Jan 23/Gold and silver strong turning back all attacks by the gold cartel/JPMorgan continues to hoard silver/China angry at new USA policies as they wish to assume world leadership/ German newspaper Handelsblatt declares the Trump inauguration speech an “act of war”/Draghi does an about face and states that countries can leave the EU but first they must pay their Target 2 balance deficiencies/President Trump busy on first day with 3 executive orders as well as state that the border tax is on/ FINAL DRAFT

Gold at (1:30 am est) $1215.00 UP $10.70

silver  at $17.15:  UP 15 CENTS

Access market prices:

Gold: $1218.20

Silver: $17.25



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:

MONDAY gold fix Shanghai

Shanghai FIRST morning fix Jan 23/17 (10:15 pm est last night): $  1230.69

NY ACCESS PRICE: $1218.00 (AT THE EXACT SAME TIME)/premium $12.69


Shanghai SECOND afternoon fix:  2: 15 am est (second fix/early  morning):$   1226.20



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


London Fix: Jan 23/2017: 5:30 am est:  $1213.75   (NY: same time:  $1213.25   (5:30AM)


London Second fix Jan 23.2017: 10 am est:  $1212.85 (NY same time: $1212.80  (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.


For comex gold: 


For silver:


Let us have a look at the data for today



In silver, the total open interest ROSE by 2076  contracts UP to 174,668 with respect to FRIDAY’S TRADING.    In ounces, the OI is still represented by just less THAN 1 BILLION oz i.e. .873 BILLION TO BE EXACT or 124% of annual global silver production (ex Russia & ex China).


In gold, the total comex gold ROSE BY 3,565 contracts WITH THE RISE IN  THE PRICE GOLD ($3.40 with FRIDAY’S trading ).The total gold OI stands at 478,792 contracts.

we had 10 notice(s) filed upon for 1000 oz of gold.


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


We had a big  changes in tonnes of gold at the GLD/this time a deposit of 1.19 tonnes

the drainage of gold to China has now stopped!!

Inventory rests tonight: 809.15 tonnes



we had no changes in silver into the SLV:

THE SLV Inventory rests at: 338.356 million oz


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

1. Today, we had the open interest in silver RISE by 2076 contracts UP to 174,668 AS SILVER ROSE 3 CENTS with FRIDAY’S trading. The gold open interest ROSE by 3,565 contracts UP to 478,972  WITH THE RISE IN THE PRICE OF GOLD OF $3.40  (FRIDAY’S TRADING)

(report Harvey).

2.a) The Shanghai and London gold fix report



2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY:  Bloomberg



i)Late  SUNDAY night/MONDAY morning: Shanghai closed UP 13.64 POINTS OR 0.44%/ /Hang Sang closed UP 12.61 OR 0.06%. The Nikkei closed DOWN 246.88 POINTS OR 0.1.29% /Australia’s all ordinaires  CLOSED DOWN 0.73%/Chinese yuan (ONSHORE) closed UP at 6.8536/Oil FELL to 52.56 dollars per barrel for WTI and 54.92 for Brent. Stocks in Europe ALL IN THE RED. Offshore yuan trades  6.8235 yuan to the dollar vs 6.8536  for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE COMPLETELY NARROWS AS POBC ATTEMPTS TO STOP DOLLARS FROM LEAVING CHINA’S SHORES. HOWEVER BOTH CHINESE YUANS RISE WITH THE LOWER DOLLAR 




 none today


i)My goodness: China manipulates its stock market on a daily basis.  How we see that their Carl Icahn,Xu Xiang, was sentenced to 5 1/2 yrs in prison for manipulating their stock market… go figure…

( zero hedge)

ii)China ready for “war” with Trump policies.  They state that capitalism is in trouble and thus they must be ready to assume “world leadership”.  Simply amazing…

( zero hedge)




The German Press has finally realized that Trump is declaring economic war against all nations with its protectionist policies.  They stated that the inaugural speech was a “Declaration of War”

( zero hedge)


ii) ECB

In a stunning admission, Draghi states that a country can leave the Eurozone is it wishes but it must settle its bill first.  This means its target 2 balances.  For Italy it means that it must pay: 357 billion euros as this is the amount of euros paid to EU countries like Germany net of incoming receipts.



Turkey is now in its final stages of having Erdogan as a dictator for life.  The only way he can be removed is by a coup

( Mish Shedlock/MishTalk)


i)Trump ready this morning to sign executive order to renegotiate NAFTA: down goes the Mexican Peso and the Cdn Loonie. He also stated that he was going to abandon the TPP”

( zero hedge)

ii)The Mexican Peso tumbles as the Mexican President wants that he will take immediate action against the USA.  To tell you the truth, he only has to do one thing which will cause tremendous grief to the USA: cut off silver shipments to the USA

( zero hedge)


Russia boosted exports by 24% to China and clearly have taken market share away from Saudi Arabia.  It seems that the Russians have supplied oil and in return they take yuan.  The yuan is then used to purchase gold (in yuan) at the Shanghai gold exchange  (SGE). This is totally putting a nail in the  petrodollar scheme  and thus the dollar.

( zerohedge)


none today


i)Total gold reserves into Russia rise to a record high 1614 tonnes, an increase of almost 200 tonnes this year, average of 16.6 tonnes per month. However, we added 0 oz in December as Nov.totals were 1,614.00 tonnes.

( Sputnik news)

ii)James Turk correctly states that the gold price suppression scheme is vital to government currencies but in the end the suppression will fail

a must read..

