawal of gold from the Customer inventory this month    428,016.7 OZ
Today:  huge activity at the gold comex AND 1 KILOBAR ENTRY
Today we had 0 dealer DEPOSIT
total dealer deposit: NIL    0z
Today we had  0 dealer withdrawals:
total dealer withdrawals:  nil oz
We had 0 customer deposit:
Total customer deposits: nil oz
Today we had 2 CUSTOMER withdrawals
 i) Out of HSBC: 225,057.000 OZ (7000.02 kilobars??)
ii) Out of Manfra: 4,018.75 oz
Total customer withdrawals  229,075.75 OZ
Today we had 1 adjustment:
i) out of brinks: 675.15 oz was adjusted out of the dealer and this landed into the customer account of Scotia. (deemed a settlement) ..02 tonnes
Note: If anybody is holding any gold at the comex, you must be out of your mind!!!
since comex gold storage is unallocated , rest assured any gold stored will be compromised!
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 44 contracts of which 0 notices was stopped (received) by JPMorgan dealer and 35 notices was stopped (received)  by JPMorgan customer account. 
To calculate the initial total number of gold ounces standing for the AUGUST  contract month, we take the total number of notices filed so far for the month (12,824) x 100 oz  or 1,282,400 oz , to which we  add the difference between the open interest for the front month of AUGUST  (1256 CONTRACTS) minus the number of notices served upon today (44) x 100 oz   x 100 oz per contract equals 1,403,600 oz, the number of ounces standing in this active month. 
 
Thus the INITIAL standings for gold for the AUGUST contract month:
No of notices served so far (12824) x 100 oz  or ounces + {OI for the front month (1256) minus the number of  notices served upon today (44) x 100 oz which equals 1,406,200 oz standing in this non  active delivery month of AUGUST  (43.6578 tonnes).
We lost 26 contracts or additional 2600 oz will not stand for metal in this active month of August.
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 now have partial evidence of gold settling for last months deliveries We now have  +  6.889 TONNES FOR MAY + 49.09 TONNES FOR JUNE +  21.452 TONNES FOR JULY + 12.3917 + 43.658 tonnes Aug +  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 ; june 10 -.0008 / June 22:0.48 tonnes /June 23: 0489 tonnes, June 24..018; june 29 .036 tonnes; JUNE 30 2.49 /july 1 1778 tonnes, JULY 28 .089 TONNES / JULY 29 .128 TONNES/ aUG 10// 0.219 TONNES/August 11: .3619 TONNES/ AUG 12/.05878/THEREFORE 93.416 tonnes still standing against 73.425 tonnes available.
 Total dealer inventor 2,359,938.781 oz or 73.403 tonnes
Total gold inventory (dealer and customer) =11,006,156.157 or 342.33 tonnes 
 
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 342.433 tonnes for a  gain of 39  tonnes over that period. 
 

THE GOLD COMEX IS AN ABSOLUTE FRAUD. THE USE OF KILOBARS AND EXACT WEIGHTS MAKES THE DATA TOTALLY ABSURD AND FRAUDULENT!!

To me, the only thing that makes sense is the fact that “kilobars” are entries or hypothecated gold sent to other jurisdictions so that they will not be short in their derivatives like in England.  This would be similar to the gold used by Jon Corzine. If this is the case, this would be the greatest fraud perpetrated on USA soil.

 

 
 end
And now for silver
 
AUGUST INITIAL standings
 august 15.2016
Silver
Ounces
Withdrawals from Dealers Inventory NIL
Withdrawals from Customer Inventory
185,444.22 oz
SCOTIA
BRINKS
Deposits to the Dealer Inventory
nil
Deposits to the Customer Inventory
586,700.02 oz
BRINKS CNT
No of oz served today (contracts)
0 CONTRACTS
(nil OZ)
No of oz to be served (notices)
199 contracts
995,000 oz)
Total monthly oz silver served (contracts) 274 contracts (1,370,000 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  8,264,815.0 oz
today we had 0 deposit into the dealer account:
 Total dealer deposits;  NIL oz
we had 0 dealer withdrawal:
:
total dealer withdrawals:  NIL oz
we had 2 customer withdrawals:
i) Out of SCOTIA:  35,307.420 oz
ii) Out of Brinks: 150,136.800 oz
Total customer withdrawals: 185,444.22 oz
We had 2 customer deposits:
i) Into Brinks: 5282.82 oz
ii) Into CNTL 581,417.200
total customer deposits:  586,700.02  oz
 
 
 
 we had 0 adjustments
The total number of notices filed today for the AUGUST contract month is represented by 0 contract for nil  oz. To calculate the number of silver ounces that will stand for delivery in AUGUST., we take the total number of notices filed for the month so far at (274) x 5,000 oz  = 1,370,000 oz to which we add the difference between the open interest for the front month of AUGUST (199) 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 AUGUST contract month:  274(notices served so far)x 5000 oz +(199 OI for front month of AUGUST ) -number of notices served upon today (0)x 5000 oz  equals  2,365,000 oz  of silver standing for the AUGUST contract month.
we gained 9 contracts or an additional 4500 oz will  stand for delivery in this non active month of August.
 
Total dealer silver:  27.485 million (close to record low inventory  
Total number of dealer and customer silver:   156.435 million oz (close to a record low)
The total open interest on silver is NOW close to its all time high with the record of 224,540 being set AUGUST 3.2016.  The registered silver (dealer silver) is NOW NEAR  multi year lows as silver is being drawn out at both dealer and customer levels 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
August 15/what a farce!! a huge “paper gold’ withdrawal of 12.17 tonnes/inventory rests at 960.45 tonnes
August 12/no change in gold inventory at the GLD/Inventory rests at 972.62 tonnes
August 11/no changes in gold inventory at the GLD/Inventory rests at 972.62 tonnes
August 10/no changes in GLD/Inventory rests at 972.62 tonnes
August 9/we had a withdrawal of 1.18 tonnes of gold from the GLD inventory/inventory rests at 972.62 tonnes
August 8/a huge changes in the GLD/Inventory, a withdrawal of 6.54 tonnes of paper gold/ rests at 973.80 tonnes of gold/
August 5/ a huge deposit of 10.69 tonnes of gold (with gold down $22.40??)/GLD inventory rests at 980.34 tonnes
August 4/no change in inventory at the GLD/Inventory rests at 969.65 tonnes
August 3/a big deposit of 5.62 tonnes of paper gold/Inventory rests at 969.65 tonnes
August 2/no change in gold inventory at the GLD/Inventory rests at 964.03 tonnes
August 1/we had a huge paper deposit of 5.94 tonnes of gold into the GLD/Inventory rests at 964.03 tonnes
July 29/ we had a huge deposit of 3.86 tonnes into the GLD/inventory rests at 958.09 tonnes
July 28/no changes in gold inventory at the GLD/Inventory rests at 954.23 tonnes
July 27/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 954.23 TONNES
jULY 26./ANOTHER HUGE PAPER WITHDRAWAL OF 4.46 TONNES FROM THE GLD/INVENTORY RESTS AT 954.23 TONNES
JULY 25/ A HUGE PAPER WITHDRAWAL OF 4.45 TONNES FROM THE GLD/INVENTORY RESTS AT 958.69 TONNES
July 22/ no change in gold inventory at the GLD/Inventory rests at 963.14 tonnes
July 21/ a large withdrawal of gold inventory to the tune of 2.08 tonnes/Inventory rests at 963.14 tonnes
July 20./no changes in gold inventory at the GLD/Inventory rests at 965.22 tonese
July 19/no change in gold inventory at the GLD/Inventory rests at 965.22 tonnes
July 18./ a good sized deposit of 2.37 tonnes of gld into GLD/this is a paper gold entry/inventory rests at 965.22 tonnese
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
August 15/ Inventory rests tonight at 960.45 tonnes

end

Now the SLV Inventory
August 15./amazing, we have a huge withdrawal in gold and yet nothing moves out of silver: no change in silverinventory at the SLV/Inventory rests at 351.765 million oz.
August 12/no change in silver inventory at the SLV/Inventory rests at 351.765 million oz
August 11/no change in silver inventory at the SLV/Inventory rests at 351.765 oz
August 10/no changes in silver inventory at the SLV/Inventory rests at 351.765 oz
August 9/a deposit of 950,000 oz into the SLV/Inventory rests at 351.765 oz
August 8/no change in silver inventory at the SLV/Inventory rests at 350.815 million oz.
August 4/no change in silver inventory at the SLV/inventory rests at 350.815 million oz
August 3/no change in silver inventory/inventory rests at 350.815 million oz
August 2/ we had a tiny withdrawal of 40,000 oz of silver/Inventory rests at 350.815 million oz
August 1/we had a huge paper deposit of 1.235 million oz into the SLV/Inventory rests at 350.955 million oz
July 29/we had no change in silver inventory/inventory rests at 349.720 million oz
July 28/we had 1.14 million oz of additional silver added to the SLV/Inventory rests at 349.720 million oz
July 27/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 348.580 MILLION OZ
jULY 26/NO CHANGE IN SILVER INVENTORY AT THE slv/INVENTORY RESTS AT 348.580 MILLION OZ
JULY 25/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 348.580 MILLION OZ
July 22/we had no change in silver inventory at the SLV.Inventory rests at 348.580 million oz/
July 21/no change in silver inventory at the SLV/Inventory rests at 348.580 million oz
July 20/no change in silver inventory at the SLV/Inventory rests at 348.580 million oz
July 19/no change in silver inventory at the SLV/Inventory rests at 348.580 million oz
July 18/no change in silver inventory at he SLV/inventory restss at 348.580 million oz
.
August 15.2016: Inventory 351.765 million oz

NPV for Sprott and Central Fund of Canada

1. Central Fund of Canada: traded at Negative 4.8 percent to NAV usa funds and Negative 4.7% to NAV for Cdn funds!!!!  (the discount is starting to disappear)
Percentage of fund in gold 59.1%
Percentage of fund in silver:39.7%
cash .+1.2%( August 15/2016).
2. Sprott silver fund (PSLV): Premium falls  to +1.25%!!!! NAV (august 15/2016) 
3. Sprott gold fund (PHYS): premium to NAV  rises TO  0.84% to NAV  ( august 15/2016)
Note: Sprott silver trust back  into POSITIVE territory at +1.25% /Sprott physical gold trust is back into positive territory at 0.84%/Central fund of Canada’s is still in jail.
 
