OCT 31/major developments in the Clinton email and Foundation scandal: schism between the Dept of Justice and the FBI/Finally a warrant is issued/ /650,000 emails are on Abedin/Weiner’s computer: best friend of Podesta heads up the Dept of Justice team in an obvious conflict/

Gold $1271.50 DOWN  $1.00

Silver 17.76 UP 8 cents

In the access market 5:15 pm

 

Gold: 1278.00

Silver: 17.92

THE DAILY GOLD FIX REPORT FROM SHANGHAI AND LONDON

.

The Shanghai fix is at 10:15 pm est and 2:15 am est

The fix for London is at 5:30  am est (first fix) and 10 am est (second fix)

Thus Shanghai’s second fix corresponds to 195 minutes before London’s first fix.

And now the fix recordings:

Shanghai morning fix OCT 28 (10:15 pm est last night): $  1280.84

NY ACCESS PRICE: $1277.00 (AT THE EXACT SAME TIME)

Shanghai afternoon fix:  2: 15 am est (second fix/early  morning):$   1282.09

NY ACCESS PRICE: 1277.90 (AT THE EXACT SAME TIME)

HUGE SPREAD TODAY!!  4 dollars

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

London Fix: OCT 31: 5:30 am est:  $1274.20   (NY: same time:  $1272.90:    5:30AM)

London Second fix OCT 31: 10 am est:  $1272.50  (NY same time: $1274.75 ,    10 AM)

Shanghai premium in silver over NY:  80 cents.

It seems that Shanghai pricing is higher than the other  two , (NY and London). The spread has been occurring on a regular basis and thus I expect to see arbitrage happening as investors buy the lower priced NY gold and sell to China at the higher price. This should drain the comex.

Also why would mining companies hand in their gold to the comex and receive constantly lower prices.  They would be open to lawsuits if they knowingly continue to supply the comex despite the fact that they could be receiving higher prices in Shanghai.

end

.

For comex gold: 

First, for the conclusion of the October contract month: 341 notices for 34100 oz

The total number of notices filed for the month:  977,600 oz for 30.407 tonnes

Second,  FIRST DAY NOTICES FILINGS FOR NOVEMBER CONTRACT MONTH:  875 NOTICES FOR 87,500 OZ  (2.72 16 TONNES)

For silver:

for the Oct contract month:  39 notices for 195,000 oz.

THE TOTAL NUMBER OF NOTICES FILED FOR THE ENTIRE OCT. MONTH: 555 NOTICES FOR 2,775,000 OZ

FOR FIRST DAY NOTICE NOVEMBER CONTRACT MONTH FOR SILVER: 338 NOTICES OR 1,690,000 OZ

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

Let us have a look at the data for today

.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

In silver, the total open interest ROSE by 318 contracts UP to 193,975. The open interest ROSE AS the silver price was UP 8 cents in yesterday’s trading .In ounces, the OI is still represented by just less THAN 1 BILLION oz i.e. .970 BILLION TO BE EXACT or 139% of annual global silver production (ex Russia &ex China).

In silver for October we finished with 39 notices served upon for 195,000 oz.  Thus the final standings for silver in October is 555 notices served upon for 2,775,000 oz. An excellent showing for silver in a non delivery month.

In November, in silver, on first day notice filings:  875 notices were served upon for 1,690,000 oz

I

In gold, the total comex gold ROSE by 2,919 contracts WITH THE RISE in price of gold ($4.30 ON FRIDAY) . The total gold OI stands at 510,070 contracts.

In gold for October we had 341 notices served upon for 341,000 oz.  This should finalize gold as the total number of notices filed for the month totals 9,776 for 977,600 oz or 30.407 tonnes.

In gold for November: we had on first day notice filings:  875 notices served upon for 87500 oz

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD

TODAY WE HAD NO CHANGES AT THE GLD OUT OF THE GLD

Total gold inventory rests tonight at: 942.59 tonnes of gold

SLV

we had NO CHANGES at the SLV/

THE SLV Inventory rests at: 360.673 million oz

.

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

1. Today, we had the open interest in silver ROSE by 318 contracts up to 193,975 as the price of silver rose by 8 cents with Friday’s trading.The gold open interest ROSE by 2,919 contracts UP to 510,070 as the price of gold ROSE $4.30 IN FRIDAY’S TRADING.

(report Harvey).

2.a) The Shanghai and London gold fix report

(Harvey)

 

2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY:  Bloomberg

3c FRBNY gold movement report

(Harvey)

3. ASIAN AFFAIRS

i)Late  SUNDAY night/MONDAY morning: Shanghai closed DOWN 3.78 POINTS OR 0.12%/ /Hang Sang closed DOWN 20.27  OR 0.09%. The Nikkei closed DOWN 21.39 POINTS OR 0.09% Australia’s all ordinaires  CLOSED UP 0.59% /Chinese yuan (ONSHORE) closed UP at 6.7728/Oil FELL to 48.43 dollars per barrel for WTI and 50.42 for Brent. Stocks in Europe: ALL IN THE MIXED   Offshore yuan trades  6.7847 yuan to the dollar vs 6.7728  for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS A LITTLE  BIT AS MORE USA DOLLARS ATTEMPT TO  LEAVE CHINA’S SHORES / CHINA SENDS A MESSAGE TO THE USA TO NOT RAISE RATES IN DECEMBER.

REPORT ON JAPAN  SOUTH KOREA NORTH KOREA AND CHINA

3a)THAILAND/SOUTH KOREA

South Korea`s is rocked this morning by an influence peddling scandal similar to the USA charitable foundation scandal

( zero hedge)

b) REPORT ON JAPAN

A preview of what to expect from Japan`s decision this week.  In essence continue what they have been doing: printing money and buying assets

( zero hedge)

c) REPORT ON CHINA

i)This is now alarming:  China`s TED spreads are blowing out as banks are now afraid to lend to one another and a huge dollar shortage.

( zero hedge)

 

ii)Another alarming commentary.  China`s debt this year has grown by 4.5 trillion uSA.  This growth has basically kept the world`s global economy moving somewhat.  When this stops all hell with break loose: a huge deflationary spiral

( zero hedge)

4 EUROPEAN AFFAIRS

i)ITALY

Another earthquakes whacks Central Italy:a 6.6 magnitude quake:

( zero hedge)

ii)ENGLAND

Mark Carney stays on as Governor of the Bank of England.  The pound hardly moves:

( zero hedge

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

i)TURKEY

USA orders family members of the Istanbul Consulate (employees) to leave Turkey immediately as Erdogan is asking for the death penalty for the plotters. Remember Turkey has moving closer to Russian now

( zero hedge)

6.GLOBAL ISSUES

 NONE TODAY

7.OIL ISSUES

It sure looks like the oil freeze deal is over

(courtesy zero hedge)

8.EMERGING MARKETS

9.PHYSICAL STORIES

i)Koos Jansen: gold`s important role in anew monetary system

( Koos Jansen)
ii)John Hathaway on the Tocqueville gold letter spells out the gold manipulation we are experiencing( John Hathaway: Tocqueville gold letter)

iii)Goldseek ratio interview Bill Murphy of GATA

( Murphy:Waltzek:GATA)

iv)No doubt the first of many:  Dubai is the first foreign operation to use the Shanghai gold fix over the London gold fix:

( Yiyao:China Daily: GATA)

v)An extremely important commentary this morning form Ambrose Evans Pritchard. He notes the huge rise in Libor rates as well as the rise in Ted spreads and other indicators showing stress in the credit markets.  This is why the long end of the bonds are falling in price (rising in yields).  In other words: the global economy is about to experience a stress test:

( Ambrose Evans Pritchard)

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

i)On Friday, you heard the very important story that Comey went to Congress with a letter stating that he was reopening the case.   There are many stories over the weekend, and I will give you the important chronological  events.  In the conclusion you will see that the emails now discovered on Weiner`s computer will be very harmful to Clinton and may affect the Presidency:

Saturday

Raoul Meijer:Part i

The FBI has of this point in time did not have the right to view the emails

(courtesy Raul Meijer)

ii) Part ii

The USA tries to throw roadblocks preventing the release of the emails:
( Raul Meijer)

iii)Sunday;

the problems facing Comey as the Washington field attempts to gain access to thos emails:

( zero hedge)

iv)I am running out of popcorn:  there is apparently 650,000 emails found on Weiner’s laptop, and they expect weeks of work. Interestingly the no. 2 man at the FBI is Mccabe, the same fellow who spouse received money from Viriginia’s McAuliffe.

( zero hedge)

v)Late Sunday night:

I have ordered in more popcorn! The FBI finally obtains the all important warrant to search Huma Abedin`s computer and emails (also Weiner`s computer)

( zero hedge)

vi)Comey has received a stack of resignation letters from furious FBI agents

( zero hedge)

vii)MONDAY

Dilbert creator, Scott discusses why the emails are really bad.  The following is extremely important and I strongly believe that he is correct.
( zero hedge)

viii)This economist predicts the rising Obamacare health care costs will lead to riots on the streets( zero hedge)

ix)Income rises, spending rises but for the 2nd straight month real disposable income per person slides:

( zerohedge)

x)The all important, national Chicago PMI falls to 50.4 barely above recession levels.  The report signals inflationary pressures is on  the rise and economic growth looks very disappointing.  This is exactly what Ambrose Evans Pritchard is discovering in his commentary today

( Chicago PMI: zero hedge)

xi)Not good:  the Dallas Mfg Fed report signals a 22nd straight monthly decline in activity:

( zero hedge)

xii) The liquidation of the Sports Authority claims another victim”  Performance Sports Group, the makers of Bauer ice hockey equipment and Easton baseball and softball gear: it shows the weakness in the consumer group:

 

( zero hedge)

xiii)This ought to make you angry:  John Podesta’s best friend, Peter Kadzik will be heading that Dept of Justice’s probe into Huma Abedin’s emails. I sure hope that the republicans get to see all of Hillary’s emails especially on Benghazi and other emails that she destroyed so that she will be charged.

( zero hedge)

xiv)Donald thanks Weiner..

( zero hedge)

Let us head over to the comex:

The total gold comex open interest ROSE BY 2,919 CONTRACTS to an OI level of 510,070 as the price of gold ROSE $3.10 with FRIDAY’S trading.

We are now closing the delivery month is October and entering the non active delivery month of November.

For October we had 341 notices served upon for its probable last filings.  The total number of notices that has been served upon for the entire month is represented by 9776 notices for 977,600 oz or 30.407 tonnes.   This is a record for the comex deliveries for October as there never has been this quantity delivered upon from the beginning of time at the Comex.

For November: on first day notice filing:  875 notices for 87500 oz

The next delivery month is November and here the OI FELL by 430 contract(s) DOWN to 1,374 contracts.This will be, no doubt the probable amount standing for gold as we open November and thus 137,400 oz  will stand for metal or 4.2737 tonnes. Eventually by the end of Nov 2015,  a total of 214 notices stood for delivery for 21,400 oz  (.6656  tonnes) so again we see a massive increase in gold demand as some entities are shunning paper deliveries for the real stuff. The next contract month and the biggest of the year is December and here this month showed an increase of 1753 contracts up to 364,543.

Today, for November we had 875 notice(s) filed for 87500 oz of gold.
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And now for the wild silver comex results.  Total silver OI ROSE by 318 contracts from 193,605 UP TO 193,975 as the  price of silver ROSE to the tune of 8 cents on Friday.  We are moving  further from the all time record high for silver open interest set on Wednesday August 3:  (224,540).We are now concluding October and here we had 39 notices served upon for 195,000 oz.The total number of notices filed for the entire month of October is 555 and thus the final amount of silver standing for October is 2,775,000 oz.  For the first day notice filing for November we had 338 notices filed for 1,690,000 oz. On first day notice filings we start with an initial 1,730,000 oz of silver standing.   The next major delivery month is December and here it FELL BY 575 contracts down to 142,390.

we had 13 notices filed for 65,000 oz

VOLUMES: for the gold comex

Today the estimated volume was 58,979  contracts which is EXTREMELY POOR.

Yesterday’s confirmed volume was 244,440  which is VERY  GOOD (COMEY RESTARTS INVESTIGATION INTO HILLARY CLINTON EMAILS).

 

today we had 20 notices filed for 2000 oz of gold:

INITIAL standings for NOVEMBER
 Oct 31.
Gold Ounces
Withdrawals from Dealers Inventory in oz  NIL
Withdrawals from Customer Inventory in oz  nil
NIL oz
Deposits to the Dealer Inventory in oz nil oz
Deposits to the Customer Inventory, in oz 
 192.91 oz
Brinks
No of oz served (contracts) today
875 notices 
87,500 oz
No of oz to be served (notices)
499 contracts
 49,900
oz
Total monthly oz gold served (contracts) so far this month
875 contracts
87500 oz
2.7216 tonnes
Total accumulative withdrawals  of gold from the Dealers inventory this month   nil oz
Total accumulative withdrawal of gold from the Customer inventory this month     192.91 oz
Today we had 0 kilobar transactions
Today we had 0 deposit into the dealer:
total dealer deposits:  nil oz
We had zero dealer withdrawals:
total dealer withdrawals:  nil oz
.
We had 1 customer deposit;
i) Into Brinks:  192.91 oz
total customer deposits; 192.91 oz
We had 0 customer withdrawal(s)
total customer withdrawal:nil   oz
We had 3 adjustment(s)
 i) Out of Brinks:  57,670.000 oz  was adjusted out of the customer account of Brinks into the dealer account of brinks.  This makes no sense as the weight is exact to 3 decimals and it is not divisible by 32.15 oz and thus not kilobars.
ii) Out of Malca;
3761.667 oz was adjusted out of the dealer account and this landed into the customer account of Malca:
iii) 19,774.952 oz was adjusted out of the dealer account and this landed into the customer account of Scotia
the later two adjustments were probable settlements.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Total dealer inventor 2,246,706.023 or 69.88 tonnes
Total gold inventory (dealer and customer) =10,564,722.892. or 328.601 tonnes 
 
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 328.601 tonnes for a  gain of 26  tonnes over that period.  Since August 8 we have lost 25 tonnes leaving the comex. However I am including kilobar transactions and they are very suspect at best.
For November:

Today, 0 notices were 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 875 contract  of which 0 notices were stopped (received) by jPMorgan dealer and 0 notice(s) was (were) stopped/ Received) by jPMorgan customer account.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
To calculate the initial total number of gold ounces standing for the NOV. contract month, we take the total number of notices filed so far for the month (875) x 100 oz or 87,500 oz, to which we add the difference between the open interest for the front month of NOV (1374 contracts) minus the number of notices served upon today (875) x 100 oz per contract equals 137,400 oz, the number of ounces standing in this non  active month of November.
 
Thus the INITIAL standings for gold for the Nov contract month:
No of notices served so far (875) x 100 oz  or ounces + {OI for the front month (1374) minus the number of  notices served upon today (875) x 100 oz which equals 137,400 oz standing in this non active delivery month of Nov  (4.2737 tonnes).
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
I have now gone over all of the final deliveries for this year and it is startling.
First of all:  in 2015 for the 12 months: 51 tonnes delivered upon for an average of 4.25 tonnes per month.
Here are the final deliveries for 2016:
Jan 2016:  .5349 tonnes  (Jan is a non delivery month)
Feb 2015:  7.9876 tonnes (Feb is a delivery month/deliveries this month very low)
March 2015: 2.311 tonnes (March is a non delivery month)
April:  12.3917 tonnes (April is a delivery month/levels on the low side
And then something happens and from May forward deliveries boom!
May; 6.889 tonnes (May is a non delivery month)
June; 48.552 tonnes ( June is a very big delivery month and in the end deliveries were huge)
July: 21.452 tonnes (July is a non delivery month and generally a poor one/not this time!)
August: 44.358 tonnes (August is a good delivery month and it came to fruition)
Sept:  8.4167 tonnes (Sept is a non delivery month)
Oct; 30.407 tonnes complete.
total for the 10 months;  183.392 tonnes
average 18.39 tonnes per month vs last yr 51 tonnes total for 12 months or 4.25 tonnes average per month. From May 2016 until Oct 2016 we have had: 160.16 tonnes per the 6 months or 26.694 tonnes per month (which includes the non delivery months of May, June and Sept).  In essence the demand for gold is skyrocketing.
Something big is going on inside the gold comex.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
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 of hypothecated gold sent to other jurisdictions so that they will not be short with their underwritten derivatives in that jurisdiction.  This would be similar to the rehypothecated gold used by Jon Corzine at MF Global.
 
IN THE LAST TWO MONTHS  25 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
 
NOV INITIAL standings
 Oct 31. 2016
Silver Ounces
Withdrawals from Dealers Inventory NIL
Withdrawals from Customer Inventory
624,745.248 oz
Delaware
Deposits to the Dealer Inventory
586,517.700  OZ
CNT
Deposits to the Customer Inventory 
 22,622.300 oz
Brinks,CNT
No of oz served today (contracts)
338 CONTRACT(S)
(1,690,000 OZ)
No of oz to be served (notices)
8 contracts
(40,000 oz)
Total monthly oz silver served (contracts) 338 contracts (1,6900,000 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  624,745.248 oz
today, we had 1 deposit(s) into the dealer account:
i) Into CNT: 586,517.700 oz
total dealer deposit: 586,517.700 oz
we had 0 dealer withdrawals:
 total dealer withdrawals: nil oz
we had 1 customer withdrawal:
i) Out of Delaware:  624,745.248 oz
Total customer withdrawals: 624,745.248  oz
We had 2 customer deposit(s):
i) Into CNT: 13,605.000 oz??? exact deposit???
ii) Into Brinks: 10,017.300 oz
total customer deposits;  22,622.300 oz
 
 
 we had 2 adjustment(s)
i) Out of Brinks:
710,828.93 oz was adjusted out of Brinks dealer and into the customer account of Brinks
ii) Out of CNT:
597,403.600 oz was adjusted out of the customer account of CNT and this landed into the dealer account. 
.
Volumes: for silver comex
Today the estimated volume was 24.813 which is VERY poor.
YESTERDAY’S  confirmed volume was 75,502 which is EXCELLENT
The total number of notices filed today for the Nov. contract month is represented by 338 contracts for 1,690,000 oz. To calculate the number of silver ounces that will stand for delivery in Nov., we take the total number of notices filed for the month so far at  338 x 5,000 oz  = 1,690,000 oz to which we add the difference between the open interest for the front month of NOV (346) and the number of notices served upon today (338) x 5000 oz equals the number of ounces standing 
 
Thus the initial standings for silver for the NOV contract month:  338(notices served so far)x 5000 oz +(346) OI for front month of NOV. ) -number of notices served upon today (338)x 5000 oz  equals  1,730,000 oz  of silver standing for the NOV contract month.
 
