Dec 21/Huge run on gold at the comex/Premiums average $33.00 between Shanghai gold fix and NY pricing at the exact same time/Another huge 3.56 tonnes of gold leave the GLD/nothing leaves the SLV/Turmoil in China sets bitcoin up $30.00/Monte de Paschi to be nationalized: the sovereign (Italy) set to advance 20 billion euros: the banking system needs a minimum of 52 billion euros/

Gold at (1:30 am est) $1131.10 DOWN $0.40

silver  at $15.92:  DOWN 13 cents

Access market prices:

Gold: $1132.10

Silver: $15.94

THE DAILY GOLD FIX REPORT FROM SHANGHAI AND LONDON

.

The Shanghai fix is at 10:15 pm est last night and 2:15 am est early this morning

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:

WEDNESDAY gold fix Shanghai

Shanghai morning fix Dec 21 (10:15 pm est last night): $  1171.21

NY ACCESS PRICE: $1134.95 (AT THE EXACT SAME TIME)/premium $36.26

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Shanghai afternoon fix:  2: 15 am est (second fix/early  morning):$   1166.22

NY ACCESS PRICE: $1136.15 (AT THE EXACT SAME TIME/2:15 am)

HUGE SPREAD 2ND FIX TODAY!!:  $30.07

China rejects NY pricing of gold  as a fraud/arbitrage will now commence fully

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

London Fix: Dec 21: 5:30 am est:  $1134.40   (NY: same time:  $1134.60    5:30AM)

London Second fix Dec 21: 10 am est:  $1133.65 (NY same time: $1134.65    10 AM)

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: 

NOTICES FILINGS FOR DECEMBER CONTRACT MONTH:  0 NOTICE(S) FOR nil OZ.  TOTAL NOTICES SO FAR: 9126 FOR 912600 OZ    (28.385 TONNES)

For silver:

 NOTICES FOR DECEMBER CONTRACT MONTH FOR SILVER: 2 NOTICE(s) FOR 10,000  OZ. TOTAL NUMBER OF NOTICES FILED SO FAR; 3534 FOR 17,670,000 OZ

Let us have a look at the data for today

.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

In silver, the total open interest FELL by 532 contracts DOWN to 159,697 with respect to YESTERDAY’S TRADING.    In ounces, the OI is still represented by just less THAN 1 BILLION oz i.e. .798 BILLION TO BE EXACT or 114% of annual global silver production (ex Russia & ex China).

FOR THE DECEMBER FRONT MONTH:  0 NOTICES FILED FOR nil  OZ.

In gold, the total comex gold FELL BY 2,081 contracts AS WE HAD A FALL IN  THE PRICE GOLD ($9.00 with YESTERDAY’S trading ).The total gold OI stands at 398,661 contracts. We are very close to the bottom with respect to OI. Generally 390,000 should do it.

we had 0 notice(s) filed upon for NIL oz of gold.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD:

We had ANOTHER HUGE CHANGE in tonnes of gold at the GLD, A WITHDRAWAL OF 3.56 TONNES OF GOLD LEAVING THE GLD VAULTS/

Inventory rests tonight: 824.54 tonnes

.

SLV

we had NO  changes in silver. THE SLV Inventory rests at: 339.262 million oz

.

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

1. Today, we had the open interest in silver FELL by 532 contracts DOWN to 159,697 DESPITE THE FACT THAT the price of silver ROSE by  $0.03 with YESTERDAY’S trading. The gold open interest FELL by 2081 contracts DOWN to 398,661 as the price of gold FELL BY $9.00 WITH YESTERDAY’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

3. ASIAN AFFAIRS

i)Late  TUESDAY night/WEDNESDAY morning: Shanghai closed up 34.55 POINTS OR 1.11%/ /Hang Sang closed UP 80.74  OR 0.37%. The Nikkei closed DOWN 50.04 OR 0.26%/Australia’s all ordinaires  CLOSED UP 0.39% /Chinese yuan (ONSHORE) closed UP at 6.9444/Oil ROSE to 53.61 dollars per barrel for WTI and 55.60 for Brent. Stocks in Europe: MOSTLY IN THE RED.  Offshore yuan trades  6.9228 yuan to the dollar vs 6.9444  for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS COMPLETELY AS  MORE USA DOLLARS ARE BLOCKED FROM LEAVING CHINA’S SHORES /

REPORT ON JAPAN  SOUTH KOREA NORTH KOREA AND CHINA

3a)THAILAND/SOUTH KOREA

none today

b) REPORT ON JAPAN

c) REPORT ON CHINA

i)Another Islamist attack??: this time in Beijing:

( zero hedge)

ii)Turmoil in China sees Bitcoin rise another 30 dollars. It is trading at $830  uSA per Bitcoin.

( zero hedge)

 

4 EUROPEAN AFFAIRS

i)Italy/Monte de Paschi

Monte de Paschi announces that not only is it insolvent but it is also illiquid as there seems to be a huge run on the bank as depositors decide not to wait and remove their money from this bank.  The Italian government has now approved the 20 billion euros of funds necessary to bail out the banks.  The next move in this chess game is Germany:  bail in or bail out?

(courtesy zero hedge)

ib)Monte de Paschi to be nationalized

Now the fun begins:  Italy is set to nationalize Monte de Paschi after private sector rescue attempts fail.  As we discussed above, it is now up to Germany to see what will happen:  a bail in or a bailout?

(courtesy zero hedge)

ii)Germany

The real suspect is a Tunisian islamist man known to the German authorities as very dangerous.  They have been aware of his terrorist beliefs for months after gaining asylum in Germany

(courtesy zero hedge)

iib)Germany offers 100,000 euros reward for information on A,Amri, the Berlin attack suspect who was previously probed in another terror plot.  He was to be deported but the authorities could not find the necessary paperwork to send him back to Tunisia:

( zero hedge)

iii)A great commentary from V Uniyal of the Gatestone Institute, a highly respected organization.  Here the author describes that the Merkel Government is in total denial of the lawlessness inside Germany with respect to the migrants and the damage that they are doing to the country

(Uniyal/Gatestone Institute)

iv)This gives you a flavour as to what is going on inside Germany:

( zero hedge)

v Switzerland

More banks fined in the manipulation of the Swiss libor rates
(courtesy Bloomberg)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

The additional sanctions on Russia brought on by the USA will no doubt be unwound the moment Trump gets power

( zero hedge)

6.GLOBAL ISSUES

none today

7. OIL ISSUES

i)Libya announces production of 900,000 barrels per day and will rise to 1.2 million barrels by next year.  That caused WTI to fall:

( zero hedge)

ii)DOE refutes the API numbers claiming a huge build up in inventory.

( zero hedge)

8. EMERGING MARKETS

9.   PHYSICAL MARKETS

i)Our good friends over at Deutsche bank is trouble again as the Central Bank of Russia has accused the firm of market manipulation in Russia.

( zero hedge)

ii)What a sensational commentary tonight from Chris Powell.  The inaction by mining companies knowing that their industry has been attacked constantly day in and day out as been a bee in my bonnet for years: Are you paying attention officers of Agnico Eagle, Newmont , Goldcorp???

(courtesy  Chris Powell)

iii)Strange:  gold ETF’s drop for a record 28 straight days.  This commenced the day of the Trump election:

( zero hedge)

iv)Bullion star notes that the gold has never really been audited and they for sure do not include their location gold swaps:

( Bullion Star/Manly/gata)

10.USA STORIES

i)The following is a must read as it explains Trump’s new “border tax proposal”.  It will be very good for the USA

( zero hedge)

ii)Strange data points this morning on existing home sales.  These rise despite soaring mortgage rates, tumbling affordability and crashing mortgage applications:  go figure..

( zero hedge)

iii)Optimism grips the nation with the Trump victory but ominous dark clouds are appearing on the horizon

( Michael Snyder)

iv)Fascinating: more baby boomers are increasingly having their social security checks garnished by authorities to cover student loan payments;( zero hedge)

Let us head over to the comex:

The total gold comex open interest FELL BY 2081 CONTRACTS DOWN to an OI level of 398,661 AS THE  PRICE OF GOLD  FELL $9.00 with YESTERDAY’S trading. We are now in the contract month of December and it is the biggest of the year. Here the front month of December showed a DECREASE of 20 contracts DOWN to 712.We had 2 notice(s) served upon yesterday so we LOST 18 contracts 1800 oz will not stand for delivery and no doubt were bought out for cash plus a fiat bonus.

For the next delivery month of January we had a loss of 172 contracts down to 2248. For the next big active delivery month of February we had a LOSS of 2891 contracts DOWN to 274,507.

We had 0 notice(s) filed upon today for  NIL oz

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

And now for the wild silver comex results.  Total silver OI FELL by 532 contracts FROM  160,229 down to 159,697 as the price of silver ROSE BY $0.03 with YESTERDAY’S trading. We are moving  further from the all time record high for silver open interest set on Wednesday August 3/2016:  (224,540). We are now in the next major delivery month of December and here it rose BY 5 contracts up to 275 CONTRACTS . We had 0 notices served upon yesterday so we GAINED 5 SILVER CONTRACTS or 25,000 additional silver ounces that will stand for delivery.

The next non active delivery month is January and here the OI fell by 59 contracts down to 1024.

The next big active delivery month is March and here the OI FELL by 1055 contracts DOWN to 130,585 contracts.

We had 2 notices filed for 10,000 oz for the December contract.

Eventually at the end of December 2015: 6.4512 tonnes of gold stood for delivery

Eventually at the end of December 2015: 18.84 million oz of silver stood for delivery

VOLUMES: for the gold comex

Today the estimated volume was 116,127  contracts which is awful.

Yesterday’s confirmed volume was 157,012 contracts  which is poor

Initial standings for DECEMBER
 Dec 21.
Gold Ounces
Withdrawals from Dealers Inventory in oz   nil
Withdrawals from Customer Inventory in oz  
 145,471.121 oz
HSBC
Deposits to the Dealer Inventory in oz nil oz
Deposits to the Customer Inventory, in oz 
  nil oz
No of oz served (contracts) today
 
0 notice(s)
NIL oz
No of oz to be served (notices)
712 contracts
71,200 oz
Total monthly oz gold served (contracts) so far this month
9126 notices
912,600 oz
28.385 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     4,399,644.0 oz
Today we HAD 0 kilobar transactions/and again massive amounts of gold leaves the comex vaults. (net 145,451.121 oz)
Today we had 0 deposit(s) into the dealer:
total dealer deposits:  nil  oz
We had nil dealer withdrawals:
total dealer withdrawals:  nil oz
we had 0 customer deposit(s):
total customer deposits; nil oz
We had 1 customer withdrawal(s)
ii) out of HSBC: 145,451.171 oz
total customer withdrawal: 145,451.121 oz
We had 1  adjustment(s)
i) Out of Brinks:  21,049.060 oz leaves the dealer and enters the customer side of Brinks
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

For December:

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

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
To calculate the initial total number of gold ounces standing for the DECEMBER. contract month, we take the total number of notices filed so far for the month (9126) x 100 oz or 912,600 oz, to which we add the difference between the open interest for the front month of DEC (712 contracts) minus the number of notices served upon today (0) x 100 oz per contract equals 983,800 oz, the number of ounces standing in this non  active month of DECEMBER.
 
Thus the INITIAL standings for gold for the DEC contract month:
No of notices served so far (9126) x 100 oz  or ounces + {OI for the front month (732) minus the number of  notices served upon today (0) x 100 oz which equals 983,800 oz standing in this non active delivery month of DEC  (30.600 tonnes)
WE LOST 18  CONTRACTS OR AN ADDITIONAL 1800 OZ OF GOLD WILL NOT STAND FOR DELIVERY.
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.
Nov.    8.3950 tonnes.
DEC.   30.600 tonnes
total for the 12 months;  223.155 tonnes
average 18.596 tonnes per month vs last yr 51 tonnes total for 12 months or 4.25 tonnes average per month. From May 2016 until Dec 2016 we have had: 198.912 tonnes per the 8 months or 24.864 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.
Just take a look at Nov 2016 deliveries at 8.3950 tonnes compared to last yr 0.6656 tonnes
December so far:  30.600 tonnes are standing vs last year’s  24 tonnes on first day notice and 6.45 tonnes on the completion of it’s delivery month.
Total dealer inventor 1,640,669.319 or 51.031 tonnes DEALER RAPIDLY LOSING GOLD
Total gold inventory (dealer and customer) = 8,991,268.560 or 279.666 tonnes 
 
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 284.19 tonnes for a  loss of 23  tonnes over that period.  Since August 8/2016 we have lost 74 tonnes leaving the comex. However I am including kilobar transactions and they are very suspect at best
I have a sneaky feeling that these withdrawals of gold in kilobars are being used in the hypothecating process  and are being used in the raiding of gold!