( James Turk/Wealth Research group/GATA)

iii)The collusion and fraud in the gold market is causing the LME’s share to falter:

( Hobson/Reuters/GATA)

iv)Chris Powell states that the currency regime in place since 1945 has always been “America first:

( Chris Powell/GATA)

v)Even though Ireland only holds 6 tonnes, it is secretive about its gold reserves

( Ronan Manly/GATA)

vi)Chinese bitcoin companies slap on fees equal to .2% per value of the transaction. This should slow down the price rise of Bitcoin.  However Bitcoin has caught on in Japan which have now seen the monthly volumes soar by 8900%

( zero hedge)


i)Early trading Monday:

( zero hedge)

ii)Late Friday night:

Trump wastes no time as he signs his first executive order to ease the burden of Obamacare

( zero hedge)

iii)Obama’s second executive order/Friday night

The FHA’s fee cut, initiated by Obama in the last day’s executive order was cancelled as it exposed the taxpayer to a dwindling FHA account.

( zero hedge)


Trump warns that the USA is going ahead with a border tax as well as cut regulations by 75%

( zero hedge)

v)The following is a terrific commentary from Pepe Escobar who gives us a background on how the next 4 to 8 years will play out re Russia and China:

( Pepe Escobar)

vi)Trump is busy this morning: he signed 3 executive orders:

A) the uSA will withdraw from TPP

B) they will freeze federal hiring

C)we will now limit overseas abortion funding.

( zero hedge)

vii)This is an excellent commentary from Dave Kranzler as he describes what will happen to the movement of single family homes once interest rates rise

(courtesy Dave Kranzler/IRD)

viii)Late this afternoon, Trump wins big as the unions now endorse his policies. The unions have always supported the Democrats and this is now a big shift away from the norm.  Trump is on a roll!!

( zero hedge)

ix)At 4:30 the USA dollar dumped against all currencies when Sec Treasury to be Mnuchin warns of an excessively strong dollar

( zero hedge)

Let us head over to the comex:

The total gold comex open interest ROSE BY 3,565 CONTRACTS UP to an OI level of 478,792 AS THE  PRICE OF GOLD ROSE $3.40 with YESTERDAY’S trading.  We are now in the contract month of JANUARY and it is one of the poorest deliveries of the year.

With the front month of January we had a LOSS of 2  contract(s) DOWN to 70.  We had 10 notices filed YESTERDAY so we GAINED 8 contract(s) or AN ADDITIONAL 800 oz WILL STAND for gold in this non active delivery month of January. For the next big active delivery month of February we had a LOSS of 4,564 contracts DOWN to 188,792.(feb  2016: 168,000 contracts). March had a LOSS of 6 contracts as it’s OI is now 919. We are now ahead with respect to OI when we compare data for open interest this year vs last year with the same amount of time to expire:

We had 10 notice(s) filed upon today for 1000 oz


And now for the wild silver comex results.  Total silver OI ROSE by 2076 contracts FROM 172,592 UP TO 174,668 AS the price of silver ROSE 3 CENTS 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 non active delivery month of January and here the OI ROSE by 63 contract(s) RISING TO  172. We had 2 notice(s) filed on yesterday so we  gained 65 silver contracts or an additional 325,000 oz will stand  in this delivery month of January. The next non active month of February saw the OI FALL by 47 contract(s) FALLING TO 214.

The next big active delivery month is March and here the OI rose by 1127 contracts up to 133,168 contracts.

We had 0 notice(s) filed for NIL oz for the January contract.

VOLUMES: for the gold comex

Today the estimated volume was 260,150  contracts which is good.

Yesterday’s confirmed volume was 275,159 contracts  which is very  good

volumes on gold are getting higher!

Initial standings for january
 Jan 23/2017.
Gold Ounces
Withdrawals from Dealers Inventory in oz   nil
Withdrawals from Customer Inventory in oz  
 nil OZ
Deposits to the Dealer Inventory in oz nil oz
Deposits to the Customer Inventory, in oz 
No of oz served (contracts) today
10 notice(s)
1000 oz
No of oz to be served (notices)
60 contracts
6000 oz
Total monthly oz gold served (contracts) so far this month
1195 notices
119,500 oz
3.7169 tonnes
Total accumulative withdrawals  of gold from the Dealers inventory this month   3000.000 oz
Total accumulative withdrawal of gold from the Customer inventory this month     4,806,084.1 oz
Today we HAD 0 kilobar transaction(s)/
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 0 customer withdrawal(s)
total customer withdrawal: nil oz
We had 0  adjustment(s)
For January:

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

To calculate the initial total number of gold ounces standing for the JANUARY. contract month, we take the total number of notices filed so far for the month (1195) x 100 oz or 119,500 oz, to which we add the difference between the open interest for the front month of JANUARY (70 contracts) minus the number of notices served upon today (10) x 100 oz per contract equals 124,700 oz, the number of ounces standing in this non  active month of JANUARY.
Thus the INITIAL standings for gold for the JANUARY contract month:
No of notices served so far (1195) x 100 oz  or ounces + {OI for the front month (70) minus the number of  notices served upon today (10) x 100 oz which equals 125,500 oz standing in this non active delivery month of JANUARY  (3.9035 tonnes)
we gained 800 oz of gold standing for delivery.
On first day notice for January 2016, we had .9642 tonnes of gold standing. At the conclusion of the month we had only .5349 tonnes standing so you can visualize the increasing demand for physical gold a t the comex.
I have now gone over all of the final deliveries for this year and it is startling.
First of all:  in 2015 for the 13 months: 51 tonnes delivered upon for an average of 4.25 tonnes per month.
Here are the final deliveries for all of 2016 and the first month of January 2017
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.   29.931 tonnes
JAN/     3.8787 tonnes
total for the 13 months;  226.322 tonnes
average 17.409 tonnes per month vs last yr  51.534 tonnes total for 13 months or 3.964 tonnes average per month.
Total dealer inventor 1,457,413.466 or 45.33 tonnes DEALER RAPIDLY LOSING GOLD
Total gold inventory (dealer and customer) = 8,980,970.936 or 279.93 tonnes 
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 279.93 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.
And now for silver
 Jan 23. 2017
Silver Ounces
Withdrawals from Dealers Inventory  nil
Withdrawals from Customer Inventory
 650,919.310 0z
Deposits to the Dealer Inventory
nil oz
Deposits to the Customer Inventory 
971,489.243 oz
No of oz served today (contracts)
(10,000 OZ)
No of oz to be served (notices)
172 contracts
(860,000  oz)
Total monthly oz silver served (contracts) 559 contracts (2,795,000 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  19,833,5365 oz
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 2 customer withdrawal(s):
i) Out of Brinks:  649,911.45 oz* this was issued by Brinks and JPMorgan was the stopper (receiver) of this silver)
ii) Scotia: 1007.860 oz was withdrawn
 we had 2 customer deposit(s):
i) Into JPMorgan:  649,911.450 oz**
** JPMorgan has deposited a huge amount of silver on each and every day starting in 2017:
this amount was stopped by jPMorgan and the issuer was Brinks
ii) Into Scotia: 321,577.800 oz
total customer deposits;  971,489.243   oz
 we had 1  adjustment(s)
out of Delaware; 20,018.686 oz was adjusted out of the customer and this landed into the dealer account of Delaware;
The total number of notices filed today for the JANUARY. contract month is represented by 0 contract(s) for NIL oz. To calculate the number of silver ounces that will stand for delivery in JANUARY., we take the total number of notices filed for the month so far at  559 x 5,000 oz  = 2,795,000 oz to which we add the difference between the open interest for the front month of JAN (172) and the number of notices served upon today (0) x 5000 oz equals the number of ounces standing 
Thus the initial standings for silver for the JANUARY contract month:  559(notices served so far)x 5000 oz +(172) OI for front month of JAN. ) -number of notices served upon today (0)x 5000 oz  equals  3,655,000 oz  of silver standing for the JAN contract month. This is  STILL huge for a non active delivery month in silver. We  gained 65 contract(s) or an additional 325,000 oz will stand.
At first day notice for the January/2016 silver contract month we had 1,845,000 oz standing for delivery.  By he conclusion of the delivery month we had only 575,000 oz stand.
Volumes: for silver comex
Today the estimated volume was 53,428 which is excellent
YESTERDAY’S  confirmed volume was 68,948 contracts  which is huge.
Total dealer silver:  29.188 million (close to record low inventory  
Total number of dealer and customer silver:   180.131 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.



And now the Gold inventory at the GLD

Jan 23/a big change/this time a deposit of 1.19 tonnes of gold into the GLD/inventory rests at 809.15 tonnes.  The drainage of gold from the GLD to Shanghai has now stopped!

Jan 20/no changes in gold inventory a the GLD/Inventory rests at 807.96 tonnes

Jan 19/no changes in gold inventory at the GLD/Inventory rests at 807.96 tonnes

Jan 18/no changes in gold inventory at the GLD/Inventory rests at 807.96 tonnes

Jan 17/17/a deposit of 2.96 tonnes of gold/inventory at the GLD rests at 807.96 tonnes.  I guess there is no more gold inventory to sent to C+Shanghai

Jan 13/17/there were no changes in gold inventory at the GLD/Inventory rests at 805.00 tonnes

Jan 12/2017/no change in gold inventory at the GLD/Inventory rests at 805.00 tonnes

Jan 11/no change in gold inventory at the GLD/Inventory rests at 805.00 tonnes

JAN 10/no changes in gold inventory at the GLD/Inventory rests at 805.00 tonnes


Jan 6/no changes in gold inventory at the GLD/inventory rests at 813.87 tonnes
Jan 5/no change in gold inventory at the GLD/inventory rests at 813.87 tonnes
Jan 4/no change in inventory/inventory rests at 813.87 tonnes
Jan 3.2017/a huge 9.49 tonnes of gold leaves the GLD/inventory rests at 813.87 tonnes
DEC 30/no changes in gold inventory at the GLD/Inventory rests at 823.36 tonnes
Dec 29/no changes in gold inventory at the GLD/Inventory rests at  823.36 tonnes
Dec 28/no change in gold tonnage at the GLD/inventory rests at 823.36 tonnes
Dec 27/a withdrawal of 1.18 tonnes from the GLD/Inventory rests at 823.36 tonnes
Dec 22/no change in inventory at the GLD/Inventory rests at 824.54 tonnes
Jan 23/2017/ Inventory rests tonight at 809.15 tonnes



Now the SLV Inventory
Jan 23/no changes in silver inventory at the SLV/Inventory rests at 338.356 million oz
Jan 20/no changes in silver inventory at the SLV/Inventory rests at 338.356 million oz
jan 19/no changes in silver inventory at the SLV/Inventory rests at 338.356 million oz
Jan 18/no changes in silver inventory/inventory rests at 338.356 million oz/
Jan 17/no change in silver inventory at the SLV/Inventory rests at 338.356 million oz/
Jan 13/2017/on changes in the SLV inventory/rests tonight at 338.356 million oz/
Jan 12.2017/ no changes in the SLV Inventory/ rests at 338.356 million oz
JAN 10/no changes in inventory at the SLV/Inventory rests at 341.199 million oz
JAN 9/no changes in inventory at the SLV/Inventory rests at 341.199 million oz/
jan 6/no changes in inventory at the SLV/Inventory rests at 341.199 million oz
Jan 5/no changes in inventory at the SLV/Inventory rests at 341.199 million oz
Jan 4/a small withdrawal of 149,000 oz (probably to pay for fees/inventory rests at 341.199 million oz
Jan 3.2017/no changes in silver inventory at the SLV/Inventory rests at 341.348 million oz/
DEC 30/no changes in silver inventory at the SLV/inventory rests at 341.348 million oz/
Dec 29/no changes in silver inventory at the SLV/Inventory rests at 341.348 million oz
Dec 28/no changes in silver inventory at the SLV/Inventory at 341.348 million oz/
Dec 27/a big deposit of 1.138 million oz/Inventory rests at 341.348 million oz
Jan 23.2017: Inventory 338.356  million oz

NPV for Sprott and Central Fund of Canada

1. Central Fund of Canada: traded at Negative 6.9 percent to NAV usa funds and Negative 7.2% to NAV for Cdn funds!!!! 
Percentage of fund in gold 60.9%
Percentage of fund in silver:38.9%
cash .+0.2%( jan 23/2017) 
2. Sprott silver fund (PSLV): Premium FALLS to +.33%!!!! NAV (Jan 23/2017) 
3. Sprott gold fund (PHYS): premium to NAV FALLS TO – 0.40% to NAV  ( Jan 23/2017)
Note: Sprott silver trust back  into POSITIVE territory at +0.33% /Sprott physical gold trust is back into NEGATIVE territory at -0.40%/Central fund of Canada’s is still in jail.