Total dealer silver:  30.460 million (close to record low inventory  
Total number of dealer and customer silver:   173.448 million oz
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
Oct 31/no changes at the GLD/Inventory rests at 942.59 tonnes
Oct 28/no changes at the GLD/Inventory remains at 942.59 tonnes
OCT 27/NO CHANGES AT THE GLD/INVENTORY REMAINS AT 942.59 TONNES
Oct 26/a massive 14.24 tonnes of gold leave the GLD and I am sure this is a paper transaction/this “paper gold” was used in the whacking of gold today/Inventory rests at 942.59 tonnes
OCT 25/A HUGE ADDITION OF 3.27 TONNES INTO THE GLD/INVENTORY RESTS AT 956.83 TONNES
OCT 24/NO CHANGES AT THE GLD/INVENTORY RESTS AT 953.56 TONNES
OCT 21/A MONSTROUS CHANGE IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 16.61 TONNES FROM THE GLD/INVENTORY RESTS AT 953.56 TONNES
OCT 20/A HUGE CHANGE IN GOLD INVENTORY AT THE GLD OF 2.94 TONNES/INVENTORY RESTS AT 970.17 TONNES
OCT 19/no change in gold inventory at the GLD inventory/inventory rests at 967.21 tonnes
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Oct 31/ Inventory rests tonight at 942.59 tonnes
*IN LAST 20 DAYS: 7.6 TONNES REMOVED FROM THE GLD

end

Now the SLV Inventory
Oct 31/no change in silver inventory at the SLV/Inventory rests at 360.673 million oz/
Oct 28/NO CHANGE IN SILVER INVENTORY AT THE SLV/iNVENTORY RESTS AT 360.673 MILLION OZ
OCT 27/A MONSTROUS WITHDRAWAL OF 5.987 MILLION OZ FROM THE SLV/INVENTORY RESTS AT 360.673 MILLION OZ  (AND YET NO CHANGE IN THE SILVER PRICE???)
Oct 26/NO CHANGES AT THE SLV/INVENTORY RESTS AT 366.366 MILLION OZ/
OCT 25/NO CHANGES AT THE SLV INVENTORY/INVENTORY RESTS AT 366.366 MILLION OZ
OCT 24/NO CHANGES AT THE SLV INVENTORY/INVENTORY RESTS AT 366.366 MILLION OZ
OCT 21/A HUGE CHANGES IN SILVER INVENTORY AT THE SLV/: A DEPOSIT OF 3.226 MILLION OZ INTO THE SLV/INVENTORY RESTS AT 366.366 MILLION OZ
oCT 20/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 363.140 MILLION OZ
oCT 19/a good sized change at the SLV inventory: a deposit of 855,000 oz/rests at 363.140 million oz/
.
Oct 31.2016: Inventory 360.673 million oz
 end

NPV for Sprott and Central Fund of Canada

1. Central Fund of Canada: traded at Negative 2.0 percent to NAV usa funds and Negative 2.1% to NAV for Cdn funds!!!! 
Percentage of fund in gold 60.8%
Percentage of fund in silver:38.4%
cash .+0.8%( Oct 31/2016).
2. Sprott silver fund (PSLV): Premium FALLS to +0.21%!!!! NAV (OCT 31/2016) 
3. Sprott gold fund (PHYS): premium to NAV  RISES TO  1.08% to NAV  ( OCT 31/2016)
Note: Sprott silver trust back  into POSITIVE territory at 0.21% /Sprott physical gold trust is back into positive territory at 1.08%/Central fund of Canada’s is still in jail.
 
 
 

end

FEDERAL RESERVE BANK OF NEW YORK: EAR MARKED GOLD MOVEMENTS

LAST MONTH:  7,849 MILLION DOLLARS WORTH OF GOLD VALUED AT $42.22

THIS MONTH: 7,841 MILLION DOLLARS WORTH OF GOLD VALUED AT $42.22

THUS 8 MILLION DOLLARS WORTH OF GOLD AT 42.22 LEFT NEW YORK

OR 189,483.65 OZ (5.8937 TONNES)

Since Germany is the only official nation asking for repatriation of their gold, we can safely assume that this gold is heading for Frankfurt.

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

OFF TODAY

end
Koos Jansen: gold`s important role in anew monetary system
(courtesy Koos Jansen)

Gold Is Going To Play A Role In A New Monetary System. Interview Koos Jansen by ‘Dutch Financial Times’

BullionStar's picture

John Hathaway on the Tocqueville gold letter spells out the gold manipulation we are experiencing

(courtesy John Hathaway: Tocqueville gold letter)

Hathaway’s Tocqueville gold letter gets pretty frank about market rigging

Section:

1:05p CT Friday, October 28, 2016

Dear Friend of GATA and Gold:

John Hathaway’s October gold strategy letter for the Tocqueville funds gets pretty frank about manipulation of the gold market by governments and central banks, quoting Zero Hedge and market analyst and financial letter writer Michael Belkin:

“The correction of the past few days coincided with an absence of Chinese buyers due to the ‘Golden Week’ holiday there. ‘With China (by far the largest buyer of physical gold) closed, the markets were open for rampant manipulation, which is exactly what happened as several billion dollars in paper assets were dumped.’ (Zero Hedge, October 9, 2016.) As noted in the October 10 Belkin Report, ‘Who sells $22 billion of gold for maximum market impact over a very short period? The global monetary cabal (central banks, Bank for International Settlements) have a long history of suppressing gold prices because a rising gold price discredits their legitimacy.'”

Hathaway’s letter is posted at the Tocqueville internet site here:

http://tocqueville.com/insights/gold-strategy-investor-letter-3Q16

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

END

Goldseek ratio interview Bill Murphy of GATA

(courtesy Murphy:Waltzek)

GoldSeek Radio’s Chris Waltzek interviews GATA Chairman Bill Murphy

Section:

1:45p CT Friday, October 28, 2016

Dear Friend of GATA and Gold:

GoldSeek Radio’s Chris Waltzek interviewed GATA Chairman Bill Murphy yesterday, discussing what seems to be the U.S. government’s lockdown on gold prices prior to the presidential election, the dubiousness of the Federal Reserve’s plan to raise interest rates, and the possibility of “black swan” events. The interview is nine minutes long and can be heard at GoldSeek here:

http://radio.goldseek.com/nuggets.php

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

END

No doubt the first of many:  Dubai is the first foreign operation to use the Shanghai gold fix over the London gold fix:

(courtesy Yiyao:China Daily: GATA)

An extremely important commentary this morning form Ambrose Evans Pritchard. He notes the huge rise in Libor rates as well as the rise in Ted spreads and other indicators showing stress in the credit markets.  This is why the long end of the bonds are falling in price (rising in yields).  In other words: the global economy is about to experience a stress test:

(courtesy Ambrose Evans Pritchard)

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 6.7728( REVALUATION NORTHBOUND  /CHINA UNHAPPY TODAY CONCERNING USA DOLLAR RISE/MORE $ USA DOLLARS LEAVE CHINA/OFFSHORE YUAN NARROWS TO 6.7847 / Shanghai bourse CLOSED DOWN 3.78 POINTS OR 0.12%   / HANG SANG CLOSED DOWN 20.27 OR 0.09%

2 Nikkei closed DOWN 21.39 OR 0.16%   /USA: YEN RISES TO 105.03

3. Europe stocks opened ALL IN THE RED ( /USA dollar index UP to 98.56/Euro DOWN to 1.0947

3b Japan 10 year bond yield: RISES TO    -.048%/     !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 104.00/ THIS IS TROUBLESOME AS BANK OF JAPAN IS RUNNING OUT OF BONDS TO BUY.

3c Nikkei now JUST BELOW 17,000

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

3e WTI::  48.43  and Brent:50.42

3f Gold UP  /Yen DOWN

3g Japan is to buy the equivalent of 108 billion uSA dollars worth of bond per month or $1.3 trillion. Japan’s GDP equals 5 trillion usa./“HELICOPTER MONEY” OFF THE TABLE FOR NOW /REVERSE OPERATION TWIST ON THE BONDS: PURCHASE OF LONG BONDS  AND SELLING THE SHORT END

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 DOWN for WTI and DOWN for Brent this morning

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10 yr bund FALLS  A BIT to +.163%   

3j Greek 10 year bond yield FALLS to  : 8.31%   

3k Gold at $1272.30/silver $17.76(7:45 am est)   SILVER FINAL RESISTANCE AT $18.50 WILL BE DEFENDED 

3l USA vs Russian rouble; (Russian rouble DOWN 26/100 in  roubles/dollar) 63.17-

3m oil into the 48 dollar handle for WTI and 50 handle for Brent/

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

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 105.03 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 .9891 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0829 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 POSITIVE territory with the 10 year FALLS to  +.163%

/German 9+ 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 1.843% early this morning. Thirty year rate  at 2.611% /POLICY ERROR)

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

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

HELICOPTER MONEY STILL ON THE TABLE FOR THE FUTURE/JAPANESE STIMULUS PLAN DISAPPOINTS

Global Stocks Mixed, Futures Rise As Oil Stumbles After OPEC Fails To Agree On Supply Cuts

Asian shares traded mixed, European shares slid while US equity futures posted a modest rebound after Friday’s surprising political news that the FBI reopened its probe into Hillary Clinton, after OPEC failed to agree supply cuts at a meeting in Vienna.

Energy shares on the MSCI All Country World Index and crude both slipped to one-month lows after OPEC ended two days of talks on Saturday without agreeing any individual quotas. The ruble led declines among the currencies of oil-exporting nations, while South Africa’s rand strengthened versus all of its major peers after the South African state prosecutor dropped fraud charges against finance minister Pravin Gordhan. Aluminum and zinc rallied to multi-year highs in Shanghai on optismism Chinese demand will hold up. Gold maintained the bulk of Friday’s gains, and traded at 4 week highs after a survey pointed to cooling support for Clinton before next week’s U.S. presidential election.

“Talks over the weekend make it seem less likely there will be an agreement on production cuts,” said Ric Spooner, a chief market analyst at CMC Markets in Sydney. “The market has probably made a fair bit of the adjustment, but I wouldn’t be surprised to see oil fall further into the $47 range.” In a note Spooner also said that “there seems little doubt that a Trump victory would trigger selling in stock markets from current levels. This has traders nervous as they start the week assimilating fresh news on Hillary Clinton’s email problems.”

The Bloomberg Dollar Spot Index rose 0.1 percent, after retreating 0.3 percent from a seven-month high in the last session. It’s climbed more than 2 percent this month, set for the biggest gain since May.  While the Fed is seen leaving rates unchanged in its November 2 meeting, futures prices indicate a 69% chance of an interest-rate hike at its December meeting, up from 59% at the end of September.

Most Asian stocks struggled higher on Monday but investors were rattled by news that the FBI is planning to review more emails related to Democratic presidential candidate Hillary Clinton’s private server, just a week before the election. European markets also looked set for a shaky start, with the Stoxx 600 index down 0.4% in early trading.

As Bloomberg notes, global equities lost ground in October as mixed corporate earnings meld with investor anxiety ahead of the Nov. 8 vote in the U.S. and expectations the Federal Reserve will hike interest rates before the year is out. The S&P 500 Index slid 20 points in about 40 minutes on Friday amid news the Federal Bureau of Investigation was again looking into Clinton’s use of private e-mail while secretary of state, an issue that has dogged her campaign. The OPEC talks yielded little more than a promise that the world’s top oil producers would keep discussing ways to stabilize the market.

“Until the election, the general theme will be uncertainty, which will have implications not just on the stock market, but on the dollar and Treasuries,” said Chad Morganlander, a money manager in Florham Park, New Jersey at Stifel, Nicolaus & Co., which oversees about $180 billion. “The probability that was factored into the market and the global financial system was a Hillary Clinton victory – investors now need to square their books going into the election based on whatever new odds come out.”

MSCI’s broadest index of Asia-Pacific shares outside Japan hit a six-week low on Monday before recovering 0.3 percent. It is set to end the month down 1.6 percent. Japan’s Nikkei, which touched a six-month high on Friday, closed 0.1 percent lower on Monday, but is up 5.9 percent in October.

The Stoxx Europe 600 Index was down 0.2 percent as of 8:12 a.m. London time, with a gauge of energy stocks sliding the most among 19 industry groups. A measure of energy shares on the MSCI Asia Pacific Index slid 0.5 percent, also the worst performance.

AIA Group Ltd. shares slumped as much as 7.2 percent after China UnionPay Co. halted credit and debt card payments for most insurance policies in Hong Kong, making it harder to conduct transactions with Chinese visitors that accounted for about half of the company’s sales in the city. Nippon Yusen KK and Mitsui O.S.K. Lines Ltd. — Japan’s two largest shipping companies — surged more than 5 percent in Tokyo after they agreed to merge their container operations with those of third-ranked Kawasaki Kisen Kaisha Ltd., which added less than 1 percent.

Futures on the S&P 500 Index rose 0.1 percent, after earlier retreating as much as 0.4 percent. An ABC/Washington Post tracking survey released Sunday gave Clinton 46 percent support from likely voters, to Trump’s 45 percent. Clinton was ahead by 12 points a week earlier.

Cited by Bloomberg, Matthew Sherwood, head of investment strategy in Sydney at Perpetual, said that “the race remains very tight and markets are far too complacent about the end result. If the polls tighten more, or the FBI investigation dominates the headlines, there could be a recalibration in market prices this week.”

American data on Monday are forecast to show personal spending and income both increased in September, based on Bloomberg surveys of economists.

Bulletin headline summary from RanSquawk

  • European equities trade lower this morning, following on from US and Asian counterparts, with concerns regarding Clinton’s emails back in the spotlight and soft energy prices
  • FX markets remain relatively subdued this morning, with ZAR the notable mover after reports suggest charges will be removed against the finance minister
  • Highlights include US Core PCE and Chicago PM! and a host of US earnings

Market Wrap

  • S&P 500 futures up 0.1% to 2127
  • Stoxx 600 down 0.5% to 339
  • FTSE 100 down 0.5% to 6964
  • DAX down 0.5% to 10642
  • German 10Yr yield down 1bp to 0.15%
  • Italian 10Yr yield up 8bps to 1.67%
  • Spanish 10Yr yield down 1bp to 1.22%
  • S&P GSCI Index down 0.2% to 369.4
  • MSCI Asia Pacific up 0.3% to 139
  • Nikkei 225 down 0.1% to 17425
  • Hang Seng down less than 0.1% to 22935
  • Shanghai Composite down 0.1% to 3100
  • S&P/ASX 200 up 0.6% to 5318
  • US 10-yr yield down less than 1bp to 1.84%
  • Dollar Index up 0.18% to 98.52
  • WTI Crude futures down 0.3% to $48.55
  • Brent Futures down 0.4% to $49.50
  • Gold spot down 0.2% to $1,273
  • Silver spot up 0.4% to $17.83

Global Headline News

  • Clinton Allies Target Comey as Probe Scrambles Election Campaign: Escalated attacks on FBI Director James Comey in a bid to stem political damage from his disclosure the agency is reviewing a new batch of files that may be related to an investigation of the former secretary of state’s e-mail practices
  • China’s COMAC Chases Xi’s Dream to Challenge Airbus, Boeing: Jet plan part of goal to boost China’s manufacturing ranking
  • GE Nears $30 Billion Energy Deal With Baker Hughes, WSJ Reports: Plans to combine oil, gas business with oilfield services co.
  • Banks Amass $2.4 Trillion Hoard of Bonds as BofA Leads Rush: Government debt holdings soar as deposits outpace loan demand
  • Greenlight Fund Takes Jab at Tesla’s Musk, Axes Vodafone Stake: Carmaker’s charismatic CEO is ‘blinding’ investors, firm says
  • American Airlines Jet Fire on Runway Forces Passenger Evacuation: Reported an engine malfunction just before catching fire while taxiing for takeoff from Chicago’s O’Hare airport

Looking at regional markets, we start in Asia where stocks were poised for the worst monthly drop since May as declines in oil prices dragged energy shares lower and investor anxiety grew over next week’s U.S. presidential election. Asian equity markets traded mixed amid indecisiveness ahead of this week’s multiple key risk events, with stocks pressured early on as political jitters resurfaced alongside a new probe into Clinton emails. Nikkei 225 (-0.2%) was also hampered by poor Industrial Production and Retail Sales figures, while the Shanghai Comp (-0.1%) and Hang Seng (-0.1%) were indecisive as earnings took centre stage with Big-4 banks ICBC and AgBank disappointing on their results. Elsewhere, the ASX 200 (+0.6%) outperformed having been lifted by the materials sector — a consequence of the softer USD. Finally,10yr JGBs saw mild gains as the risk averse sentiment spurred safe-haven flows, while the BoJ were also in the market during the session.

Top Asia News

  • Goldman Sachs Alumni Said to Start Macro Hedge Fund in Asia: Their Vanhau hedge fund will make half of investments in Asia
  • DBS to Buy ANZ’s Wealth, Retail Units in Five Asian Markets: ANZ Bank says it will take A$265 million loss on deal
  • Japan’s Shippers to Merge Container Business as Industry Shrinks: Combination will create world’s sixth-largest operator
  • Sony Cuts Annual Forecast on Battery Impairment, Components Loss: Company to transfer 8,500 workers to Murata Manufacturing
  • Japan Tobacco Raises Profit Forecast on Better Overseas Growth: Raises FY operating profit forecast by 1.4% to 580b yen vs est. 586.2b yen
  • Honda Boosts Profit Forecast as SUVs Lead China Sales Surge: China’s tax cut on smaller-engine models spurring demand
  • Xi’s Power a Double-Edged Sword as Pressure Grows to Deliver: Investors looking for balance of reform, growth and stability

European markets looked set for a shaky start, with equities opening on the softer side as European participants respond to the jitters surrounding the US election after reports late Friday stated that the FBI were to review newly obtained emails linked to Hilary Clinton. Alongside this, weakening oil prices have added to the dampened sentiment amid soured hopes that an agreement among OPEC nations on a supply agreement will be finalised after objections from Iran and Iraq to even freeze output. In turn, this has led to energy being among the worst performers this morning. Across fixed income, the softer tone has seen global bonds supported with bunds moderately higher, while the 10- yr is outperforming in the curve supported by month-end extensions which are expected to the largest since 2011. Elsewhere, Italian BTPs have been underperforming this morning after the nation was yet again hit by another earthquake.

Top European News

  • Carney’s Decision on BOE Future Overshadows U.K. Rate Decision: Governor could decide this week on term as BOE governor
  • EU to Match U.S. Capital Demands on Local Units of Foreign Banks: TLAC rules are part of sweeping changes to EU bank laws
  • European Banks Stuck With $1.3 Trillion of Bad Loans, KPMG Say

In FX, the Bloomberg Dollar Spot Index rose 0.1 percent, after retreating 0.3 percent from a seven-month high in the last session. It’s climbed more than 2 percent this month, set for the biggest gain since May. While the Fed is seen leaving policy unchanged at a review this week, futures prices indicate a 69 percent chance of an interest-rate hike at its December meeting, up from 59 percent at the end of September. American data on Monday are forecast to show personal spending and income both increased in September, based on Bloomberg surveys of economists.  The rand strengthened 0.9 percent after the City Press newspaper reported that South African prosecutors may drop fraud charges against Finance Minister Pravin Gordhan, who has been a key driver of a campaign to maintain the nation’s investment-grade credit rating. The National Prosecuting Authority said Sunday there were no such plans.  China’s yuan strengthened 0.2 percent, paring its biggest monthly loss since May. It advanced from near a six-year low following Friday’s retreat in the dollar and as China’s clampdown on UnionPay payments for insurance products in Hong Kong provided support. The transactions have been used as a means of skirting capital controls to take funds out of the mainland.