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 4 1/2 MONTHS  74 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
AND NOW THE DECEMBER DELIVERY MONTH
DECEMBER INITIAL standings
 Dec 21. 2016
Silver Ounces
Withdrawals from Dealers Inventory  nil
Withdrawals from Customer Inventory
 70,021.990 0z
Scotia
Deposits to the Dealer Inventory
  nil OZ
Deposits to the Customer Inventory 
298,779.461 oz
CNT
No of oz served today (contracts)
2 CONTRACT(S)
(10,000 OZ)
No of oz to be served (notices)
273 contracts
(1,365,000  oz)
Total monthly oz silver served (contracts) 3534 contracts (17,670,000 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  3,316,326.3 oz
 END
today, we had 0 deposit(s) into the dealer account:
total dealer deposit: nil oz
we had nil dealer withdrawals:
total dealer withdrawals: nil oz
we had 1 customer withdrawal(s):
i) Out of Scotia:  70,021.990 oz
TOTAL CUSTOMER WITHDRAWALS: 70,021.990 oz
 we had 1 customer deposit(s):
i) into CNT:  298,779.461  OZ
total customer deposits;  298,779.461  oz
 
 
 we had 2 adjustment(s)
 i) Out of Brinks:  538,454.890 oz was adjusted out of the customer and this landed into the dealer account of Brinks
ii) Out of CNT: a massive 1,911,172.770 oz was adjusted out of the dealer account of CNT and this landed into the customer account of CNT
The total number of notices filed today for the DEC. contract month is represented by 2 contracts for 10,000 oz. To calculate the number of silver ounces that will stand for delivery in DEC., we take the total number of notices filed for the month so far at  3534 x 5,000 oz  = 17,670,000 oz to which we add the difference between the open interest for the front month of DEC (275) and the number of notices served upon today (2) x 5000 oz equals the number of ounces standing 
 
Thus the initial standings for silver for the DEC contract month:  3534(notices served so far)x 5000 oz +(275) OI for front month of DEC. ) -number of notices served upon today (2)x 5000 oz  equals  19,035,000 oz  of silver standing for the DEC contract month.
we gained 5  silver contracts or an additional 25,000 oz will stand for delivery in this active month of December.
Volumes: for silver comex
Today the estimated volume was 43,884 which is good
YESTERDAY’S  confirmed volume was 61,640 contracts  which is excellent.
 
Total dealer silver:  36.177 million (close to record low inventory  
Total number of dealer and customer silver:   183.155 million oz
The total open interest on silver is NOW moving away from  its all time high with the record of 224,540 being set AUGUST 3.2016.

end

And now the Gold inventory at the GLD
DEC 21/another massive 3.56 tonnes leaves the GLD/Inventory rests at 824.54 tonnes
Dec 20/no changes in gold inventory at the GLD/Inventory rests at 828.10 tonnes
Dec 19/A MASSIVE WITHDRAWAL OF 14.23 TONNES OF GOLD FROM THE GLD (WITH GOLD UP THESE PAST TWO TRADING SESSIONS)/INVENTORY RESTS TONIGHT AT 828.10 TONNES
Dec 16/no changes at the GLD/Inventory rests at 842.33 tonnes
Dec 15/ANOTHER HUGE WITHDRAWAL OF 7.11 TONNES OF GOLD/INVENTORY RESTS AT 842.33 TONNES
DEC 14/another huge withdrawal of 6.82 tonnes from the GLD/Inventory rests at 849.44 tonnes/
DEC 13/no changes in gold inventory at the GLD/Inventory rests at 856.26 tonnes
Dec 12/a withdrawal of 1.19 tonnes of gold from the GLD/Inventory rests at 856.26 tonnes
Dec 9/another huge withdrawal of 3.26 tonnes of gold leaves the GLD vaults on its way to Shanghai/Inventory rests this weekend at 857.45 tonnes
Dec 8/ANOTHER HUGE WITHDRAWAL OF 2.96 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 860.71 TONNES (THIS GOLD IS HEADING TO SHANGHAI)
DEC 7/ a huge change in gold inventory/a withdrawal of 6.23 tonnesas this gold is heading towards Shanghai/inventory rests at 863.67 tonnes
Dec 6/no changes in gold inventory/inventory rests at 869.92 tonnes.
Dec 5./ a tiny withdrawal of .32 tonnes and this is probably to pay for fees/inventory rests tonight at 869.92 tonnes
Dec 2/a huge withdrawal of 13.64 tonnes of gold leaving the GLD vaults/no doubt this is heading to Shanghai taking advantage of the huge premium/inventory rests tonight at 870.22 tonnes
Dec 1/no change in gold inventory at the GLD/Inventory rests at 883.86 tonnes
NOV 30/A SMALL WITHDRAWAL OF 1.18 TONNES FROM THE GLD/INVENTORY RESTS AT 883.86 TONNES/MAYBE THEY ARE AT THE BOTTOM OF THE BARREL FOR PHYSICAL GOLD TO TRANSFER TO THE BANKERS.
Nov 29/no changes in gold inventory at the GLD/inventory rests at 885.04 tonnes
Nov 28/no change in gold inventory at the GLD/Inventory rests at 885.04 tonnes
Nov 25 We had a massive 19.87 tonnes of gold leave the GLD/this would be a paper loss not real gold (they only have paper gold in their inventory/total inventory: 885.04 tonnes
Nov 23/a huge withdrawal of paper gold from the GLD equal to 4.66 tonnes/inventory rests at 904.91 tonnes
NOV 22/no changes at the GLD/Inventory rests at 908.76 tonnes
Nov 21/A MASSIVE 11.87 TONNES OF PAPER GOLD WERE SUPPLIED BY THE CROOKS TO SUPPRESS THE PRICE OF GOLD/INVENTORY RESTS AT 908.76 TONNES/ AND GOLD RISES???
Nov 18/no changes at the GLD/Inventory rests at 920.63 tonnes
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Dec 21/ Inventory rests tonight at 824.54 tonnes
*IN LAST 55 TRADING DAYS: 125.27 TONNES REMOVED FROM THE GLD

end

Now the SLV Inventory
DEC 21/no change in silver inventory at the SLV/Inventory rests at 339.262 million oz
Dec 20/a small withdrawal of 758,000 oz/inventory rests at 339.262 tonnes
Dec 19A HUGE DEPOSIT OF 1.327 MILLION OZ INTO THE SLV/INVENTORY RESTS AT 340.020 MILLION OZ
Dec 16/A HUGE WITHDRAWAL OF 2.37 MILLION OZ FROM THE SLV/INVENTORY RESTS AT 338.693 MILLION OZ/
Dec 15/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 341.063 MILLION OZ/
Dec 14.no change in inventory at the SLV/Inventory rests at 341.063 million oz/
DEC 13/ a huge withdrawal of 1.802 million oz from the SLV/Inventory rests at 341.063 million oz
Dec 12/no change in silver inventory/inventory rests at 342.865 million oz/
Dec 9/no change in silver inventory/inventory rests at 342.865 million oz/
Dec 8/a huge withdrawal of 3.09 million oz from the SLV/Inventory rests at 342.865 million oz
DEC7/no changes in silver inventory at the SLV/Inventory rests at 345.995 million oz/
Dec 6/no changes in silver inventory at the SLV/inventory rests at 345.995 million oz
Dec 5/no changes in silver inventory at the SLV/inventory rests at 345.995 million oz/
Dec 2 a tiny withdrawal of 155,000 oz and this is probably to pay for fees/inventory rests at 345.995 million oz/
Dec 1/no changes in silver inventory at the SLV/inventory rests at 346.150 million oz/
NOV 30/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 346.150 MILLION OZ
Nov 29/no changes in silver inventory /inventory rests tonight at 346.150 million oz/
Nov 28/no change in silver inventory/inventory rests tonight at 346.150 million oz/
Nov 25/we had another withdrawal of 949,000 oz from the SLV/Inventory rests at 346.150 million oz
Nov 23/A HUGE WITHDRAWAL OF 3.083 MILLION OZ FROM THE SLV/INVENTORY RESTS AT 347.099 MILLION OZ
NOV 22/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 350.182 MILLION OZ
Nov 21/a MASSIVE 6.071 MILLION OZ OF SILVER WITHDRAWN FROM THE SLV VAULTS/INVENTORY RESTS AT 350.182 MILLION OZ/AND SILVER HOLDS IN PRICE???
Nov 18/no changes in silver inventory at the SLV/Inventory rests at 356/253 million oz
.
Dec 21.2016: Inventory 339.262  million oz
 end

NPV for Sprott and Central Fund of Canada

1. Central Fund of Canada: traded at Negative 8.3 percent to NAV usa funds and Negative 8.4% to NAV for Cdn funds!!!! 
Percentage of fund in gold 60.8%
Percentage of fund in silver:38.9%
cash .+0.3%( Dec 21/2016)
.
2. Sprott silver fund (PSLV): Premium RISES to +.19%!!!! NAV (Dec 21/2016) 
3. Sprott gold fund (PHYS): premium to NAV FALLS TO – 0.79% to NAV  ( Dec 21/2016)
Note: Sprott silver trust back  into POSITIVE territory at +0.19% /Sprott physical gold trust is back into NEGATIVE territory at -0.79%/Central fund of Canada’s is still in jail.
 

end

Major gold/silver stories for WEDNESDAY

GOLDCORE/BLOG/MARK O’BYRNE

China Gold and Precious Metals Summit 2016 – GoldCore Presentation

 

Our good friends over at Deutsche bank is trouble again as the Central Bank of Russia has accused the firm of market manipulation in Russia.

(courtesy zero hedge)

Ex-Deutsche Bank trader accused of market manipulation in Russia

Section:

By Martin Arnold and Max Seddon
Financial Times, London
Tuesday, December 20, 2016

Russia’s central bank said on Tuesday it had found evidence of “large scale” market manipulation by Deutsche Bank’s former head of Russian equity trading, accusing him of doing R300 billion ($4.8 billion) of illicit trades in the names of his relatives.

The case is another blow for Deutsche’s already battered reputation in Russia, where it has shut down most of its investment banking operations after being hit by a separate trading scandal last year.

Yuri Khilov, who left Deutsche in 2015, earned about R255 million of profit for himself and his family from 2013 to 2015, the Russian central bank said in a statement today. It said complaints had been filed with local law enforcement agencies.

The central bank accused Mr. Khilov of opening accounts in his relatives’ names, then booking trades on behalf of Deutsche’s London branch that allowed them to profit within minutes by buying or selling stocks of Russia’s most liquid companies, including Gazprom, Sberbank, Rosneft, Lukoil, and Norilsk Nickel, in the opposite direction. …

… For the remainder of the report:

https://www.ft.com/content/488a58e0-c6bd-11e6-8f29-9445cac8966f

 

 

END

 

What a sensational commentary tonight from Chris Powell.  The inaction by mining companies knowing that their industry has been attacked constantly day in and day out as been a bee in my bonnet for years: Are you paying attention officers of Agnico Eagle, Newmont , Goldcorp???

(courtesy  Chris Powell)

Why invest in the monetary metals and their miners if they won’t defend themselves?

Section:

All the market riggers are primary dealers of U.S. government securities, the most intimate associates of the Federal Reserve Bank of New York.

* * *

10:25p ET Tuesday, December 20, 2016

Dear Friend of GATA and Gold:

The more it exposes and documents manipulation of the monetary metals markets by governments, central banks, and their agents in the financial industry, the more GATA is resented by those in the monetary metals industry who are merely touters of mining shares.

That’s because GATA tells people what they are up against when they invest in the monetary metals — indeed, when they aspire to free and transparent markets and to liberty itself. So while there was a victory for GATA in this month’s disgorgement in federal court in New York of Deutsche Bank’s electronic records of market rigging by its traders and the traders of other banks, on the whole the revelations may have been a defeat for the mining industry.

.
Toronto market analyst and broker Michael Ballanger explained why in his financial letter this week:

https://www.streetwisereports.com/pub/na/twas-the-week-before-christmas

Ballanger wrote: “Until the regulators can finally put an end to this horrific process whereby the bullion banks have a total carte blanche to issue as many [futures] contracts as they desire under the guise of ‘hedging,’ prospective gold investors are simply going to say, ‘Nope, not playing.’ The intervention, collusion, and bank-coordinated gang attacks such as we are now witnessing via the Deutsche Bank evidence coming out is actually having a negative effect on sentiment, because as much as the revelations are creating transparency, they are also scaring prospective investors. The prevailing wisdom emanating from the trading desks is: ‘Wow! If they can get away with that, why would anyone put money into the gold and silver markets?”

The Deutsche Bank disgorgement has incriminated not just Deutsche Bank itself but all the recent participants of the daily London gold and silver price “fixings” — HSBC, Bank of Nova Scotia, UBS, Barclays, and Societe Generale. But apparently none of them is reported to be under investigation by government law-enforcement agencies for rigging the gold and silver markets. Indeed, three years ago the U.S. Commodity Futures Trading Commission announced that it had closed a five-year investigation of the silver market without finding any cause for an enforcement action:

http://www.cftc.gov/PressRoom/PressReleases/pr6709-13

While the CFTC has subpoena power and dozens of investigators, it apparently was unable to discover what the anti-trust class-action lawsuit in New York did.

It is not hard to understand why the CFTC might have failed — or, rather, why it might not have tried very hard. That is, all the trading bank defendants in the gold and silver lawsuits are also primary dealers in U.S. government securities, the most intimate associates of the Federal Reserve Bank of New York.

This is unlikely to be a mere coincidence.

According to the New York Fed —

https://www.newyorkfed.org/markets/primarydealers

— “Primary dealers are trading counterparties of the New York Fed in its implementation of monetary policy. They are also expected to make markets for the New York Fed on behalf of its official accountholders as needed, and to bid on a pro-rata basis in all Treasury auctions at reasonably competitive prices.”