Major gold/silver trading/commentaries for MONDAY


Gold Price To 2 Month High As Fiery Trump Declares World Order

Gold price to 2 month high as fiery Trump declares New American Order

– ‘Trumponomics’: Politics and economic policy in 140 characters
– The ‘intelligence’ according to Trump
– Trump, Putin and Russia – the great bromance
– Trump – Bull in a China shop
– Trade and currency wars with China and other nations
– Trump – Fan of gold and golden tweets
– Conclusion – Trump may be the ‘Golden Ticket’

by Jan Skoyles, Editor Mark O’Byrne

On Friday Donald J Trump became the 45th President of the United States of America.

Gold prices were surprisingly muted on Friday but did begin to rise towards the end of trading and rose from below $1,200 to over $1,212 per ounce before closing slightly lower at $,207.60 per ounce.

Gold is looking very healthy technically and has risen for four weeks in a row and reached a two month high this morning at $1,219.43 per ounce – its highest since November 22nd.   According to Bloomberg holdings in gold-backed ETFs climbed for the fifth day in a row by 0.9 tons.

Gold is gaining on increasing investor concern about the Trump Presidency and uncertainty regarding what is set to be his radically different term in office. The dollar has continued to weaken as markets prepare for major changes to US trade, economic and foreign policies.

The British pound has hit a five week high, along with the yen and 10 year US Futures. Shares fell across most markets, the dollar fell 0.5%, which RBS Capital markets blame on “the lack of economic policy detail in President Trump’s inauguration speech coupled with concerns over his potential protectionist stance.”

“The market is now worrying about what would come out from the new administration,” Bob Takai, chief executive officer and president of Sumitomo Corp. Global Research Co., told Bloomberg. “In this kind of very unforeseeable environment, people want to buy gold,” he said, adding the biggest factor was the strength of the dollar and the outlook for interest rates.

With Obama and Bernanke destroying the value of the dollar, gold and real estate should continue to rise in value.

More on Trump’s like of gold and golden tweets below

Trump’s fiery inauguration speech was a significant step away from the more presidential-tones of his November acceptance speeches. It was full of protectionism, promises to ‘hire’ and ‘buy’ American and strident nationalism.

The weekend was not full of any shocking declarations such as currency manipulation or border taxes, however Trump did tweet yesterday that he would be sitting down with Canada and Mexico to discuss NAFTA.

Across the world, most people aren’t sure what to think. Markets seem disappointed that Trump’s inauguration speech contained few details on fiscal policy, tax cuts and infrastructure spending. For the first time following a Presidential election we are more likely to feel uncertain post inauguration than we were in the run-up to the vote.

With Trump we are facing something new and radically different. His tweets are not only emotional and reactive but the subject of them combined with his general message go against the status quo, or international order (of the West) that we have seen supported in political America for so long.

The status quo opinions on Russia, free trade, strong dollar, China and war – has long been supported throughout Western politics, regardless of party leanings since the end of World War Two.

Politicians, policy makers, markets and the general public around the world are now having to come to terms with what this might mean. And whilst they figure it out, we expect heightened uncertainty.

For gold investors this is likely good news in both the long and medium term. We expect to see severe volatility due to Trump’s unexpected actions and tweets. Markets will be very nervous and wait with baited breath to see how the affected party, be it the EU, China, Russia or Congress, decide how to react.

‘Trumponomics’: Politics and economic policy in 140 characters

It was generally expected that we would see markets pull back in the week running up to the inauguration as confusion tends to surround anticipated policy from the new administration.

That is precisely what has happened, but it was exacerbated by both Trump’s direct comments to the press and his own tweets. Trump’s tweets and comments, clearly have an impact on sentiment. GM, Boeing and Toyota have all felt the wrath of the market following a Trump Tweet.

And, when companies thought it could not get much worse for them,  this week Trump told the Wall Street Journal that the US Dollar was too strong, breaking the unwritten rule that Presidents do not comment on the currency.

The dollar headed south following the comments. This surprised markets who were getting used to the Trump Trade that had seen equity markets and the dollar embark on a rally since the election result.

On a political note, Trumps’ comments to Bild on NATO being obsolete have put the first military alliance that combines both Second World War agreements and post-Soviet Union countries on an awkward and unstable position. Comments against NATO flies in the face of US foreign policy.

Trump reconfirmed his views, by tweeting “My statement on NATO being obsolete and disproportionately too expensive (and unfair) for the U.S. are now, finally, receiving plaudits!”

The above is just a recent reminder of the power of a Trump statement and that his favoured medium of communication, one that is un-vetted and seemingly unadvised, continues to take some getting used to.

There seems to be some thinking that once Trump takes office, the tweets will calm down.

Trump has no plans to stop, telling the Sunday Times, “…I can put out Twitter — and it’s not 140, it’s now 280 — I can go bing bing bing… and they put it on…”

Everyone is aware of how Trump is changing how Presidents will rule and make statements, Wei Li, iShares head of investment strategy EMEA, said in a recent interview with TradngFloor:

“There are some really unexpected things happening with the Trump administration and there are no doubt a lot more people paying attention to Twitter at 2am in the night…We are operating in a very different environment where markets are reacting and adapting to changes that have not been seen for a good decade or more.”

The CIA’s outgoing director, John Brennan, has also warned Trump that his tweets are not only bad for markets but also for national security:
“Spontaneity is not something that protects national security interests…So therefore when he  [Trump] speaks or when he reacts, just make sure he understands that the implications and impact on the United States could be profound.”