In commodities, crude oil fell 0.3 percent to $48.57 a barrel in New York. OPEC members ended talks on Friday without reaching a deal on country quotas, and discussions with major producers from outside the group on Saturday also concluded without any commitments. Oil has fluctuated near $50 amid uncertainty about whether OPEC can implement the first supply cuts in eight years at an official meeting in November. “Talks over the weekend make it seem less likely there will be an agreement on production cuts,” said Ric Spooner, a chief market analyst at CMC Markets in Sydney. “The market has probably made a fair bit of the adjustment, but I wouldn’t be surprised to see oil fall further into the $47 range.” Gold was little changed at about $1,275 an ounce after rallying 0.6 percent on Friday. The metal’s gains reflect “safe-haven buying after the FBI reopened its inquiry into Hillary Clinton’s use of a private e-mail server,” Australia & New Zealand Banking Group Ltd. analysts wrote in a note on Monday. Aluminum and zinc extended gains in Shanghai as investors bet that strong domestic demand, surging coal prices and logistical issues will underpin prices. Aluminum rose to its highest since September 2014, having jumped by about 10 percent last week, and zinc climbed to levels last seen in March 2011.

Today’s main events include the September personal income and spending reports, along with the PCE core and deflator readings. We’ll also get the Chicago PMI and Dallas Fed manufacturing survey

DB’s Jim Reid concludes the overnight wrap

Friday’s late damage to markets was from the fresh FBI decision to re-open the investigation into Hillary Clinton’s private email use. Indeed I’ve never known a US election campaign like this with lurid accusations one minute and FBI investigations the next. Clinton’s campaign team have been fairly robust in response and have effectively told the FBI to immediately put the details of the allegations out in the open. The fact that there has not been much additional news over the weekend has taken some of the sting out of what was an explosive development just before Friday’s close.

The wires have been busy reporting some of the latest polls but we’d caution on their findings given that they all have sampling periods which span both before and after the headlines broke. The ABC/Washington Post poll has got a fair bit of airtime and shows Clinton as holding a small 1 point lead over Trump. However, that’s not much change from the 2point lead in the previous poll so the implied gain for Trump is pretty small. Other polls conducted by IBD/TIPP and USC/LA Times have shown no change. Again though these cover only a small period post the headlines (2 out of 6 days for the former and 2 of 7 days the latter). State-only polls are also evidently suggesting that it’s too early to really assess the impact.

Bloomberg is also highlighting the latest CBS/YouGov survey. That survey showed that only 5% of Democrat supporters would be less likely to support Clinton following the latest FBI announcement. The survey also suggested that 13% are now more likely to vote for her. 50% said it doesn’t matter. Taken together, it’s hard to really take much away from these polls right now.

So we’ll wait to see if anything changes and whether anything substantive gets released from the FBI before Election Day in just 10 days time. Over the last few years we’ve all had to make ourselves better political analysts, but I never thought analysing the FBI would be an important skill. Analysing Mark Carney could also be a good skill this week especially for Sterling assets. Over the weekend conflicting reports suggest that he either may be close to announcing he’ll leave by the end of 2018 (The Times) or be prepared to serve his full 8 year term to 2021 (FT). Both articles suggest he could discuss his intentions at the BoE meeting on Thursday which will give it added dimension.

Other things to look for this week are all the global PMIs between Tuesday and Thursday, the BoJ meeting on Tuesday, the FOMC on Wednesday and aforementioned BoE meeting Thursday and of course US payrolls on Friday. We also have 131 and 76 S&P and Stoxx 600 companies respectively reporting. It’s also possible that we get the UK High Court Brexit case ruling concerning the triggering of Article 50 without parliamentary approval. For those that missed it, on Friday Northern Ireland’s High Court ruled that the law of the province did not restrict Theresa May from triggering an exit in a boost to the UK government. More on the next 5 days at the end in the week ahead.

In terms of the remaining weekend newsflow, we finally got confirmation of an eleventh hour rescue yesterday of the CETA agreement between the EU and Canada. Talks were complicated by the objection from the Francophone region of Wallonia, with the region citing a range of concerns about the deal from the impact on employment to its impact on regional values. Significantly the deal still requires the approval of 38 national parliaments in order to be fully ratified, meaning it may drag on further. There’s also suggestion now that the opposition put up by Wallonia may act as a precedent for further trade deals and so limiting Europe’s future negotiation power. The only other thing to mention from this weekend concerns Iceland where the Independence Party came out on top in the snap election with 21 seats. Notably the populist Pirate Party more than tripled the number of seats it won (10 seats) to leave it in joint second place. An expanded coalition will be needed however the Pirate Party has previously ruled out working with the Independence Party.

Onto markets now where risk is opening up a bit mixed this morning. The Hang Seng (+0.13%) and ASX (+0.77%) are currently running with gains however the Nikkei (-0.23%), Shanghai Comp (-0.45%) and Kospi (-0.56%) look to be ending the month on more of a down note. That’s largely to do with the moves for Oil this morning where WTI (-0.43%) has followed a -2.05% decline on Friday following disappointment from the latest OPEC discussions. Discussions between delegates were said to have ended in a deadlock with disputes over country level quotas. Non-OPEC countries were also said to have met on Saturday with the same outcome. According to the WSJ the talks were said to have run into trouble when Iraq and Iran disputed the data being used to estimate production levels. Credit indices are also trading with a slightly softer tone while Gold and the USD index have edged up +0.10%. The Mexican Peso is holding near a two-week low following three days of losses into Friday.

There’s also been some data out this morning in Japan. It’s made for slightly disappointing reading however. Both industrial production (0.0% mom vs. +0.9% expected) and retail sales (0.0% vs. +0.2% expected) were flat in September and missed relative to expectations for a modest rise. Despite that there’s not been much of a reaction for the Yen.

The moves this morning follow that late tumble into the close on Friday evening post the FBI headlines which put a dampener on things after earlier data showed Q3 GDP in the US had surprised to the upside at +2.9% qoq saar (vs. +2.6% expected). The S&P 500 eventually finished -0.31% with healthcare stocks in particular getting hit hard. It also means that the index has now fallen for four consecutive sessions for the first time since June. In fairness the cumulative four-day loss is only -1.16% so it’s far from being a huge selloff. Earnings continue to be a big factor with 291 S&P 500 companies now ticked off. The overall trend is relatively positive with our US equity strategists reporting that 66% have beat on EPS with a weighted average beat of 5.7% even if just 36% have beat on sales (with 30% missing and the remaining large proportion in line). They note that this earnings season has been better than they expected primarily because of the strong performance for financials and large tech (ex. Apple). They also highlight that the blended (actually for reported and estimate for remaining) bottom up Q3 EPS has climbed to $30.99 or +2.8% yoy. They expect the final Q3 EPS to come in +2 to +3% yoy. As always last minute estimates are helping, albeit less of a factor than that in previous quarters. EPS has been revised down on average by 3% during the calendar quarter versus the five-year average of slightly over 4%. It’s worth noting that analysts are already starting to slash Q4 EPS estimates however. The consensus is for $31.29 now, down from $31.76 at the start of September.

Meanwhile markets in Europe were also a little softer on Friday. The Stoxx 600 finished -0.27% with earnings also dictating sentiment after UBS came in better than expected, but offset but slightly weaker numbers for AB-InBev and Novo Nordisk – the latter tumbling nearly 15% alone. Away from that, it was a much quieter day for sovereign bond markets. Core European bond yields ended fairly little changed, although were still some 15-20bps higher in yield for the week, while 10y US Treasury yields closed the week at 1.848%, down close to 1bp on Friday but up 11bps for the week.

Back to that GDP data. In terms of the composition, along with the boost from consumption the primary drivers for growth included exports which increased +10.0% annualized with net exports adding 0.83 percentage points to GDP growth as a result. Inventory building was also positive adding 0.61 percentage points. In terms of other data the final revisions to the University of Michigan consumer sentiment survey were made on Friday. The headline sentiment index reading was revised down to 87.2 from 87.9 as a result of a big downgrade for the current conditions index to 103.2 from 105.5. Expectations (76.8 from 76.6) were actually revised up a touch.

Over in Europe the focus of the data on Friday was on the inflation reports in Germany and France. For the former, CPI rose +0.2% mom in October which matched expectations. That helped to push the YoY rate to +0.8% from +0.7%. In France the data was a little bit more disappointing. CPI was unchanged in October versus expectations for a +0.2% mom. Meanwhile the other data to highlight was the latest economic confidence reading for the Euro area which rose to 106.3 this month from 104.9 in September. That actually puts the reading at the highest level this year. It’s worth noting that our European Economics team SIREN momentum indicator has reached a seven-month high. The SIREN surprise index has also surged to its best reading in 3 years and similarly, the SIREN surprise for Q4 has had its best start to a quarter since Q1 2012. They do however note that technical arguments suggest the improvement is overstated and the upside surprise is strongly tilted towards Germany. Furthermore they see headwinds next year from higher Oil, political uncertainty and the weakening of the fiscal and credit impulse so it might be too early to factor in a stronger recovery trend. Nevertheless, more robust data flow could strengthen the ECB’s conviction on its above-consensus 2016 GDP forecasts and the case of the more hawkish ECB Council members.

Turning over now to the week ahead. It’s a busy start to the week for data today. We’ll be kicking off firstly in the UK where the latest money and credit aggregates data is due for September. Shortly after that we’ll get Q3 GDP for the Euro area along with the October CPI report. Over in the US this afternoon the big focus will be on the September personal income and spending reports, along with the PCE core and deflator readings. We’ll also get the Chicago PMI and Dallas Fed manufacturing survey. Tuesday morning kicks off in China with the official manufacturing and non-manufacturing PMI’s for October. The RBA policy rate decision will also be due along with the BoJ decision. No change in policy for either is expected. In Europe tomorrow the only data due is the manufacturing PMI for the UK. There’s important data in the US however with the ISM manufacturing, while any last revisions to the manufacturing PMI will be made. The IBD/TIPP economic optimism reading will also be released, while vehicle sales data is out in the evening. Wednesday morning kicks off with the remainder of the final manufacturing PMI’s in Europe, along with the latest unemployment rate print for Germany. Over in the US the highlight data wise is the ADP employment change reading which comes before the FOMC meeting later in the evening. As we noted earlier we’re not expecting any surprises at the outcome of that. Turning to Thursday, the non-official services PMI will first of all be released in China. There’s not much data in Europe aside from the Euro area unemployment rate print however the focus will again be on another central bank meeting, this time in the form of the BoE. Again, we’re expecting no change to policy but the inflation report could be interesting. It’s set to be another busy afternoon in the US on Thursday. Q3 nonfarm productivity and unit labour costs kick things off followed by the remaining PMI’s. We’ll also get initial jobless claims, ISM non-manufacturing and finally factory orders. There’s little sign of things quietening down on Friday. We’ll kick off firstly in Japan with the Nikkei PMI’s. In Europe we then get the remaining PMI’s for October along with Euro area PPI before all eyes turn to the October employment report in the US including of course nonfarm payrolls. We’ll also get the September trade balance reading.

3.REPORT ON JAPAN  SOUTH KOREA NORTH KOREA AND CHINA

i)Late  SUNDAY night/MONDAY morning: Shanghai closed DOWN 3.78 POINTS OR 0.12%/ /Hang Sang closed DOWN 20.27  OR 0.09%. The Nikkei closed DOWN 21.39 POINTS OR 0.09% Australia’s all ordinaires  CLOSED UP 0.59% /Chinese yuan (ONSHORE) closed UP at 6.7728/Oil FELL to 48.43 dollars per barrel for WTI and 50.42 for Brent. Stocks in Europe: ALL IN THE MIXED   Offshore yuan trades  6.7847 yuan to the dollar vs 6.7728  for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS A LITTLE  BIT AS MORE USA DOLLARS ATTEMPT TO  LEAVE CHINA’S SHORES / CHINA SENDS A MESSAGE TO THE USA TO NOT RAISE RATES IN DECEMBER.

3a)THAILAND/SOUTH KOREA/:

South Korea`s is rocked this morning by an influence peddling scandal similar to the USA charitable foundation scandal

(courtesy zero hedge)

South Korea’s Presidency Rocked By Oddly Familiar “Influence-Peddling”, “Charitable Foundation” Scandal

While various prominent politicians in the US, who shall remain nameless, are seemingly made out of Teflon when it comes to policy-peddling scandals, South Korea is less lucky and, as the WSJ reports, South Korea’s president Park Geun-hye has accepted the resignation of her chief of staff and four other senior aides, following public outcry over the influence of a friend of Geun-hye’s in state affairs. The move comes after the president’s public approval ratings plunged to historic lows and thousands of street protesters called for her resignation Saturday after she said recently that her friend, Choi Soon-sil, had helped her prepare speeches early in her presidential term.

The two women have been friends for more than 40 years and became connected through Ms. Choi’s father, who created a religious cult and was close to Ms. Park’s father, former South Korean president Park Chung-hee. The cult connection in Ms. Choi’s family has increased public suspicions of her motives.

So wait, someone else writing the president’s speeches, and people riot over that?  Americans, used to a far greater degree of drama in recent months would merely gloss over, as they would over the allegation by a South Korean broadcaster that Ms. Choi was also given access to confidential government documents, based on files it retrieved from a tablet computer that it says it recovered from an office she used.In a South Korean newspaper interview, Ms. Choi, who has no position in government, denied accessing material other than the speeches.

No really, please stop us when this “scandal” which threatens to overthrow the South Korean administration reminds readers of something that has kept America up for the past few months.


South Korean police detain a protester during a rally against South

Korean President Park Geun-hye in Seoul on Saturday, Oct. 29, 2016

Oh, and South Korea’s scandal also involves, drumroll, “charitable foundations.

According to the WSJ, Choi, 60, who is also the subject of an investigation by prosecutors into possible corruption at two charitable foundations, returned to South Korea from London on Sunday morning. Her lawyer told reporters she would “actively respond” to prosecutors questions.

The crisis is the biggest Ms. Park has faced since high-profile resignations in government and an overhaul of state agencies following the sinking of a South Korean ferry in 2014 that she said was partly due to failures of government oversight.

In what may be a preview of things to come to the US, opposition politicians have called for a thorough investigation into the scandal, but haven’t called for Ms. Park’s impeachment.

Analysts say it is unlikely Ms. Park will resign unless the crisis escalates. But the furor will likely accelerate the start of her so-called ‘lame duck’ period, when her own political powers are diminished ahead of a presidential election at the end of next year. South Korean presidents serve a five-year term and are barred from running for re-election

Sadly for Park, if America is any example of how deep the rot goes, the crisis will certainly escalate.

Furthermore, in a peculiar twist, the presidential crisis may impact US diplomatic strategy in the region. According to the Eurasia Group, the crisis will make it harder for Ms. Park to push through economic initiatives, such as labor-market reforms, and could potentially impact existing policy plans like the deployment of an advanced U.S. missile-defense shield next year.

While Park remains in power, her staffers are getting the axe. The resignations of Ms. Park’s senior staff come after she requested they offer to quit, a process that is common in South Korea to show the government is taking responsibility for criticism directed at it. A presidential spokesman said the moves were made “in light of the current situation,” and declined to provide further explanation. Park hasn’t spoken about the case publicly since making a nationally televised apology Tuesday for sharing her speeches with Choi.

* * *

And then, the final similarity to that oddly “similar scandal” taking place in the US: On Sunday, prosecutors looking into Ms. Choi confiscated computers and documents from officials at the presidential office.

Yet one place where the US and South Korean differ, is in the media’s response. South Korean newspapers have been full of further accusations about the influence of Ms. Choi over Ms. Park in recent days, fanning public anger.

Another difference: the public’s response. While in the US there is much indignation over said “similar scandal” most of it is confined to Twitter and various online venues; meanwhile in South Korea several thousand protesters occupied the main square in downtown Seoul on Saturday evening to call for Ms. Park to resign. Some wore masks of Ms. Choi and mimicked the actions of a puppeteer, with strings connected to other demonstrators wearing masks of Ms. Park.

* * *

The WSJ concludes that scandals over alleged corruption or other wrongdoing are common among South Korean presidents, often late in their terms. Ms. Park’s public approval rating has sunk to about 14% in one poll, similar to the levels of other recent presidents, all of whom completed their terms. On the other hand, Ms. Park’s public approva rating would be around 80% after sampling a group of 5 “random” respondents, all of whom received kickbacks and benefits from her corruption. Furthermore in the US, a few donations to Park’s charitable foundations, a few kickbacks, and all would be forgiven.

It almost makes us wonder which is the greater banana republic: South Korea or the US…

end

b) REPORT ON JAPAN

A preview of what to expect from Japan`s decision this week.  In essence continue what they have been doing: printing money and buying assets

(courtesy zero hedge)

Previewing This Week’s Most Interesting Central Bank Decision (No, Not The Fed: the Central Bank of Japan)

While most attention over the next week will be focused on the fascinating slow-motion-train-wreck developments in the US political arena over the next week, let’s please think of the central banks, which are used to being the key source of public fascination. And while the Fed’s November 1-2 meeting will come and go, with Yellen paralyzed with fear and certain to change nothing just 6 days before the election, a far more interesting central bank meeting due later this week, is that of the BOJ which addresses the market on November 1, and which over the past few months has set the global bond market on edge with its attempts to steepen the JGB yield curve which in turn led to the VaR-shocked early September stock selloff, inspiring other central banks to contemplate tapering long-end purchases resulting in a the biggest global debt selloff since the Fed’s 2013 taper tantrum.

This is what to expect from the BOJ according to Goldman Sachs:

We expect the Bank of Japan (BOJ) to maintain current monetary policy at its October 31-November 1 Monetary Policy Meeting. Here, we look at this and other points in a Q&A format.

Q1: Will the BOJ ease further at the next monetary policy meeting?

A1: We expect the BOJ to maintain the status quo.

We expect the BOJ to opt to maintain current monetary policy, keeping the short-term policy rate at -0.1% and the long-term (10-year) yield target at around 0%. Our impression from the BOJ’s “comprehensive assessment” in September and the adoption of an “inflation-overshooting commitment” is that the BOJ’s bias toward maintaining the status quo has strengthened, as we discuss in more detail in Q4.

On top of it, we see very little chance of the BOJ embarking on additional easing at the next monetary policy meeting (MPM), given the following four factors. (1) We expect core CPI inflation, which is tied to the inflation-overshooting commitment, to rise in coming months due to slowing in the pace of year-on-year energy price declines. (2) The Japanese government has formulated a second FY2016 supplementary budget, which is likely to buoy the economy through FY2017. (3) Although the BOJ has set a 10-year JGB yield target of around 0%, little improvement is evident in the JGB yield in the 1-5-year zone, which is an important factor for banks earnings. (4) Market expectations for a near-term rate hike have risen in the US and with this the yen has come off high levels in the forex market.

Q2: What changes do you expect in the Outlook Report?

A2: We expect the BOJ to lower its FY2017 inflation outlook and push back the target date for achieving its 2% inflation target. However, we see the importance of the Outlook Report diminishing in terms of forecasting monetary policy.