Gold and silver are money, and as GATA’s documentation has shown, governments still treat them as such and they remain of great interest to “monetary policy,” which is not to let them compete effectively with government-issued money. Governments and central banks can’t be much bothered by their primary dealers pushing gold and silver prices around as long as the primary dealers are pushing those prices where governments and central banks want them to go and providing camouflage for government and central bank intervention.

But if that explains the failure of governments to prosecute the gold and silver market riggers, what explains the silence of the monetary metals mining industry and its nominal representatives, like the World Gold Council, even after Deutsche Bank’s disgorgement? Enough clamor and exposure would compel governments and central banks either to stop rigging the monetary metals markets or at least to do it in the open, which soon would destroy the rigging’s effectiveness, as doing it in the open destroyed the London Gold Pool in 1968:

https://en.wikipedia.org/wiki/London_Gold_Pool

Yet mining companies and the World Gold Council act as if they are owned by the governments destroying them. The mining companies do not act as if they understand the monetary nature of their products or their own function as minters of independent money for free people.

The mining industry’s failure to defend itself against predators goes even beyond this. The industry doesn’t defend individual companies being systematically victimized.

As Rudi P. Fronk, chairman and chief executive officer of Seabridge Gold, a company that long has supported GATA, writes today:

“I don’t know if you have been following the recent trading activity in Seabridge, but last week the company got caught up in a significant rebalancing of the exchange-traded fund GDXJ that occurred Friday with more than 2.17 million shares sold as a block at the close. Going into last week, GDXJ owned just over 6 million common shares of Seabridge, or approximately 12 percent of our shares outstanding. The fund ended the week owning only 3.7 million shares (7 percent of Seabridge), having sold more than 2.3 million shares of the company during a tough week for gold.

“Unfortunately we do not get any notice of the extent of these rebalancings and learn about them only after the fact. But it is clear to me that someone knows ahead of time about the rebalancings, as we get shorted days before the block crosses with the shorters knowing that they will be able to cover at a low price with the end-of-week block.

“This has happened to us before, and while such events usually make great entry points for new buyers, current shareholders get screwed.”

The mining industry should have an association to clamor against such mistreatment as well. But where is it? The World Gold Council seems to function mainly to divert into mere derivatives investment funds intended for real metal and to ensure that there never is a world gold council.

So what can be done by investors in the monetary metals and by advocates of free and transparent markets and limited and accountable government?

Plenty can be done, once you realize that, powerful as the other side is, exercising all the power of government, its most powerful weapon is your own demoralization.

For starters people can challenge the gold and silver companies in which they are invested, insisting that company executives review the documentation of surreptitious intervention in the gold and silver markets by central banks and take a position on it:

http://www.gata.org/node/14839

Is the documentation genuine and valid or forged or misconstrued? If the mining industry protested about it to its elected representatives in government, it would make serious trouble.

Second, people can query their elected representatives about the market rigging — urging them to review and investigate the documentation as well and to question treasury and central bank officials about it. Are governments surreptitiously trading the gold market and, if so, for what purpose? Then any responses or refusals to respond should be publicized.

The same questions should be directed to financial regulators too and their answers publicized — particularly the U.S. Commodity Futures Trading Commission, whose failure to crack the silver case is now a spectacular embarrassment.

Sensational as the revelations in the Deutsche Bank case have been, the case has a long way to go before resolution. It likely will prompt more lawsuits against more trading banks, but maybe not until the current case is resolved. No one should wait for that.

And of course since apart from the lawsuit in New York only GATA seems to be doing anything about this fraud, people can support us financially:

http://www.gata.org/node/16

Even a $5 donation will be more than Newmont Mining has contributed to the cause.

The logic of the use of derivatives to suppress monetary metals prices is that there is enormous potential for prices to explode if the rigging stops and the physical market defeats the paper market. But as long as investors are ready to accept mere certificates from bullion banks in place of real metal, and governments, central banks, and their agents are ready to issue paper for infinite amounts of imaginary gold, the market rigging can go on forever.

As with everything else in the world, it’s entirely a question of whether people can ever bring themselves to act.

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

 

END

 

Strange:  gold ETF’s drop for a record 28 straight days.  This commenced the day of the Trump election:

(courtesy zero hedge)

.

Gold ETF Holdings Drop For Record 28 Straight Days

While demand for physical gold is soaring in India and China (with premiums near record highs)…

Bloomberg reports that the last time ETF investors were net buyers of gold was the day Hillary Clinton conceded victory to U.S. President-elect Donald Trump. Holdings have dropped for 28 straight days, the longest run since the ETF’s creation in 2004.

Investors have slashed holdings by 11 percent to about 1,787 metric tons in the period, exacerbating a decline in prices…

But as financial conditions deteriorate once again, gold has decoupled (for now)…

And finally we note that as Bitcoin soars, it feels like deja vu all over again from late last year…

. end

 

Bullion star notes that the gold has never really been audited and they for sure do not include their location gold swaps:

(courtesy Bullion Star/ManlyGATA)

Bullion Star’s primer on the U.S. gold reserve

Section:

10:48a ET Wednesday, December 21, 2016

Dear Friend of GATA and Gold:

Bullion Star today has posted a primer on the U.S. gold reserve, noting that it hasn’t been audited terribly well in recent decades. More interesting to GATA is that the audits, such as they are, as well as general discussion and news reporting about the reserve never cover the secret gold swaps in which, according to a 2009 admission to GATA by a member of the Federal Reserve’s Board of Governors, the Fed is secretly involved:

http://www.gata.org/node/7819

The secret March 1999 report of the staff of the International Monetary Fund to the IMF’s board said central banks conceal their gold swaps and leases to facilitate their surreptitious intervention in the gold and currency markets:

http://www.gata.org/node/12016

Bullion Star’s primer on the U.S. gold reserve is posted here:

https://www.bullionstar.com/gold-university/central-bank-gold-policies-u…

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

 

end

 

Russia adds another whopping 31 tonnes of gold to its reserves

(courtesy Lawrie Williams/Sharp’s Pixley)

LAWRIE WILLIAMS: Russia adds 31 tonnes of gold to reserves in November

DEC
21

Russia, which, along with China, has been reported to be orchestrating a financial alliance to supplant the U.S. dollar as the world’s leading reserve currency, thus reducing its dominance of global trade, obviously sees gold as an integral part of the process. Its central bank is currently by far the largest known regular buyer of gold globally and has added a further 31.1 tonnes (1 million ounces) to its gold reserves in November according to an announcement made by the central bank yesterday – it releases monthly reserve data usually on the 20th of the month. Indeed Russia has been building its gold reserves pretty consistently for the past 10 years as can be seen from the chart below from Nick Laird’s excellent goldchartsrus.com website.

Russian central bank reserve figures will be subject to minor adjustment when reported to IMF, but overall they probably add up to just short of 1,600 tonnes – the world’s sixth largest national gold reserve, but still hugely short of the 8,133.5 tonnes as reported to the IMF by the USA.

Only recently Pravda reported that Russia would have to sell some of its gold to allay current account deficit problems – see: Russia may have to sell gold to boost current account but as we suggested at the time that doesn’t seem to have affected its central bank buying programme which has just seen the largest two month period of total purchases on record. However, Russian mines produce over 20 tonnes of gold a month on average so there is scope for both gold buying and gold sales from the country’s own output alone.

http://news.sharpspixley.com/article/lawrie-williams- russia-adds-31-tonnes
-of-gold-to-reserves-in- november/260963/

-END-

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

 
 

1 Chinese yuan vs USA dollar/yuan UP to 6.9444(SMALL REVALUATION NORTHBOUND  /CHINA UNHAPPY TODAY CONCERNING USA DOLLAR RISE/MORE $ USA DOLLARS LEAVE CHINA/OFFSHORE YUAN NARROWS  TO 6.9228 / Shanghai bourse CLOSED UP 34.55 POINTS OR 1.11%   / HANG SANG CLOSED UP 80.74 OR 0.37%

2. Nikkei closed DOWN 50.04 POINTS OR 0.26% /USA: YEN RISES TO 117.12

3. Europe stocks opened ALL IN TH RED     ( /USA dollar index FALLS TO  102.92/Euro UP to 1.0432

3b Japan 10 year bond yield: FALLS    +.061%/     !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 117.12/ THIS IS TROUBLESOME AS BANK OF JAPAN IS RUNNING OUT OF BONDS TO BUY./JAPAN 10 YR YIELD FINALLY IN THE POSITIVE/BANK OF JAPAN LOSING CONTROL OF THEIR YIELD CURVE AS THEY PURCHASE ALL BONDS TO GET TO ZERO RATE!!

3c Nikkei now JUST BELOW 17,000

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

3e WTI::  53.61  and Brent: 55.60

3f Gold UP/Yen UP

3g Japan is to buy the equivalent of 108 billion uSA dollars worth of bond per month or $1.3 trillion. Japan’s GDP equals 5 trillion usa./“HELICOPTER MONEY” 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 UP for WTI and UP for Brent this morning

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10 yr bund FALLS TO +253.%/Italian 10 yr bond yield FALLS 3 full basis points to 1.827%    

3j Greek 10 year bond yield RISES to  : 7.25%   

3k Gold at $1135.10/silver $16.06(7:45 am est)   SILVER BELOW RESISTANCE AT $18.50 

3l USA vs Russian rouble; (Russian rouble UP  45/100 in  roubles/dollar) 60.99-

3m oil into the 53 dollar handle for WTI and 55 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 SMALL   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 117.12 DESTROYING JAPANESE CITIZENS WITH HIGHER FOOD INFLATION

30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF. It is not working: USA/SF this morning  1.0252 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0695 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  +.253%

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 2.555% early this morning. Thirty year rate  at 3.138% /POLICY ERROR)GETTING DANGEROUSLY HIGH

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

Dow At All Time High, Dollar Dips, Europe Lower Dragged By Sliding Spanish, Italian Banks

US equity futures and Asian stocks were unchanged while European stocks declined after touching the highest level in almost a year, as Italian and Spanish banks dragged indexes lower. The dollar eased back from 14-year highs as bond yields fell on Wednesday and oil extended its advance in increasingly thin trading.

Spanish banks fell after a ruling in the European Union’s top court that may result in them handing back billions of euros to mortgage customers. Bank shares tumbled by as much as 10%. Borrowers who paid too much interest on home loans pre-dating a May 2013 Spanish ruling on so-called mortgage floors are entitled to a refund from their banks, judges at the EU Court of Justice ruled in Luxembourg Wednesday.

As Bloomberg reports, the court said that a proposed time limit on the refunds is illegal and customers shouldn’t be bound by such unfair terms. Banco Sabadell SA fell as much as 7.5 percent, while Banco Popular slipped as much as 10.5%, the largest decliner in Spain’s Ibex 35 benchmark.

“This comes as a surprise and in a bad moment for Spanish banks as most of them would have to make extra provisions to pay for this,” Daragh Quinn, an analyst at Keefe Bruyette & Woods, said by phone. “It will mean pressure on capital generation and profits in the fourth quarter.”

Meanwhile in Italy, Banca Monte dei Paschi di Siena SpA fell on concern it may fail in its efforts to raise €5 billion euros of funds and after it said its liquidity may turn negative in four months. Oil traded above $53.50 a barrel as data showed U.S. stockpiles declined last week. The yen strengthened and the dollar slid from the highest since 2003 versus the euro.

Looking at Bloomberg data, volumes are thinning and swings in global equities are muted, with European equity volatility dropping to the lowest since 2014. The Trumflation rally has proppelled the Dow Jones to all time highs just shy of 20,000 on prospects for increased government spending in the U.S. and while Ray Dalio offered praise for Trump’s policies, Mohamed El-Erian and his former colleagues at Pacific Investment Management Co. say now’s a good time to take advantage of the latest rallies in global financial markets and scale back from risk.

“It makes total sense to take some money off the table,” El-Erian, the chief economic adviser at Allianz SE said Tuesday. “We’ve priced in no policy mistakes. We’ve priced in no market accidents, and we’ve ignored all sorts of political issues,” he said on Bloomberg TV. In October, El-Erian said that he held about 30 percent of his own money in cash.

The MSCI index of Asia-Pacific shares ex-Japan inched up 0.1% after a string of losses. Tokyo’s Nikkei share average fell, pulling back from earlier one-year highs to close down 0.3 percent.

In Europe, the Stoxx Europe 600 Index fell 0.1 percent in early trading. The gauge closed at its highest level since December 2015 on Tuesday. European banks led declines, falling 0.5%. Futures on the S&P 500 Index were little changed The gauge rose 0.3 percent to 2,266.5 on Tuesday, a point below its all-time high. The Dow Jones Industrial Average closed at record 19,974.62.

Yields on 10-year Treasury notes fell less than one basis point to 2.55 percent, after gaining two basis points Tuesday. Germany’s 10-year bund yields dropped two basis points to 0.25%. Among lower-rated bonds.
Spanish 10-year yields fell to five-week lows and Italian
equivalents also fell on concerns over banks. The premium over Spain that Italy would pay to borrow in bond markets briefly topped 50 bps for the first time since just after a failed Dec. 4 referendum on constitutional reform triggered Italian premier Matteo Renzi’s resignation.