 
 

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/David Russell
Just look at what this large insurer in Ireland did:  it removed money from the banks because of fears of a bail in.  The Irish housing sector is now overheated and many are warning of a new crash in housing prices@!

Will Ireland Be First Country In World To See Bail-in Regime?

Deposit bail-in risks are slowly being realised in Ireland, after it emerged overnight that FBD, one of Ireland’s largest insurance companies, have been moving cash out of Irish bank deposits and into bonds.

Revelations regarding deposit bail-in risks came in the wake of warnings of a new property crash centred on the housing market in Ireland. The former deputy governor of the Central Bank warned in an op-ed in a leading international financial publication, Project Syndicate, that Ireland is at risk of another housing market crash.

bail-ins-considerationsBail-In Regimes – Key Considerations (GoldCore Research)

Insurer FBD has moved over €150 million out of the Irish banking system and into corporate and sovereign bonds over the past year. The move was prompted by low returns offered by bank deposits and the risks that deposit bail-in rules could see deposits confiscated.

FBD chief executive Fiona Muldoon told the Irish Independent that the “extremely low returns offered on term deposits by banks, coupled with fears that new bail-in rules introduced this year by the European Union could expose bank bondholders and depositors to bailing out a failed lender, meant it has shifted investments away from banks.”

The new deposit bail-in mechanism is designed to protect banks and is touted as a way to prevent taxpayers being liable for bailing out collapsed lenders. It is believed that it leaves bank bondholders and deposit customers with more than €100,000 on deposit at risk of footing the bill.

There is a belief that bail-ins only relate to “the wealthy” and “rich” depositors as they will be imposed on those with deposits greater than national deposit guarantees. These deposit “guarantees” are generally the ‘big round’, arbitrary number of say €100,000, $250,000 and £75,000. These are not particularly large amounts and could amount to the entire life savings of a pensioner, a family or indeed it could be the entire capital of a small to medium size business enterprise.

An example of this is the UK where the deposit guarantee was arbitrarily, suddenly and with little fanfare quietly reduced from £100,000 to £75,000 just last year in July 2015.

Thus, it is important to note that the arbitrary round number in the various government deposit guarantees can be, and probably will be, reduced to a lower number – say the new round number of €50,000, £50,000 and $50,000 –  depending on the severity of the next banking crash.

In the event of bail-ins, governments and banks are likely to seek to impose deeper haircuts on creditors including depositors in order to bail-out and protect the failing banking system.

Protecting-Your-Savings-In-The-Coming-Bail-In-EraDownload Bail-in Guide

FBD’s deposits with Irish banks were reduced from €451 million to €305 million in recent months. FBD made a €3.1m loss in the first half of the year.

As reported by the Irish Independent:

“As they mature, and as the bank bail-in rules come into play, it’s no longer the case that for corporate investors depositing at a bank is risk free,” she added.
“To be honest, the return is abysmal now. We’ve gone back to a more typical investment portfolio for an insurance company.”

“You have to be paid for the risk you take,” she added. “You might entertain the bail-in risk if you were being properly paid. But if you’ve a bank trying to charge you for leaving your money with them, you’re not inclined to take any risk at all.”

The recent bank stress tests showed that Irish banks are the most vulnerable in the EU in the event of another financial crisis.

Meanwhile, the risk of another property crash centred on the housing market has been warned of by a respected economist. Stefan Gerlach, who left the Central Bank of Ireland earlier this year to become Chief Economist at BSI Bank in Zurich, asked:

“Having endured the collapse of its housing market less than a decade ago, Ireland has lately been experiencing a blistering recovery in prices, which already have risen in Dublin by some 50% from the trough in 2010, is Ireland setting itself up for another devastating crash?”

Among the concerns he expresses in an article titled ‘The Return of Ireland’s Housing Bubble’ for the global finance think-tank Project Syndicate is that the Central Bank here is coming under undue pressure from the construction industry and politicians to relax the loan to value and loan to income ratios on mortgage lending it introduced last year.

He warns that while housing bubbles are easy to spot, there are a number of conflicts of interest that make it hard to take action as the market gets out of control as reported by Newstalk:

“The obvious question is why nobody stepped in before it was too late. The answer is simple: while the bubbles are inflating, many people benefit. With the construction sector thriving, unemployment falling, and banks lending freely, people are happy – and politicians like it that way.”

“Many in Ireland might find that conclusion overly pessimistic. Maybe they are simply hoping that, this time, the luck of the Irish will hold. Perhaps it will, and this time really is different. But there isn’t much evidence of that,” he concludes.

The ‘Bail-in regime’ is one of the greatest financial risks to investors, savers and indeed companies internationally today. Yet it remains the most poorly covered financial risk and is largely ignored by financial advisers, brokers and not surprisingly governments and banks.

The growing financial risk in all western countries has not been properly analysed. In a world already beset with huge deflationary pressures and still insolvent banks, the bail-in regime and confiscating deposits, especially from job creating companies, would be extremely deflationary and would likely contribute to severe recessions.

This is something we warned of when we first conducted our extensive research on the developing global bail-in regimes after the Cyprus bail-ins in 2013. Diversification of deposits remains vital and one important way to protect against a bail-in is owning physical gold. Taking delivery of gold coins and bars and owning bullion in allocated and segregated storage in the safest vaults in the world is a prudent way to protect against the deposit bail-in regime.

Gold and Silver Bullion – News and Commentary

Gold Rises as Fed Rate Hike Bets Recede, Dollar Near June Low (Bloomberg)

Gold steady as U.S. data lowers rate hike prospects (Reuters)

Latest gold, forex rates in UAE (Emirates247)

Bail-in deposit fears spur insurance company move to bonds (Independent)

Ireland warned of new property crash  (Independent)

7RealRisksBlogBanner

Goldman is squaring up against JPM and HSBC to decide the future of gold trading (Business Insider)

European Close Sparks $5 Billion Selling-Panic In Gold Futures (Zerohedge)

RBC adds $200 to its gold price forecast (Mining.com)

Silver Kangaroo Sales Head For New Records  (Numismatic News)

Coming Global Silver Production Collapse & Skyrocketing Price (SRS Rocco Report)

Gold Prices (LBMA AM)

15Aug: USD 1,339.20, GBP 1,037.21 & EUR 1,198.85 per ounce
12Aug: USD 1,336.70, GBP 1,032.60 & EUR 1,199.02 per ounce
11Aug: USD 1,344.55, GBP 1,037.05 & EUR 1,206.06 per ounce
10Aug: USD 1,351.85, GBP 1,035.11 & EUR 1,209.23 per ounce
09Aug: USD 1,332.90, GBP 1,025.80 & EUR 1,201.74 per ounce
08Aug: USD 1,330.00, GBP 1,019.84 & EUR 1,198.86 per ounce
05Aug: USD 1,362.60, GBP 1,036.39 & EUR 1,222.53 per ounce

Silver Prices (LBMA)

15Aug: USD 19.90, GBP 15.40 & EUR 17.81 per ounce
12Aug: USD 19.87, GBP 15.33 & EUR 17.81 per ounce
11Aug: USD 20.21, GBP 15.56 & EUR 18.13 per ounce
10Aug: USD 20.34, GBP 15.55 & EUR 18.19 per ounce
09Aug: USD 19.70, GBP 15.18 & EUR 17.77 per ounce
08Aug: USD 19.66, GBP 15.04 & EUR 17.74 per ounce
05Aug: USD 20.22, GBP 15.36 & EUR 18.14 per ounce


Recent Market Updates

– Money “Madness” Negative Interest Rates Sees Gold Buying Surge
– Gold Investment Demand Reaches Record In First Half 2016 On “Perfect Storm”
– Peak Gold – Did Gold Production Peak in 2015?
– Financial Times: “Victory For Gold Bulls Is Only Just Beginning”
– Irish Banks Most Vulnerable In Stress Tests – Banking Contagion In EU Cometh
– Gold In Sterling 2.2% Higher After Bank Of England Cuts To 0.25% and Expands QE
– Silver Kangaroo Coins – Sales Surge To Over 10 Million
– Trump, Clinton, “Ugliest” Election Coming – Gold’s “Summer Doldrums” Prior To Resumption of Bull Market
– Marc Faber: Invest 25% Of Investment Portfolios In Gold Bullion
– “Could Not Invent A More Bullish Story For Gold Bullion”
– Gold In Bull Market – “Every Reason For It To Continue” – Frisby In Money
– Is Gold Set To Hit $1,500 Per Ounce?
– Why Italy’s bank crisis could be a ‘ticking time bomb’

david russell
end
The following is real cool: an infographic on the entire Chinese gold market;
(courtesy Koos Jansen)

Infographic: The Chinese Gold Market

— Published: Monday, 15 August 2016

By Koos Jansen

https://www.bullionstar.com/

This Chinese Gold Market infographic guides you through the largest physical gold trading market in the world, China.