We expect the BOJ to lower its inflation outlook to around 0% for FY2016 (from +0.1% as of July outlook report), around +1.3% for FY2017 (from +1.7%), and around +1.7% for FY2018 (from +1.9%; see Exhibits 1-2). We also see a possibility of a slight downward revision to the BOJ’s real GDP forecast, to around +0.9% for FY2016 (from +1.0%) given data thus far, but we expect almost no changes in other areas. We think the BOJ will push back the deadline for its 2% inflation target, which has been within FY2017 (i.e., before the end of March 2018), by around six months at least.

In its comprehensive monetary policy assessment, we believe the BOJ has already drawn lines of defense, saying “a further rise in inflation expectations through the adaptive mechanism is uncertain and may take time” (bolding added by us). Moreover, it has already extended its timeframe from a short battle to a prolonged one by introducing an inflation-overshooting commitment. We believe that the connection between the inflation outlook in the Outlook Report and monetary policy actions will diminish going forward (see Q4).

Exhibit 1: The BOJ’s economic and inflation outlook


Source: BOJ, JCER

Exhibit 2: Revisions to the BOJ’s inflation outlook


Source: BOJ, JCER

Q3: What do you think about the JGB market conditions under the yield curve control?

A3: JGB market functionality has already deteriorated and we expect it to continue to deteriorate under the yield curve control, as long as the BOJ continues with the current monetary policy.

Bond market functionality has been deteriorating even prior to the introduction of yield curve control in late September. In the BOJ’s bond market survey, the DI for bond market functionality deteriorated to -46 in August 2016, as compared to -25 in February 2015, when the survey first started (see Exhibit 3)[1]. Deterioration in the DI was particularly noticeable after the adoption of the negative rate policy.

With the addition of 10-year JGB yield control on top of the negative interest rate policy, we expect long-term rates to become more “fixed” and market functionality to decline even further. Already, on October 19, an entire day went by with no transactions made in newly issued 10-year JGBs (according to the Japan Bond Trading Co.). This is the first time in 13 months, since September 24, 2015, that no transactions have been made for an entire day.

We believe that the BOJ is also concerned about impairment of JGB market functionality, in that it may potentially cause large stress in the market when the BOJ decides to raise its policy rates in the future. We see little way to get around this issue, however, as long as the BOJ maintains current monetary policy.

Exhibit 3: DI on Bond market functionality


Source: BOJ

Q4: What is the outlook for BOJ’s monetary policy beyond the next MPM?

A4: We expect the BOJ to maintain status quo for now, barring a surge in the yen’s value, although there is uncertainty about the effectiveness of further rate cuts in correcting yen appreciation.

At its September monetary policy meeting, the BOJ announced a comprehensive assessment and also decided to adopt a new monetary easing framework that it refers to as “Quantitative and Qualitative Monetary Easing with Yield Curve Control.” In light of this, we see a high likelihood that the BOJ will continue to preserve further monetary easing as a future option barring any major market shocks, such as a surge in the yen’s value.

Our view is based on two main factors: (1) The BOJ’s latest set of policies represents a major shift in direction to prepare for a prolonged battle, in which it will only respond to significantly negative exogenous shocks, and the bias toward maintaining the status quo appears to have grown stronger. (2) It will take more time for the BOJ’s new framework to take hold among the BOJ and bond market participants.

The BOJ’s additional monetary easing options center on taking short rates further into negative territory insofar as the BOJ regards this as an effective means of correcting yen appreciation. In its comprehensive assessment, the BOJ said that the flip-side of the positive effects of the negative interest rate policy is growing pressure on financial institutions’ profits. It went on to say that the impact can vary depending on the duration of the policy. With the BOJ explicitly extending its timeframe and saying that the side-effects of the negative interest rate policy will depend on how long the policy is maintained, we think that the number of monetary easing policy measures that the BOJ is left with has diminished. This will serve to strengthen the bias toward maintaining the status quo, in our view.

In addition, our analysis indicates that if the BOJ were to take interest rates deeper into negative territory, it would likely need to lower the 10-year yield target by at least the same degree as the rate cut (see Japan Economics Analyst: To what degree can the BOJ control the 10-year JGB yield? October 17, 2016). Our understanding is that the BOJ’s aim is to avoid lowering 10-year yields, as much as possible, in order to minimize the adverse impact on financial institutions’ earnings. However, it may not be possible to simultaneously achieve both this objective and that of strengthening the negative interest rate policy. This risk, too, could strengthen the bias towards maintaining status quo.

In a speech on August 27, BOJ Governor Haruhiko Kuroda said that the adoption of a negative interest rate policy provides central banks with more leeway in coping with a variety of adverse shocks[2]. In line with this remark, we expect the BOJ to position further rate cuts as a backstop measure for dealing with negative exogenous shocks, such as a surge in the yen’s value. However, with the number of measures the BOJ is left with in this prolonged battle having diminished, it would not likely be able to make a move if the yen were merely to breach the ¥100/US$ level. We should note, however, uncertainty about the effectiveness of further rate cuts in correcting yen appreciation on such occasions.

end

c) Report on CHINA

This is now alarming:  China`s TED spreads are blowing out as banks are now afraid to lend to one another and a huge dollar shortage.

(courtesy zero hedge)

China’s Blowing Out TED-Spread Has Traders Bracing For A Cash Shortage

This past July, we lamented that as a result of the now implemented money market reform which sent Libor soaring, Wall Street had lost one of its most dependable, forward-looking crisis indicators: the TED-Spread (the difference between LIBOR and 3 month TSYs), something which Bloomberg also figured out last week.

Specifically, we said that “now the regulatory intervention is set to pressure what have traditionally been reliable metrics indicative of funding stress and systemic risk, among them swap spreads, the TED-Spread and the FRA-OIS spread, the market is about to lose the last metric indicative of underlying tensions. After all, with central bank intervention having broken all conventional signalling pathways, including equities, corporate bonds, Treasuries, and VIX, there will no longer be any reliable sources hinting at fundamental risk in the market, certainly for the short-term and perhaps over an indefinite amount of time.”

However, one place where the TED spread – ironically – is still a valid indicator of liquidity concerns, is oddly enough China. And it is in China where traders in the local interest-rate swap market are bracing for a cash shortage as a result of the blowout in the premium for the 1-year swap rate over the 1-year sovereign bond yield to 52 basis points, the widest since July 2015.

As Bloomberg reminds us, this is China’s version of the familiar TED spread, which in the US is (or rather was) a gauge of stress that compares funding costs for banks and the government.

“This is a signal in the market that swap traders are readying for tighter liquidity as the government tries to prevent a property bubble,” said Iris Pang, senior economist for Greater China at Natixis Asia Ltd. in Hong Kong. “Further tightness may be very limited because the PBOC doesn’t want to put financial stress on the market.

The good news: it is still well below the 140 basis points reached during the trust finance crackdown of early 2014. The bad news is that as reported last week, China has just launched a new crackdown, this time on on the infamous Wealth-Managemnt Products, shadow banking conduits which amount to just under $1.9 trillion in products, the immediate result of which has been the recent 10% surge in bitcoin. Which means that should absent another liquidity injections elsewhere, the drought is set to get far worse.

The recent, sharp move in the swap spread is the result of market concerns that the government is seeking to crackdown on the local housing bubble:

The fixed cost to receive the seven-day repurchase rate for a year climbed to an 18-month high on concern the People’s Bank of China will tighten its purse strings after property prices surged 40 percent in Shanghai last month from a year earlier.  The one-year swap rate reached 2.73 percent on Friday in Shanghai, matching the highest level since April 2015, while the seven-day repo rate reached a one-month high on Thursday. The one-year sovereign yield was at 2.19 percent, heading for a third annual decline.

Making matters worse, China Securities Journal reported on its front page that finance companies need to prepare for “tight days” as monetary policy shifts to focus on deleveraging.

The “good” news from this upcoming liquidity shortage, is that China’s government bond yields, already near all time lows, are set to drop even further, as bond investors – who assume the market’s reaction to a Chinese growth slowdown is similar to that in the US – are preparing to benefit from the slower economic growth that may result. “Any decline in real estate activity is likely to dent growth in the world’s second-largest economy, providing a tailwind for government bonds”, according to ING and DBS.

And while it is all connected, the liquidity shortage, the drop in yields, and the rising swap spreads, the cash squeeze also reflects the flight from a weakening yuan. While China’s SAFE reported that 44.7 billion in yuan payments left the nation last month, up from August’s outflow of $27.7 billion, Goldman’s calculation was nearly double that, or some $78 billion in September outflows. As a result of the return of China’s banking sector bogeyman, which as we reported last week just hit a staggering 200 trillion yuan

… the Chinese currency continued to slide this past week, bringing its drop against the dollar to 4.2% YTD, the most among 11 Asian currencies tracked by Bloomberg.

How should one trade this reacceleration in Chinese capital outflows, Yuan devaluation and overall economic deterioration? One way, as Kyle Bass has done, is to short the Yuan outright, and in size. Another, as we did last September, and as Corriente’s MarK Hart discussed in February, is simply to go long bitcoin – a trade that has returned over 200% in just over a year.

Of course, one doesn’t have to trade it at all: sitting back and watching events unfold may be just as satisfactory.

end

Another alarming commentary.  China`s debt this year has grown by 4.5 trillion uSA.  This growth has basically kept the world`s global economy moving somewhat.  When this stops all hell with break loose: a huge deflationary spiral

(courtesy zero hedge)

“China’s Debt Has Grown $4.5 Trillion In Past 12 Months, More Than The US, Japan And Europe Combined”

While concerns about China’s debt load, capital flows, and depreciating currency have been pushed to the backburner in recent months, perhaps facilitated by a welcome rebound in global inflation – perceived by markets and global central bankers that monetary policy is finally working –  it is worth a quick reminder of how we got here.

First, a quick trip through memory lane to remind us how much has changed in just the past year.

In a note by Morgan Stanley’s Chetan Ahya released on Sunday, the strategist reminds us that a little more than a year ago, the global economy was facing intense disinflationary pressures. Global commodity prices were declining significantly and the slowdown in China and other major commodity-producing EMs had led to some concerns that it could pull developed markets into recession and drag inflation down along with it. At the same time, in China, producer prices fell by almost 6%Y and the regime change in its currency management approach meant that China was no longer absorbing disinflationary pressures from abroad.

And while this seems like a distant memory today, thanks to China which has played a pivotal role in driving the global inflation cycle – this time on the upside – as the cyclical recovery has both lifted China’s own inflation and transmitted it globally, here is how this happened: the recovery in China has been driven by yet another round of debt indulgence. Debt in China has grown by US$4.5 trillion over the past 12 months, by far the highest amount of debt creation globally as compared to US$2.2 trillion in the US, US$870 billion in Japan and US$550 billion in the euro area. Indeed, China on its own has added more debt than the US, Japan and the euro area combined.

While we have shown the IIF’s forecast of Chinese debt countless times in recent months, here it is once again to put China’s unprecedented debt expansion in context:

Furthermore, as we noted last week, for the first time Chinese domestic debt liabilities crossed the 200 trillion yuan threshold, just shy of $20 trillion. This has been driven primarily as a result of an exponential increase in Chinese corporate debt which has grown from $4.5 trillion in 2008 to over $17 trillion as of 2016, even as Chinese GDP growth has been cut in half from 12% to 6% as trillions in non-performing loans – by some estimates as much as 20% of total loans – clog up the debt-growth transmission machinery.

For now at least, the good news is that this debt creation has at least managed to stoke Chinese inflation, if not so much economic growth. The bulk of the debt creation in China has been diverted towards infrastructure and property markets. This push to domestic demand has provided an uplift to global commodity prices and China’s commodity-related producer price segments, as Morgan Stanley calculates. Higher commodity prices, alongside the improvement in demand, have begun to translate, albeit modestly, into the non-commodity segments of the producer price index.

Outside China, the rise in commodity prices is pushing headline inflation higher in DM too. Given China’s dominant role in the global manufacturing supply chain, the dissipating disinflationary pressures in China’s producer prices should transmit more generally into tradeables (core goods) inflation. Recall that while core services inflation had been holding up well in DM, it was the core goods component which had been the key drag on core inflation.

That said, China is already slamming the brakes (or at least trying) on debt creation as much of these trillions in new debt have found their way into China’s housing market, where prices are growing at a record pace, leading to concerns for Beijing of another out of control housing bubble (which in turn has sent Chinese car sales soaring as the local asset bubble jumps from one asset to another).

And since record debt is what catalyzed the rebound in global inflation, any possibility of a slowdown in China’s debt-creation is being carefully watched. As Morgan Stanley adds, to assess the potential for any overshoot in the cyclical recovery, the key indicator to watch in this context will be China’s property sales. Fundamentally, the economy is still facing the issues of over-investment and excess capacity, which policy-makers are resolving in a gradual approach. These factors point towards a bias that disinflationary pressures will reassert themselves once the effects of the stimulus fade.

Ultimately this all goes to a topic we have discuss frequently, most recently last month, namely China’s credit impulse, which boosts both the economy and inflation expectations in the 1-2 quarter after a massive debt injections, but subsequently leads to a contraction unless offset with even more debt. Schematically, this is shown in the following Goldman chart:

Whether China’s recent debt-fueled growth fades soon is a material issue for the Fed which is set to hike rates in just over a month, a hike which like in December of 2015 may come at a time when the Chinese credit impulse pulls sharply back and lead to the next global deflationary wave just as the US is further tightening financial conditions, leading to a sharp spike in the USD and a substantial decline in the Yuan.

Further, as an indication of how intertwined China’s economic fate is with the rest of the world’s, a senior Australian politician warned, just weeks after the continent celebrated a quarter century of growth without a recession thatChina’s growing debt mountain poses a risk to Australia’s financial stability.”

As the FT summarizes, China is Australia’s largest trading partner, accounting for A$150 billion of two-way trade in 2015. Beijing is also an important foreign investor in Australia, leaving Canberra potentially among the developed nations most exposed to a Chinese downturn. China’s growing debt in its local government and state-owned enterprise sector were potential vulnerabilities that could end up having an impact on the continent, Scott Morrison, Australian treasurer, said in an interview with the Financial Times.

“We are not rose-coloured-glasses optimists about China,” Mr Morrison said. “We have a practical and real appreciation about what some of their vulnerabilities are.”

Australia’s warning on Chinese debt follows concerns expressed by the International Monetary Fund and others, including billionaire George Soros, who have warned that adverse shocks in China fuelled by its rising debt levels could spark contagion and hit countries with a high trade exposure to the country.

“I am not forecasting any change in China but we are very practically minded of the vulnerabilities and what that could convert into — but equally saying they have the capacity to manage it,” he said.

It is courtesy of China, and thus its debt creation, that Australia’s economy is growing at an annual rate of 3.3%, among the highest in the developed world, and has notched up a remarkable quarter of a century of growth without a recession. Surging exports to China have played a key role in enabling its economy to continue growing even during the financial crisis in 2008, when many other countries faltered. Growth has remained robust despite a slump in commodities prices over the past five years.

Should China, whose consolidated debt/GDP is now at or above 300%, feel truly compelled to slow down its debt creation, not just Australia but the rest of the world will feel the consequences.

end

4 EUROPEAN AFFAIRS

ITALY

Another earthquakes whacks Central Italy:a 6.6 magnitude quake:

(courtesy zero hedge)

“It’s As If The Whole City Fell Down” – Towns Collapse After Strongest Quake In 35 Years Hits Italy

On Wednesday, when we reported on the latest set of powerful, shallow quakes to strike central Italy, which themselves were aftershocks of the deadly August 24 earthquake which killed 300 people and injured many more, we quoted Salvatore Mazza, the National Institute of Geophysics and Volcanology who said that “The earthquake today has further disrupted the tectonic plates, and in the coming hours we may see aftershocks of today’s earthquake on top of those from August 24”, and concluded that it is likely that more quakes are coming.

We didn’t have long to wait, and overnight central Italy was hit by another powerful earthquake Sunday, toppling buildings that had recently withstood other major quakes and sending panicked residents back into the streets, but luckily causing no immediate loss of life. That there were no reports of deaths was largely due to the fact that thousands of residents left their homes after two strong jolts last week shook the same mountainous area.

As AP reports, the quake with a preliminary magnitude of 6.6 was the strongest to strike the country in nearly 36 years. 

Some 20 people were injured, many lightly, authorities said.

The Apennine Mountain region of central Italy, located along a major fault line, has been the site of dozens of significant earthquakes, including an Aug. 24 quake with a 6.1 magnitude that killed nearly 300 people.  Back-to-back jolts on Wednesday left thousands more people homeless, but the only death reported resulted from a heart attack.

Closest to the epicenter was the ancient city of Norcia, the birthplace of St. Benedict, the father of monasticism and famed for its Benedictine monastery. Witnesses said the 14th Century St. Benedict cathedral collapsed in the quake, with only the facade still standing.

It’s as if the whole city fell down,” Norcia city assessor Giuseppina Perla told the ANSA news agency. The city’s ancient walls suffered damage, as did another famous Norcia church, St. Mary Argentea, known for its 15th century frescoes.

“It is since 1980 that we have had to deal with an earthquake of this magnitude,” Fabrizio Curcio, the head of Italy’s Civil Protection agency, said. Curcio was referring to a 6.9 magnitude quake in a different region that includes Naples that killed some 3,000 people and caused extensive damage in November 1980.

Residents already rattled by a constant trembling of the earth rushed into piazzas and streets after being roused from bed by Sunday’s 7:40 a.m. quake. It was felt as far north as Salzburg, Austria and all the way down the Italian peninsula to the Puglia region, the heel of the boot.

Curcio said authorities were responding with helicopters to help the injured and monitor collapses, as many roads were blocked by landslides. Some 3,600 people had already been relocated, many to the coast, following last week’s quake, and Curcio said more would follow.

Television images showed nuns rushing into the main piazza of Norcia as the bell tower appeared on the verge of collapse. Later, nuns and priests knelt in prayer in the main piazza, and a firefighter appealed to a priest to help keep residents calm in an effort to prevent them from looking for loved ones.

: Firemen assisting nuns in Norcia after 6.6M eartquake

Cited by AP, the town’s deputy mayor, Pierluigi Altavilla, said his house remained standing, but everything inside had been toppled. “It seemed like a bomb exploded inside the house,” he told Sky TG24.The quake comes during a long holiday weekend in Italy going into Tuesday’s All Saint’s Day, when Catholics honor the dead. The head of the church in Umbria, Cardinal Gualtiero Bassetti, urged priests not to hold Masses during the period inside churches, for fear of further collapses, but in open spaces, ANSA reported.

Adding drama to the event, mayors in some towns, including Castelsantangelo sul Nera, said coffins had been pushed out of their resting place inside the walls of cemeteries, which in Italy are typically walled structures into which coffins are laid.

“The scene is indescribable,” Mayor Mauro Falcucci told ANSA.

The quake struck a cluster of mountain towns, many of historic significance, already reeling from last week’s pair of aftershocks to last August’s deadly quake, including Norcia, Visso, Castelsantangelo sul Nero and Preci.