In all likelihood, Brennan’s advice will not be heeded by Trump.

The ‘intelligence’ according to Trump

John Brennan had been feeling Trump’s wrath for a long time. The new President has long criticised the intelligence services in the US, at one point suggesting Brennan was the ‘leaker of fake news’ following the Golden Shower story.

Trump had previously likened the intelligence services the Nazi regime, tweeting

“Intelligence agencies should never have allowed this fake news to “leak” into the public. One last shot at me. Are we living in Nazi Germany?”

As Zerohedge pointed out recently, no president since JF Kennedy has dared to take on America’s seemingly untouchable intelligence agency. The website writes, “If his refusal to take intelligence briefings, or follow CIA advice is serious, then serious consequences will follow. If Trump is serious about peace with Putin when they insist on war, there will be a problem.”

Trump has already announced that he will be replacing Brennan with Mike Pompeo, something which may be seen as a smart move for Trump, but whether it is so for the rest of the world, time will tell. Either way there is a changing of the guard from deep within the national security state that has, until now, been widely listened to when it comes to geopolitical, international and domestic threats.

Trump’s lack of desire to toe the status quo party line is something intelligence services around the world will seemingly have to get used to. This has become acutely apparent when it comes to matter of Russian relations, which was what triggered the most recent bout between Trump and the intelligence community.

Trump, Putin and Russia – the great bromance

Trump’s desire to improve relations with Putin and the Kremlin is the most glaring difference between his ideas and those of the status quo, and alongside his thoughts on NATO has much of the Western community nervous.

When CIA Director John Brennan responded to Trump’s comments comparing the US Intelligence Agencies to Nazi Germany he not only said that the then President-elect had crossed the line but also warned him about Russia:

“Mr. Trump has to understand that absolving Russia of various actions it has taken in the past number of years is a road that he, I think, needs to be very, very careful about moving down …”

It wasn’t until last week that Trump admitted it was likely that Russia had been involved in cyber-attacks and hacking, having previously expressed doubts over US Intelligence Agencies assertions in this regard.

A US Intelligence Report, seen by both outgoing President Obama and President Trump alleged that Russia had tried to sway the outcome of the 2016 election. However, there was little hard evidence and it did not state if the measures specifically had been successful.

In an interview with the Wall Street Journal, Trump vowed to improve relations with Putin and Moscow. He stated that the sanctions imposed by Obama last month, may be removed in exchange for support in fighting terrorism and meeting other US goals.

He reiterated his desire to work with Russia again in an interview with the Sunday Times, claiming that he wanted both the nuclear powers of the US and Russia to be

“reduced very substantially…They have sanctions on Russia — let’s see if we can make some good deals with Russia. For one thing, I think nuclear weapons should be way down and reduced very substantially, that’s part of it.”

In the same interview in The Times, Trump also criticised Putin and his country, for their involvement in Syria’s war, describing it as “a very bad thing” that had led to a “terrible humanitarian situation.”

It is no secret that Poland and Finland have been preparing themselves, with some international support, for a possible attack from Russia. Whilst neither Russia nor Europe have commented directly on any potential threat, Kremlin spokesman Dmitri Peskov says “threatens our interests, our security”.

Trump’s comments on both Russia and China, and apparent planned-policies regarding them, are very different to current foreign policies stances of the U.S., the EU, the UK and NATO.

Trump – a bull in a China shop

At various points during Trump’s campaign he managed to rile China, accusing them of currency manipulation and of ‘raping American jobs’. Then, he really made sure they were paying attention and increased tensions even more when he accepted a call from Taiwan’s President, on his birthday.

For just some of Trump’s issues with China, it’s worth looking at yet more of his tweets:

January 3: China has been taking out massive amounts of money & wealth from the U.S. in totally one-sided trade, but won’t help with North Korea. Nice!

December 18: We should tell China that we don’t want the drone they stole back.- let them keep it!

December 17: China steals United States Navy research drone in international waters – rips it out of water and takes it to China in unprecedented act.

December 5: Did China ask us if it was OK to devalue their currency (making it hard for our companies to compete), heavily tax our products going into…their country (the U.S. doesn’t tax them) or to build a massive military complex in the middle of the South China Sea? I don’t think so!

Anti-China and anti-free trade and globalisation rhetoric is something that is becoming louder, not just because of Trump’s victory but also because of discontent in the EU. China is likely to be one of the biggest victims of this change in trade, and a trade and currency war may be on the cards.

Prior to the election Trump signaled that he would label China a currency manipulator, whether he will do so or not is obviously unknown, but he has still drawn attention to their currency. In a recent interview Trump complained about the strong US dollar and China’s weak yuan.

“Our companies can’t compete with them [Chinese companies] now because our currency is too strong. And it’s killing us”. In the same interview Trump said that China’s currency was “dropping like a rock.”

The election of Donald Trump has seen the US Dollar climb to 13 year highs and made gains of nearly 5% in the period since November. But now, just one week ahead of the inauguration, the President has signaled that he will be dropping the strong dollar policy.

It isn’t just China’s currency that Trump is likely to have a say on, in 140 characters or perhaps more. Some pundits believe is about to upset China by not only announcing his intention to abandon the one-China policy but also to declare the move by China to build artificial islands in the South China Sea, as illegal.

China remains unimpressed, the English-language paper China Daily wrote, ““If Trump is determined to use this gambit in taking office, a period of fierce, damaging interactions will be unavoidable, as Beijing will have no choice but to take off the gloves.”

“China and the U.S. can find ways to solve problems through dialogue and negotiation,” Ministry of Commerce spokesman Sun Jiwen said Thursday at a briefing in Beijing. “Bilateral trade and economic cooperation have made the two nations inseparable since relations were established more than three decades ago, and that’s reinforced every day”, Sun said.

According to Jim Rickards, this anti-China rhetoric could lead to a new currency war between the US and China.