The Bloomberg Dollar Spot Index was little changed after climbing for two straight days. The measure’s gain for the quarter is 7.6 percent, heading for the biggest three-month advance since the third quarter of 2008. Many analysts still see the dollar rising further, possibly to parity with the euro.  “The euro is in a fight between short-covering pressure and political angst. Economics doesn’t come into it at all. If Dow 20,000 is just a number but a magnet all the same, euro parity with the dollar will be every bit as magnetic,” said Kit Juckes at Societe Generale. “We’ll get there and get over-excited before too long.”

“We are seeing quite a lot of volatility. It is driven by the direction of the U.S. dollar. (Gold) is just marking time before it makes its next big move. It is in a very, very strong down channel,” said Jeffrey Halley, senior market analyst at OANDA.

The Swedish crown hit a two-month high against the euro after the Riksbank kept interest rates on hold and expanded its asset-buying program.

Lack of more dollar strength pushed oil higher by 0.7% to $53.69 in New York. Crude inventories dropped by 4.15 million barrels according to API data, and ahead of the EIA weekly report today which is expected to show further inventory declines.

Overnight Bulletin Summary from RanSquawk

  • European equities trade mostly lower with peripheral banks once again under pressure as concerns continue to mount over the future of Banca Monte dei Paschi
  • The standout theme today has been GBP, with losses against the EUR widely acknowledged to be front-loaded Dec buying out of Europe
  • Looking ahead, highlights include Riksbank rate decision, US existing home sales and DoE crude oil inventories

Market Snapshot

  • S&P 500 futures little changed at 2267.4
  • Stoxx Europe 600 down 0.2% to 360.77
  • MSCI Asia Pacific little changed at 135.31
  • US 10Yr yield little changed at 2.56%
  • Dollar index down 0.1% to 103.22
  • WTI oil futures up 0.7% to $53.69/bbl
  • Gold spot up 0.1% to $1133.26/oz

Top Market News

  • TDK Corp. agreed to buy InvenSense Inc. in a deal that values the supplier of sensors to Apple Inc. and other smartphone makers at about $1.3b
  • Coca-Cola Co. will pay $3.15b to buy Anheuser-Busch InBev NV out of an African bottling joint venture after the Budweiser brewer’s takeover of the U.S. beverage company’s partner in the region.
  • Paschi plunged to a record low amid mounting concern it will fail in its effort to raise 5 billion euros ($5.2b) of funds from money managers and individuals
  • A lifeline for China’s local junk bonds is about to get cut, threatening financing for weaker companies already grappling with mounting defaults
  • Trudeau Joins Obama in Freezing Arctic Offshore Oil Drilling
  • Swedish Central Bank Expands Stimulus as Record Easing Nears End
  • Twitter CTO Messinger to Exit, Further Depleting Executive Ranks
  • Calpers Staff Says Pension Should Lower Return Target to 7%
  • Tesla Boosts Credit Lines Again to Aid Elon Musk Expansion
  • Spanish Banks Lose EU Case Over Mortgage Interest Repayments
  • Stanley to Sell Door-Locks Unit to Dormakaba for $725 Million
  • FedEx Profit Disappoints as Spending Rises on Ground Delivery
  • Nike Earnings Top Estimates, Easing Concerns About Slowdown
  • Pandora Says Chief Operating Officer Sara Clemens Resigned
  • Arizona Reduces Solar Incentive for Consumer Rooftop Systems
  • Amazon Sells Out of Echo Speakers in Midst of Holiday Rush

Looking at Asian markets, stocks traded mostly higher following the positive lead from Wall St where financials outperformed and DJIA posted a fresh record high to close near 20,000. ASX 200 (+0.4%) was led higher by the materials sector after iron ore rose 2%, while Nikkei 225 (-0.1%) swung between gains and losses with cautiousness driven by a pullback in USD/JPY. Shanghai Comp (+1.2%) and Hang Seng (+0.6%) traded with an upbeat tone despite a further 6 Hong Kong banks increasing CNH deposit rates due to tight liquidity, as the PBoC conducted another firm liquidity injection and there were also reports China is to relax limits on stock index futures soon. 10yr JGBs saw quiet overnight trade with mild gains seen after sentiment in Japanese stocks began to sour and after today’s enhanced liquidity auction printed a higher b/c than previous. PBoC injected CNY 110bIn in 7-day reverse repos, CNY 70bIn in 14-day reverse repos, CNY 30bIn in 28-day reverse repos. PBoC set the mid-point at 6.9489, virtually unchanged from the last print of 6.9468.

In Europe bourses trade mixed (EUROSTOXX 50 -0.2%) this morning with Spanish and Italian banks underperforming. Spanish banks trade at session lows amid reports that banks have lost EU case on mortgage interest repayments and will face an extra bill and as such, CaixaBank are currently trading lower by 4.7%. Once again, Banca Monte dei Paschi are feeling the squeeze after trading at YTD lows with the latest reports suggesting the bank may only have 4 months of liquidity left (Prey. view was for 11 months) Elsewhere in equities, Volkswagen / Porsche have reached a new deal in which they will recall 83,000 vehicles over emission cheating with the estimated value of the agreement in the region of USD lbln. Fixed income markets are suffering from thin volumes with the only story of note coming from Greece, with the country are struggling to meet their payments to creditors in July 2017.

Top European News

  • Spanish Banks Lose EU Case Over Mortgage Interest Repayments
  • Italy Bank Rescue Won’t Fill $54 Billion Hole on Balance Sheets
  • Meggitt Sells Meggitt Target Systems to QinetiQ Group

In currencies, the Bloomberg Dollar Spot Index was little changed after climbing for two straight days. The measure’s gain for the quarter is 7.6 percent, heading for the biggest three-month advance since the third quarter of 2008. The yen gained 0.3 percent to 117.56, after falling 0.7 percent on Tuesday. The euro added 0.1 percent to $1.0403, after touching an almost 14-year low of $1.0352 yesterday. The standout theme today has been GBP, with losses against the EUR widely acknowledged to be front-loaded Dec buying out of Europe. Cable has been pressed lower as a result, but this is also down to the pressure seen on EUR/USD, which is struggling to post any sort of recovery through 1.0400 as USD dips are consistently paid up. Some moderation in the AUD as Iron Ore prices rose 2%. Spot trade tight on .7250 today, while NZD/USD gains back above .6900 look temporary at best. USD/CAD buyers seen in the mid 1.3300’s, as yield sentiment overrules the Oil price relationship.

In commodities, oil climbed 0.7 percent to $53.69 in New York. Crude inventories dropped by 4.15 million barrels, the American Petroleum Institute was said to report. Data from the Energy Information Administration on Wednesday is also forecast to show supplies shrank. Gold rose 0.2 percent to $1,135.55 an ounce, after closing near a 10-month low Tuesday. As the Christmas break nears, activity slowly grinds to a halt, and nowhere more so than in commodities. Gold saw a minor upturn as the USD gives up some of its better levels, but the prospects of further downside look likely given 2017 projections for the greenback and stocks still very much on the front foot. Base metals are supported as a consequence, as are Oil prices, further bolstered by the API drawdown reported last night. Front month WTI highs seen just shy of USD53.80 so far today.

US Event Calendar

3.REPORT ON JAPAN  SOUTH KOREA NORTH KOREA AND CHINA

i)Late  TUESDAY night/WEDNESDAY morning: Shanghai closed up 34.55 POINTS OR 1.11%/ /Hang Sang closed UP 80.74  OR 0.37%. The Nikkei closed DOWN 50.04 OR 0.26%/Australia’s all ordinaires  CLOSED UP 0.39% /Chinese yuan (ONSHORE) closed UP at 6.9444/Oil ROSE to 53.61 dollars per barrel for WTI and 55.60 for Brent. Stocks in Europe: MOSTLY IN THE RED.  Offshore yuan trades  6.9228 yuan to the dollar vs 6.9444  for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS COMPLETELY AS  MORE USA DOLLARS ARE BLOCKED FROM LEAVING CHINA’S SHORES /

3a)THAILAND/SOUTH KOREA/:

none today

b) REPORT ON JAPAN

c) REPORT ON CHINA

Another Islamist attack??: this time in Beijing:

(courtesy zero hedge)

4 Dead, Many Injured After Minibus “Drove Into” Beijing Market

Four people are dead and many more injured after a minibus drive into a market in the northern region of Beijing. While China’s traffic safety record is not exactly stellar, with many on edge following the Berlin attack, this event is noteworthy as China has faced a threat from Islamist militants operating in its far western region of Xinjiang who have been blamed for a series of attacks in recent years.

As Reuters reports, the incident happened at about 3 p.m. (0700 GMT) in a small town in Beijing’s largely rural Changping district, when the minibus “drove into” an agricultural market and hit people there, Beijing police said in a short statement on their microblog.

The injured have been taken to hospital, the statement said, without given a number of people involved.

Police have taken custody of the vehicle and “relevant personnel” and are investigating further, it added, without giving other details.

China’s poor traffic safety record means such incidents are common.

While the police statement did not suggest this was intentional, there have been cases in China of people seeking to settle personal scores who have carried out similar acts.

China also says it faces a threat from Islamist militants operating in its far western region of Xinjiang, who have been blamed for a series of attacks in recent years, mostly in Xinjiang but occasionally in other parts of the country.

The sad thing is that this event could be nothing but an accident, but in this new normal of government-inflamed fear, our biases immediately tilt to terrorism as more likely.

 

 

end

 

Turmoil in China sees Bitcoin rise another 30 dollars. It is trading at $830  uSA per Bitcoin.

(courtesy zero hedge)

Bitcoin Soars To 3 Year Highs As China Turmoils

With Chinese liquidity markets turmoiling, bonds crashing, and gold premiums soaring, it appears growing concerns over capital controls tightening has sent Chinese fleeing into Bitcoin as a way to escape the mainland restrictions. Bitcoin is up over $30 today to its hghest since Dec 2013

We first warned of this ‘outlet’ for Chinese capital in September 2015 when Bitcoin was trading around $200… its just topped $830…

As we noted recently, according to Bloomberg sources, Chinese officials are
considering policies including restricting domestic bitcoin exchanges
from moving the cryptocurrency to platforms outside the nation and
imposing quotas on the amount of bitcoins that can be sent abroad
. Further indicating that Chinese regulators were “just a little behind the curve”, they allegedly noticed only recently that some investors bought bitcoins on local exchanges and sold them
offshore, evading rules on foreign exchange and cross-border fund flows,
the report further reveals.

A quick look at the uncanny correlation between the decline in the
Yuan and the rise in the bitcoin, confirms that the digital currency has
indeed been largely used to evade capital controls.

And it appears pushing into Bitcoin is cleaner (for now) than precious metals as an alternative to the Yuan…

Note we saw this pattern in Nov/Dec last year also (as capital control fears grew) and that was followed by a surge back into gold.

end

 

I highlighted to you the Trump proposal for a “border tax policy”  I urge you to read it carefully.(in the USA section today)  Just now, Trump appoints author Peter Navarro to head the trade office and he has stated that we are in a economic war with China.

If Trump goes ahead with his border tax proposal, the dollar will skyrocket, the deficit will shrink and China will have a full blown crisis on its hands as it must devalue it’s currency to well over 8. China will no doubt pull its gold card out if this may come to fruition:

(courtesy zero hedge)

 

Trump Appoints “Death By China” Author Peter Navarro To Head Trade Office, Hints At Trade War With Beijing

Another day, another shot across the bow from Donald Trump aimed squarely at China.

Having already participated (and in the case of one, precipitated) two mini diplomatic snafus with Beijing in just the past two weeks, Trump is sending a clear message to Beijing that US-China trade under his administration will be anything but business as usual, by creating a National Trade Council inside the White House to oversee industrial policy and has decided to appoint a hard core China hawk to run it.

According to the FT, which broke the news, Trump has chosen Peter Navarro, a Harvard-trained economist and one-time daytrader, to head the NTC. The author of books such as “Death by China” and “Crouching Tiger: What China’s Militarism Means for the World”has for years warned that the US is engaged in an economic war with China and should adopt a more aggressive stance — a message that the president-elect sold to voters across the US during his campaign.

Speaking to the American public, Trump said “I read one of Peter’s books on America’s trade problems years ago and was impressed by the clarity of his arguments and thoroughness of his research,” Trump said. “He has presciently documented the harms inflicted by globalism on American workers, and laid out a path forward to restore our middle class.”

Fast forward to today, when Trump has made it clear that at least when it comes to the Chinese trade relationship, the president elect will engage in a wholesale overhaul of the legacy relationship. More details from the FT:

The Trump transition team described Mr Navarro as a “visionary economist” who would “develop trade policies that shrink our trade deficit, expand our growth, and help stop the exodus of jobs from our shores”. His appointment is the second restructuring of trade policy that will see Mr Trump attempt to follow through on his focus to resurrect manufacturing, and create more industrial jobs, in the American economy.

 

The Trump team said the NTC would lead a “Buy America, Hire America” programme that would boost job creation in areas such as infrastructure and defence. It will work in tandem with three other offices in the White House: the National Security Council, the National Economic Council and the Domestic Policy Council.

 

They added that it would mark the first time there was an office dedicated to manufacturing inside the White House, in a strong signal that Mr Trump plans to follow through on the promises that he made on the campaign trail.