An impressive 16,000 tonnes of gold are held within China’s borders.

Did you know that the Chinese wholesale demand for physical gold was an astounding 2,596 metric tonnes in 2015? This was supplied by China mining more gold than any other country in the world as well as importing more gold than any other country.

The chief architect of the Chinese gold market, the Chinese State, is continuously moving forward China’s position as the dominant market player for physical gold globally.

The Shanghai Gold Exchange (SGE) is the largest market in the world for physical gold trading. It has 10 million institutional customers, 8.3 million individual customers and 55 certified gold vaults connected to it.

In this infographic you will learn more about the following features of the Chinese Gold Market:

  • Total Chinese Gold Reserves
  • Important Chinese Gold Developments
  • Trading Volumes on the Shanghai Gold Exchange (SGE)
  • Trading Volumes and Trading Lots for the Shanghai Futures Exchange (SHFE)
  • Official Chinese Gold Reserves
  • The Role of the Chinese Banks on the Chinese Gold Market
  • Chinese Gold Mining
  • Chinese Gold Supply
  • Chinese Gold Importation

You can learn more about the Chinese Gold Market at the BullionStar Gold Universityand in Koos Jansen’s blog at BullionStar.

-END-

SWOT Analysi

A great interview of John Embry by Egon Von Greyerz as they discuss gold/silver as being undervalued assets against overvalued financial assets.
(courtesy Egon Von Greyerz/John Embry/GATA)

Von Greyerz, Embry discuss prospects for monetary metals

Section:

1:21p ET Friday, August 12, 2016

Dear Friend of GATA and Gold:

Gold fund manager Egon von Greyerz interviews Sprott Asset Management’s John Embry, discussing the prospects of the monetary metals, the overvaluation of financial assets, and the increasing weaknesses of currencies, among other topics. The interview is 23 minutes long and can be viewed at Gold Switzerland’s Internet site here:

https://goldswitzerland.com/egon-von-greyerz-meets-with-john-embry-augus…

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

END

A terrific commentary from Chris Powell discussing the trading of gold/silver lately and the blatant manipulation (whacking of our precious metals) during the last 5 days.

(Chris Powell/GATA)

The emperor wears no clothes but who else dares to say so?

Section:

11:15p ET Friday, August 12, 2016

Dear Friend of GATA and Gold:

Somebody smashed the gold price out of the blue today, with no particular news developments to explain it:

http://www.chartseeker.com/images/AU-24HR-LG.png?r=463917316745.4918

Zero Hedge asserts that the smash was accomplished by the dumping of $5 billion in paper gold:

http://www.zerohedge.com/news/2016-08-12/european-close-sparks-selling-p…

King World News charges that it was done by the Bank for International Settlements —

http://kingworldnews.com/alert-bis-intervened-in-the-gold-market-to-assi…

— and while KWN offers no particular evidence for its charge, that the BIS is intervening surreptitiously in the gold market nearly every day on behalf of its client central banks long has been documented well enough by the bank’s annual reports —

http://www.gata.org/node/12717

— by statements by BIS officers —

http://www.gata.org/node/4279

http://www.gata.org/node/11304

— and by the BIS’ own advertising:

http://www.gata.org/node/11012

Putting it all together best today may have been market analysts John Brimelow and James McShirley, who contribute frequently to GATA Chairman Bill Murphy’s daily “Midas” commentary on the gold market at LeMetropoleCafe.com

Brimelow, editor of the John Brimelow Gold Jottings letter, today reminisced about the failure in the 1990s of the 200-day moving average as a market indicator:

“Gold veterans will remember that it was in the mid-90s that the Frank Veneroso school judged there to be persistent central bank intervention in gold and began to wonder how far it extended into other markets. This concept is less controversial now than it was 20 years ago.”

McShirley wrote:

“The last two months have been a microcosm of the past five years. Gold is being mugged in plain sight, right in front of the cops, with no media bothering to report the crime. It sounds like a broken record but clearly this rigging is untenable. Epic rallies come from markets that have become distorted. Gold and silver aren’t merely being distorted; they are being suppressed to small fractions of their true net worth. Tsunamis come to mind when predicting the outcome.”

For years GATA’s premise has been that this market rigging could be defeated if it was documented, exposed, and publicized well enough. But while many people in the monetary metals industry have come to understand what is happening, few have acknowledged it in public. And while the documentation has been presented and explained to many financial news organizations, none in the mainstream have dared to pursue it seriously.

Even some mainstream financial news organizations that have approached GATA professing an interest in the subject have dropped it quickly and fled upon realizing how sensitive governments are about it.

Yet at least two major governments, those of Russia and China, have acknowledged knowing all about gold price suppression and even about GATA’s work particularly:

http://www.gata.org/node/4235

http://www.gata.org/node/10380

http://www.gata.org/node/10416

So GATA presses on in the morning, even as the market rigging couldn’t get more obvious. For it won’t matter that the emperor wears no clothes until more people in his audience have the courage to exclaim that he’s naked.

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

END

The value of all negative yielding bonds has now risen from 13 to 13.4 trillion equiv. USA

(courtesy Robin Wigglesworth/London’s Financial Times)

Value of negative-yielding bonds rises to $13.4 trillion

Section:

By Robin Wigglesworth and Eric Platt
Financial Times, London
Saturday, August 13, 2016

The value of negative-yielding bonds swelled to $13.4 trillion this week, as negative interest rates and central bank bond buying ripple through the debt market.

The universe of sub-zero-yielding debt — primarily government bonds in Europe and Japan but also a mounting number of highly-rated corporate bonds — has grown from $13.1 trillion last week, according to figures compiled by Tradeweb for the Financial Times.

“It’s surreal,” said Gregory Peters, senior investment officer at Prudential Fixed Income. “It’s clear that central banks are dominating markets. There’s a race to the bottom. Central banks are the main drivers of this. It’s not fundamental.” …

… For the remainder of the report:

http://www.ft.com/cms/s/0/973b6060-60ce-11e6-ae3f-77baadeb1c93.html

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  DOWN to 6.6498 ( HUGE DEVALUATION SOUTHBOUND  /CHINA UNHAPPY TODAY CONCERNING USA DOLLAR RISE/MORE $ USA DOLLARS LEAVE CHINA/OFFSHORE YUAN NARROWS TO 6.64831) / Shanghai bourse  UP 74.53 OR 2.44%   / HANG SANG CLOSED UP 165.60 or 0.73%

2 Nikkei closed /USA: YEN FALLS TO 101.08

3. Europe stocks opened  IN THE GREEN,     /USA dollar index DOWN to 95.63/Euro UP to 1.1173

3b Japan 10 year bond yield: RISES TO  -.085%     !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 101.08

3c Nikkei now JUST BELOW 17,000

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

3e WTI::  44.69  and Brent: 47.52

3f Gold UP  /Yen UP

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./“HELICOPTER MONEY” ON THE TABLE 

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 -.099%   German bunds BASICALLY negative yields from  10+ years out

 Greece  sees its 2 year rate RISE to 7.44%/: 

3j Greek 10 year bond yield FALL to  : 8.15%   (YIELD CURVE NOW  UPWARD SLOPING)

3k Gold at $1339.70/silver $19.88(7:45 am est)   SILVER FINAL RESISTANCE AT $18.50 BROKEN 

3l USA vs Russian rouble; (Russian rouble UP 41/100 in  roubles/dollar) 64.35-

3m oil into the 44 dollar handle for WTI and 47 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/GOT a BIG DEVALUATION UPWARD from POBC.

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 101.08 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 .9772 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0885 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 VOTES AFFIRMATIVE BREXIT

3r the 10 Year German bund now NEGATIVE territory with the 10 year FALLS to  -0.099%

/German 10+ year rate BASICALLY  negative%!!!