Some towns and smaller settlements were left isolated by landslides that blocked the roads, and the civil protection authority was responding with helicopters to help the injured, while also monitoring damage. A civil protection official in the Marche region, Cesare Spuri, said they were trying to determine if people were trapped under downed debris. New collapses also were reported throughout the region, including in Tolentino, where the news agency ANSA said three people were extracted from the rubble.

The hilltop town of Camerino, some 60 kilometers from Ancona, suffered new building collapses but no reports of injuries. City spokesman Emmanuele Pironi said the main fire hall had been rendered uninhabitable and that they had transferred to a warehouse. “An hour and a half after the quake, we can be reassured,” Pironi told The Associated Press.

* * *

The mayor of quake-hit Ussita said a huge cloud of smoke erupted from the crumbled buildings. “It’s a disaster, a disaster!” Mayor Marco Rinaldi told ANSA. “I was sleeping in the car and I saw hell.”

The dramatic statements continued: in Arquata del Tronto, which had been devastated by the Aug. 24 earthquake that killed nearly 300 people, Arquata Mayor Aleandro Petrucci said, “There are no towns left.”

“Everything came down,” he said.

The quake sent boulders raining onto state highways and smaller roads, forcing closures throughout the quake zone that was impeding access to hard-hit cities such as Norcia. Traffic was being diverted to other roads. The Salaria highway, one of the main highways in the region, was closed at certain points as it was after Wednesday’s quakes.

In addition, Italy’s rail line said some local lines in Umbria and Le Marche were closed as a precaution. The quake forced the temporary closure of some of Rome’s most important tourist sites, including the presidential palace, so authorities could check for damage.

The St. Paul Outside the Walls basilica was closed for several hours after some plaster fell, but was later reopened. Vatican firefighters conducted checks at St. Peter’s Basilica and the Vatican’s other basilicas but found no damage.

The crowds in St. Peter’s Square interrupted Pope Francis with applause when he mentioned the quake during his weekly Sunday blessing.

“I’m praying for the injured and the families who have suffered the most damage, as well as for rescue and first aid workers,” he said.

The European-Mediterranean Seismological Center put the magnitude of Sunday’s earthquake at 6.6 or 6.5 with an epicenter 132 kilometers northeast of Rome and 67 kilometers east of Perugia, near the epicenter of last week’s temblors. The U.S. Geological Survey put the magnitude at 6.6. To date, Italy’s deadliest quake in recent history remains the 1908 Messina quake that destroyed the Sicilian city and killed tens of thousands of people.

The worst news for central Italian residents is that the worst is likely not over yet: aftershocks with magnitudes of up to 4.5 still reportedly rock the region.

Italy’s National Commission for the Forecast and Prevention of Major Risks (CGR) cautioned Friday that more powerful earthquakes could hit the region in the nearest future, identifying at least three areas at risk for further seismic activity.

“There is no current evidence that the (seismic) sequence underway is coming to an end,” the commission warned.

 

end

ENGLAND

Mark Carney stays on as Governor of the Bank of England.  The pound hardly moves:

(courtesy zero hedge)

 

Mark Carney Announces He Will Remain At The Bank of England Until June 2019

Seeking to end speculation about whether or not the governor of the BOE would announces an early departure this week, moments ago the BOE issued a statement from Mark Carney, in which the head of the central bank made it clear that he would extend his term until the end of June 2019, putting any speculation about his early resignation to rest.

From the Bank of England

Governor Mark Carney makes announcement on his term
31 October 2016

 

In a letter to the Chancellor, published this evening (Monday 31 October), the Governor said he would extend his term to the end of June 2019.

 

The Governor said:

 

“I would be honoured to extend my time of service as Governor for an additional year to the end of June 2019. By taking my term in office beyond the expected period of the Article 50 process, this should help contribute to securing an orderly transition to the UK’s new relationship with Europe.

 

It is an honour and a privilege to serve in this important role. I deeply appreciate your support, that of the Prime Minister, and that of colleagues at the Bank, and I look forward to continuing to promote the good of the people of the United Kingdom during this crucial time for the country.”

 

In his reply, the Chancellor said:

 

“I am very pleased to hear that you intend to continue as Governor of the Bank of England until the end of June 2019. This will enable you to continue your highly effective leadership of the Bank through a critical period for the British economy as we negotiate our exit from the European Union.”

The BOE also provided link to Carney’s letter to the Chancellor, and the letter back from the Chancellor to the Governor. The former is below:

While cable moved modestly higher in kneejerk reaction to the news, it is now largely unchanged.

END

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

USA orders family members of the Istanbul Consulate (employees) to leave Turkey immediately as Erdogan is asking for the death penalty for the plotters. Remember Turkey has moving closer to Russian now

(courtesy zero hedge)

US Orders Family Members Of Istanbul Consulate Employees To Leave

Tensions in Turkey are heating up again.

In a move that is will again infuriate Europe, today Turkish President Recep Tayyip Erdogan said his government would ask parliament to consider reintroducing the death penalty as a punishment for the plotters behind the July coup bid. “Our government will take this (proposal on capital punishment) to parliament. I am convinced that parliament will approve it, and when it comes back to me, I will ratify it,” Erdogan said at an inauguration ceremony in Ankara.

“Soon, soon, don’t worry. It’s happening soon, God willing,” he said, as crowds chanted: “We want the death penalty!”

Capital punishment was abolished in Turkey in 2004 as the nation sought accession to the European Union. After the failed bid to unseat Erdogan on July 15, the leader had threatened to bring the death penalty back for the coup plotters, stunning EU leaders.

Relations between Brussels and Ankara have been strained since Turkey responded to the coup by launching a relentless crackdown against alleged plotters in state institutions, amid calls from the EU to act within the rule of law. Tens of thousands of staff within the military, judiciary, civil service and education have been dismissed or detained in a crackdown.

Meanwhile, with EU relations at rock bottom, on Saturday, Erdogan scoffed at the West’s warnings on the reintroduction of the death penalty.

“The West says this, the West says that. Excuse me, but what counts is not what the West says. What counts is what my people say,” he said, during a ceremony to inaugurate a high-speed train station in the Turkish capital.

* * *

And in a separate move, which may be linked to the escalation in tensions, this afternoon the US Embassy in Istanbul ordered the families of employees to depart, and  also advised U.S. citizens to avoid travel to southeast Turkey and “carefully consider the risks of travel to and throughout the country.”

Full Travel Warning:

The U.S. Department of State continues to warn U.S. citizens of increased threats from terrorist groups throughout Turkey.  U.S. citizens should avoid travel to southeast Turkey and carefully consider the risks of travel to and throughout the country.  The U.S. Department of State is updating this Travel Warning to reflect the October 29, 2016, decision to order the departure of family members of employees posted to the U.S. Consulate General in Istanbul, Turkey.  The Department of State made this decision based on security information indicating extremist groups are continuing aggressive efforts to attack U.S. citizens in areas of Istanbul where they reside or frequent.  The Consulate General remains open and fully staffed.

This order applies only to the U.S. Consulate General in Istanbul, not to other U.S. diplomatic posts in Turkey.  The Department continues to monitor the effect of these developments on the overall security situation in the country. This replaces the Travel Warning dated October 24, 2016.

The Governor of Ankara, acting under the authority of the recently-extended state of emergency, and on the basis of reported terrorist threats against cities in Turkey, has banned all demonstrations in Ankara province until November 30. The Department continues to monitor the effects of the ongoing state of emergency; recent terrorist incidents in Ankara, Istanbul, Gaziantep, and throughout the Southeast; recurring threats; visible increases in police or military activities; and the potential for restrictions on movement as they relate to the safety and well-being of U.S. citizens in Turkey.  Delays or denial of consular access to U.S. citizens detained or arrested by security forces, some of whom also possess Turkish citizenship, continue.

Foreign and U.S. tourists have been explicitly targeted by international and indigenous terrorist organizations in Turkey.  In the past year, extremists have carried out attacks in France, Belgium, Germany, Mali, Bangladesh, Tunisia, and Turkey.  Additional attacks in Turkey at major events, tourist sites, restaurants, commercial centers, places of worship, and transportation hubs, including aviation services, metros, buses, bridges, bus terminals and sea transport, could occur.  Extremists have also threatened to kidnap and assassinate Westerners and U.S. citizens.  U.S. citizens are reminded to review personal security plans, monitor local news for breaking events, and remain vigilant at all times.

U.S. Government personnel in Turkey remain subject to travel restrictions in the southeastern provinces of Hatay, Kilis, Gaziantep, Sanliurfa, Sirnak, Diyarbakir, Van, Siirt, Mus, Mardin, Batman, Bingol, Tunceli, Hakkari, Bitlis, and Elazig.  In particular, the U.S. Mission to Turkey may prohibit movements by its personnel to these areas on short notice for security reasons, including threats and demonstrations.  Due to recent acts of violence, such as the August 20 suicide bombing in Gaziantep, the September 12 bombing in Van, and the potential for reprisal attacks due to continued Turkish military activity in Syria, U.S. citizens are urged to defer travel to large, urban centers near the Turkish/Syrian border.  Finally, the Government of Turkey has closed its border with Syria.  Border crossings from Syria into Turkey are prohibited, even if the traveler entered Syria from Turkey.  Individuals seeking emergency medical treatment or safety from immediate danger are assessed on a case by case basis

end

6. GLOBAL ISSUES

7. OIL ISSUES

It sure looks like the oil freeze deal is over

(courtesy zero hedge)

Oil Tumbles To 1-Month Lows As OPEC Deadlock Shatters Deal Hopes

Confirming the swirling rumors from Friday, WTI crude is leaking lower (near $47 handle) in early asia trading afer Bloomberg reports OPEC’s internal disagreements over how to implement oil-supply cuts agreed to last month prevented a deal to secure the cooperation of other major suppliers.

More than 18 hours of talks over two days in Vienna yielded little more than a promise that the world’s largest oil producers would keep on talking. Discussions will continue in late November, just days before the Organization of Petroleum Exporting Countries is supposed to finalize the accord that lifted oil prices to one-year highs.

Non-OPEC nations ended talks with the group on Saturday without making any supply commitments, Brazil’s Oil and Gas Secretary Marcio Felix said after the meeting. Brazil won’t restrict its oil production, though it’s willing as early as next year to host future OPEC conferences with the world’s biggest producers, he said in a phone interview.

A deal wasn’t possible because internal OPEC talks on Friday reached an impasse over the role of Iran and Iraq, both of which want to be exempt from any cuts. While non-member Oman said Saturday it was willing to cooperate in a supply deal, it couldn’t commit to a specific output cut until OPEC had its own agreement.

read more here…

And WTI is extending Friday’s losses…

As OilPrice.com’s Julianne Geiger noted, in a tweet late in the afternoon on Friday, the Wall Street Journal’s financial reporter, Georgi Kantchev, said that OPEC’s technical meeting in Vienna was in deadlock, with Iraq and Iran disputing data on the grounds that OPEC has underestimated their production.

A separate tweet moments later stated that Iraq and Iran “refuse” to freeze their output, according to WSJ sources.

The news that Iraq and Iran may be refusing to freeze may disappoint the markets, but it is not shocking, and follows a pattern we’ve seen unfolding for quite some time.

Most recently, Iraq insisted on Sunday that it should be exempt from any OPEC cuts that were being discussed on the grounds that it needed to maintain production while it continued its fight against Islamic State. At the time, Iraq had scared the markets, not by refusing to take part in OPEC cuts that are said to be finalized on November 30, but by mentioning that it should be producing some 9 million barrels per day were it not for the war, pointing out that other countries had taken a chunk of its previously held market share.

But before that, Iraq and Iran had decided not to send their oil ministers to the OPEC meeting in Istanbul the week of October 10, in a sign that not all OPEC members were on board weeks ago.

But Iraq showed its displeasure at the deal all the way back in late September, when it began to question the method in which OPEC calculated production figures—production figures that would be used to determine who would cut what.

Meanwhile, OPEC long ago implied that Iran would receive some type of pass, with Saudi Energy Minister Khalid al-Falih saying back in late September that Iran, Nigeria, and Libya would be allowed to produce “at maximum levels that make sense”—whatever that means.

So if what the WSJ sources are saying is true, and Iraq and Iran are indeed flat-out refusing to freeze their output, this changes nothing other than to offer up some level of certainty to the market. The OPEC deal was on shaky ground from the beginning, and today, it remains on more solid ground that the deal will likely be a no-go.

Although some had hoped that Iraq would join in, the likelihood that they would give up even more market share than what it already lost was always quite slim.

This leaves Saudi Arabia, OPEC’s #1 producer, and the United Arab Emirates, OPEC’s #4 producer, holding most of the bag. If OPEC is still committed to cut between 200,000 and 700,000 bpd—and if OPEC grants Iraq—OPEC’s #2—and Iraq—OPEC’s #3—a pass, then Saudi Arabia and UAE should get ready to hunker down and take the brunt of the cuts, or resign themselves to the fact that a cut just isn’t feasible, with two of OPEC’s top four producers are not ready to take part.

*  *  *

So what happens next?

Chart: Bloomberg

end

8. EMERGING MARKETS

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

 

Euro/USA   1.0947 DOWN .0035/REACTING TO NO DECISION IN JAPAN AND USA + huge Deutsche bank problems 

USA/JAPAN YEN 105.03  UP .394(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 AND DECISION ON SEPT 21 DISAPPOINTS WITH STIMULUS/OPERATION REVERSE TWIST

GBP/USA 1.2153 DOWN.0018 (Brexit by March 201/pound clobbered)

USA/CAN 1.3388 DOWN .0002

Early THIS MONDAY morning in Europe, the Euro FELL by 35 basis points, trading now JUST above the important 1.08 level RISING to 1.0947; 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,  THE USA’S NON tightening by FAILING TO RAISE THEIR INTEREST RATE AND NOW THE HUGE PROBLEMS FACING TOO BIG TO FAIL DEUTSCHE BANK / Last night the Shanghai composite CLOSED DOWN 3.78 OR   0.12%   / Hang Sang  CLOSED D0WN 20.27 OR 0.16%   /AUSTRALIA IS HIGHER BY 0.59% / EUROPEAN BOURSES ALL IN THE RED

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 21.39 POINTS OR 0.16%

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

2/ CHINESE BOURSES / : Hang Sang CLOSED DOWN 20.27 OR 0.09%   ,Shanghai CLOSED DOWN 3.78 POINTS OR 0.12%   / Australia BOURSE IN THE GREEN /Nikkei (Japan)CLOSED IN THE RED/  INDIA’S SENSEX IN THE RED

Gold very early morning trading: $1273.90

silver:$17.83

Early MONDAY morning USA 10 year bond yield: 1.843% !!! DOWN 1 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  2.611, DOWN 1 IN BASIS POINTS  from FRIDAY night.

USA dollar index early MONDAY morning: 98.56 UP 22 CENTS from FRIDAY’s close.

This ends early morning numbers MONDAY MORNING

END

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And now your closing MONDAY NUMBERS

Portuguese 10 year bond yield: 3.32% DOWN 2 in basis point yield from FRIDAY  (does not buy the rally)

JAPANESE BOND YIELD: -.048% up  1 in   basis point yield from  FRIDAY

SPANISH 10 YR BOND YIELD:1.20%  DOWN 3 IN basis point yield from  FRIDAY (this is totally nuts!!/

ITALIAN 10 YR BOND YIELD: 1.66 UP 8  in basis point yield from FRIDAY 

the Italian 10 yr bond yield is trading 44 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: +.164% down 1  IN  BASIS POINTS ON THE DAY

END

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IMPORTANT CURRENCY CLOSES FOR MONDAY

Closing currency crosses for MONDAY night/USA DOLLAR INDEX/USA 10 YR BOND YIELD/3.00 PM

Euro/USA 1.0973 DOWN .0009 (Euro DOWN 9 basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 104.750 UP: 0.150(Yen DOWN 15 basis points/POLICY ERROR ON BANK OF JAPAN/

Great Britain/USA 1.2242 UP 0.0071( POUND UP 71 basis points

USA/Canada 1.3409 UP 0.0019(Canadian dollar DOWN 19 basis points AS OIL FELL TO $46.76

 

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This afternoon, the Euro was DOWN by 9 basis points to trade at 1.0971

The Yen FELL to 104.75 for a LOSS of 15 basis points as NIRP is STILL a big failure for the Japanese central bank/HELICOPTER MONEY IS NOW DELAYED/BANK OF JAPAN NOW WORRIED AS AS THEY ARE RUNNING OUT OF BONDS TO BUY AS BOND YIELDS RISE  /OPERATION REVERSE TWIST ANNOUNCED SEPT 21.2016

The POUND ROSE 71 basis points, trading at 1.2242/

The Canadian dollar FELL by 19 basis points to 1.3409, AS WTI OIL FELL TO :  $46.76

The USA/Yuan closed at 6.7735 (SENDING DEFLATION AROUND THE WORLD)

the 10 yr Japanese bond yield closed at -.048%  DOWN 1 POINTS  IN BASIS POINTS / yield/ AND THIS IS BECOMING BOTHERSOME TO THE BANK OF JAPAN

Your closing 10 yr USA bond yield DOWN 3   IN basis points from FRIDAY at 1.825% //trading well below the resistance level of 2.27-2.32%) very problematic  USA 30 yr bond yield: 2.58 DOWN 4  in basis points on the day /

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

Your closing USA dollar index, 98.35 UP 2 CENTS  ON THE DAY/3 PM 

Your closing bourses for Europe and the Dow along with the USA dollar index closing and interest rates for MONDAY: 2:30 PM EST

London:  CLOSED DOWN 42.04 POINTS OR 0.60%
German Dax :CLOSED DOWN 31.18 OR  0.29%
Paris Cac  CLOSED DOWN 39.32 OR 0.86%
Spain IBEX CLOSED DOWN 58.10 OR 0.63%
Italian MIB: CLOSED DOWN 199.18 POINTS OR 1.15%

The Dow was DOWN 18.77 points or 0.10%  4 PM EST

NASDAQ  DOWN 0.97 points or 0.02%  4 PM EST
WTI Oil price;  46.76 at 4:00 pm; 

Brent Oil: 48.53   4:00 EST

USA DOLLAR VS RUSSIAN ROUBLE CROSS:  63.37(ROUBLE DOWN 47/100 ROUBLES PER DOLLAR FROM THURSDAY)  2:30 EST

TODAY THE GERMAN YIELD FALLS  TO +0.164%  FOR THE 10 YR BOND  2:30 EST

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:$46.78

BRENT: $48.53

USA 10 YR BOND YIELD: 1.825%

USA DOLLAR INDEX: 98.35 UP 2  cents

The British pound at 5 pm: Great Britain Pound/USA: 1.2242 up .0071 or 71 basis pts.

German 10 yr bond yield at 5 pm: +.164%

END

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

TRADING IN GRAPH FORM

The Real October Surprise: Stocks, Bonds, Gold, & Oil All Dump As The Dollar Jumps

Anyone else feel like this?