While the Navarro appointment will certainly raise eyebrows, the move to create the new office is also likely to be seen as controversial by mainstream economists, many in the business community and pro-trade Republicans. Targeting the trade deficit is seen by many economists as likely to lead to protectionist trade policies. It may also be complicated by Mr Trump’s plans for an increase in spending and rising interest rates, both of which have already yielded a surge in the dollar that is likely to make US exports less competitive and would normally lead to a bigger trade deficit.

Navarro’s appointment also means that the speculation that Trump may launch a “Border tax proposal” to eliminate the US trade deficit is far more likely than the 30% probability some assign to it. If it indeed passes, then watch out, because as Deutsche Bank calcualted yesterday, it would lead to a 15% surge in the dollar, which would almost certainly lead to a full blown Chinese economic crisis.

 

For those who missed it, here is what a border tax proposal would mean in three paragraphs:

  • A “border tax adjustment” would, roughly speaking, be equivalent to a 15% one-off devaluation of the dollar. Imports would be 20% more expensive, because corporates would have to pay the new 20% corporate tax rate on their value. Exports would be roughly 12% “cheaper”, because for every $33 of earnings earned from $100 of exports (we use the 33% gross margin of the S&P), there would be a 12% tax cost ($33 earnings*35% current tax rate) that would no longer be imposed on corporates. Taking the average impact on the prices of exports and imports is equivalent to a 15% drop in the dollar.
  • A border tax adjustment would be very inflationary. The price of exports doesn’t affect the US consumption basket so would have no impact on CPI. However, the cost of imports would go up by 20%, which based on a simple relationship between import PPI and US inflation would be equivalent to a 5% rise in the CPI. Corporates may of course choose to absorb part of the rise in import costs in their profit margins. But either way, the order of magnitude is large.
  • A border tax adjustment would be very positive for the US trade balance. Similarly to the dollar calculations, a border tax adjustment would be equivalent to an across the board import tariff of 20% and an export subsidy of 12%. Keeping all else constant and applying standard trade elasticity impact parameters to an average of the two estimates results in a more than 2% drop in the trade deficit equivalent to more than 400bn USD, or equivalently, an almost complete closing of the US trade deficit.

4 EUROPEAN AFFAIRS

Italy/Monte de Paschi

Monte de Paschi announces that not only is it insolvent but it is also illiquid as there seems to be a huge run on the bank as depositors decide not to wait and remove their money from this bank.  The Italian government has now approved the 20 billion euros of funds necessary to bail out the banks.  The next move in this chess game is Germany:  bail in or bail out?

(courtesy zero hedge)

Monte Paschi Crashes To All Time Low, Rebounds After Government Agrees To Fund Bank Bailouts

In early European trading, shares of Italy’s third largest and most troubled bank were halted after crashing 17%, dropping to fresh all time lows, after the bank warned it is not only insolvent, but its liquidity could run out far sooner than expected.

BMPS shares initially dropped following yesterday’s news that the €5 billion private sector rescue plan appeared to be a dead end, after only €500 million in new capital was said to have been lined up, coming far short of the targeted bogey. An analysis by Swedbank said that adverse reports about Paschi’s efforts to find private capital are “quite discouraging” and added that “it seems as if a government intervention comes closer by the day.” It also noted that that government intervention that also abides by BRRD (Bank Recovery and Resolution Directive) rules will punish equity and junior bond holders, which is a major concern.

This was, however, compounded after Monte Paschi warned it expects to burn through around €11 billion euros of liquidity more quickly than previously forecast, according to a revised prospectus on the bank’s website.

The world’s oldest bank said it now expected its net liquidity position, currently standing at €10.6 billion, to turn negative after four months. This was a sharp deterioration from the most recent liquidity update just three days prior, when on Sunday the bank had forecast that a current net liquidity position would turn negative after 11 months under a number of assumptions. It said on Wednesday the position would be negative for 15 million euros on the 5th month and could worsen further to minus 740 million euros by the 12th month. This compares with the minus 100 million-euro level it forecast on Sunday for the 12th month.

The bank also noted that it had lost 11%, or €14 billion, of its total deposits from January to September 2016, and added that its liquidity levels would fall under the required level should it suffer another €10bn of deposit outflows under a “stress” scenario calculated by the European Central Bank. From the prospectus, as quoted by the FT:

The situation of the liquidity of the bank had progressively deteriorated until it reached, following the constitutional referendum of December 4, a time horizon of 29 days before which the bank would not be able to meet its liquidity requirements without seeking help from new interventions. That time horizon was calculated applying a stress situation where the bank saw an outflow of €10.3bn in a month.

However, just as the situation appeared terminally grim for the twice-bailed out bank, its shares soared briefly recovering all losses when moments ago Italy’s upper house of parliament approved a government request to borrow up to €20 billion in new public debt to underwrite bailouts of the country’s various troubled banks. The vote came just minutes after the lower house had also given its authorization for a hike in the national debt to cover an eventual intervention.

The twin votes clear the way for government action, possibly this week, and the result was a bout of optimism that Italy may just have kicked the can one more time, on expectations Monte Paschi would quickly request state funds to prevent it from collapse.

Amusingly, earlier in the day, Italy’s Finance Minister Padon told lawmakers that the “Italian banking system was solid.” Maybe it is for the next few months, and all it will cost taxpayers is another €20 billion in public debt.

We now await Germany’s statement on what appears to be yet another government bailout of insolvent European banks.

 

 

end

Now the fun begins:  Italy is set to nationalize Monte de Paschi after private sector rescue attempts fail.  As we discussed above, it is now up to Germany to see what will happen:  a bail in or a bailout?

(courtesy zero hedge)

Italy To Nationalize Monte Paschi After Private Sector Rescue Fails

Update: the FT writes that the Italian govt set to take a stake between 50% and 70% in Monte dei Paschi, up from the current 4% stake, as part of the government’s third bailout in as many years. As the FT adds, “the government rescue, which had long been resisted in Rome, is designed to draw a line under the slow-burn crisis in Italian banking that has alarmed investors and become the main source of concern for European financial regulators.”

It remains to be seen if Germany, long a critic of state bailouts, will be as agreeable.

Meanwhile, Pier Carlo Padoan, the Italian finmin, insisted that apart from a few “critical” situations, Italy’s banking system was “solid and healthy”. He vowed to “minimise, if not erase” any impact of the public intervention on the savings of ordinary citizens.

* * *

The third bailout, and re-nationalization, of Italy’s third largest banks is imminent following a Reuters report that the ongoing, JPM-led attempt to execute a complex private sector bailout of Monte Paschi has failed.

According to Reuters, Qatar’s sovereign wealth fund, long considered as the most likely anchor investor with a €1 billion allocation in any rescue plan cash call, decided it is unwilling to invest in the Italian bank, meanwhile Monte Paschi has been unable to find a replacement investor willing to put money in its privately funded rescue plan, less than 24 hours before the offer ends.

As a result, the bank entire share sale, which closes at 2 p.m. (1300 GMT) on Thursday, has drawn very little interest from the wider investment community.

As laid out previously, the bank needs to raise €5 billion by the end of this month to avert being wound down. The Italian government, which earlier today got a greenlight to issue €20 billion in public debt to use for bank bailout purposes, is expected to step in this week and nationalize the bank.

The approval came after the ECB refused to extend a deadline on a €5bn recapitalisation before the end of the year and fears mounted the lender’s liquidity levels were becoming unsustainable. MPS has lost €14bn, or 11 per cent of its total deposits, from January to September 2016 and warned its liquidity provision would fall under the required levels should it suffer another €10bn of deposit outflows under a “stress” scenario calculated by the ECB. The news sent the stock plunging to record lows, shortly before the government agreed to let taxpayers shoulder the burden of yet another bailout of the insolvent bank. In addition to Monte Paschi, other banks expected to benefit from Italy’s imminent state aid include Veneto Banca, Popolare Vicenza, Cassa di Cesena, Cassa di Rimini and Cassa di San Miniato.

In addition to the new capital injection by the government, it is unclear what the “bail-in” terms of the rescue will be. While a reported by Il Messaggero earlier said that the planned government bank aid won’t hurt depositors because funds will be given under EU’s precautionary recapitalization plans, it is likely that at least some of the bondholders will be impaired. The Italian newspaper said that holders of shares and bonds in banks affected to face “soft” burden-sharing by having to participate in conversion of subordinated bonds into shares.

As shown previously, Italy is unique in that the vast majority of “bail-inable” debt on bank balance sheets is held by domestic, retail investors.

The terms of their impairment may determine the longevity of the brand new Italian government.

There is another problem: in the past both Merkel and Schauble, not to mention Djisselbloem, have made it expressly clear that a bail-in mechanism should be used to preserve insolvent banks, and a state-funded and taxpayer backed bailout/nationalization is no longer permitted. Allowing Italy to proceed with this transaction would make a mockery of Europe’s entire “bail-in” protocol, not to mention the European finance ministers’ resolve and ability to implement anything, which is why the European Commission would need to assess whether the government’s intervention is taking place at market prices or if it constitutes state aid.

 

 

end

Germany

The real suspect is a Tunisian islamist man known to the German authorities as very dangerous.  They have been aware of his terrorist beliefs for months after gaining asylum in Germany

(courtesy zero hedge)

New Suspect In Berlin Terror Attack: German Police Hunt For Tunisian Islamist Man

Update: According to Reuters, quoting German newspapers, the Tunisian suspect had been in contact with network of leading Islamist ideologist know as Abu Walaa, and had applied for asylum and received residency permit.

The German state minister says the suspect in Berlin attack appears to have used different names, declined to say whether suspect was on a watch list but security agencies have identified suspect as being in contact with Islamist network.

German state minister also said the suspect appears to have arrived in Germany in July 2015, and his asylum application had been rejected.

German police is searching for a Tunisian man after conveniently finding a temporary-stay permit under the driver’s seat of the truck that plowed into a Berlin Christmas market, killing 12 people, according to Spiegel Online. The man is aged 21 or 23 and known by three different names, according to reports in the daily Allgemeine Zeitung and the Bild newspaper. According to a slightly conflicting report, the document was in the name of Anis A., born in the southern city of Tataouine in 1992.

Anis A.

It was not immediately clear why it took so long to find the alleged identity document which was located under the driver’s seat, and why a different person of interest was detained for nearly 24 hours after the attack.

As a reminder the man who rammed a truck through a crowd in Nice during Bastille Day celebrations, killing 86, was also Tunisian-born.

Bild reported that the Tunisian was known to police as a possibly dangerous individual, and part of a large Islamist network. A police operation is said to be under way in the state of North Rhine-Westphalia where the permit was issued. Reports also say the suspect may have been injured in a struggle with the driver.

He applied for asylum in April and was given a temporary residence permit, the Sueddeutsche Zeitung said.

Police initially arrested a Pakistani asylum-seeker near the scene, but released him without charge on Tuesday. Authorities have warned that the attacker is on the run and may be armed. It is not clear if the perpetrator was acting alone or with others.

According to Reuters, the Polish driver of the killer truck was found shot dead in the cabin of the vehicle. An autopsy indicated that the driver was still alive at the time of the attack, the daily Bild reported. It quoted an investigator as saying there must have been a struggle with the attacker, who may have been injured. The 37-year-old Pole named Lukasz worked for his cousin Ariel Zurawski’s transport company in northern Poland. Zurawski described him as a “good guy” and said his body showed signs of a struggle with the assailant or assailants.

Islamic State has claimed responsibility, as it did for a similar attack in July when a Tunisian-born man rammed a truck through a crowd celebrating Bastille Day in the French city of Nice. Eighty-six people were killed, and the driver was shot dead by police.

The head of the Association of German Criminal Detectives, Andre Schulz, told German television late on Tuesday that police hoped to make another arrest soon. “I am relatively confident that we will perhaps tomorrow or in the near future be able to present a new suspect,” he said.

Meanwhile, Wednesday’s Passauer Neue Presse quoted the head of the group of interior ministers from Germany’s 16 federal states, Klaus Bouillon, as saying tougher security measures were needed.

“We want to raise the police presence and strengthen the protection of Christmas markets. We will have more patrols. Officers will have machine guns. We want to make access to markets more difficult, with vehicles parked across them,” Bouillon told the paper.

German Chancellor Angela Merkel, who will run for a fourth term next year, has said it would be particularly repulsive if a refugee, seeking protection in Germany, was the perpetrator. The Chancellor was slammed by the anti-immigrant Alternative for Germany (AfD) party, which has won support in the last two years as Merkel’s own popularity has waned, who said on Tuesday that Germany is no longer safe.

Some politicians have also called for changes to Merkel’s immigration and security policies after she allowed more than a million migrants to enter Germany in the last two years, many fleeing countries such as Syria, Iraq and Afghanistan. Bavarian Interior Minister Joachim Herrmann told German radio on Wednesday that there was a higher risk of Islamist attacks because of the influx of migrants.

 

 

end

 

Germany offers 100,000 euros reward for information on A,Amri, the Berlin attack suspect who was previously probed in another terror plot.  He was to be deported but the authorities could not find the necessary paperwork to send him back to Tunisia:

(courtesy zero hedge)

Germany Offers $100,000 Bounty For Information On Berlin Attack Suspect Who Was Previously Probed In Terror Plot

Update 1: Germany has offered a €100,000 bounty for any information leading to the suspect’s arrest during a Europe-wide manhunt across the border-free area.