3s The Greece ELA NOW a 71.4 billion euros,AND NOW THE ECB WILL ACCEPT GREEK BONDS (WHAT A DISASTER)

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 1.515% early this morning. Thirty year rate  at 2.2306% /POLICY ERROR)

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

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

HELICOPTER MONEY STILL ON THE TABLE/JAPANESE STIMULUS PLAN DISAPPOINTS

Global Stocks Rise, US Futures Near All Time Highs As Flood Into Emerging Markets Continues

European shares advanced, with gains in automakers 
helping Germany’s benchmark DAX Index turn positive for the year for
the first time. Stocks rose around the world, led by emerging-markets, as oil climbed further after its best week since April and traders pushed back bets on higher U.S. interest rates. S&P futures advance and Asian stocks little changed as rising oil prices bolstered investor sentiment. That said, volumes are even more lethargic than usual as peak vacation season hits, and the volume for the Stoxx 600 is 70% below average with much of Europe on official holiday due to Assumption day.

While Developed Markets have been sleepy, the MSCI Emerging Markets Index climbed to the highest level in more than a year, with Chinese equities rallying the most since May on speculation of more property takeovers. The MSCI emerging markets gauge rose 0.4% at 10:24 a.m. in London, gaining for an eighth day to the highest since July 2015. The ruble strengthened as oil extended gains on speculation that producers will revive talks to stabilize prices. European shares rose modestly, pushing Germany’s DAX into the green YTD for the year for the first time. Helping EMs, the Bloomberg Dollar Spot Index declined for a second day.

Continued expectations of easy monetary policies, meant that global equities are trading near a one-year high as evidence of uneven growth in the world’s biggest economies fuels optimism that central banks will come to the rescue by way of additional stimulus and looser monetary policy. The probability that the Federal Reserve will increase interest rates this year eased to 42% in the futures market on Friday following the release of the disappointing U.S. retail sales figures, from 49% a day earlier.

“Interest rates will stay low and the dollar should be quite stable,” said Hertta Alava, the head of emerging markets at FIM Asset Management Ltd. in Helsinki. “That is supportive for emerging-market currencies. The oil price recovery is supportive for sentiment too.”

Oil prices rebounded in early trading, forcing more shorts to cover after comments by the Russian Energy Minister Novak who stated that Russia are consulting with Saudi Arabia, other countries to achieve oil market stability. However, the initial euphoria has fizzled and oil was largely unchanged at last check.

Among other notable overnight movers, in addition to the ongoing strength in EMs indices, now up for an 8th consecutive day, China’s Shanghai Composite jumped 2.4% as a measure of real estate companies had its steepest two-day rally in almost a year after stake purchases by China Evergrande Group fueled optimism of more mergers.  The Stoxx Europe 600 Index added 0.1%, with volume 70 percent lower than the 30-day average for the time of day.

The DAX Index rose as much as 0.8%. Volkswagen added 1.4 percent, helping automakers to a rebound from Friday’s decline to post the best performance of the 19 industry groups on the Stoxx 600. Statoil ASA was among the best-performing oil stocks as crude extended its advance above $44 a barrel. Glencore Plc dragged raw material producers lower. Hennes & Mauritz AB advanced 1.9 percent after reporting a better-than-expected 10 percent increase in July sales.

S&P 500 Index futures advanced 0.2%, after U.S. equities slipped from their highs on Friday following disappointing retail sales and consumer confidence data. Later today, the latest NY Fed “Empire Manufacturing” report is expected to rise modestly by 2, after last month’s 0.55 print.

Market Snapshot

  • S&P 500 futures up 0.2% to 2184
  • Stoxx 600 up 0.2% to 347
  • FTSE 100 up 0.2% to 6929
  • DAX up 0.3% to 10742
  • German 10Yr yieldunchanged at -0.11%
  • Italian 10Yr yield down less than 1bp to 1.04%
  • Spanish 10Yr yield down less than 1bp to 0.92%
  • S&P GSCI Index up 0.3% to 354.3
  • MSCI Asia Pacific down less than 0.1% to 140
  • Nikkei 225 down 0.3% to 16870
  • Hang Seng up 0.7% to 22933
  • Shanghai Composite up 2.4% to 3125
  • S&P/ASX 200 up 0.2% to 5540
  • US 10-yr yield down 1bp to 1.5%
  • Dollar Index down 0.08% to 95.65
  • WTI Crude futures up 1.3% to $45.08
  • Brent Futures up 1.1% to $47.51
  • Gold spot up 0.4% to $1,342
  • Silver spot up 0.8% to $19.87

Top Global Headline News

  • Here comes the Brexit-era British economy in hard numbers; inflation, retail sales, jobs may show how vote impacted U.K.
    • Londoners cut house prices to lure buyers in slowing market
    • British millennials are ‘collateral damage’ as pension gap grows; younger workers will have to save more or work for longer
    • Hedge funds make record bearish pound bets on Brexit pessimism
  • Loonie breaks from oil as bears shift focus to economic woes
  • Yuan tumbles most in six weeks as data reignite economy concerns
  • Honeywell to Buy JDA Software for $3 Billion, WSJ Says; The transaction could be announced as soon as Monday
  • Entertainment One Gains as KKR Weighs Bid to Top ITV’s Proposal; KKR emerged as a potential bidder for the film and television distributor, which rejected a proposal by broadcaster ITV Plc last week.
  • Noble Group’s Liquidity Crunch to Be ‘Temporary,’ Fitch Says: The demphasis on scale to remain until NAES sale, agency says. So-called liquidity ratio seen rising back above level of 1
  • AngloGold Says Dividends May Return Next Year as Cash Flow Rises: Bullion miner’s board will debate new dividend policy. First-half cash flow tripled to $108 million on higher prices
  • Treasuries Fall Behind Company Debt as Pimco Pursues Credit: Corporate bond spread over Treasuries is smallest in a year. Pimco’s Kiesel sees significant opportunity in corporate debt
  • World’s Biggest Shipping Firm Warns Against U.S. Protectionism: Maersk, a Danish conglomerate that owns the world’s largest container shipping company, is voicing concern as a potential shift in U.S. policy threatens to reduce global trade.

* * *

Looking at regional markets, we start in Asia, where sentiment was lifted by the upside in WTI and Brent crude futures with the latter making a break above USD 47.00/bbl, following comments by Russia that it may join Saudi Arabia is limiting production, although the bounce promptly faded shortly after. The Nikkei 225 (-0.3%) was the notable laggard in the wake of the first look at the soft Japanese Q2 GDP figures. ASX 200 (+0.2%) had been weighed on by banking heavyweight NAB following their earnings, however losses were later pared amid the rise in oil prices. Shanghai Comp (+2.4%) and Hang Seng (+0.2%) traded higher amid reports that the Shenzhen-HK stock link could be announced as soon as next week. JGB’s continued to extend on losses despite the soft Japanese GDP readings, with some attributing the weakness to Fridays comments where Japan Post announced that they have reduced their JGB holdings again and may invest around half of their JGB redemptions in foreign bonds.

Top Asian News:

  • The Tokyo Whale’s Unstoppable Rise to Shareholder No. 1 in Japan: BOJ set to become top owner of 55 cos. in the Nikkei 225
  • Japan Economy Grew Less Than Expected as Business Spending Fell: 2Q GDP rises annualized 0.2% vs est. +0.7%
  • Singapore Home Sales at Highest in a Year as Prices Drop: Developers sold 1,091 units last month versus 536 in June
  • Wanda Commercial Investors Said to Pass $4.4 Billion Buyout: Decision paves way for Hong Kong’s biggest privatization deal
  • WeChat Coming Soon at 35,000 Feet as China Eases Phone Rules: Standards by early 2017 may allow mobile phone use on planes

In a very quiet morning European equities have traded higher, with volumes very thin due to Assumption day. In major indices, the DAX (+0.3%) has moved into positive territory for the year for the first time, with healthcare and energy names outperforming throughout Europe, while materials remain the laggard. In fixed income market, today sees no major supply and amid the light newsflow Bunds have been trading flat throughout the morning, while today saw 10 year Gilt yields continue their decline to reach 0.50% for the first time, a total fall of 88bps since the Brexit vote just under 2 months ago. Also of note, today we shall be looking out for the BoE’s 3-7year Gilt purchase, which could garner particular focus given that last week saw the BoE fail to purchase the full allotment.

Top European News:

  • William Hill Rejects Increased Offer From Suitors 888, Rank: Bidders improve stock element of proposal for U.K. bookmaker. William Hill shares decline as much as 1.7% in London
  • VW Gets German Regulator’s Approval to Fix 460,000 Diesel Autos: Approval includes models of Volkswagen Polo, Seat Ibiza.

In FX, the dollar weakened against most of its major peers amid receding chances of a Fed rate increase this year. The greenback fell 0.4 percent against the yen. China’s yuan dropped 0.12 percent to 6.6408 against the dollar, according to prices from the China Foreign Exchange Trade System. China’s broadest measure of new credit grew the least in two years in July, a report showed on Friday, after data indicated industrial production and investments also weakened. Sterling reached a one-month low Monday before reports on inflation, retail sales and unemployment benefit claims for July, which will provide more detail on how the economy is faring after the June 23 Brexit referendum. Hedge funds were the most bearish on the pound on record in the week ended Aug. 9, after the Bank of England cut interest rates and boosted its stimulus plan the previous week. The pound fell to as low as $1.2901 on Monday, the weakest level since July 11. Russia’s ruble led gains among the world’s 32 major currencies, climbing 0.7 percent versus the dollar. The Mexican peso advanced 0.6 percent, and South Africa’s rand 0.4 percent. Thailand’s baht climbed 0.6 percent after a report showed the economy grew a more-than-estimated 3.5 percent in the second quarter.