President Xi Jinping, is also aware of the risks, speaking at his first address at Davos, China’s President spoke against businesses and political elites engaging in trade wars and protectionism:

“Pursuing protectionism is like locking yourself in a dark room, which would seem to escape the wind and rain, but also block out the sunshine and air…Waging a trade war will only cause injury and loss to both sides.”

Trade and currency wars with China and other nations, a civil war with Democrats and much of civil society in the U.S.,  combined with a weakening or dismantling of NATO, all in all points to uncertainty and volatility on a grand scale.

Trump – Fan of gold and golden tweets
We know (and not just from his taste in interiors) that Trump is a fan of gold and he is aware of the role in plays in both dollar hegemony and currency wars.

Tweets over the last four to five years have shown an interest in the gold price and trade, tweeting in 2012:

“With Obama and Bernanke destroying the value of the dollar, gold and real estate should continue to rise in value.”

He is also not a fan of QE, tweeting in 2011 “The Fed continues to flood the market with US dollars. Wrong move.” and has since commented on gold purchases by China and Russia.

But what about the gold price? As we explained last week, the fundamentals supporting the gold market look good, regardless of who is about to take the US Presidency.

This year the gold price has already climbed by around 5%, fuelled by what appears to be a perfect storm coming together of Trump worries, Brexit angst and brewing tensions on trade and globalisation, generally.

Axel Merk told Bloomberg that uncertainty will support gold, “We have no idea what’s going to happen with some of Trump’s policies — everybody is a little nervous,” said Axel Merk, San Francisco-based founder of Merk Investments LLC, pointed out that

“Gold is relatively undervalued and will push higher.”

We concur and believe that the next four years of the Trump Presidency will be good for gold. If we assume gold takes a similar journey to that it took following Obama’s inauguration, we can expect:

A similar performance in the coming month would see gold rise from $1,200/oz to $1,392/oz.

A similar performance in the coming year would see gold rise from $1,200/oz to $1,555/oz

According to Bloomberg, gold has averaged gains of almost 15% in the inauguration years since the 1970s. It has made gains in five of the last seven inaugurations, and declined only in the year of Reagan’s.

Whilst events regarding China, Russia, NATO and even potential Civil War are unknown in how they will play out, one thing we can be fairly sure of is that Donald Trump is likely to preside over a significant budget deficit.

Conclusion – Trump may be the ‘Golden Ticket’

Whilst the run up to Trump’s inauguration has proven to be box office viewing, it is important to tune out the noise surrounding the short-term hype and to consider the real world consequences of his Presidency for investors and savers. We should be aware that what he says/tweets may impact and have lasting results, around the world.

The golden rule of negotiation: He who has the gold makes the rules.

A man who is against many of the financial, economic and foreign policies of most Western nations,  has been democratically elected to run the West’s most powerful country. Policy may now be issued via Twitter and with little consultation.

Expect some serious volatility and prepare by diversifying and owning safe haven gold which has protected investors and savers from economic and political uncertainty in recent times and throughout the ages.

Total gold reserves into Russia rise to a record high 1614 tonnes, an increase of almost 200 tonnes this year, average of 16.6 tonnes per month. However, we added 0 oz in December as Nov.totals were 1,614.00 tonnes.
(courtesy Sputnik news)

Russia’s Gold Reserves Top 1,614 Tonnes – Central Bank

© Sputnik/ Valery Titievsky


The amount of monetary gold in Russia’s international reserves grew by 14.7 percent [199 tonnes] and totals 51.9 million troy ounces [1,614.27 tonnes], according to the statement of the Bank of Russia.

MOSCOW (Sputnik) — Russia’s gold reserves grew by 14 percent in 2016 to 1,614.3 metric tons, the Bank of Russia said on Friday.

“The amount of monetary gold in Russia’s international reserves grew by 14.7 percent [199 tonnes] and totals 51.9 million troy ounces [1,614.27 tonnes], the financial regulator said in a report.




Chris Powell states that the currency regime in place since 1945 has always been “America first:

(courtesy Chris Powell/GATA)

Chris Powell: Currency regime has run the world for ‘America first’ since 1945


Trump’s Megalomaniac Delusion: ‘Now I Am the People’

By Chris Powell
Journal Inquirer, Manchester, Connecticut
Monday, January 23, 2017


President Trump’s inaugural address was based on the ridiculous conceit that he somehow had received a mandate for running second in the election with just 46 percent of the vote, almost 3 million votes behind the leader, who didn’t do so well herself. With his ascension, Trump said, “we are not merely transferring power from one administration to another, or from one party to another, but we are transferring power from Washington and giving it back to you, the American people.”

Or as the megalomanical politician invented by the Firesign Theater in 1970 said, “Now I am the people.”

Continuing to pander, Trump offered another ridiculous conceit — that “a small group in our nation’s capital” has been cheating all the good people of the country.

In fact, while the country purports to hate Congress, it loves its own congressman, almost always re-electing him because he does his best to cheat every other congressman’s district for the benefit of his own. That is, nearly everyone is on the government gravy train one way or another but still fashions himself exploited.

“We’ve made other countries rich while the wealth, strength, and confidence of our country have disappeared over the horizon,” the new president said. “The wealth of our middle class has been ripped from their homes and then redistributed across the entire world. … From this moment on, it’s going to be America first.”

Except that since 1945, when, by international agreement, the U.S. dollar was installed as the world reserve currency, the world itself has been run on an “America first” basis. That’s because for international trade the world has been required to use currency issued only by the U.S. government, allowing the United States to run huge trade deficits, thereby essentially taxing the world for using the dollar so Americans can consume far more than they produce.

This currency arrangement is a primary cause of the decline of simple manufacturing in the United States, about which Trump complained during his campaign and again in his inaugural address.

“America first”? It has been a long time since it was otherwise.