* * *

Update 2: German authorities issued a Europe-wide police alert naming 23-year-old Anis Amri as a suspect in the case, describing him as “dangerous and armed.”

Meanwhile, according to the suspect’s father and security sources, Tunisia’s Radio Mosaique reported that Anis Amri left Tunisia seven years ago as an illegal immigrant and spent time in prison in Italy.

The radio reported on its website that security sources had named the suspect as Anis Amri from Oueslatia in rural central Tunisia. He served four years in jail in Italy on accusations of burning a school, it said. The father told the radio station that his son left for Germany a year ago.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

Storm clouds are gathering for Angela Merkel who, in the aftermath of Monday’s tragic Berlin truck attack said that “it would be particularly repulsive if a refugee, seeking protection in Germany, was the perpetrator.” According to the latest news out of Germany, not only was the suspect, Anis Amri, a (failed) refugee, as he was supposed to be deported from Germany, but more troubling for Merkel is that he was previously investigated in a separate terror plot, however was never apprehended.

According to Ralf Jäger, the interior minister of North Rhine-Westphalia state where the suspect had lived for some time, Amri was previously investigated in connection with an earlier terror plot. The man had been considered a potential threat by security authorities since November. After being turned down for asylum, he should have been deported but could not be returned to Tunisia because his documents were missing, added Jaeger.

Amri reportedly moved around Germany and lived in several places, Jäger said. Since February this year he lived mostly in Berlin, but he had been back in North Rhine-Westphalia recently.

Jäger said an investigation had been launched against the suspect earlier this year on suspicion of “preparing a serious crime endangering national safety”. The investigation was launched by police in North Rhine-Westphalia but mainly conducted in Berlin, he said.

Just as troubling is that the Tunisian suspect was supposed to be deported from Germany but could not be, “because he had no valid identity document that could be used to prove he was Tunisian”, Jager said cited by the Telegraph.

As Jäger was speaking, a police raid on refugee accommodation where Anis Amri lived was reportedly under way.

Jäger said that the suspect had been in Germany since July 2015. His claim for asylum was rejected in June this year but the authorities were unable to deport him as they could not prove his identity.

German authorities requested Tunisia issue him with a new passport or laissez-passer two months ago. Tunisia initially denied that he was Tunisian but document arrived on Wednesday – two days after the attack. Bild added that German authorities requested a passport for Amri from the Tunisian authorities two months ago so he could be deported.

It is unclear if Merkel’s government was pass the blame for Monday’s attack on the Tunisians for not being cooperative on time, and preventing Amri’s deportation.

The new details will add to a growing list of questions about whether security authorities missed opportunities to prevent the attack which claimed the lives of 12 people and was the deadliest attack on German soil since 1980; it will also cast further doubt on how competent Merkel is to deal with the fallout from a problem which her political opponents, and much of the local population, allege she is responsible for.

 

 

end

 

A great commentary from V Uniyal of the Gatestone Institute, a highly respected organization.  Here the author describes that the Merkel Government is in total denial of the lawlessness inside Germany with respect to the migrants and the damage that they are doing to the country

(Uniyal/GatestoneInstitute)

Merkel Government Still In Denial

Submitted by Vijeta Uniyal via The Gatestone Institute,

  • Islamic State took responsibility for the December 19 Berlin truck-ramming attack that killed 12 people, similar to the July 14 attack in the French city of Nice, and countless car-rammings in Israel. Now Europeans feel what Israelis live with every day.
  • This month, the police union in the German state of Thuringia issued an open letter to the state’s Interior Minister, describing the crumbling law-and-order situation amid the rising migrant crime: “[You] are abandoning us completely helpless to a superior force… But what changes? Nothing. One instead gets a sense of uninterest.”
  • Meanwhile, representatives of Arab community were reported telling the police in Ruhr, “The police will not win a war with us because we are too many.”
  • Chancellor Merkel, Germany’s ruling elites and the media can continue putting a happy face on uncontrolled mass-migration from Arab and Muslim lands, or suppress news reporting on rising migrant crime, but they cannot wish away the country’s deteriorating law and order situation.
  • It should be evident to even a casual observer that her government still does not care about the victims of its own failed “refugee” policy.

Monday’s terrorist attack on a Berlin Christmas market killed at least 12 people and injured 50 others. Islamic State took responsibility for the truck-ramming attack, as recommend by the al-Qaeda magazine, Inspire, and similar to the July 14 attack in the French city of Nice, and countless car-rammings in Israel. Now Europeans feel what Israelis live with every day.


Police confer at the site of the December 19 car-ramming attack at a Christmas market in Berlin. (Image source: RT video screenshot)

Earlier this year, Germany was hit by a series of ISIS-inspired attacks and failed terror plots. Despite that almost all the perpetrators were recent Syrian or Afghan migrants, German Chancellor Angela Merkel, in the middle of a re-election bid, has stuck to her claim that there is “no connection” between terror attacks in the country and uncontrolled mass migration from Arab and Muslim lands.

Ahead of an election year, Merkel and her coalition partners also want to avoid another mass sexual attack — in Cologne.

Adding insult to injury, the Mayor of Cologne, Henriette Reker, is planning to put on a big show this coming New Year’s Eve in the city’s main square. After an elaborate year-long cover up, the city will be lighting up the crime scene as part of a multi-media show. “The City of Cologne has announced plans for a spectacular multi-media show in the area immediately surrounding the famous Gothic cathedral, close to the main train station,” state-run broadcaster Deutsche Welle reported.

“Cologne will send good images to the world,” says the city’s mayor. The taxpayer-funded spectacle has been named “Time Drifts Cologne.” The “light artist” running the show, Philipp Geist, considers last year’s crime scene “a fantastic place for an art installation.”

Of an estimated two thousand exclusively Muslim men who raped, assaulted and robbed more than 1200 women, almost all the attackers have managed to walk free. Ralf Jäger, Interior Minister of North Rhine-Westphalia, admitted recently that “most of the cases will remain unsolved.”

An estimated 1,800 police officers will be on duty in Cologne on New Year’s Eve, compared to just 140 last year. Barricades have been erected in the city center to check the flow of the crowd. The city’s historic cathedral and adjoining area have been placed under a crush barrier. Police will man observation posts and fly helicopters to monitor the crowd, and deploy mounted police and six armoured vehicles for riot-control. “No expense will be spared,” assured the mayor. In an important election year, the government wants to defend the city to the last taxpayer dime.

Even before it can face any real onslaught, however, Merkel’s fortification is showing some serious cracks.

Just days ahead of the News Year’s Eve, the police union in the eastern German state of Thuringia has issued an open letter describing the crumbling law-and-order situation amid the rising migrant crime. “[You] are abandoning us completely helpless to a superior force,” says the desperate note addressed to the Interior Minister of Thuringia. The union claims that politicians have been repeatedly briefed on the deteriorating conditions under which police have been working. “But what changes? Nothing. One instead gets a sense of uninterest.”

Unwilling to acknowledge the breakdown of law and order in face of the rising migrant crime wave, the German media and politicians are going after the messenger.

Their latest target is the head of German Police Union, Rainer Wendt. Wendt’s crime, after a series of rape crimes this December, was to speak the obvious truth. “The criminals are using open borders,” he said.

Ralf Stegner, deputy leader of Social Democratic Party (SPD) and a fervent supporter of Merkel’s “Refugees Welcome” policy, denounced Wendt’s statement as “politically disgusting and stupid as one can get.”

Wendt has also been attacked for questioning the customary kid-glove treatment given to violent and criminal “refugees” by German courts. Sven Rebehn, Chairman of the German Association of Judges, called Wendt, “the Donald Trump of domestic politics” — apparently the biggest insult a German liberal can come up with these days.

The Merkel government can turn the center of Cologne into an impenetrable fortress for a day or two, but the threat is not going away. The problem lies in the Ruhr region that encircles Cologne. “Have foreign clans turned Ruhr region into a No-Go-Area?” asks the leading German newspaper, Die Welt, just days ahead of News Year’s Eve.

Meanwhile, representatives of Arab community were reported telling the police in Ruhr, “The police will not win a war with us because we are too many.”

Chancellor Merkel, Germany’s ruling elites and the media can continue putting a happy face on uncontrolled mass-migration from Arab and Muslim lands, or suppress news reporting on rising migrant crime, as much as they want, but they cannot wish away the country’s deteriorating law-and-order situation.

As the desperate plea of the police union shows, the Merkel government has decided to ignore the plight of law enforcement, at least for now. It should be evident to even a casual observer that her government still does not care about the victims of its own failed “refugee” policy: Germany appears to be heading toward another rough year.

 

 

end

 

This gives you a flavour as to what is going on inside Germany:

(courtesy zero hedge)

Brawl Erupts Between Locals And Migrants At Another German Christmas Market

As the manhunt continues for the “solider of the Islamic State” that plowed down and killed over a dozen innocent people and injured another 50 in Berlin, tensions throughout Germany generally between locals and the migrant beneficiaries of Merkel’s open border policies continue to escalate.  One such example comes from the German city of Bautzen, in which a group of local Germans and “young asylum seekers” got into a brawl at the Christmas market after a heated exchange regarding the migrants’ playing of loud music from their phones.

According to Breitbart, the brawl involved six young migrants and resulted in two injuries and $100s of Euros worth of damage.

The commotion began on Saturday night at the Bautzen Christmas market — thought to be the oldest market of its kind in Germany — when locals objected to a group of approximately six migrant youths playing loud music from their mobile phones.

Taking place near the town’s historic meat market, a police source said the group of “young asylum seekers” initially were in a “verbal disagreement” with an equally sized group of young locals, reports Lausitzer Rundschau. The source remarked: “After a heated debate, individuals from both groups are said to have shoved each other. Two young men are said to have hurt themselves.”

The paper reports that as the migrants withdrew from the fight, they damaged a car on their way, causing hundreds of euros of damage. Police arrived after locals called in a report.

Germany Christmas Market

This was not the first confrontation between violent migrants and locals in the eastern German town of Bautzen. The local newspaper, Lausitzer Rundschau, reported that Police had to intervene in September when migrants attacked locals and pelted bottles at officers. Right-wing anti-mass migrant protesters also got involved and followed the immigrants back to their hostel.

As our readers are well aware, outbursts like the one above are nothing new as, over the past several months, the German people have become increasingly frustrated with Merkel’s “open-border” policy that has allowed over 1mm migrants to flow into the country from the Middle East and North Africa.  The flood of migrants has brought with it a wave of violent crime including sexual assaults resulting in a rising nationalist tension as people have turned their backs on Merkel and her Christian Democratic Union party in recent elections.

In fact, we recently noted that the Mayor of Oersdorf in Northern Germany, Joachim Kebschull (61), was beaten unconscious outside of the city’s Town Hall where the construction committee was meeting to discuss a new housing development for migrants. According to The Telegraph, the attack came just hours after Kebschull received a threatening letter saying:

“He who will not listen will have to feel.” 

“Oersdorf for Oersdorfers”

In conclusion:

Today there were terror attacks in Turkey, Switzerland and Germany – and it is only getting worse. The civilized world must change thinking!

 end
Switzerland
More banks fined in the manipulation of the Swiss libor rates
(courtesy Bloomberg)

Seven Banks Fined in Swiss Probes of Rate-Rigging Cartels

Bloomberg

December 21, 2016, 1:48 AM CST December 21, 2016, 4:57 AM CS

JPMorgan to pay $33 million for franc Libor cartel with RBS

Barclays to pay $29 million for collusion Euribor rate cartel

Switzerland handed out about $100 million in antitrust fines against seven U.S. and European banks for participating in cartels to manipulate widely used financial benchmarks.

PMorgan Chase & Co. was fined 33.9 million francs ($33 million) for operating a cartel with Royal Bank of Scotland Group Plc for more than a year, with the aim of influencing the Swiss franc Libor benchmark, which is tied to the London interbank offered rate, Switzerland’s competition commission said in a statement Wednesday. RBS received immunity for revealing the existence of the cartel, which operated between March 2008 and July 2009.

“RBS and JPMorgan tried to distort the normal course of the pricing of interest-rate derivatives denominated in Swiss franc,” the commission wrote. “They occasionally discussed the future Swiss franc Libor rate submissions of one of the banks and at times exchanged information concerning trading positions and intended prices.”

Regulators across the globe have been probing banks’ manipulation of Libor and similar benchmarks that are used to calculate interest payments for trillions of euros of financial products including mortgages. The investigations have so far triggered about $9 billion in fines for a dozen banks in the last four years while more than 20 traders have been charged.

Libor and Euribor, the euro interbank offered rate, gauge banks’ estimated cost of borrowing over different periods of time. Earlier this month, JPMorgan, HSBC Holdings Plc and Credit Agricole SA were fined a total of 485.5 million euros ($505 million) for rigging Euribor as European Union antitrust regulators wrapped up a five-year investigation into the scandal.

‘Legacy Issue’

The Swiss commission fined three banks a total of 45.3 million francs for participating in a cartel involving the Euribor interest rate between September 2005 and March 2008. Barclays Plc was fined 29.8 million francs while RBS and Societe Generale SA will pay 12.3 million francs and 3.25 million francs respectively.