In commodities, both WTI and Brent crude futures enter the North American crossover in positive territory, albeit off best levels. Initial upside for prices emanated from comments by the Russian Energy Minister Novak who stated that Russia are consulting with Saudi Arabia, other countries to achieve oil market stability. With newsflow otherwise relatively light, prices have also been tracking some of the fluctuations seen in the USD-index as participants await any further commentary from OPEC/non-OPEC producers on what to expect next month. Elsewhere, precious metals markets have seen a particularly subdued session overnight with silver remaining below USD 20/oz. Gold rose for the first time in three days as the dollar traded near its lowest level since June, boosting demand for a haven. Bullion for immediate delivery rose 0.3 percent to $1,339.97 an ounce. In base metals, copper prices in London printed a one-month low as demand concerns continue to hamper prices with price action otherwise relatively contained.

It is a quiet session in US economic data, with just the NY Fed Empire manufacturing survey (+2.00 expected; +0.55 previous) and NAHB housing market index (60 expected; 59 previous) for August to watch.

* * *

Bulletin Headline Summary from Bloomberg and RanSquawk

  • European equities enter the North American crossover in positive territory alongside modest upside in energy prices
  • FX markets continue to remain rangebound with newsflow once again light and Europe celebrating Assumption Day Holiday
  • Looking ahead, the main highlight on the calendar is the NY Empire State Manufacturing Index at 1330BST
  • Treasuries mostly steady in overnight trading, global equities rally to near one-year highs while WTI crude near $45/barrel amid Saudi stabilization rhetoric.
  • Global markets may be muted due to Assumption Day
  • Japan’s economy grew less than forecast in the three months through June 30 as business spending contracted for a second-straight quarter and exporters struggled with the resurgent yen
  • In a sign of how worried it is about Japan’s economy, the International Monetary Fund is urging the country to resurrect a radical strategy once employed by former U.S. presidents Nixon, Ford and Carter — only in reverse
  • The European Union is considering adding to protections for banks’ riskiest debt securities by requiring that lenders pay coupons on such bonds before stock dividends and staff bonuses
  • Speculators are the most bearish on the pound since records began as they await data that will give the clearest picture yet of the effects of Britain’s decision to leave the European Union
  • Taliban militants captured a key district about 100 miles north of Afghanistan’s capital, which itself was hit by a bombing on Monday, a blow to the government in Kabul that’s coming under further pressure from a renewed surge in fighting

DB’s Jim Reid completes the overnight recap

British, this week will be where we get our first major glimpse of hard post-Brexit data following a raft of weak sentiment surveys released so far. First up is July inflation (CPI and PPI) tomorrow and although it might be too early to see too much of an impact of a 12% trade weighted decline in sterling since the referendum it’ll be interesting if we get a few clues as to higher inflation ahead. I suppose the Euro and Yen have had big bouts of depreciation in the last couple of years without lasting impacts on inflation but the UK imports more relatively. It’s also interesting that gilts have been one of the best performing assets since the referendum (50 years up over 30% and well over 50% YTD) even as inflation forecasts have risen. That’s financial repression for you. Over the rest of the week the UK highlights are July unemployment (Wednesday), retail sales (Thursday) and the public finance data (Friday). The latter being interesting as we edge closer to the Autumn statement where looser fiscal policy is expected.

Staying with data, disappointments in the US on Friday halted the recent rally in equity markets. Over in Europe the STOXX (-0.13%) and DAX (-0.27%) slipped from their post-Brexit highs while the FTSE (+0.02%) was largely flat. US markets also saw the S&P 500 (-0.08%) dip from all-time highs in the face of broadly weak data (discussed later). On the whole the week did see the European markets gain with the STOXX up +1.38% while the S&P see-sawed to essentially end the week flat.

European credit saw iTraxx Main largely unchanged on the day and the week as a whole, while Crossover tightened by -3bps on the day and by nearly -9bps on the week. US CDX indices were fairly static on the day and pretty much flat on the week.

Soft data appeared to impact rates markets the most as German 10Y and US 10Y yields dropped by -2bps and -5bps respectively on the day, falling by -4bps and -8bps on the week after the post payrolls spike the Friday before. UK yields continued to drop to fresh new lows, with 10Y yields dropping by -2bps on the day and -15bps on the week. UK 30Y yields however rose by +2bps from their all time lows, bringing their cumulative drop to about -25bps on the week.
Asian stocks are mostly higher this morning with the Nikkei (-0.3%) an exception after Japan GDP came in below expectations (+0.2% vs +0.7% annualised QoQ). Chinese stocks climbed to a seven-month high (up 2-3% across the board) with activity high as property developers saw M&A hopes and reports that the delayed exchange link with Hong Kong will be announced shortly. There is also talk that weak new credit numbers late on Friday, which rounded off a soft monthly data dump from earlier in the day, increases the likelihood of more stimulus before YE. Oil is up +0.75% overnight after climbing +6.4% last week as hope that a production freeze might be possible next month at a side meeting at the international energy summit in Algeria.

Digging into the data on Friday now. The US saw a busy session of broadly weak data reinforcing the tepid growth story. July retail sales numbers disappointed (0.0% mom vs. +0.4% expected), although June’s numbers were revised higher (+0.8% mom vs. +0.6% before revisions). Auto sales helped support the headline number as ex-auto sales contracted by -0.3% mom (vs. +0.1% expected). This slowdown in consumer spending is certainly concerning given that it was the primary driver of US growth in the past quarter. Producer inflation also unexpectedly fell into deflationary territory in July (-0.4% mom vs. +0.1% expected; +0.5% previous) with the biggest drop in the index since last September. US business inventories for June also clocked in marginally above expectations (+0.2% mom vs. +0.1% expected; +0.2% previous) as the inventory to sales ratio remains elevated. The UMichigan consumer sentiment indicator for August picked up but less than forecast (90.4 vs. 91.5 expected; 90.0 previous) as the current economic conditions index declined to a five month low of 106.1 (vs. 109.5 expected; 109 previous). Inflation expectations for the next year also declined to 2.5% (vs. 2.7% previous).

Earlier in Europe we saw some preliminary Q2 GDP numbers, with Germany slowing but still beating expectations (+0.4% QoQ vs. +0.2% expected; +0.7% previous) while Italy unexpectedly stagnated (0.0% QoQ vs. +0.2% expected; +0.3% previous). Eurozone growth was in line with expectations (+0.3% QoQ vs. +0.3% expected; +0.3% previous). The final July CPI numbers for Germany (+0.4% mom vs. +0.4% expected) and Spain (-1.3% mom vs. -1.3% expected) held no surprises. Eurozone industrial production surprised on the upside in June (+0.6% mom vs. +0.5% expected) after growth rebounded back into positive territory (-1.2% previous).

Taking a look now at the week ahead. It’s a quiet start today with nothing notable out of Europe and just the NY Fed Empire manufacturing survey (+2.00 expected; +0.55 previous) and NAHB housing market index (60 expected; 59 previous) for August to watch in the US. Tuesday will see nothing significant out of Asia, but Europe is busier with the aforementioned UK inflation data dump for July and the German ZEW survey report for August due. Over in the US we will see housing starts, industrial production and CPI data for July. Wednesday brings us labour data for the UK in the form of jobless claims, earnings and unemployment numbers. There’s no data out of the US but the Fed will release the minutes for the July FOMC meeting. Thursday kicks off in Asia with trade data out of Japan. Over in Europe we will see July retail sales data out of the UK and July CPI numbers for the Eurozone. The US will see more jobless claims numbers for the second week of August, as well as the Philadelphia Fed Business Outlook for August. It’s a quiet end to the week, as Friday opens in Japan with the June print for the All Industry Activity Index due. Over in Europe we will see the July PPI print for Germany while there is no data due in the US.

end

ASIA MARKETS

i)Late  SUNDAY night/MONDAY morning: Shanghai closed UP 74.53 POINTS OR 2.44%/ /Hang Sang closed UP 165.60 points or 0.73%. The Nikkei closed DOWN 50.36 POINTS OR 0.30% Australia’s all ordinaires  CLOSED UP 0.16% Chinese yuan (ONSHORE) closed DOWN at 6.6498/Oil rose to 44.69 dollars per barrel for WTI and 47.52 for Brent. Stocks in Europe:  in the GREEN . Offshore yuan trades  6.64831 yuan to the dollar vs 6.6498 for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS HUGELY AS  MORE USA DOLLARS ATTEMPTS TO LEAVE CHINA’S SHORES  

FIRST  REPORT ON JAPAN  SOUTH KOREA AND CHINA

a) JAPAN ISSUES

The Yen remains basically unchanged with the report of a big 2nd quarter GDP miss from Japan.  Business spending reports a huge drop and worse of all: exports slide

Another indicator as to global growth as this once big engine for goods supplying the rest of the world is faltering;

(courtesy zero hedge)

Japan Q2 GDP Misses, Unchanged From First Quarter, As Business Spending, Exports Slide

After a flurry of disappointing GDP reports from the US and Europe, not to mention last week’s uniformly poor Chinese economic data, Japan was the latest country to report that nominal economic growth in the second quarter rose a disappointing 0.2% annualized, missing expectations of a 0.7% increase, and down from the revised 2.0%  GDP growth in Q1, while on a sequential basis GDP was flat with the first quarter.