 

On the month, everything ended in the red

  • Bonds worst month since Feb 2015
  • Stocks worst month since Jan 2016
  • USD Index best month since Nov 2015

This is the first time since Aug 2015 (and the china devaluation crash) that stocks and bonds both closed red on the month. Note that Oil, Bonds, and Gold just happened to all end down around 3.3% on the month…

 

Which is interesting since the USD Index rose 3.1% on the month… its best month since Nov 2015…

 

Risk-Parity deleveraging was the key factor with the funds suffering their worst month since Nov 2015…

 

And a surge in December rate hike odds…

*  *  *

Since Comey dropped his bombshell, bonds & bullion are bid, stocks and oil are not…

 

Stocks scrambled back to unch on the day (with Trannies surging as crude plunged) but faded into the close…

 

S&P remains on the cliff edge…

 

VIX ended the month above 17 (highest monthly close since Feb)… The closing ramp has disappeared…

 

After 5 straight down days, VIX is now up 5 straight days…

 

The USD index was very modestly higher on the day with Cable strength (Comey staying) offset buy weakness in the other majors…

 

Treasury yields fell on the day (flattening with 30Y -3bps)…

 

Leaving the 10Y yield back at 5 month highs…

 

Crude was ugly on the day as copper and silver gained most (and gold inched higher)…

 

WTI Crude crashed to a $46 handle…

 

end

 

On Friday, you heard the very important story that Comey went to Congress with a letter stating that he was reopening the case.   There are many stories over the weekend, and I will give you the important chronological  events.  In the conclusion you will see that the emails now discovered on Weiner`s computer will be very harmful to Clinton and may affect the Presidency:

Saturday

Raoul Meijer:Part i

The FBI has of this point in time did not have the right to view the emails

(courtesy Raul Meijer)

Throw Huma Under The Bus?

Submitted by Raul Ilargi Meijer via The Automatic Earth blog,

There is so much in innuendo and guesses and biased opinion floating around on this ‘morning after’ the Comey bombshell that the only option we have is to read and watch a ton of stuff and see what sticks. One thing that definitely should stick was published late last night by Paul Sperry for the New York Post.

He scores a solid and massive point that looks as damning for the FBI itself (or at least the superiors), as it does for Hillary Clinton. It is, in that regard, perhaps telling that one of the alleged reasons whispered for FBI director Jim Comey to come forward on Friday is that he feared details of the probe would otherwise be leaked to the press.

Sperry’s point: the emails that are at the center of Friday’s announcement that Hillary Clinton ‘s entire email server investigation will be re-opened -whether formally or not is moot-, were obtained by seizing devices from Anthony Weiner in relation him sexting to a 15-year old girl.

And seizing devices was exactly what was never done in Hillary’s case, though “agents assigned to that case knew Abedin hoarded classified emails on her electronic devices.”They were seized neither from Hillary nor from her closest aide Huma Abedin, who now probably- and probably rightly- fears that she may be thrown under the bus at the first convenient moment.

Hillary doesn’t appear to know what exactly is on the Weiner/Abedin device, but her staff is undoubtedly preparing a defense based on Hillary denying she knew anything about what emails Huma kept and/or sent. Such a defense may well be useless, depending on the contents of the mails. But by now it’s full blown panic danger control in the campaign.

While at the FBI the mood may now be that a second consecutive investigation that would end in a second consecutive ‘dismissal’ would be unacceptable to -a lot of- agents. Something Comey is undoubtedly painfully aware of. His ‘own people’ may have given him an ultimatum: either you do it right this time, or we will.

A few bits from Paul Sperry’s piece:

On page 3 of their 11-page report, the agents detail how they showed Abedin a classified paper on Pakistan sent from a State Department source which she, in turn, inexplicably forwarded to her personal Yahoo email account — an obviously unclassified, unencrypted, unsecured and unauthorized system. The breach of security was not an isolated event but a common practice with Abedin.

This is one of those things that Hillary will likely try to plead innocence on. Not that that should be good enough: the server, illegal as it may have been, was still her responsibility. That either she herself or Abedin would play fast and loose with the confidentiality and classification of the material involved, on top of using a server whose very existence played fast and loose with the law, is the kind of thing that disqualifies her from public office, let alone the presidency.

Hillary’s ‘defense’ has been ‘I made a mistake’, and that was enough for her, for Comey, and for the entire American media. It’s still hard to believe. And it certainly doesn’t look like it will be enough a second time. Just imagine what some FBI agents must have thought when they found out, and when Comey subsequently decided to hush the case.

“She routinely forwarded emails from her state.gov account to either her clintonemail.com or her yahoo.com account,” the agents wrote. Why? “So she could print them” at home and not at her State Department office. Abedin contended that she “would typically print the documents without reading them” and “was unaware of the classification.” Uh-huh.

The FBI also pointed out that “the only person at DoS (Department of State) to receive an email account on the (clintonemail.com) domain was Abedin.” “Multiple State employees” told the FBI that they considered emailing Abedin “the equivalent of e-mailing Clinton.” Another close Clinton aide told the FBI that “Abedin may have kept emails that Clinton did not.”

The phrase “the equivalent of e-mailing Clinton” says a lot about how closely the two worked together. And that in turn says something about the odds that Huma acted alone, without Hillary knowing.

In her April interview with the FBI, Abedin incredulously maintained that she “did not know that Clinton had a private server until about a year and a half ago, when it became public knowledge.” [..] .. another witness told agents that he and another Clinton aide with computer skills built the new server system “at the recommendation of Huma Abedin,” who first broached the idea of an off-the-grid email server as early as the “fall (of) 2008.”

So if you believe Abedin, she didn’t know the private clintonemail.com server that hosted her huma@clintonemail.comaccount even existed until she heard about it in the news. Comey was a believer; he didn’t even bother to call her back for further questioning. Case closed.

Yes, Huma knew the server existed, long before she admitted knowing it. That’s a bold faced lie. But wait, didn’t she get immunity? Apparently perhaps not officially (?!), but FBI agents seriously suspect she did:

During research, FBI assets and federal law enforcement sources concluded the only way Abedin could have walked away from the probe without criminal charges was because her legal team struck a secret immunity deal with Justice. “She has a deal in place or (FBI Director James) Comey and (Attorney General Loretta) Lynch let her just walk out the door,” a FBI source said.

Wait a minute! Anybody seen Loretta Lynch lately? Did she know Comey would make his announcement Friday? She’s his boss…

If Huma knew the server existed when she said she did not know, it’s 99% sure Anthony Weiner knew it, too. Which is important in more than one way. They shared at least one device, which means he had access to classified material. That in itself is highly illegal. And in the -year long- first stage of the probe, FBI agents knew this, or could have suspected it, and asked Huma for details. Apparently, that didn’t happen.

Perhaps even more important, Weiner is a huge and obvious risk as a blackmail target. For all we know, he may have already provided classified files to parties threatening to go public with photos he sent exposing his weiner to underage girls.

Was the clinton email server hacked? So far the word is there’s no proof of that, but… Did Huma delete and/or bleach-bit information on her devices the same way Hillary did? We can’t know, because despite Huma’s obvious untruths, these devices were not seized for the earlier investigation.

Why? We can only guess. But to quote Hillary from last night (albeit on a slightly different topic): “your guess is as good as mine, and that’s not good enough”.

What we do know is that, obviously, there is still enough material left for the FBI to re-open the case. They may have found as many as tens of thousands of mails belonging to Huma (well, actually, to the US government) on Weiner’s laptop.

[..] Abedin’s role in this caper begs for fresh scrutiny. Making false statements to a federal agent is a felony. So is mishandling classified information. By forwarding classified emails to her personal email account and printing them out at home, Abedin appears to have violated a Classified Information NonDisclosure Agreement she signed at the State Department on Jan. 30, 2009, in which she agreed to keep all classified material under the control of the US government.

Classified emails sent to an unprotected server and printed out at home. How dumb exactly is Huma Abedin? And how dumb does all this make Hillary?

Let’s see if Comey puts the screws to Abedin and leverages her for information on her boss. If he agrees to cut another immunity deal, we’ll know the fix is still in.

Will the media propaganda caravan now turn on Hillary to save its face? I would predict perhaps not immediately, since they bet a lot on their horse. But give it a few days and they may conclude it’s high time to cut their losses. And so may a lot of other parties involved.

The thumbscrews put on Huma this morning by the campaign must be hurting. Can she cut another immunity deal or will she end up under the bus?

 

 

end

 

Sunday:

The USA tries to throw roadblocks preventing the release of the emails:
(courtesy Raul Meijer)
Part ii

James Comey, American Hero?

 

 

end

 

Sunday;

the problems facing Comey as the Washington field attempts to gain access to thos emails:

(courtesy zero hedge)

Why The DOJ Is Having Trouble Accessing The Thousands Of Huma Abedin Emails Discovered “Weeks Ago”

What has made Friday’s political fiasco – which started with the FBI’s announcement it has reopened its probe into Hillary’s emails – especially chaotic is that, at least officially, few official institutions have had access to the Abedin emails that are at the center of the new probe for various legal reasons as described below, and is the reason why the Clinton Campaign has been so forceful in demanding that the FBI provide additional information into what is contained among the “tens of thousands of emails” found on Anthony Weiner’s notebook, which as the NYT reported was seized on October 3.

Federal authorities had seized four devices from Abedin and her estranged husband Weiner, including a laptop the former congressman used to send the sexual messages to the fifteen-year old girl. According to The New York Post, agents did not read the e-mails seized, because their warrant only covered Weiner’s messages.

This also means that FBI agents knew early this month about the new emails that the agency now says are “pertinent” to the investigation into Hillary Clinton’s private server, but did not brief FBI Director James Comey until late last week. Comey was reportedly told about the new messages on Thursday, The Washington Post reported.

The FBI director said the team should “take appropriate investigative steps designed to allow investigators to review these emails.” The Washington Post reported that it is not clear why the FBI agents waited to brief Comey after discovering in early October the emails in question on a computer it seized in connection with a separate investigation.

The Clinton campaign responded to the news with campaign spokesman Brian Fallon tweeting, “In other words: Comey officially does not know what he is talking about.”

It also explains why as CNN noted moments ago, Justice Department and FBI officials are working to secure approval that would allow the FBI to conduct a full search of Huma Abedin’s newly discovered emails, sources.  Government lawyers haven’t yet approached Abedin’s lawyers to seek an agreement to conduct the search. Sources earlier told CNN that those discussions had begun, but the law enforcement officials now say they have not.

According to CNN sources, government lawyers plan to seek a search warrant from a judge to conduct the search of the computer.  But what makes the issue especially complicated, is that the computer is considered to belong to Anthony Weiner, her estranged husband, and the case may raise spousal privilege legal protections for Abedin. Government lawyers hope to secure the warrant to permit investigators to review the thousands of emails.

The new search warrant is needed because the existing authorization, covered by a subpoena, related only to the ongoing investigation of Weiner, who is accused of having sexually explicit communications with an underage girl.

As previously report, investigators from the FBI’s New York field office who are conducting the Weiner investigation stumbled on the Abedin emails while they were reviewing emails and other communications on the computer, which was considered to belong to Weiner. They stopped their work and called in the team of investigators from FBI headquarters who conducted the probe of Clinton’s private email server. The investigators saw enough of the emails to determine that they appeared pertinent to the previously completed investigation and that they may be emails not previously reviewed.

And because they don’t have a warrant specific to Abedin’s emails, officials have not been able to further examine them. Justice Department and FBI officials view Abedin as cooperative with the investigation.

CNN adds, hopefully, that many of the emails are duplicates of emails they already have reviewed as part of the Clinton email server investigation and whether any of them may contain classified information. Investigators believe it’s likely the newly recovered trove will include emailsthat were deleted from the Clinton server before the FBI took possession of it as part of that earlier investigation.

* * *

But where things get interesting, is that as Daily Caller noted today, while the DOJ has yet to allow the FBI access through a warrant to any of the newly discovered Huma Abedin emails, that may not mean other law enforcement agencies in communication with the FBI did not have access to the new material.

The DC speculates that the New York Police Department, along with the New York U.S. Attorney’s office for the Southern District of New York, led by Preet Bharara, and the U.S. Attorney’s Office in the Western District of North Carolina, may have all very well seen the emails in question when the NYPD’s Special Victims Unit first launched their own investigation into Weiner and his sexually explicit messaging to the teenage girl.

Furthermore, as reported earlier, Anthony Weiner is said to be cooperating with the FBI probe, and as Fox News Channel’s Brett Baier reported, no warrant was necessary for the FBI to search the laptop co-owned by him and Abedin, as Weiner has given permission to the agency to search the device.

I emailed that 2 sources say Weiner is cooperating w/ FBI- & co-owned laptop. Also NY FBI had info 4 a few weeks- pressure was building https://twitter.com/joshrogin/status/792752933892874240 

Additionally, the U.S. Attorneys offices and local law enforcement have access to the FBI laboratory to conduct “scientific examinations of evidence for any federal, state, and/or local law enforcement organization in the United States.”

Ultimately, the question may be not what is in the emails, but who is creating the bottlenecks, and why, and also just how many emails will the FBI have to go pour through seeking potential criminality on Hillary’s behalf before the election. On the other hand, as defenders of Hillary will allege…

Breaking: trove of Abedin emails found wks ago, law enforcement officials tell CNN, raising q’s why info released only days before election

… why – if the Abedin emails were found weeks ago – did the FBI wait just days before the election before the information was released.

 

 

end

 

Presented with no comment…

h/t @Deej_Id

 

 

end

I am running out of popcorn:  there is apparently 650,000 emails found on Weiner’s laptop, and they expect weeks of work. Interestingly the no. 2 man at the FBI is Mccabe, the same fellow who spouse received money from Viriginia’s McAuliffe.

(courtesy zero hedge)

Yesterday, we reported that the FBI has found “tens of thousands of emails” belonging to Huma Adein on Anthony Weiner’s computer, raising questions how practical it is that any conclusive finding will be available or made by the FBI in the few days left before the elections

Now, according to the WSJ, it appears that Federal agents are preparing to scour roughly 650,000 emails that, as we reported moments ago were discovered weeks ago on the laptop of Anthony Weiner, to see how many relate to a prior probe of Hillary Clinton’s email use, as metadata on the device suggests there may be thousands sent to or from the private server that the Democratic nominee used while she was secretary of state, according to people familiar with the matter.

As the WSJ adds, the review will take weeks at a minimum to determine whether those messages are work-related emails between Huma Abedin, a close Clinton aide and the estranged wife of Mr. Weiner, and State Department officials; how many are duplicates of emails already reviewed by the Federal Bureau of Investigation; and whether they include either classified information or important new evidence in the Clinton email probe, which FBI officials call “Midyear.”

And, as we further reported earlier today, the FBI has had to await a court order to begin reviewing the emails, because they were uncovered in an unrelated probe of Mr. Weiner, and that order was delayed for reasons that remain unclear.

More stunning is just how many emails were found on Weiner’s computer. And while one can only imagine the content of some of the more persona ones, the WSJ writes that the latest development began in early October when New York-based FBI officials notified Andrew McCabe, the bureau’s second-in-command, that while investigating Mr. Weiner for possibly sending sexually charged messages to a minor, they had recovered a laptop with 650,000 emails. Many, they said, were from the accounts of Ms. Abedin, according to people familiar with the matter.

Those emails stretched back years, these people said, and were on a laptop that both Mr. Weiner and Ms. Abedin used and that hadn’t previously come up in the Clinton email probe. Ms. Abedin said in late August that the couple were separating.

The FBI had searched the computer while looking for child pornography, people familiar with the matter said, but the warrant they used didn’t give them authority to search for matters related to Mrs. Clinton’s email arrangement at the State Department. Mr. Weiner has denied sending explicit or indecent messages to the teenager.

As reported yesterday, it appears that there are potentially tens of thousands of Abedin linked emails on Weiner’s computer:

In their initial review of the laptop, the metadata showed many messages, apparently in the thousands, that were either sent to or from the private email server at Mrs. Clinton’s home that had been the focus of so much investigative effort for the FBI. Senior FBI officials decided to let the Weiner investigators proceed with a closer examination of the metadata on the computer, and report back to them.

The WSJ then connects the dots between how the Weiner emails were linked to the Clinton reopening of the Clinton probe, despite Loretta Lynch’s and the DOJ’s vocal urges not to do so:

At a meeting early last week of senior Justice Department and FBI officials, a member of the department’s senior national-security staff asked for an update on the Weiner laptop, the people familiar with the matter said. At that point, officials realized that no one had acted to obtain a warrant, these people said.

Mr. McCabe then instructed the email investigators to talk to the Weiner investigators and see whether the laptop’s contents could be relevant to the Clinton email probe, these people said. After the investigators spoke, the agents agreed it was potentially relevant.

Mr. Comey was given an update, decided to go forward with the case and notified Congress on Friday, with explosive results. Senior Justice Department officials had warned Mr. Comey that telling Congress would violate well-established policies against overt actions that could affect an election, and some within the FBI have been unhappy at Mr. Comey’s repeated public statements on the probe, going back to his first press conference on the subject in July.

But wait it gets better.

Recall that this is the same Andrew Mcabe whose wife the Wall Street Journal reported last week received $467,500 in campaign funds in late 2015 from the political action committee of Virginia Gov. Terry McAuliffe, a longtime ally of the Clintons and, until he was elected governor in November 2013, a Clinton Foundation board member.

Mr. McAuliffe had supported Dr. McCabe in the hopes she and a handful of other Democrats might help win a majority in the state Senate, giving Mr. McAuliffe more sway in the state capitol. Dr. McCabe lost her race last November, and Democrats failed to win their majority.

FBI officials have said Mr. McCabe had no role in the Clinton email probe until he became deputy director, and there was no conflict of interest because by then his wife’s campaign was over.

A tangent on the Clinton Foundation probe:

The Washington field office was probing financial relationships
involving Mr. McAuliffe before he became a Clinton Foundation board
member, these people said. Mr. McAuliffe has denied any wrongdoing, and
his lawyer has said the probe is focused on whether he failed to
register as an agent of a foreign entity. The FBI field office in New York had done the most work on the Clinton  Foundation case and received help from the FBI field office in Little Rock, the people familiar with the matter said.

In February, FBI officials made a presentation to the Justice Department, according to these people. By all accounts, the meeting didn’t go well.

Some said that is because the FBI didn’t present compelling evidence to justify more aggressive pursuit of the Clinton Foundation, and that the career public integrity prosecutors in the room simply believed it wasn’t a very strong case. Others said that from the start, the Justice Department officials were stern, icy and dismissive of the case.

“That was one of the weirdest meetings I’ve ever been to,” one participant told others afterward, according to people familiar with the matter.

Needless to say, the probe into the Foundation faded.

But back to the Clinton probe, according to a person familiar with the probes, on Aug. 12, a senior Justice Department official called Mr. McCabe to voice his displeasure at finding that New York FBI agents were still openly pursuing the Clinton Foundation probe, despite the department’s refusal to allow more aggressive investigative methods in the case. Mr. McCabe said agents still had the authority to pursue the issue as long as they didn’t use those methods.

At this point a question emerges: did McCabe seek to defend or press on with a Clinton probe:

Mr. McCabe’s defenders in the agency said that following the call, he repeated the instruction that he had given earlier in the Clinton Foundation investigation: Agents were to keep pursuing the work within the authority they had.

Others further down the FBI chain of command, however, said agents were given a much starker instruction on the case: “Stand down.” When agents questioned why they weren’t allowed to take more aggressive steps, they said they were told the order had come from the deputy director—Mr. McCabe. Others familiar with the matter deny Mr. McCabe or any other senior FBI official gave such a stand-down instruction.