Deutsche Bank AG received immunity in the Euribor probe for alerting the commission to the cartel. BNP Paribas SA, Credit Agricole SA, HSBC Holdings, JPMorgan and Rabobank Groep remain under investigation in that probe.

“We are pleased to have settled this legacy issue,” RBS spokeswoman Linda Harper said. “The culture at RBS has changed dramatically in recent years. We are determined to put these issues behind us and build a bank that is fully focused on the best interests of our customers.”

A spokesman for Societe Generale said “the matters essentially involved a single employee, who left the bank in September 2009, and neither the Swiss COMCO nor the European Commission found that this employee’s management was aware of his actions.”

“Societe Generale strongly condemns this type of individual behavior and has entirely reviewed its interbank rate submission process to comply in full with the new standards set by the various bodies and authorities concerned,” the spokesman said.

Yen Rates

An official for Deutsche Bank declined to comment. JPMorgan didn’t immediately respond to requests for comment.

The Swiss commission announced 5.4 million francs in fines against three banks for conspiring to rig the bid-ask spread on Swiss franc interest-rate derivatives between May and September 2007. Credit Suisse Group AG must pay 2.04 million francs while JPMorgan was fined 2.6 million francs and RBS 856,000 francs. UBS Group AG received immunity.

A spokesman for Credit Suisse said the bank was “pleased to have resolved this matter.”

Citigroup Inc., Deutsche Bank, JPMorgan and RBS were fined 14.4 million francs for collusion in the trading of yen interest rate derivatives that violated antitrust law between 2007 and 2010. The commission dropped its investigation of three Japanese banks, while HSBC, Lloyds, Rabobank and UBS remain under investigation, as well as three interdealer brokers.

UBS will “strongly defend its position” in the proceedings, the bank said in an e-mailed statement.

-END-

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

The additional sanctions on Russia brought on by the USA will no doubt be unwound the moment Trump gets power

(courtesy zero hedge)

Kremlin Warns Of Response To Latest US Sanctions, Says “Almost All Communication With US Is Frozen”

n response to the latest imposition of US sanctions on Russia, the Kremlin said on Wednesday that the new sanctions would further damage relations between the two countries and that Moscow would respond with its own measures. “We regret that Washington is continuing on this destructive path,” Kremlin spokesman Dmitry Peskov told reporters on a conference call.

As a reminder, on Tuesday the United States widened sanctions against Russian businessmen and companies adopted after Russia’s annexation of Crimea in 2014 and the conflict in Ukraine.

“We believe this damages bilateral relations … Russia will take commensurate measures.”

Kremlin spokesman Dmitry Peskov

Then again, it is difficult to see how sanctions between the two administration could be any more “damaged”: also on Wednesday, the Kremlin said it did not expect the incoming U.S. administration to reject NATO enlargement overnight and that almost all communications channels between Russia and the United States were frozen, the RIA news agency reported.

Almost every level of dialogue with the United States is frozen. We don’t communicate with one another, or (if we do) we do so minimally,” Peskov said.

Additionally, RIA said that according to Peskov “he did not know whether President Vladimir Putin would seek re-election in 2018.”

“Everyone’s heads are aching because of work and with projects and nobody is thinking or talking about elections,” Peskov said.

Then again, the sanctions may soon be history. According to a Bloomberg report, the U.S. will start easing its penalties, imposed over the showdown in Ukraine in 2014, during the next 12 months, according to 55 percent of respondents in a Bloomberg survey, up from 10 percent in an October poll. Without the restrictions, Russia’s economic growth would get a boost equivalent to 0.2 percentage point of gross domestic product next year and 0.5 percentage point in 2018, according to the median estimates in the poll.

“It’s still a toss-up whether the U.S. will ease sanctions quickly, with the EU lagging, but the direction of travel is toward easier sanctions or less enforcement, which could reduce financing costs,” said Rachel Ziemba, the New York-based head of emerging markets at 4CAST-RGE. “We think the macro impact would be greater in the medium term than short term as it facilitates a rate easing trend that is already on course. In the longer term, it gives more choice of investment.”

Trump, who’s called President Vladimir Putin a better leader than Barack Obama, has said he may consider recognizing Russia’s annexation of Crimea from Ukraine and lifting the curbs. While dogged by concerns that Russia intervened to tip this year’s elections in the Republican candidate’s favor, Trump has already showed his hand by planning to stack his administration with officials supportive of closer cooperation with the Kremlin, from Michael Flynn, the president-elect’s national security adviser, to Exxon Mobil Corp. chief Rex Tillerson, a candidate for secretary of state.

An equally important consequence of any policy change by Trump would be its affect on the EU’s own penalties on Russia, with more economists saying the bloc will follow suit. Forty percent of respondents said in the Dec. 16-19 survey that the EU will begin easing sanctions in the next 12 months, compared with 33 percent in October.

“If the U.S. eases sanctions, it won’t be possible to achieve a consensus among EU member states to keep their sanctions regime in place as currently formulated,” said Charles Movit, an economist at IHS Markit in Washington.

6.GLOBAL ISSUES

7. OIL ISSUES

Libya announces production of 900,000 barrels per day and will rise to 1.2 million barrels by next year.  That caused WTI to fall:

(courtesy zero hedge)

WTI Sinks On Libya Production Fears (Again)

The overnight rally in crude following API’s unexpectedly large crude inventory drawdown has been erased as more headlines from Libya send WTI lower.

Bloomberg reports that output will be 900k b/d beginning next yr, NOC Chairman Mustafa Sanalla says in Cairo, and is expected to reach 1.2mm barrels per day by the end of 2017.

And the reaction is fear…

As Bloomberg Briefs details, Libya reopened two of its biggest oil fields and is set to load its first crude cargo in two years from its largest export terminal as the war-torn country pursues plans to almost double output in 2017.

Pipelines connecting the Sharara oil field to Zawiya refinery, and the El-Feel deposit to the Mellitah energy complex, reopened at the town of Rayayina, according to a statement by the state-run National Oil Corp. The reopening of the fields will help boost the country’s oil production by 175,000 barrels a day within one month and 270,000 barrels a day within three months, it said. Also, a tanker is set to load the first export from Es Sider oil port since the terminal was closed in 2014.

“I welcome the statement by the Rayayina Patrols Company of the Petroleum Facilities Guard, Western Branch, announcing lifting of the blockade on all the pipelines,” NOC Chairman Mustafa Sanalla said in the statement posted yesterday on the company’s website. “There were no payoffs and no backroom deals. For the first time in nearly three years, all our oil can flow freely. I hope this marks the end of the use of blockade tactics in our country.”

Libya’s comeback will put more pressure on OPEC and other major producers that agreed over the past three weeks to cut their output to rein in an oversupply and shore up prices. The North African nation, which was exempted from OPEC’s planned cuts because of its internal strife, is currently producing 600,000 barrels a day, less than half of the 1.6 million it pumped before a 2011 uprising.

“Anything that weighs on oil prices right now,” — whether it’s rising Libyan supply, a leap in the U.S. rig count, or the Federal Reserve’s interest-rate guidance for 2017 — “is a problem for OPEC,” Derek Brower, managing director of research at Petroleum Policy Intelligence, a U.K.-based consultant, said today by e-mail. “If the cuts don’t bring a sustained rally, then some producers will be tempted to push volume.”

Once again it seems the extreme sensitivity of algos to any shifts in production at all suggest faith in the OPEC/NOPEC ‘cut’ deal is anything but strong.

end

DOE refutes the API numbers claiming a huge build up in inventory.

(courtesy zero hedge)

WTI Tumbles To $52 Handle After Surprise Crude Inventory Build

Following API’s reported across the board inventory draws, DOE refuted this and saw a surprise notable 2.256mm build (most in 5 weeks). Cushing inventories fell very modestly (biggest draw in 2 months) and Gasoline and Distillates also saw further inventiry dras. Production slid very modestly. WTI is being sold on this print, testing back to a $52 handle.

API

  • Crude -4.15mm (-2.5mm exp)
  • Cushing +690k (+1.9mm exp)
  • Gasoline -1.96mm
  • Distillates -1.55mm

DOE

  • Crude +2.256mm (-2.5mm exp)
  • Cushing -245k (+700k exp)
  • Gasoline -1.309mm (+1.375mm exp)
  • Distillates -2.42mm (-1.625mm exp)

First overall build in 5 weeks but biggest Cushing draw in 2 months…

As Reuters notes also, US Crude stocks have not exhibited normal drawdown before the end of the year. Stocks now +171 million bbl (+54%) over 10-yr average

The breakdown…

  • Midwest Padd2 Crude Inventories Rose 1.01 Mln Bbl
  • Gulf Coast Crude Inventories Fell 443,000 Bbl
  • West Coast Crude Inventories Rose 1.28 Mln Bbl
  • East Coast Distillate Inventories Fell 2.06 Mln Bbl

Cushing inventories are now notably higher YoY…

Production fell very modestly on the week but the trend remains tracking the lagged rig count higher..

The reaction (after Libya headlines erased API’s gains overnight) was more selling pressure to a $52 handle…

Carsten Fritsch, commodity analyst at Commerzbank, noted “Price movements have seen small intraday moves in thin volumes this week”

end

 

8. EMERGING MARKETS

none today

Your early morning currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings WEDNESDAY morning 10:00 am

Euro/USA   1.0432 UP .0042/REACTING TO  + huge Deutsche bank problems + USA election:/TRUMP WINS THE ELECTION/USA READY TO GO ON A SPENDING BINGE WITH THE TRUMP VICTORY/ITALIAN REFERENDUM DEFEAT/AND NOW ECB TAPERING BOND PURCHASES/USA RAISING RATES

USA/JAPAN YEN 117.12  DOWN 0.694(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 1.2376 UP .0012 (Brexit by March 201/UK government loses case/parliament must vote)

USA/CAN 1.3370 DOWN .0003 (CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT FROM EU)

Early THIS WEDNESDAY morning in Europe, the Euro ROSE by 42 basis points, trading now WELL BELOW the important 1.08 level RISING to 1.0432; Europe is still reacting to Gr Britain BREXIT,deflation, announcements of massive stimulation (QE), a proxy middle east war, and the ramifications of a default at the Austrian Hypo bank, an imminent default of Greece, Glencore, Nysmark and the Ukraine, along with rising peripheral bond yield further stimulation as the EU is moving more into NIRP, and now the Italian referendum defeat AND NOW THE ECB TAPERING OF ITS PURCHASES/ THE USA’S NON tightening by FAILING TO RAISE THEIR INTEREST RATE AND NOW THE HUGE PROBLEMS FACING TOO BIG TO FAIL DEUTSCHE BANK + THE ELECTION OF TRUMP IN THE USA / Last night the Shanghai composite CLOSED UP 34.55 0r 1.11%     / Hang Sang  CLOSED UP 80.74 POINTS OR 0.37%   /AUSTRALIA IS HIGHER BY 0.39% / 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 WEDNESDAY morning CLOSED DOWN 50.04 POINTS OR 0.26%

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

2/ CHINESE BOURSES / : Hang Sang CLOSED UP 80.74 OR 0.37%   Shanghai CLOSED UP 34.55 POINTS OR 1.11%   / Australia BOURSE IN THE GREEN /Nikkei (Japan)CLOSED DOWN 50.04 POINTS OR 0.26%/  INDIA’S SENSEX IN THE RED

Gold very early morning trading: $1135.60

silver:$16.06

Early WEDNESDAY morning USA 10 year bond yield: 2.555% !!! UP 0 IN POINTS from TUESDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%. THE RISE IN YIELD WITH THIS SPEED IS FRIGHTENING

 The 30 yr bond yield  3.138, down 1 IN BASIS POINTS  from TUESDAY night.

USA dollar index early WEDNESDAY morning: 102.92 down 33 CENT(S) from TUESDAY’s close.