While private consumption rose 0.2% q/q; in line with estimate, there was pronounced weakness in business spending which fell 0.4% q/q; well below the consensus estimate of +0.2%, while net exports dipped -0.3% from last month’s 0.1%, confirming yet again the global economic growth remains in the doldrums, and that the BOJ is in desperate need of putting more pressure on the Japanese Yen, something it has failed to do so far this year despite unleashing NIRP and doubling the pace of its ETF purchases.

Annualized GDP barely grew, rising just 0.2%, and missed expectations.

On a sequential basis, GDP was unchanged, after fluctuating between contraction and growth for 4 consecutive quarters.

As Betty Rui Wang, an economist at Standard Chartered Bank in Hong Kong observes, corporate investment has declined for two consecutive quarters, the first time since the sales-tax hike in 2014, said “GDP signals, especially for the business sector, that there is big downside risk” She also noted that the report doesn’t fully reflect the U.K.’s June 23 Brexit vote.

“The strong yen’s continued since the beginning of the year and I think a wait-and-see posture may have spread when it comes to business investment,” said Masaki Kuwahara, an economist at Nomura Securities in Tokyo.

“The number confirmed that there are still risks in the global economy,” said Kuwahara. “China’s economy is a major risk for Japan.”

It was unclear if, like China, Japan would also blame the weather for the sudden economic weakness.

More troubling is that despite the surge in the BOJ’s balance sheet to unprecedented levels, Japan’s business investment has been basically unchanged for the past three years.

Perhaps the reason for the miss is that the BOJ simply did not buy more ETFs, although it remains unclear just how the central bank becoming a top shareholder in some 55 names over the next year, among which a video game maker, a clothing retailer, and a chemical company will either push inflation to 2% or somehow force the moribund Japanese economy to rebound.

The market’s reaction has so far been negilgible, with the Yen mostly unchanged, while the Nikkei was fractionally higher on a number that in the past would have ignited a dramatic surge in stocks on hopes of more stimulus.

end

This is what a failed state looks like:  the Bank of Japan by next year will be the top shareholder of 55 companies:

(courtesy zero hedge)

The Bank of Japan Will Be The Top Shareholder Of 55 Companies By The End Of 2017

In the aftermath of the BOJ’s announcement that it would almost double its ETF purchases to ¥6 trillion, or $58 billion, up from the current ¥3.3 trillion, we put this number in context. Over the next year, BoJ is scheduled to purchase ¥6t ($58b) in ETFs, and $116b over the next two years.  By June of 2018, BoJ is likely to hold ¥20.5t ($200b) in ETFs.

Three ways to put BoJ’s purchases in perspective:

  • The US market cap is 5x Japan’s, so this new stimulus can be viewed as equivalent of the Fed purchasing $580b in ETFs over the next two years, and the Fed holding $1t in ETFs.  Of course, this is just a hypothetical exercise as the Fed is prohibited from purchasing equities.  But the new stimulus illustrates that BoJ is concerned with the severity of bearishness in Japan’s equity market, and that such drastic purchases are necessary to reverse the bearishness.
  • In Oct 2014, Government Pension Investment Fund announced a new asset allocation of its ¥127t assets. Among other changes, its domestic equity allocation increased from 17% to 25%, or an increase of +¥10t.  So BoJ’s ETF purchases over the next two years and GPIF’s equity purchases may be in the same ballpark.
  • So far this year, foreign investors have sold almost ¥5t in net of Japanese equities.  That’s smaller than BoJ’s annual purchase rate of ¥6t.

While dramatic, some additional facts courtesy of Bloomberg should convey just how truly unprecedented the move truly is: with the BOJ already a top-five owner of 81 companies in Japan’s Nikkei 225 Stock Average, the BOJ is on course to become the No. 1 shareholder in 55 of those firms by the end of next year, according to estimates compiled by Bloomberg from the central bank’s exchange-traded fund holdings.

Just as insane, the central bank owned about 60% of Japan’s domestic ETFs at the end of June. This is up from just over half as of a few months ago suggesting that the BOJ is gobbling up equities at an unprecedented pace.

At this point the usual debate begins: is central bank intervention good (of course, the bulls say) or bad (everyone else grudgingly admits). While bulls have cheered the tailwind from BOJ purchases, opponents say the central bank is artificially inflating equity valuations and undercutting efforts to make public companies more efficient. Traders worry that the monetary authority’s outsized presence will make some shares harder to buy and sell, a phenomenon that led to convulsions in Japan’s government bond market this year.

“Only in Japan does the central bank show its face in the stock market this much,” said Masahiro Ichikawa, a Tokyo-based senior strategist at Sumitomo Mitsui Asset Management Co., which oversees about 12 trillion yen ($118 billion). “Investors are asking whether this is really right.”

Investors may ask, but the BOJ doesn’t care, as it has now become the single, most dominant force in the equity market, and would rather traders thanked it, and be on their way, than worry about the “long-term.” As for the BOJ “showing its face in the stock market this much”, both the SNB and the ECB are now just as actively involved in the equity market, as reported previously.

As Bloomberg adds, while the BOJ doesn’t buy individual shares directly, it’s the ultimate owner of stakes purchased through ETFs. Estimates of the central bank’s underlying holdings can be gleaned from the BOJ’s public records, regulatory filings by companies and ETF managers, and statistics from the Investment Trusts Association of Japan. Forecasts of the BOJ’s future shareholder rankings assume that other major investors keep their positions stable and that policy makers maintain the historical composition of their purchases.

Meanwhile, Kuroda’s insane buying spree means that the central bank’s influence on Japanese stocks already rivals that of the biggest traders, locally called “whales”. It’s the No. 1 shareholder in piano maker Yamaha Corp., Bloomberg estimates show, after its ownership stake via ETFs climbed to about 5.9 percent.

The BOJ is set to become the top holder of about five other Nikkei 225 companies by year-end, after boosting its annual ETF buying target to 6 trillion yen last month. By 2017, the central bank will rank No. 1 in about a quarter of the index’s members, including Olympus Corp., the world’s biggest maker of endoscopes; Fanuc Corp., the largest producer of industrial robots; and Advantest Corp., one of the top manufacturers of semiconductor-testing devices.

The list below shows the top BOJ holdings as of this moment.

The Japanese central bank finds nothing out of the ordinary with becoming the top holder of dozens of stocks, and instead falls back to its cliche of an explanation:

A central bank spokesman, who asked not to be named citing BOJ policy, said the ETF purchases will help officials reach their 2 percent inflation target as soon as possible. Consumer prices fell 0.4 percent in June from a year earlier, the fourth straight month of declines.

It may get even more insane: Kuroda has argued that ETF purchases will help spur economic activity and inflation by boosting risk appetite in Japan. After the BOJ’s last meeting on July 29, he said the central bank has room to increase buying if needed.

As noted above, the bulls love it. For Takashi Aoki, a fund manager at Mizuho Asset Management, the ETF program’s downsides aren’t substantial enough to justify removing it from the BOJ’s toolkit. “The goal is to get Japanese companies making money again, and to reach 2 percent inflation,” said Aoki, whose firm oversees about $50 billion. “The scope of the BOJ’s buying is what’s needed to reach that target. It’s effective.”

Actually, if Takashi has seen a chart of Japan’s core CPI, he will note that monetizing stocks has been anything but effective, but who actually bothers with facts these days.

The good news is that, at least for now, the liquidity of the stock market has not collapsed (unlike what has happened in the JGB market where the BOJ is virtually running out of willing sellers). So far, there’s little evidence that the BOJ’s purchases are disrupting the smooth functioning of Japan’s stock market, according to Keiichi Ito, the chief quantitative analyst at SMBC Nikko Securities Inc. But that could change as the buying increases, Ito said, particularly for stocks with low free float, or shares available for trading.

Take the example of Fast Retailing, whose free float is about 25% of shares outstanding. The BOJ owns about half the company’s free float now, a proportion that will rise to 63 percent by year-end, according to Nomura Holdings Inc., Japan’s biggest brokerage. BOJ purchases could soak up the remaining free float at companies including Comsys Holdings Corp. and Tokyo Electron Ltd. over the next year, according to analysts at Goldman Sachs Group Inc. “It’s going to become hard to trade,” Ito said. “Stocks that have a low free-float ratio will become very volatile.”

However, just because liquidity is here today, does not mean it will be there tomorrow. “If the BOJ does not sell stocks, then liquidity will disappear,” Murakami said. “As liquidity falls, the number of shares you can buy starts to decline — the same thing that’s happening in the JGB market.”

While some raise the question of governance, or just how will the BOJ intervene as a top shareholder in determining the future of so many public companies…

While there’s no sign that the central bank will use its stock holdings to influence how Japan’s public companies are managed, some investors worry that BOJ purchases could give a free ride to poorly-run firms and crowd out shareholders who would otherwise push for better corporate governance. The BOJ isn’t explicitly subject to Japan’s stewardship code for institutional investors, designed to encourage stockholders to push companies for better performance.