At this point the two probes, into Hillary’s email and the Clinton Foundation converged:

For agents who already felt uneasy about FBI leadership’s handling of the Clinton Foundation case, the moment only deepened their concerns, these people said. For those who felt the probe hadn’t yet found significant evidence of criminal conduct, the leadership’s approach was the right response to the facts on the ground.

Things accelerated over the past two months, when in September, agents on the foundation case asked to see the emails contained on non government laptops that had been searched as part of the Clinton email case, but that request was rejected by prosecutors at the Eastern District of New York, in Brooklyn. Those emails were given to the FBI based on grants of partial immunity and limited-use agreements, meaning agents could only use them for the purpose of investigating possible mishandling of classified information.

Some FBI agents were dissatisfied with that answer, and asked for permission to make a similar request to federal prosecutors in Manhattan, according to people familiar with the matter. Mr. McCabe, these people said, told them no and added that they could not “go prosecutor-shopping.”

Not long after that discussion, FBI agents informed the bureau’s leaders about the Weiner laptop, prompting Mr. Comey’s disclosure to Congress and setting of the furor that promises to consume the final days of a tumultuous campaign

While much of the latest developments are known, or could have been inferred assuming more corruption within government agencies, the punchline is that the weeks if not months of upcoming work means that if Clinton wins the White House, she will likely do so amist at least one ongoing investigation into her inner circle being handled by law-enforcement officials who are deeply divided over how to manage such cases. It also means that Trump will be hounding Hillary for the remainder of the campaign as being the only presidential candidate to seek election with a recently reopened criminal probe hanging over her head.

 

 

end

 

Late Sunday night:

I have ordered in more popcorn! The FBI finally obtains the all important warrant to search Huma Abedin`s computer and emails (also Weiner`s computer)

(courtesy zero hedge)

FBI Obtains Warrant To Search Huma Abedin’s Emails

While we explained earlier today why the DOJ and FBI had found themselves in the awkward position of knowing that Anthony Weiner’s computer contained thousands of Huma Abedin emails sent from Hillary Clinton’s private server, yet were unable to access them, we noted it was only a matter of time before this particular hurdle was rectified. A few hours later, according to CBS’ Jeff Pegues, in the matter of the FBI having much needed access to begin poring over Weiner’s emails, which we now know number roughly 650,000 (and thus will take the FBI months to pore over), the FBI has just obtained the needed warrant.

As NBC confirms, the FBI obtained a warrant to search emails related to the Hillary Clinton private server probe that were discovered on ex-congressman Anthony Weiner’s laptop. The warrant came two days after FBI director James Comey revealed the existence of the emails, which law-enforcement sources said were linked to Weiner’s estranged wife, top Clinton aide Huma Abedin. The FBI already had a warrant to search Weiner’s laptop, but that only applied to evidence of his allegedly illicit communications with an underage girl.

The warrant came moments after Democratic Senate Minority Leader Harry Reid scolded Comey, saying in a letter that he “demonstrated a disturbing double standard for the treatment of sensitive information, with what appears to be clear intent to aid one political party over another.

Reid added that his office determined that Comey may have violated the Hatch Act, which bars government officials from using their authority to influence elections.

The following screengrab from WaPo, perhaps summarizes best how the democrats’ take on things has changed dramatically over the past few weeks:

Meanwhile, the CBS reporter also noted that according to law enforcement sources HumaAbedin Is cooperating and “seemed surprised that emails were there.”

enforcement sources also say Is cooperating and “seemed surprised that emails were there.”

Finally, Pegues also points out that after having fielded much pressure from Democrats for the past 48 hours, FBI Director Comey has been quietly reaching out to members of Congress as pressure mounts on him.

News Director has been quietly reaching out to members of as pressure mounts on him.

So will the FBI promptly announce that nothing of material important was found among Weiner’s emails, or will it now begin a protracted, intensive investigation? Will Comey resign? Will Huma quit from her role in the Clinton campaign? Will Loretta Lynch take some of the blame? We hope to have some of these much needed answers in the coming days as the FBI’s reopened probe begins gaining traction.

 

 

end

 

Comey has received a stack of resignation letters from furious FBI agents

(courtesy zero hedge)

Is This Why Comey Broke: A Stack Of Resignation Letters From Furious FBI Agents

Conspiracy theories have swirled in recent days as to why FBI Director James Comey reopened Hillary’s email investigation after just closing it back in July concluding that, although Hillary had demonstrated gross negligence in her establishment of a private email server, that “no reasonable prosecutor” would bring a case against her.  Democrats, after lavishing Comey with praise for months on concluding his investigation in an “impartial” way, have since lashed out at him for seeking to influence the 2016 election cycle with Hillary herself describing his recent actions as “deeply troubling”.  Republicans, on the other hand, have praised Comey’s recent efforts as an attempt to correct a corrupt investigation that seemingly ignored critical evidence while granting numerous immunity agreements to Clinton staffers.

According to the Daily Mail, and a source close to James Comey, the decision, at least in part, came after he “could no longer resist mounting pressure by mutinous agents in the FBI” who “felt that he betrayed them and brought disgrace on the bureau by letting Hillary off with a slap on the wrist.”

James Comey’s decision to revive the investigation of Hillary Clinton’s email server and her handling of classified material came after he could no longer resist mounting pressure by mutinous agents in the FBI, including some of his top deputies, according to a source close to the embattled FBI director.

‘The atmosphere at the FBI has been toxic ever since Jim announced last July that he wouldn’t recommend an indictment against Hillary,’ said the source, a close friend who has known Comey for nearly two decades, shares family outings with him, and accompanies him to Catholic mass every week.

‘Some people, including department heads, stopped talking to Jim, and even ignored his greetings when they passed him in the hall,’ said the source. ‘They felt that he betrayed them and brought disgrace on the bureau by letting Hillary off with a slap on the wrist.’

According to the source, Comey fretted over the problem for months and discussed it at great length with his wife, Patrice.

He told his wife that he was depressed by the stack of resignation letters piling up on his desk from disaffected agents.The letters reminded him every day that morale in the FBI had hit rock bottom.

‘The people he trusts the most have been the angriest at him,’ the source continued. ‘And that includes his wife, Pat. She kept urging him to admit that he had been wrong when he refused to press charges against the former secretary of state.

Though we’re sure there are many facets behind Comey’s decision making process, we can all be quite certain, at this point, that he’s not motivated by a desire to make friends having now alienated just about everyone in Washington, both in law enforcement and in both political parties.  In fact, after Tim Kaine just last week praised Comey as a “wonderful” career public servant with the “highest standards of integrity”….

…everything has now been turned on it’s head with Hillary calling his latest moves “unprecedented and deeply troubling”…seemingly implying an attempt, on the part of Comey, to “rig” the election from Trump.

Meanwhile, President Obama and Attorney General Loretta Lynch are apparently also “furious” with Comey over his recent decision.

His announcement about the revived investigation, which came just 11 days before the presidential election, was greeted with shock and dismay by Attorney General Loretta Lynch and the prosecutors at the Justice Department.

‘Jim told me that Lynch and Obama are furious with him,’ the source said.

‘Lynch and Obama haven’t contacted Jim directly,’ said the source, ‘but they’ve made it crystal clear through third parties that they disapprove of his effort to save face.’

And while the decision to reopen the case may appease FBI agents and republicans, in the short-term, we suspect it does very little to restore overall faith in his competence.  As such, we continue to question just how long Comey can hold out before being forced to resign his post.  At a bare minimum, in light of his continued questionable judgement and serious doubts raised about the integrity of the first investigation, we fail to understand how an independent investigation into Hillary’s email server isn’t warranted.

 

end
MONDAY
Dilbert creator, Scott discusses why the emails are really bad.  The following is extremely important and I strongly believe that he is correct.
(courtesy zero hedge)

Dilbert Creator Explains “How Do I Know The Emails Are That Bad?”

If you’re following the news, you know FBI Director James Comey announced that the FBI found a bunch of emails on Anthony Weiner’s laptop.

As Dilbert Creator Scott Adams notes, there appears to be two main observations:

1. Comey seemed pro-Clinton when he dropped the initial email case.

2. Comey seems anti-Clinton this week because he announced a new round of investigations right before the election.

So, how can both behaviors be explained?

 First some background from Adams on ‘The Persuasion Filter’:

As my regular readers know, the Persuasion Filter is related to the idea that the human brain never evolved to accurately comprehend reality. In order for us to be here today, our predecessors only needed to survive and procreate. They had no need to understand reality at any basic level. And we have no such need either. That’s why you might believe you are reincarnated from a monk and I might believe my prophet flew to heaven on a winged horse but we can both get through the day just fine. Many different interpretations of reality are good enough for survival. I like to describe reality as each person living their own movie, which works well unless our script’s conflict. When that happens, one of us goes into cognitive dissonance and rewrites our past to make the movies consistent.

That’s how I see the world.

Last year in this blog I suggested that the most productive and predictive way to view reality is through what I call the Persuasion Filter. That’s what I have been using to make spooky-good predictions about the election so far. And that’s what I’ll use today to give you an alternate movie about James Comey. Compare it to the movie you are running in your head and see which one better predicts the future.

The base assumption of the Persuasion Filter is that people are irrational 90% of the time and only rarely – when no emotions are involved – truly rational. This is the reverse of the common filter for reality, in which people are assumed to be rational 90% of the time and a bit crazy 10% of the time. That’s some background for context.

Read more here…

So, back to Comey, Adams asks –  which movie does the best job of explaining our observations and also predicting the future?

Some say Comey is a political pawn in a rigged system. By that movie script we can explain why he dropped the initial email case. But we can’t explain why he’s acting against Clinton’s interests now. What changed?

Well, some say Comey had to reopen the case against Clinton after discovering the Weiner laptop emails. If he failed to act, there might be a revolt at the FBI and maybe a whistleblower would come forward. But that leaves unexplained why Comey detailed to Congress how Clinton appeared to be guilty of crimes at the same time he said the FBI was dropping the case. If Comey had been protecting Clinton on the first round, he would have softened his description of her misdeeds, wouldn’t he? But he didn’t seem to hold back anything.

And none of those hypotheses explain why the people who know Comey have high regard for his integrity. Comey also has the security of a 10-year appointment as Director, so he has a low chance of getting fired or politically influenced. That’s exactly why the job has a 10-year term. Given what we know of Comey before any of the Clinton emails, any movie that casts Comey as an ass-covering weasel is probably making a casting mistake.

So allow me to offer an interpretation of events that casts Comey as more of a patriot and hero than an ass-covering weasel. Compare my interpretation with whatever movie you have in your head and see which one works best for explaining and predicting.

My movie says Comey had good evidence against Clinton during the initial investigation but made a judgement call to leave the decision to the American public. For reasons of conscience, and acting as a patriot, Comey explained in clear language to the public exactly what evidence the FBI found against Clinton. The evidence looked daming because it was. Under this interpretation, Comey took a bullet to his reputation for the sake of the Republic. He didn’t want the FBI to steal this important decision away from the people, but at the same time he couldn’t let the people decide blind. So he divulged the evidence and stepped away, like the action hero who doesn’t look back at the explosion.

In the second act of this movie, Comey learns that the Weiner laptop had emails that were so damning it would be a crime against the public to allow them to vote without first seeing a big red flag. And a flag was the best he could do because it was too early in the investigation to leak out bits and pieces of the evidence. That would violate Clinton’s rights.

But Comey couldn’t easily raise a red flag to warn the public because it was against FBI policy to announce a criminal investigation about a candidate so close to election day. So Comey had a choice of either taking another bullet for the Republic or screwing the very country that he has spent his career protecting.

In this movie, Comey did the hero thing. He alerted the public to the fact that the FBI found DISQUALIFYING information on the Weiner laptop. And he took a second bullet to his reputation.

How do I know the new emails are that bad?

I start by assuming Comey is the same man now as the one who was carefully vetted before being hired to protect the integrity of one of our most important institutions. And even Comey’s critics concede he’s smart.

So…

The way you know the new emails are disqualifying for Clinton is because otherwise our hero would have privately informed Congress and honored the tradition of not influencing elections. Comey is smart enough to know his options. And unless he suddenly turned rotten at his current age, he’s got the character to jump in front of a second bullet for the Republic.

According to this movie, no matter who gets elected, we’ll eventually learn of something disqualifying in the Weiner emails.

And we can’t say we weren’t warned. Comey took two bullets to do it.

So compare this movie to your own movie and see which one does the best job of explaining the observed facts. And when we find out what is in the Weiner laptop emails, compare that news to my prediction that the information is disqualifying.

The Persuasion Filter says there is no prefered reality. We all see our own movies. In my movie, Comey’s has a consistent personality from start to finish. He starts out his career as a smart, competent patriot and he later proves it by taking two bullets for the Republic. If your movie script has Comey suddenly changing his basic character for this election season, don’t expect an Oscar.

Read more here…

Of course if you’re a Democrat, this is all irrelevant and Comey is “A Putin puppet” (Howard Dean), “a federal law-breaker who should never have been appointed” (Harry Reid), and “a partisan, prejudiced individual” (Eric Holder)…

View image on TwitterView image on TwitterView image on TwitterView image on Twitter

NEW: Former Attorney General Holder, dozens of other former DOJ officials pen letter criticizing FBI director Comey. http://abcn.ws/2f7leb4 

You decide which makes more sense – Scott Adams’ “movie” or the real partisan hacks above?

 

end

 

And now the last word on the subject courtesy of Michael Snyder

(courtesy Michael Snyder/EconomicCollapseBlog)

Will Barack Obama Suspend The Election If Hillary Is Forced Out By The New FBI Email Investigation?

Submitted by Michael Snyder via The Economic Collapse blog,

Just when it looked like Hillary Clinton was poised to win the 2016 election, the FBI has thrown a gamechanger into the mix. On Friday, FBI Director James Comey announced that his agency has discovered new emails related to Hillary Clinton’s mishandling of classified information that they had not previously seen. According to the Associated Press, the newly discovered emails “did not come from her private server”, but instead were found when the FBI started going through electronic devices that belonged to top Clinton aide Huma Abedin and her husband Anthony Weiner.  The FBI has been looking into messages of a sexual nature that Weiner had exchanged with a 15-year-old girl in North Carolina, and that is why they originally seized those electronic devices.  According to the Washington Post, the “emails were found on a computer used jointly by both Weiner and his wife, top Clinton aide Huma Abedin, according to a person with knowledge of the inquiry”, and according to some reports there may be “potentially thousands” of emails on the computer that the FBI did not have access to previously.  Even though there are less than two weeks to go until election day, this scandal has the potential to possibly force Clinton out of the race, and if that happens could Barack Obama delay or suspend the election until a replacement candidate can be found?

Let’s take this one step at a time.  On Friday, financial markets tanked when reports of these new Clinton emails hit the wires.  The following comes from CNN

After recommending earlier this year that the Department of Justice not press charges against the former secretary of state, Comey said in a letter to eight congressional committee chairmen that investigators are examining newly discovered emails that “appear to be pertinent” to the email probe.

 

“In connection with an unrelated case, the FBI has learned of the existence of emails that appear pertinent to the investigation,” Comey wrote the chairmen. “I am writing to inform you that the investigative team briefed me on this yesterday, and I agreed that the FBI should take appropriate investigative steps designed to allow investigators to review these emails to determine whether they contain classified information, as well as to assess their importance to our investigation.”

At this point, we do not know what is contained in these emails.  But without a doubt Huma Abedin is Hillary Clinton’s closest confidant, and I have always felt that she was Clinton’s Achilles heel.  Journalist Carl Bernstein (of Watergate fame) is fully convinced that the FBI would have never made this move unless something significant had already been discovered

We don’t know what this means yet except that it’s a real bombshell. And it is unthinkable that the Director of the FBI would take this action lightly, that he would put this letter forth to the Congress of the United States saying there is more information out there about classified e-mails and call it to the attention of congress unless it was something requiring serious investigation. So that’s where we are…

 

Is it a certainty that we won’t learn before the election? I’m not sure it’s a certainty we won’t learn before the election.

 

One thing is, it’s possible that Hillary Clinton might want to on her own initiative talk to the FBI and find out what she can, and if she chooses to let the American people know what she thinks or knows is going on. People need to hear from her…

If the FBI has indeed found something explosive, would they actually charge her with a crime right before the election?

It is possible, but we also have to remember that government agencies (including the FBI) tend to move very, very slowly.  If there are thousands of emails, it is going to take quite a while to sift through them all.  And of course Barack Obama has lots of ways that he could influence, delay or even shut down the investigation.

So those that are counting on this to be the miracle that Donald Trump needs should not count their chickens before they hatch.

But if Hillary Clinton were to be forced out of the race by this FBI investigation, the Democrats would have to decide on a new candidate, and that would take time.  The following is from a U.S. News & World Report article that examined what would happen if one of the candidates was forced out of the race for some reason…

If Clinton were to fall off the ticket, Democratic National Committee members would gather to vote on a replacement. DNC members acted as superdelegates during this year’s primary and overwhelmingly backed Clinton over boat-rocking socialist Sen. Bernie Sanders of Vermont.

 

DNC spokesman Mark Paustenbach says there currently are 445 committee members – a number that changes over time and is guided by the group’s bylaws, which give membership to specific officeholders and party leaders and hold 200 spots for selection by states, along with an optional 75 slots DNC members can choose to fill.

 

But the party rules for replacing a presidential nominee merely specify that a majority of members must be present at a special meeting called by the committee chairman. The meeting would follow procedures set by the DNC Rules and Bylaws Committee and proxy voting would not be allowed.

It would be extremely challenging to get a majority of the members of the Democratic National Committee together on such short notice.  If Clinton were to drop out next week, it would be almost impossible for this to happen before election day.

In such a scenario, Barack Obama may attempt to invoke his emergency powers.  Since the election would not be “fair” until the Democrats have a new candidate, he could try to delay or suspend the election.  There would be a lot of controversy as to whether this is legal or not, but Barack Obama has not let the U.S. Constitution stop him in the past.

Meanwhile, new poll numbers show that the Trump campaign was already gaining momentum even before this story about the new emails broke.  According to a brand new ABC News/Washington Post survey, Donald Trump is now only trailing Hillary Clinton by 4 points after trailing her by as much as 12 points last weekend.

And CNBC is reporting on a highly advanced artificial intelligence system that accurately predicted the outcomes of the presidential primaries and which is now indicating that Trump will be the winner in November…

An artificial intelligence system that correctly predicted the last three U.S. presidential elections puts Republican nominee Donald Trump ahead of Democrat rival Hillary Clinton in the race for the White House.

 

MogIA was developed by Sanjiv Rai, founder of Indian start-up Genic.ai. It takes in 20 million data points from public platforms including Google, Facebook, Twitter and YouTube in the U.S. and then analyzes the information to create predictions.

The AI system was created in 2004, so it has been getting smarter all the time. It had already correctly predicted the results of the Democratic and Republican Primaries.

Without Hillary at the top of the ticket, the odds of a Trump victory would go way, way up.

So if Hillary is forced out of the race by this investigation, Barack Obama and the Democrats will want to delay or suspend the election for as long as possible if they can.