The protectionism and tariffs the new president seemed to advocate in his address will not be good for the complex manufacturing in which the United States now excels. Protectionism and tariffs will be reciprocated and may be as bad for Boeing and Pratt & Whitney as they may be good for Airbus and Rolls Royce.

Trump’s address included fair grievances: “Mothers and children trapped in poverty in our inner cities. Rusted-out factories scattered like tombstones across the landscape of our nation. An education system flush with cash but which leaves our young and beautiful students deprived of knowledge. And the crime and gangs and drugs that have stolen too many lives and robbed our country of so much unrealized potential. … We have defended other nations’ borders while refusing to defend our own.”

But Trump’s own response to these problems was only the most delusional megalomania. “This American carnage stops right here and stops right now,” the new president said before hurrying off to march in the inaugural parade and dance at the inaugural balls.

A new week has begun and of course the “carnage” has not stopped or even slowed, for mere proclamations are powerless against problems arising from mistaken policies of long standing. The country may not even be capable of addressing these problems while it is as divided politically, philosophically, and socially as Weimar Germany was divided between Nazis and Communists.

Indeed, as the tribune of America’s populist right was taking his oath, just a few blocks away the neo-Stalinist left was already rioting, smashing windows and burning cars.


Chris Powell is managing editor of the Journal Inquirer.




James Turk correctly states that the gold price suppression scheme is vital to government currencies but in the end the suppression will fail

a must read..

(courtesy James Turk/Wealth Research group/GATA)

Gold price suppression is vital to govt. currencies but will fail, Turk says


10:16a ET Saturday, January 21, 2017

Dear Friend of GATA and Gold:

In an interview with Wealth Research Group, GoldMoney founder and GATA consultant James Turk explains why gold price suppression is essential to the defense of government-issued currencies and why the current suppression scheme seems likely to fail soon. Turk credits GATA for exposing the scheme worldwide. The interview is a half hour long and can be heard at You Tube here:


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





Nothing but crooks!!

(courtesy Murphy/London’s Financial Times)


High-frequency trading radio masts criticized by planners


By Hannah Murphy
Financial Times, London
Sunday, January 22, 2017

U.S. high-‎frequency traders aiming to build radio towers taller than the Shard in a tiny village in the English countryside have been criticized by local planning officials ahead of a crucial council meeting next week.

Three traders are behind plans to build two vast masts in Kent to clip milliseconds off trading speeds between London and Frankfurt, but the size of the towers has attracted local opposition.

The fate of the masts will be decided at a Dover council meeting on Thursday, which will judge whether to overrule residents’ protests and a report last week by a local planning official that they would damage views of the landscape, which contains the remnants of a Roman fort.

The standoff highlights the lengths to which electronic traders are prepared to go to receive valuable trading data before rivals, by beaming information over hundreds of miles using radio microwaves. …

… For the remainder of the report:




The collusion and fraud in the gold market is causing the LME’s share to falter:

(courtesy Hobson/Reuters/GATA)

LME’s pitch for share of gold market faces bumpy ride


By Peter Hobson and Pratima Desai
Monday, January 23, 2017

LONDON — Fears of inflexibility and rising costs are sapping enthusiasm for the London Metal Exchange’s new suite of gold contracts, potentially leaving the exchange reliant on the threat of an increasing regulatory burden to drive uptake.

London’s $5 trillion-a-year gold trade has, along with the rest of the City of London, found itself under increased scrutiny since the Libor scandal, with U.S. lawsuits alleging rigging against the banks that set bullion prices.

Regulatory pressure sparked the fall of the near century-old telephone-based gold fix, or benchmark pricing, which was replaced by an electronic alternative in 2015, and reform of the management structure of the London Bullion Market Association.

The LME, owned by Hong Kong Exchanges and Clearing Ltd., says its contracts, which include spot, futures, and options, would bring price-setting out of the back rooms of banks by creating a published forward pricing curve for gold and sliver out to five years.

It also says the contracts’ central clearing would free the banks and brokers that dominate London’s over-the-counter gold market from increasingly onerous capital requirements, creating savings that could be passed to others in the industry.

But a source at a major gold trading bank said: “There’s a lot of caution and probably outright scepticism from market participants whether this will add anything but another cost to the bottom line.” …

… For the remainder of the report:






Even though Ireland only holds 6 tonnes, it is secretive about its gold reserves

(courtesy Ronan Manly/GATA)

Ronan Manly: Ireland conceals basic information about its gold reserves


11:20a ET Monday, January 23, 2017

Dear Friend of GATA and Gold:

Gold researcher Ronan Manly today begins a two-part series of essays showing how Ireland’s central bank is striving to conceal basic information about the country’s gold reserves. Manly’s essay is headlined “Ireland’s Monetary Gold Reserves: High-Level Secrecy vs. Freedom of Information — Part I” and it’s posted at Bullion Star here:


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





Chinese bitcoin companies slap on fees equal to .2% per value of the transaction. This should slow down the price rise of Bitcoin.  However Bitcoin has caught on in Japan which have now seen the monthly volumes soar by 8900%

(courtesy zero hedge)

As China Slaps Fees On Bitcoin Trades, Japan Monthly Volumes Soar by 8,900%

There is one reason why bitcoin quickly became the darling of HFT and various high speed algo traders operating out of China and the rest of the world: domestic transactions were “frictionless”, as there were no fees on buys or sells. Until last night, that is, because as China’s three largest bitcoin exchanges, BTCC, Huobi and OkCoin, all said in separate statements on their websites late on Sunday, starting Tuesday they will charge traders a flat fee of 0.2% per transaction. This is only the latest fallout from the recent crackdown on Chinese bitcoin exchanges whose activities have drawn increased scrutiny from the central bank.

Each of the statements said assessing fees will “further curb market manipulation and extreme volatility”.