This ends early morning numbers WEDNESDAY MORNING

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

And now your closing WEDNESDAY NUMBERS

Portuguese 10 year bond yield: 3.77% UP 3  in basis point yield from TUESDAY  (does not buy the rally)

JAPANESE BOND YIELD: +.061% DOWN  2  in   basis point yield from  TUESDAY/JAPAN losing control of its yield curve

SPANISH 10 YR BOND YIELD:1.367%  UP  3  IN basis point yield from  TUESDAY (this is totally nuts!!/

ITALIAN 10 YR BOND YIELD: 1.822  DOWN  2  in basis point yield from TUESDAY 

the Italian 10 yr bond yield is trading 45 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: +.246% DOWN 2 IN  BASIS POINTS ON THE DAY

END

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IMPORTANT CURRENCY CLOSES FOR WEDNESDAY

Closing currency crosses for WEDNESDAY night/USA DOLLAR INDEX/USA 10 YR BOND YIELD/1:00 PM 

Euro/USA 1.0427 UP .0036 (Euro UP 36 basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 117.62 DOWN: 0.196(Yen UP 20 basis points/ 

Great Britain/USA 1.2347 DOWN 0.0016( POUND DOWN 16 basis points)

USA/Canada 1.3405 UP 0.0034(Canadian dollar DOWN 34 basis points AS OIL ROSE TO $52.80

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

This afternoon, the Euro was UP by 36 basis points to trade at 1.0427

The Yen ROSE to 117.62 for a GAIN of 20 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 FELL 16 basis points, trading at 1.2347/

The Canadian dollar FELL by 34 basis points to 1.3405,  WITH WTI OIL RISING TO :  $52.80

The USA/Yuan closed at 6.9435
the 10 yr Japanese bond yield closed at +.061% DOWN 2 IN  BASIS POINTS / yield/ 

Your closing 10 yr USA bond yield DOWN   3   IN basis points from TUESDAY at 2.538% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic  USA 30 yr bond yield: 3.122 DOWN 2  in basis points on the day /

Your closing USA dollar index, 103.02 DOWN 23 CENT(S)  ON THE DAY/1.00 PM 

Your closing bourses for Europe and the Dow along with the USA dollar index closing and interest rates for WEDNESDAY: 1:30 PM EST

London:  CLOSED DOWN 2.54 POINTS OR 0.04%
German Dax :CLOSED UP 3.80 POINTS OR 0.03%
Paris Cac  CLOSED DOWN 16.07 OR 0.33%
Spain IBEX CLOSED DOWN 36.20 POINTS OR 0.38%
Italian MIB: CLOSED DOWN 31.65 POINTS OR 0.16%

The Dow was DOWN 32.66 POINTS OR .16% 4 PM EST

NASDAQ WAS DOWN 12.51 POINTS OR .23%  4.00 PM EST
WTI Oil price;  52.80 at 1:00 pm; 

Brent Oil: 54.73  1:00 EST

USA /RUSSIAN ROUBLE CROSS:  61.10 (ROUBLE UP  34/100 roubles from YESTERDAY)

TODAY THE GERMAN YIELD RISES  TO +0.246%  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:$52.54

BRENT: $54.53

USA 10 YR BOND YIELD: 2.537%  (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)

USA 30 YR BOND YIELD: 3.109%

EURO/USA DOLLAR CROSS:  1.0424 up .0033

USA/JAPANESE YEN:117.55  down 0.284

USA DOLLAR INDEX: 103.03 down 22  cents (BREAKS HUGE resistance at 101.80)

The British pound at 5 pm: Great Britain Pound/USA: 1.2353 : down 11  BASIS POINTS.

German 10 yr bond yield at 5 pm: +.246%

END

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

TRADING IN GRAPH FORM

“Almost 20,000” Dow Disappoints For 7th Day In A Row Despite VIXtermination

7th day in a row of hope for Dow 20k…

 

It’s a real cliffhanger…

 

Before we start – 2 WTF Charts of the day…

This is the stock is best in The Dow this year…

 

And this is the stock that is most responsible for The Dow’s post-Trump surge…

That’s the market you’re buying ladies and gentlemen!

So, despite a massive monkey-hammering of VIX to a 10 handle at the opening, Dow 20,000 remains elusive…NOTE: Very odd action in VIX and The Dow today – super noisy. Dow’s narrowest trading day since 2013.

 

Very ugly close for stocks – 3rd worst close since Trump election

 

Futures show that overnight was quiet – pumped into the open then dumped when VIX ran out of steam… and an ugly close…

 

VIX puked to a 10-handle – its lowest since July 2014… (before that this is the lowest since March 2007) – note the last two times VIX droppped for 5 consecutive days was in July and October and was followed by a huge spike in vol.

 

The correlation between high- and low-beta stocks has collapsed to the lowest since the peak of the dotcom boom…

 

Despite red across all majors today, stocks remain green on the week, but the S&P is lagging (Small Caps best) – Trannies and Small Caps worst losers today…

 

Financials managed to hold green post-Fed but everything else is lower…

 

Volume has collapsed…

 

Bonds were bid again, pushing yields lower across the curve (lower on the week)…

 

The Dollar Index fell very modestly for the first time in 7 days…

 

Copper remains the week’s biggest loser but crude (and silver) slipped notably on the day…

 

Ugly-ish day for crude – dropping on Libya production and an unexpected crude build…

 

Finally, we note that the turmoil in China/Hong Kong money markets has sent the Hang Seng to 13-year lows against The Dow – getting closed to support at parity…

end

 

The following is a must read as it explains Trump’s new “border tax proposal”.  It will be very good for the USA

(courtesy zero hedge)

Why Trump’s “Border Tax Proposal” Is The “Most Important Thing Nobody Is Talking About”

While the market, and various pundits and economists have been mostly focused on the still to be disclosed details of Trump’s infrastructure spending aspects of his fiscal plan, “one of the least talked about but possibly most important tax shifts in the history of the United States” is, according to DB, House Speaker Paul Ryan’s and President-elect Trump’s “border tax adjustment” proposal.

This is part of the “Better Way” reform package and also figures prominently in the writings of senior Trump administration officials.

What is it?

Put simply, the proposal would tax US imports at the corporate income tax rate, while exempting income earned from exports from any taxation. The reform would closely mirror tax border adjustments in economies with consumption-based VAT tax systems. If enacted, the plan will likely be extremely bullish for the US dollar. What’s more, it would have a transformational impact on the US trade relationship with the rest of the world. Consider the below:

  • A “border tax adjustment” would, roughly speaking, be equivalent to a 15% one-off devaluation of the dollar. Imports would be 20% more expensive, because corporates would have to pay the new 20% corporate tax rate on their value. Exports would be roughly 12% “cheaper”, because for every $33 of earnings earned from $100 of exports (we use the 33% gross margin of the S&P), there would be a 12% tax cost ($33 earnings*35% current tax rate) that would no longer be imposed on corporates. Taking the average impact on the prices of exports and imports is equivalent to a 15% drop in the dollar.
  • A border tax adjustment would be very inflationary. The price of exports doesn’t affect the US consumption basket so would have no impact on CPI. However, the cost of imports would go up by 20%, which based on a simple relationship between import PPI and US inflation would be equivalent to a 5% rise in the CPI. Corporates may of course choose to absorb part of the rise in import costs in their profit margins. But either way, the order of magnitude is large.
  • A border tax adjustment would be very positive for the US trade balance. Similarly to the dollar calculations, a border tax adjustment would be equivalent to an across the board import tariff of 20% and an export subsidy of 12%. Keeping all else constant and applying standard trade elasticity impact parameters to an average of the two estimates results in a more than 2% drop in the trade deficit equivalent to more than 400bn USD, or equivalently, an almost complete closing of the US trade deficit.

In other words, should the “border tax proposal” pass, it would not only send inflation soaring, while eliminating the US trade deficit – a long-time pet peeve of Trump  – it would also be the trade-equivalent of a 15% USD devaluation, even as it leads to an offsetting surge in the actual value of the dollar.

To be sure, there are uncertainties related to all estimates above. First, there is a question mark on whether a border tax adjustment based on a territorial corporate tax system (as opposed to VAT) would be allowable under WTO rules. The question is highly complex, but senior Trump advisers have stated they would be willing to take the issue to the WTO.

It is also not clear what types of goods the new tax would cover – the broader the coverage the bigger the impact and vice versa.

Second, the impact on trade highlighted above should be considered an upper bound, as the post-crisis responsiveness of current account balances to relative price shifts has proven to be much lower.

Still, it is hard to argue that such a fundamental shift in tax treatment of US exports and imports would not have a material impact on trade relations and flows with the rest of the world. More importantly, Saravelos argues, the second-order impact of “re-shoring” may be more material given that US corporate activity has been disadvantaged due to the current unfavorable tax treatment of offshore profits.

* * *

Taking all of the above into account, the academic literature is unambiguous in its conclusion that the dollar should rally strongly in the event a “border tax adjustment” is put in place. An appreciating dollar would be a natural response to an improving US trade balance and the competitiveness gains achieved by the shift in the relative prices of exports over imports. In extremis, the dollar would rally by 15% to fully offset the price changes caused by the tax. This analysis is partial however, with the knock-on consequences on the Fed, US corporate off-shoring and global trade relations likely making the impact even more material.

Deutsche Bank concludes that combined with potential changes to the treatment of unrepatriated earnings, “the proposed changes to the US corporate tax code could be one of the most important shifts in US tax and international trade policy in a generation.”

We wholeheartedly agree with DB’s assessment in this particular case.

 

 

end

 

Strange data points this morning on existing home sales.  These rise despite soaring mortgage rates, tumbling affordability and crashing mortgage applications:

go figure..

(courtesy zero hedge)

Existing Home Sales Surge To Feb 2007 Highs Despite Soaring Mortgage Rates

Despite soaring mortgage rates, tumbling affordability, and crashing mortgage applications, existing home sales soared to fresh cycle highs. At 5.61mm SAAR, this is the highest existing home sale print since Feb 2007 (+0.7% MoM vs -1.8% exp).

  • Sales increased 18.2 percent before seasonal adjustment from November 2015, when changes in mortgage regulations delayed closings
  • Median sales price climbed 6.8 percent from November 2015 to $234,900
  • Inventory of available properties dropped 9.3 percent from November 2015 to 1.85 million, marking the 18th consecutive year-over-year decline

However, today’s data does not reflect the post-Trump spike in rates and collapse in mortgages. What happens next?

Lawrence Yun, NAR chief economist, says it’s been an outstanding three-month stretch for the housing market as 2016 nears the finish line.

“People who had locked in their rate,” followed through with their purchases last month, but still, “we have this inventory shortage, this housing shortage, for the past five years, hurting affordability for first-time buyers.”

“First-time buyers in higher priced cities will be most affected by rising prices and mortgage rates next year and will likely have to stretch their budget or make compromises on home size, price or location,” said Yun.

“Rental units are also seeing this shortage. As a result, both home prices and rents continue to far outstrip incomes in much of the country.”

end
Optimism grips the nation with the Trump victory but ominous dark clouds are appearing on the horizon
(courtesy Michael Snyder)

U.S. Economic Confidence Surges To The Highest Level That Gallup Has Ever Recorded

 

 

END

 

Fascinating: more baby boomers are increasingly having their social security checks garnished by authorities to cover student loan payments;

(courtesy zero hedge)

Baby Boomers Increasingly Having Social Security Checks Garnished To Cover Student Loan Payments

Early 2017 Record Scam Stock Market Going to Blow Up-Michael Pento

michael-pentoBy Greg Hunter’s USAWatchdog.com

Money manager Michael Pento says don’t get too comfortable with the record highs in the stock market. Pento warns, “In December of 2015, the Fed raised rates. It was the first time in a decade. From the middle of December to the end of December (2015), it was nirvana. They raised rates. There was no problem, and then came January. The first trading day of January, boom, and we had the worst January in the history of all Januarys in the stock market. I think the very same thing is going to happen in 2017, but I think it’s going to be worse. Not only are we going to fall, I think there is going to be a huge tremor in China and in the emerging markets. That’s early in 2017, and when that occurs, Janet Yellen (Fed Head) can forget about three rate hikes. I think she will not get more than one rate hike out of the way before this whole thing unwinds and unfolds. Then, you are going to get a reversal of those rate hikes. You are going to go back into QE (quantitative easing or money printing) in 2017.”

Pento goes on to predict, “I know gold is suffering huge right now, and in full disclosure, I sold most of my gold after the election of Donald Trump. I knew we had rising real interest rates and a stronger dollar. That’s temporary. It’s not going to last very long, but when it reverses, oh boy, it’s going to reverse really hard and really strong. I am an active manager, and I can buy it back, but if you are a long term holder of gold, you should hold gold. If you are a long, long term holder of gold, you should be using this selloff to buy more gold. . . . This is going to reverse in early 2017. You are going to hit 3% or 4% on the 10-year Treasury, and the whole scam is going to blow up. We have a record amount of debt worldwide. . . .This thing is going to unravel in 2017, and then you are going to see, I believe, helicopter money on the other side. So, you better get ready to own gold again if you sold it.”

On the record bubble in bonds, Pento contends, “Where’s the 10-year Treasury right now? It was 1.3%, and now it’s around 2.6%. We’re going to 4% on the 10-year Treasury. That, by definition, is an absolute bursting of the bond bubble. The problem is this: All assets are priced off of the ‘risk free’ rate of return, ‘risk free’ rate of return on sovereign debt. All asset prices were priced off 1.3% of the 10-year Treasury, or a negative 40 basis points on the Japanese 10-year, or negative yielding German bunds, all assets, and yes that includes real estate and stocks. So, the bond bubble is epic. It is that big in proportion, and it is now bursting.”

Pento goes on to warn, “The real estate market is starting to go off-line. If you look at new home starts, they were down 19% in November month over month. There is no more refinancing market. It’s gone off-line. The initial purchase applications have flat lined. . . . As the housing market goes, so goes the economy. While the Dow and the S&P 500 have surged after November 9th, after Trump was elected, emerging markets are down 8%. . . . The emerging market economies and their currencies are crashing, and that is where I see the epicenter of the bubble breaks.”

In closing, Pento says, “This stronger dollar and this rise in Treasury yields is not going to last very long. They are going to have to reverse course. When they do, they are going to temporarily bring that yield back down. They are going to create unprecedented inflation like you have never seen before–even worse that the 1970’s. You are going to want to have gold at that juncture.”

Join Greg Hunter as he goes One-on-One with Michael Pento of Pento Portfolio Strategies.

 

 

(There is much more in the video interview.)

After the Interview:

end

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