… a far more obvious question is ignored: just how will the BOJ ever unwind its unprecedented holdings of not only bonds, which are now roughly 100% of Japan’s GDP, but also of stocks, without crashing both the bond and the stock market. And then we remember, that the BOJ will simply never unwind any of its “emergency” opertions just because nobody actually thought that far, plus the whole point of the exercise is hyperinflation or bust, as the sheer lunacy of Japan’s authorities is exposed for the entire world to see, leading to the terminal collapse of faith in the local currency. With every passing day, we get that much closer to said terminal moment.

end

b) REPORT ON CHINA

China is hoarding cash at the fastest pace since 2008. Basically there is nothing to invest in so they hoard cash:

(courtesy zero hedge)

Panic? China Is Hoarding Cash At The Fastest Pace Since Lehman

The last few months have seen trillions of dollars of fresh credit puked into existence in China to enable goal-seeked growth numbers to creep lower (as opposed to utterly collapse). The problem is… theChinese are hoarding that cash at the fastest pace since Lehman as liquidity concerns flood through the nation.

China’s M2, a broad gauge of money supply including savings deposits, rose at the slowest pace in 15 months and trailed the government’s full-year target of +11% in July. But, as Bloomberg details, by contrast, M1, the total of cash, checks and demand deposits, rose at the quickest pace in six years…

That shows companies “are holding all this cash, but investment returns are low and there are few options for projects,” said Liu Dongliang, a senior analyst at China Merchants Bank Co. in Shenzhen.

In fact, no matter what has been done since the Chinese stock market crashed, the Chinese have been hoarding cash…

In fact, the hoarding of cash in China corresponded with the top in 1999/2000, and the top in 2007…

“probably nothing”

end

EUROPEAN AFFAIRS

German bank Rauffeisen has had enough and will now charge customers who deposit over 100,000 euros into their bank:

(courtesy zero hedge)

 

(courtesy Asian Times/Bhadrakumar/)

end

 

Then we learn that Turkey is threatening to reopen the refugee floodgates to Europe. This is a no brainer to Erdogan having crossed the line over to Russia:

(courtesy Michael Krieger/Liberty Blitzkrieg blog)

 

Turkey Threatens To Reopen The Refugee Floodgates To Europe

Submitted by Michael Krieger via Liberty Blitzkrieg blog,

Even if you’ve only been paying a superficial amount of attention to the European refugee crisis, you’ll be aware of the fact that earlier this year the EU and Turkey agreed to a deal on migrants where in exchange for concessions, Turkey would stem the flow of migrants from its shores. The deal went through and refugee levels from Turkey fell dramatically.

Unfortunately, one major problem with the deal is Turkey’s demand for visa-free travel, something many throughout the EU were intensely against from the beginning, and are even more opposed to now following the Turkish government’s authoritarian crackdown on tens of thousands of its own citizens following last month’s failed coup.

So here we are, less than six months since the deal was agreed to and Turkey is now threatening to end it. This could be a geopolitical event of enormous consequence considering there are an estimated 2 million Syrian refugees in Turkey, many of which are itching to take their chances within the EU.

Reuters reports:

Turkey could walk away from its promise to stem the flow of illegal migrants to Europe if the European Union fails to grant Turks visa-free travel to the bloc in October, Foreign Minister Mevlut Cavusoglu told a German newspaper.

 

His comments in Bild’s Monday edition coincide with rising tensions between Ankara and the West that have been exacerbated by the failed coup attempt in Turkey on July 15. Turkey is incensed by what it sees as an insensitive response from Western allies to the failed putsch, in which 240 people were killed.

 

Long wary of Turkey’s ambitions to join the EU, Europe has been alarmed by the crackdown since the coup, fearing President Tayyip Erdogan is using purges to quash dissent. The unease has relations between Turkey and Austria and Sweden. Ankara has summoned diplomats from both countries to protest what it says are false reports about changes to its child abuse laws.

 

Asked whether hundreds of thousands of refugees in Turkey would head to Europe if the EU did not grant Turks visa freedom from October, Cavusoglu told Bild: “I don’t want to talk about the worst case scenario – talks with the EU are continuing but it’s clear that we either apply all treaties at the same time or we put them all aside.”

 

European Commissioner Guenther Oettinger has said he does not see the EU granting Turks visa-free travel this year due to Ankara’s crackdown, which has included the round-up of more than 35,000 over alleged involvement in the coup.

 

Cavusoglu said the migration deal with the EU stipulated that all Turks would get visa freedom in October, adding: “It can’t be that we implement everything that is good for the EU but that Turkey gets nothing in return.”

This is a very perilous situation, particularly considering how irate so many already are about the crisis as it stands. As we learned from the recent post, Pew Research Survey Points to Widespread Angst About How the EU is Handling the Refugee Crisis:

Disapproval was generally greatest in countries with the highest number of asylum seekers in 2015. For example, 94% of Greeks and 88% of Swedes said they disapprove of how the EU has handled the refugee issue. Sweden received the third highest number of asylum applications in 2015. And while Greece was not the final destination for most refugees in 2015, it was their main point of entry, with about 850,000 arrivals in 2015 alone.

Even in countries with a lower number of asylees, disapproval of the EU’s handling of the refugee issue was widespread, including in France (70%), the UK (70%) and the Netherlands (63%). And in Germany, which had the most asylum applications in 2015, fully two-thirds faulted the EU’s approach to the refugee crisis. 

*  *  *

As we noted a month ago, Reuters quoted German Vice Chancellor Sigmar Gabriel as saying while on an official visit to northern Germany.

“Germany and Europe should under no circumstances be blackmailed,” Gabriel added.

The vice chancellor also welcomed the move by Germany’s highest court to block a livestream address by Turkish President Recep Tayyip Erdogan to a rally of Turkish nationals in Germany’s Cologne on Sunday.

Needless to say Germany is playing a dangerous game here as Erdogan knows he has little to lose if he breaches the terms of the March deal, which he can claim was already violated by Europe and thus boost his populist image even more. After all, once Germany is flooded with another million in potential radical jihadists, it will come crawling to Ankara, begging to redo the deal, only this time the terms will be that much higher. Then again, perhaps Germany and the “European democracies” should have though of all this before they agreed to deal with Erdogan who is now well on his way to becoming the undisputed authoritarian leader of the Turkish nation, which continues to undergo historic purges of all of Erdogan’s political opponents.

(courtesy zero hedge)

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

Euro/USA   1.1173 UP .0024 (STILL  REACTING TO BREXIT/REACTING TO BRITISH CUT IN INTEREST RATE TO .25%

USA/JAPAN YEN 101.08  DOWN 0.058(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/KURODA HELICOPTER MONEY  ON THE TABLE BUT DISAPPOINTS WITH STIMULUS

GBP/USA 1.2932 UP .0027(CARNEY CUTS BR. INTEREST RATES TO .25%)

USA/CAN 1.2931 DOWN .0010

Early THIS MONDAY morning in Europe, the Euro ROSE by 24 basis points, trading now JUST above the important 1.08 level RISING to 1.1173; Europe is still reacting to Gr Britain BREXIT,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 UP 74.53 POINTS OR 2.44%    / Hang Sang CLOSED UP 165.60 POINTS OR 0.73%     /AUSTRALIA IS HIGHER BY .16% / EUROPEAN BOURSES ALL  IN THE GREEN

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 50.36 POINTS OR 0.30%  

Trading from Europe and Asia:
1. Europe stocks ALL IN THE GREEN

2/ CHINESE BOURSES / : Hang Sang CLOSED UP 165.60 POINTS OR 0.73%  ,Shanghai CLOSED UP 74.53  POINTS OR 2.44%    / Australia BOURSE IN THE GREEN: /Nikkei (Japan)CLOSED IN THE RED   /INDIA’S SENSEX IN THE GREEN 

Gold very early morning trading: $1340.15

silver:$19.80

Early MONDAY morning USA 10 year bond yield: 1.515% !!! PAR  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 FALLS to 2.2306 DOWN  1/2 in basis points from FRIDAY night. (SPREAD GOES AGAINST THE BANKS)

USA dollar index early MONDAY morning: 95.63 DOWN 9 CENTS from FRIDAY’s close.

This ends early morning numbers MONDAY MORNING

END

And now your closing MONDAY NUMBERS

Portuguese 10 year bond yield:  2.69% DOWN 1 in basis points from FRIDAY  (does not buy the rally)

JAPANESE BOND YIELD: -0.085% UP 2 in   basis points from FRIDAY

SPANISH 10 YR BOND YIELD:0.937% UP 1 IN basis points from FRIDAY (this is totally nuts!!/

ITALIAN 10 YR BOND YIELD: 1.058UP 2 in basis points from FRIDAY (again totally nuts/)

the Italian 10 yr bond yield is trading 11 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: -0.074% UP  3 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 1.1182 UP .0033 (Euro UP 33 basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 101.25 UP .1130(Yen DOWN 11 basis points/

Great Britain/USA 1 .2877 DOWN 0.0029 ( Pound DOWN 29 basis points/BREXIT DECISION AFFIRMATIVE/QE TO START AGAIN/UK DOWNGRADED/NEW PRIME MINISTER T. MAY/GR BRITAIN LOWERS INTEREST RATES/

USA/Canada 1.2919-DOWN 0.0022 (Canadian dollar UP 22 basis points AS OIL FELL(WTI AT $45.66). Canada keeps rate at 0.5% and does not cut!