At this point there is probably not a high probability that such a scenario will play out, but in this crazy election year we have already seen that just about anything can happen.

 

end

 

This ought to make you angry:  John Podesta’s best friend, Peter Kadzik will be heading that Dept of Justice’s probe into Huma Abedin’s emails.

I sure hope that the republicans get to see all of Hillary’s emails especially on Benghazi and other emails that she destroyed so that she will be charged.

(courtesy zero hedge)

 

John Podesta’s Best Friend At The DOJ Will Be In Charge Of The DOJ’s Probe Into Huma Abedin Emails

Now that the FBI has obtained the needed warrant to start poring over the 650,000 or so emails uncovered in Anthony Weiner’s notebook, among which thousands of emails sent from Huma Abedin using Hillary Clinton’s personal server, moments ago the Us Justice Department decided to also finally join the probe, and as AP reported moments ago, it vowed to dedicate all needed resources to quickly review the over half a million emails in the Clinton case.

BREAKING: Justice Dept. says it’ll dedicate all needed resources to quickly review emails in Clinton case.

In the letter to Congress, the DOJ writes that it “will continue to work closely with the FBI and together, dedicate all necessary resources and take appropriate steps as expeditiously as possible,” assistant attorney General Peter J. Kadzik writes in letters to House and Senate lawmakers.

View image on TwitterView image on Twitter

Senior DOJ official sends letter to lawmakers responding to request for more information about email review.

So far so good, even if one wonders just how active the DOJ will be in a case that has shown an unprecedented schism between the politically influenced Department of Justice and the FBI.

And yet, something felt odd about this.

Kadzik… Kadzik… where have we heard that name?

Oh yes. Recall our post from last week, “Clinton Campaign Chair Had Dinner With Top DOJ Official One Day After Hillary’s Benghazi Hearing” in which we reported that John Podesta had dinner with one of the highest ranked DOJ officials the very day after Hillary Clinton’s Benghazi testimony?

It was Peter Kadzik.

In other words, the best friend of John Podesta, Clinton’s Campaign char, at the DOJ will be in charge of a probe that could potentially sink Hillary Clinton.

For those who missed it, this is what we reported:

The day after Hillary Clinton testified in front of the House Select Committee on Benghazi last October, John Podesta, Hillary’s campaign chairman met for dinner with a small group of well-connected friends, including Peter Kadzik, who is currently a top official at the US Justice Department serving as Assistant Attorney General for Legislative Affairs.

 

The post-Benghazi dinner was attended by Podesta, Kadzik, superlobbyist Vincent Roberti and other well-placed Beltway fixtures. The first mention of personal contact between Podesta and Kadzik in the Wikileaks dump is in an Oct. 23, 2015 email sent out by Vincent Roberti, a lobbyist who is close to Podesta and his superlobbyist brother, Tony Podesta. In it, Roberti refers to a dinner reservation at Posto, a Washington D.C. restaurant.  The dinner was set for 7:30 that evening, just one day after Clinton gave 11 hours of testimony to the Benghazi Committee.

 

Podesta and Kadzik met several months later for dinner at Podesta’s home, another email shows. Another email sent on May 5, 2015, Kadzik’s son asked Podesta for a job on the Clinton campaign.

As the Daily Caller noted, the dinner arrangement “is just the latest example of an apparent conflict of interest between the Clinton campaign and the federal agency charged with investigating the former secretary of state’s email practices.” As one former U.S. Attorney tells told the DC, the exchanges are another example of the Clinton campaign’s “cozy relationship” with the Obama Justice Department.

The hacked emails confirm that Podesta and Kadzik were in frequent contact. In one email from January, Kadzik and Podesta, who were classmates at Georgetown Law School in the 1970s, discussed plans to celebrate Podesta’s birthday. And in another sent last May, Kadzik’s son emailed Podesta asking for a job on the Clinton campaign.

“The political appointees in the Obama administration, especially in the Department of Justice, appear to be very partisan in nature and I don’t think had clean hands when it comes to the investigation of the private email server,” says Matthew Whitaker, the executive director of the Foundation for Accountability and Civic Trust, a government watchdog group.

“It’s the kind of thing the American people are frustrated about is that the politically powerful have insider access and have these kind of relationships that ultimately appear to always break to the benefit of Hillary Clinton,” he added, comparing the Podesta-Kadzik meetings to the revelation that Attorney General Loretta Lynch met in private with Bill Clinton at the airport in Phoenix days before the FBI and DOJ investigating Hillary Clinton.

Kadzik’s role at the DOJ, where he started in 2013, is particularly notable Kadzik, as helped spearhead the effort to nominate Lynch, who was heavily criticized for her secret meeting with the former president.

It gets better because, as we further revealed, if there is one person in the DOJ who is John Podesta’s, and thus the Clinton Foundation’s inside man, it is Peter Kadjik.

Kadzik represented Podesta during the Monica Lewinsky investigation. And in the waning days of the Bill Clinton administration, Kadzik lobbied Podesta on behalf of Marc Rich, the fugitive who Bill Clinton controversially pardoned on his last day in office. That history is cited by Podesta in another email hacked from his Gmail account. In a Sept. 2008 email, which the Washington Free Beacon flagged last week, Podesta emailed an Obama campaign official to recommend Kadzik for a supportive role in the campaign. Podesta, who would later head up the Obama White House transition effort, wrote that Kadzik was a “fantastic lawyer” who “kept me out of jail.”

screen-shot-2016-10-25-at-11-57-45-am

Podesta was caught in a sticky situation in both the Lewinsky affair and the Rich pardon scandal. As deputy chief of staff to Clinton in 1996, Podesta asked then-United Nations ambassador Bill Richardson to hire the 23-year-old Lewinsky. In April 1996, the White House transferred Lewinsky from her job as a White House intern to the Pentagon in order to keep her and Bill Clinton separate. But the Clinton team also wanted to keep Lewinsky happy so that she would not spill the beans about her sexual relationship with Clinton.

Richardson later recounted in his autobiography that he offered Lewinsky the position but that she declined it.

Podesta made false statements to a grand jury impaneled by Independent Counsel Kenneth Starr for the investigation. But he defended the falsehoods, saying later that he was merely relaying false information from Clinton that he did not know was inaccurate at the time. “He did lie to me,” Podesta said about Clinton in a National Public Radio interview in 1998. Clinton was acquitted by the Senate in Feb. 1999 of perjury and obstruction of justice charges related to the Lewinsky probe. Kadzik, then a lawyer with the firm Dickstein Shapiro Morin & Oshinsky, represented Podesta through the fiasco.

Podesta had been promoted to Clinton’s chief of staff when he and Kadzik became embroiled in another scandal.

Kadzik was then representing Marc Rich, a billionaire financier who was wanted by the U.S. government for evading a $48 million tax bill. The fugitive, who was also implicated in illegal trading activity with nations that sponsored terrorism, had been living in Switzerland for 17 years when he sought the pardon. To help Rich, Kadzik lobbied Podesta heavily in the weeks before Clinton left office on Jan. 20, 2001. A House Oversight Committee report released in May 2002 stated that “Kadzik was recruited into Marc Rich’s lobbying campaign because he was a long-time friend of White House Chief of Staff John Podesta.”

The report noted that Kadzik contacted Podesta at least seven times regarding Rich’s pardon. On top of the all-hands-on-deck lobbying effort, Rich’s ex-wife, Denise Rich, had doled out more than $1 million to the Clintons and other Democrats prior to the pardon. She gave $100,000 to Hillary Clinton’s New York Senate campaign and another $450,000 to the Clinton presidential library.

Kadzik’s current role

In his current role as head of the Office of Legislative Affairs, Kadzik handles inquiries from Congress on a variety of issues. In that role he was not in the direct chain of command on the Clinton investigation. The Justice Department and FBI have insisted that career investigators oversaw the investigation, which concluded in July with no charges filed against Clinton.

But Kadzik worked on other Clinton email issues in his dealings with Congress. Last November, he denied a request from Republican lawmakers to appoint a special counsel to lead the investigation.

In a Feb. 1, 2016 letter in response to Kadzik, Florida Rep. Ron DeSantis noted that Kadzik had explained “that special counsel may be appointed at the discretion of the Attorney General when an investigation or prosecution by the Department of Justice would create a potential conflict of interest.”

DeSantis, a Republican, suggested that Lynch’s appointment by Bill Clinton in 1999 as U.S. Attorney in New York may be considered a conflict of interest. He also asserted that Obama’s political appointees — a list which includes Kadzik — “are being asked to impartially execute their respective duties as Department of Justice officials that may involve an investigation into the activities of the forerunner for the Democratic nomination for President of the United States.”

It is unknown if Kadzik responded to DeSantis’ questions.

Kadzik’s first involvement in the Clinton email brouhaha came in a Sept. 24, 2015 response letter to Senate Judiciary Committee chairman Chuck Grassley in which he declined to confirm or deny whether the DOJ was investigating Clinton. Last month, Politico reported that Kadzik angered Republican lawmakers when, in a classified briefing, he declined to say whether Clinton aides who received DOJ immunity were required to cooperate with congressional probes.

Kadzik also testified at a House Oversight Committee hearing last month on the issue of classifications and redactions in the FBI’s files of the Clinton email investigation.

* * *

And now it seems that Kadjik will be in charge of the DOJ’s “probe” into Huma Abedin’s emails. Which is why we are a little skeptical the DOJ will find “anything” of note.

Peter Kadzik, with lobbyist Tony Podesta, brother of John Podesta.

end
Donald thanks Weiner..
(courtesy zero hedge)

Trump To Weiner: “Thank You”

With even The White House not standing by their candidate’s narrative, perhaps we should all thank Anthony Weiner…

Hillary is the one who set up an illegal private e-mail server in a closet to shield herself from her illegal activities. Hillary is the one who engaged in a pay-for-play scheme at the State Department. Now there are five FBI probes into the Clinton Foundation and their pay-for-play activities. Very, very deep investigations.

Hillary is the one who sent and received classified information on an unsecure server, putting the safety of the American people under threat. That’s what she did…

650,000 emails. You know what I call that? That’s the motherlode.

I think you will find the 33,000 that are missing, the 15,000 that are missing, the facts that are missing.

You know they had boxes of e-mails missing two weeks ago? I think we hit the motherlode, as they say in the good old mining industry.

Hillary is the one who lied to Congress under oath. Hillary is the one who lied on so many different occasions to the FBI. And they know, they know. They know Hillary is the one who made 13 phones disappear. Some with a hammer.

Hillary is the one who destroyed 33,000 e-mails, after she got the subpoena. After. Before, no good. But after? No, that’s why something should have happened then.

Hillary is the one that broke the law over and over and over again. We can be sure that what is in those e-mails is absolutely devastating. And I think we are going to find out, by the way, for the first time.

Thank you, Huma. Good job, Huma. Thank you, Anthony Weiner.

And you all saw the statements I made about him a year ago?

You know, in New York we knew Weiner. And I made statements that were rough. Like — how can she be allowed to live with this guy? How can she have access to this important information? And I was badly criticized, right? Now they are saying — wow, Trump has good judgment. Wow. Got good instincts. Got good instincts.

Hillary is not the victim. The American people are the victims.

end

This economist predicts the rising Obamacare health care costs will lead to riots on the streets

(courtesy zero hedge)

Economist Predicts Rising Obamacare Costs Will Lead To Riots

Real Disposable Income Per Capita Slides For 2nd Straight Month

Personal Income rose less than expected in September (+0.3% vs +0.4% exp MoM) and thanks to a downward revision in August, Spending rose more than expected (+0.5% vs +0.4% MoM).

In context, income and spending continue to rise…

Both income (+3.2%) and spending (+3.7%) growth rose in September on a year-over-year basis with service sector wages (+$19.9bn) rising dramatically relative to goods-producing (+$4.3bn).

Chart: Bloomberg

Thanks to the historical revisions, personal savings dipped a little from 5.8% to 5.7%.

But perhaps the most notable aspect of today’s data is the second straight decline in real disposable income, which declined to $39,092 in September after peaking at $39,117 in July.

This is the first time since Jan 2013 that real disposable income per capita has fallen two straight months.<

 

end

 

The all important, national Chicago PMI falls to 50.4 barely above recession levels.

The report signals inflationary pressures is on  the rise and economic growth looks very disappointing.  This is exactly what Ambrose Evans Pritchard is discovering in his commentary today

(courtesy Chicago PMI: zero hedge)

Chicago PMI Screams Stagflation: Inflationary Pressures On The Rise As “Economic Growth Looks Very Disappointing”

Following September’s bounce, October’s Chicago PMI plunged to 5-month lows. The 50.4 print is a four standard-deviation miss with new orders sliding, production tumbling, but prices paid surging to the highest since Nov 2014. So, stagflation looms as inflationary pressures build but economic growth outlooks decline.

The bounce from June to September… is over…

Chart: Bloomberg

As MNI reports, the latest data marked a weak start to Q4, with the three-month trend softening to 52.1 in October from 53.8 in the three months to September.

The Barometer decline was led by a slowdown in Production, which fell 5.4 points to 54.4, giving up most of the gain seen last month but remaining above the 2016 average. New Orders also subtracted from the Barometer, falling to the lowest level since May. Order Backlogs increased slightly, but failed to jump out of contraction territory, where they have been over the past three months. Employment saw a smaller rise, edging back above the 50-breakeven level and recovering some of the lost ground experienced in the previous month. Meanwhile, Supplier Deliveries fell to the lowest level since June.

There was evidence of a pick-up in inflationary pressures at the factory-gate. Prices Paid rose to the highest level since November 2014, following the recovery in the oil price and panellists also reported higher prices for steel and plastic products. Moreover, suppliers have been pushing for price increases in recent months and some of these pressures appeared to have materialised in October.

And as Lorena Castellanos, senior economist at MNI Indicators, explains…

“A key takeaway from the latest survey was the pick-up in Prices Paid to a nearly two-year high. Inflationary pressures are on the rise, which is one of the metrics the Federal Reserve has been waiting for to increase rates. However, economic growth ahead, as read by the October Chicago Business Barometer, looks very disappointing. Hopefully, it doesn’t mark the start of a downward trend,”

Or put another way – the Chicago PMI report screams stagflation:

  • “inflationary pressures on the rise”
  • “economic growth looks very disappointing”

 end

 

Not good:  the Dallas Mfg Fed report signals a 22nd straight monthly decline in activity:

(courtesy zero hedge)

Dallas Fed Outlook Signals 22nd Straight Month Of Contraction

Dallas Fed’s Manufacturing Outlook has now contracted for 22 consecutive months (the 2008/9 crisis collapse was 24 straight months) with a -1.5 print in October (missing expectations of +2). Production declined, Capacity Utilization tumbled, New Orders and Average Workweek contracted, and wages dropped (while prices paid rose).

“Not” a recession…

Chart: Bloomberg

Notably, expectations for business activity six months ahead dropped to 5 month lows. And respondents do not seem too enthusiastic

…Job losses from the oil sector are having a negative effect on tax revenues in Texas. This puts pressure on government spending at the state and local level. High-paying manufacturing jobs are being replaced with lower-paying minimum wage service sector jobs. Unfunded pension liabilities of the city of Houston will further depress economic expansion as city budgets are affected.

The global economies and U.S. economy are very weak and uncertain. We have had a lot of bid activity, but most schools, colleges, municipalities and commercial clients are postponing expansion until they see how the economy goes after the elections. The second and third quarters showed improvement over a weak first quarter, but the outlook for the fourth quarter is very soft. Additional staff reductions may be required.

…We are just bumping along in a low-growth environment. We are starting to hear that auto market may slow, but have not seen it yet in our order rates.

…We are very worried about six months from now. Not only is that a slow time period for us, but with the election not looking to be favorable for business climate in general, it gives me a very uneasy feeling.

But it’s probably nothing.

 

end

 

The liquidation of the Sports Authority claims another victim”  Performance Sports Group, the makers of Bauer ice hockey equipment and Easton baseball and softball gear: it shows the weakness in the consumer group:

(courtesy zero hedge)

 

 

 

 

 

Sports Authority Liquidation Claims Another Supplier Casualty As Performance Sports Goes Under

Performance Sports Group (PSG), maker of Bauer ice hockey equipment and Easton baseball and softball gear, filed for bankruptcy protection earlier today in Canada and the United States.  Among other things, the company cited“weakening consumer demand,” the liquidation of Sports Authority back in March 2016 as well as the subsequent bankruptcy of an “internet baseball retailer” as key drivers of their financial downturn.  According to the company’s most recent annual filing, 51% of Easton sales were to “big box” retailers.

The performance of the Company’s business in fiscal 2016 and fiscal 2017 to date has been significantly impacted by adverse market and   economic conditions and related customer credit issues. The baseball/softball market experienced a significant downturn in retail sales across all product categories, but particularly in the Company’s important bat category. This weakening of consumer demand, coupled with the Chapter 11 filing by one of the largest U.S. national sporting goods retailers and the bankruptcy of an internet baseball retailer, has reduced the Company’s sales with respect to baseball and softball products.

 

The consolidation of hockey retailers in the U.S., and the bankruptcy of a key U.S. hockey customer, has reduced customer  demand for products as the Company’s customers have continued to reduce their inventory  levels. The Company’s results throughout fiscal 2016 and  fiscal  2017  to  date have  also continued to be impacted negatively by foreign currency exchange rates, specifically, the depreciation of the Canadian dollar and other world currencies relative to the U.S. dollar.

Not surprisingly, PSG’s EBITDA collapsed for the LTM period ended in February 2016 which coincided with the Sports Authority bankruptcy filing in March.

PSG

 

As part of the bankruptcy process, PSG has secured a stalking horse bid from Sagard Capital and Fairfax Financial for $575mm which will serve as a baseline bid for a competitive auction process.

In  connection  with  the  Restructuring  Process,  the  Company has entered  into  an  asset  purchase agreement (the “Purchase Agreement”) with  an acquisition  vehicle  to  be  co-owned  by  an  affiliate  of Sagard  Capital  Partners,  L.P. and Fairfax  Financial  Holdings  Limited (collectively,  the “Purchaser”), pursuant  to  which  the  Purchaser  has  agreed  to  acquire  substantially  all  of  the  assets of  the  Company and  its  North  American subsidiaries for  U.S. $575 million in  aggregate,  assume  related  operating liabilities and serve as a “stalking horse” bidder through the Restructuring Process. The Purchase Agreement sets  the  floor,  or  minimum  acceptable bid,  for  an  auction  under  the  supervision  of  the Courts,  which  is designed  to  achieve  the  highest available or  otherwise  best  offer.  The  proceeds  to  be received on the closing of the acquisition should be in excess of the Company’s outstanding secured indebtedness and are expected to provide meaningful recoveries to the Company’s other stakeholders. A final sale approval hearing is expected to take place  shortly after completion of the auction with the anticipated  closing of  the  successful  bid to  occur in  the  first quarter  of calendar  year 2017,  subject  to receipt  of  applicable  regulatory  approvals  and  the  satisfaction  or  waiver  of  other  customary  closing conditions.

Just another sign of the “strong” consumer benefiting from the Obama “recovery.”

Weak COnsumer

Today was quite a day
I will see you tomorrow night

 

Harvey

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