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

This afternoon, the Euro was UP by 33 basis points to trade at 1.1182

The Yen FELL to 101.25 for a LOSS of 11 basis points as NIRP is STILL a big failure for the Japanese central bank/HELICOPTER MONEY IS NOW DELAYED 

The POUND was DOWN 29 basis points, trading at 1 .2877 AS PRIME MINISTER THERESA MAY TAKES OFFICE/CARNEY CUTS INTEREST RATE TO ONLY  .25%

The Canadian dollar ROSE by 22 basis points to 1.2919, WITH WTI OIL AT:  $45.68

CANADIAN RATES WERE NOT CUT

The USA/Yuan closed at 6.6362

the 10 yr Japanese bond yield closed at -.085% UP 2  IN BASIS  points in yield/

Your closing 10 yr USA bond yield:UP 4 IN basis points from FRIDAY at 1.559% //trading well below the resistance level of 2.27-2.32%)

USA 30 yr bond yield: 2.284 UP 4 in basis points on the day /

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

Your closing USA dollar index, 95.62  DOWN 10 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 25.17 OR 0.36%
German Dax :CLOSED UP 25.78 OR  0.24%
Paris Cac  CLOSED DOWN 2,33  OR 0.05%
Spain IBEX CLOSED UP 4.20 OR 0.05%
Italian MIB: CLOSED HOLIDAY

The Dow was UP 59.58 points or 0.32%

NASDAQ UP 23.12 points or 0.56%
WTI Oil price; 45.68 at 4:30 pm;

Brent Oil: 48.27

USA DOLLAR VS RUSSIAN ROUBLE CROSS:  64.04 (ROUBLE DOWN  0/100 ROUBLES PER DOLLAR FROM FRIDAY) 

TODAY THE GERMAN YIELD FALLS TO -.074%  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:45.68

BRENT: 48.27

USA 10 YR BOND YIELD: 1.559% 

USA DOLLAR INDEX: 95.62 down 10 cents

The British pound at 5 pm: Great Britain Pound/USA: 1.28761 DOWN .0030 or 30 basis pts.

German 10 yr bond yield at 5 pm: -.074%

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

Hedgers Active As Stocks Hit Record Highs On Lowest Volume Day Of The Year

What we think about when we see the opening ramp like this morning…

 

Another day, another record high…

 

And another “lowest volume day of the year”..

 

Small Caps and Trannies outperformed on the day thanks to the opening ramp but we note that all indices closed lower from the EU close…

 

Today’s meltup was not enjoyed by the vol-selling machines… it appears the spike was heavily hedged amid dismally low volume…

 

The first VIX up, Stocks up day in 6 weeks…

 

On a daily basis, the S&P is at its most over-extended since April when it slid lower…

 

And on a monthly basis, the S&P has swing across its bollinger bands back near record highs…

 

Treasury yields rose today (with the long-end underperforming)…

 

The USD Index ended the day practically unchanged with Cable weakest and commodity currencies gaining on the heels of crude…

 

Spot the odd one out (all commodities gained on the day but crude was just funny…)

 

WTI Sept 2016 contract traded almost back to $46 today

 

Oil’s gain helped early BUT from the NYMEX close, stocks fell…

Charts: Bloomberg

end

A terrific commentary on the plight of North American Life Insurers has they have to deal with a huge $13.4 trillion of negative interest rates.  The search for yield is causing them to seek higher risk assets and this is an accident waiting to happen: e.g. the huge amount of energy assets that they have invested in only to see the price of oil collapse!

(courtesy zero hedge)

North American Life Insurers “Accidentally” Pile Up Massive Distressed Debt Holdings

The all important New York manufacturing index falls into contraction again;

(courtesy zero hedge)

Empire Fed Tumbles Back Into Contraction As Hope Slumps To 6-Month Lows

After 2 brief dead-cat-bounce months of hope, The Empire Fed business survey has tumbled back into contraction (-4.21 missing expectations of +2.0).

The index is now at 3 month lows despite rises in the number of employees, average workweek, shipments, and new orders but ‘hope’ tumbles to its lowest since Feb 2016.

Indexes for the six-month outlook revealed that respondents remained optimistic about future conditions, though to a lesser extent than in July.

The index for future business conditions fell for a second consecutive month, dropping six points to 23.7.Indexes for future new orders and shipments also edged lower. Indexes for future employment and the average workweek were below zero, suggesting that firms expected employment and hours worked to decline in the months ahead. The capital expenditures index fell to 4.1, and the technology spending index retreated to 5.2

Yet again the central banks’ asset-inflation efforts are failing to revive confidence…

end

 

Let us head tonight with this interview of Bill Murphy with Greg Hunter

(courtesy Bill Murphy/Greg Hunter)

Silver is Kryptonite to Gold Cartel Bankers-Bill Murphy

23By Greg Hunter’s USAWatchdog.com (Early Sunday Release)

Chairman of GATA (Gold Anti-Trust Action Committee) Bill Murphy thinks financial markets are way more vulnerable than they appear. Murphy explains, “There are negative interest rates and low interest rates that just keep staying down there, and supposedly things are really good.  Look at our Dow at all-time highs, and yet something is really wrong.  Of course, this fits into the GATA premise on this whole thing.  There’s a lot of quantitative easing (money printing) and propping up of the markets, and it’s on very shaky ground.  The plug could be pulled at any time. . . . With interest rates where they are and debt growing all over the place, the reasons to be in gold are off the charts.”

Murphy says “silver is Kryptonite to central bankers” because there is little supply to use in the cartel’s suppression game.  Murphy says, “You mention the word Kryptonite and the key is what silver is doing.  It is an extraordinary situation right now. . . . It seems to me that, this year, silver is in play . . . . That is this big money talking on the JPMorgan crowd and their game.  They are gradually moving in for what I think is going to be one of the biggest market moves in history, and that is silver going to $50 (per ounce) and then a $100 (per ounce).  Basically, it’s because supply is drying up. . . . Where is all this supply coming from that this JPMorgan crowd has been feeding the market with, and I think they are hitting the wall with it.  I think this big money knows what’s going on, and they are quietly moving in.  That’s the reason silver has been trading like it has.  $18.50 was a key number.  That was the completion of a big base. . . . The next big key is to take out $20.50, but the real number is $21.   If it gets above $21, it’s going to start trading chaotically with volatile action on the upside.  The market move is going to be historic.”

Murphy has long charged there was suppression of gold and silver prices and has been proven 100% correct. He now charges, “The real key for this gold cartel, as we call it, is the suppression of the gold price.  They realized a long time ago they couldn’t have a dichotomy between the silver and gold.  So, they got involved in the silver market (to suppress the price) to make gold look like it should be doing what it is.  The problem is they are running out of physical silver to keep the price down. . . . Eventually, you are going to get a commercial signal failure in silver,  which means these so-called commercials, which is a misnomer because they are not commercials, they’re gold cartel trying to keep the silver price down.  They know when they lose control of silver, and it gets to $21 (per ounce), it will be the end of their gold suppression scheme. . . . It will be a gradual process because the price of silver is going to go bonkers.  It will show what they have been doing all these years.  I think they are finally reaching a tipping point. . . . The death knell to the gold cartel is the lack of supply of silver to keep the price down. . . . I think you are going to see the double top of $50 be taken out and go to at least $100 per ounce and maybe a lot more.  I think it’s going to move up faster than anybody can imagine. . . . Gold is going to move to some big number also. . . .If gold kept pace with inflation, it would be double what it is today.”

Join Greg Hunter as he goes One-on-One with Bill Murphy, Chairman and co-founder of GATA.

(There is much more in the video interview.)

After the Interview:
There is free information and analysis on GATA.org.

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5 comments

  1. raymikeva · · Reply

    Harvey–Sorry to report that the formatting in Firefox is still screwed up. Any chance this will be fixed. I’m lazy, so I don’t like changing to IE just to read your comments, but I will if I must! Keep up your good work!

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  2. The “banks” pretend they are trying to help the world economy as they intentionally buy up the entire world with their fiat “worthless” money .. then when there is an “unavoidable currency reset”..they will own everything and we will have nothing but a couple of pennies .. we cannot stop them because our leaders and elected officials and the press are all “sell outs to the banks” and so we continue .. letting them buy up our world with their paper “fake – money”. They are buying up everything of any value .. bonds, equities, property, .. all with soon to be worthless paper money .. and all happening right in front of our faces .. and we can do nothing about it .. because their plan is so well orchestrated. All we can do is understand it perfectly .. and recognize also but for the “grace of God” we might do the same things if we were the corrupt banks .. and this is how our human nature works in the real world .. too bad there is not a way to stop them or at least slow them down .. they must be smiling at themselves .. and laughing at everyone else in the world.

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