One of the reasons why China has dominated bitcoin trading volumes in recent years, in addition to the US of the digital currency to bypass capital controls, has been the absence of trading fees which encouraged volumes and boosted demand at Chinese bitcoin exchanges. However, when the price of bitcoin soared to near-record highs – as this website predicted would happen in the summer of 2015 – driven by a stampede of Chinese momentum chasers, it attracted attention from Chinese regulators. Helping the surge, was the collapse in the yuan which weakened 6.6% against the dollar, its worst performance since 1994 as local savers sought the relative “safety” of bitcoin relative to the renminbi.

The standoff between local bitcoin traders and exchanges on one hand, and regulators on other culminated on Jan. 11, when the People’s Bank of China launched spot checks on BTCC, Huobi and OkCoin to look into a range of possible rule violations, amid increasing government efforts to stem capital outflows and relieve pressure on the yuan. According to Reuters, citing “a person familiar with the matter”, the exchanges had not received direct instructions from the PBOC, but decided to introduce trading fees to align with its wishes to see the bitcoin market cool down.

So far, the impact of the new fees has been negligible, with the price of Bitcoin on the BTCChina exchange largely unchanged overnight.


And as one bitcoin bubble fizzles, a new one appears to be born. Japan.

As Cryptocoinsnews reported over the weekend, a major factor that has sent the trading volume of Bitcoin in Japan soaring, is the new virtual currency law which will be enforced by this spring, says the Business Development Lead of CoinCheck, the country’s top exchange. According to Kagayaki (Kaga) Kawabata, the introduction of the proposed law made Bitcoin a darling of top media organisations in the country. He explains:

“After this announcement, various large media that once negated Bitcoin started to feature Bitcoin again this time as an innovative technology (After the Mt. Gox incident, the media broadcasted Bitcoin as a tool for money laundering). Japanese national TV shows and newspapers such as NHK and NIKKEI featured about cryptocurrency expanding awareness of the general public and bringing in various users with diverse backgrounds from college students to elderlies.”

Kawabata, whose CoinCheck’s parent company, ResuPress, also provides Bitcoin payment processing for merchants similar to the service BitPay offers, the announcement could have contributed to a key new trend in Japan which is the changing view that Bitcoin is not just an investment vehicle. He says:

“Many still think of Bitcoin as an investment vehicle. However, the situation is changing where Bitcoin is also starting to be used as a payment method in the past few years. Currently, there’s around 5,270 merchants and website that accept Bitcoin as payment in Japan (99% of them use Coincheck payment). Regarding payment volume, compared to last year January, the monthly volume increased by 8900%. This number could accelerate in the next few years.”

He added that the enforcement of the new law may have positive side effects on Bitcoin as it was once considered a toy for geeks but is now changing dramatically now to be seen as a legit currency. Ironically, Japan was also the epicenter of the first mass bitcoin casualty, when Mt.Gox went under, wiping out hundreds of millions in the process. Then again, human memory tends to be quite shallow when potential profits are involved.

Such a change in perception, he says, has the potential to migrate serious traders to trade in Bitcoin and other cryptocurrencies which will inadvertently surge cryptocurrency trading volume remarkably. Which is why he is very optimistic about the future:

“We believe the hype in Bitcoin price is not just a fluke,” Kawabata says on the general outlook of cryptocurrencies. “Many factors exist that accelerate the trading volume. We believe cryptocurrencies market will grow dramatically in the next few years. Many large corporations and banks in Japan have started to show interest in cryptocurrency and started to experiment with the Blockchain technology. I think remittance will be the first practical usage of cryptocurrency where many corporations/banks will adopt cryptocurrencies.”

Of course, if and when the second coming of the Japanese bitcoin bubble fizzles, we are confident some other country in the world will open it with open arms, as the rolling digital currency bubble continues its fascinating drift around the globe.





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



2. Nikkei closed DOWN 246.88 POINTS OR 1.29%   /USA: YEN FALLS TO 113.52

3. Europe stocks opened ALL IN THE RED      ( /USA dollar index FALLS TO  100.40/Euro UP to 1.0736


3c Nikkei now JUST BELOW 17,000

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

3e WTI::  52.56  and Brent: 54.92

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 DOWN for WTI and DOWN for Brent this morning

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund RISES TO  +.403%/Italian 10 yr bond yield UP  to 2.047%    

3j Greek 10 year bond yield FALLS to  : 6.69%   

3k Gold at $1214.25/silver $17.16(8:15 am est)   SILVER BELOW RESISTANCE AT $18.50 

3l USA vs Russian rouble; (Russian rouble UP 16/100 in  roubles/dollar) 59.44-

3m oil into the 52 dollar handle for WTI and 54 handle for Brent/

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


30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF. It is not working: USA/SF this morning  0.9983 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0721 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.


3r the 10 Year German bund now POSITIVE territory with the 10 year RISES to  +.403%


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 2.454% early this morning. Thirty year rate  at 3.037% /POLICY ERROR)GETTING DANGEROUSLY HIGH

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

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


Futures, Dollar Slide; European Stocks At 3-Week Lows As “Trump Reality Sets In”

While US stocks closed near session, and all time highs on Friday, the first green close on inauguration day in over 50 years, Monday has seen a modest case of buyer’s remorse, with European stocks sliding, Asian shares mixed and U.S. futures lower as the dollar weakened for the 3rd consecutive day to a six-week low, dropping as much as 1% against the Yen, as anxious investors awaited more details of Donald Trump’s policies, or – as Reuters put it – the “Trump reality set in.” While European shares and US equity futures sold off in early trading, tracking the USDJPY, the now traditional buying levitation wave has emerged, pushing US futures close to unchanged on the session.

The modest risk off session,  which comes after world stocks hit multi-year highs earlier this month on expectations Trump would boost growth and inflation with extraordinary fiscal spending measures, has seen shares in developed markets fall with the dollar, while lifting metals and Treasuries after Donald Trump offered little more on plans to boost growth while stirring concerns over protectionism in his first days in office. Europe’s Stoxx 600 Index dropped to its lowest level this year, while U.S. futures slid and the dollar fell against all major peers. The weaker currency pushed aluminum to the highest in more than a year, while ten-year Treasury yields fell a second day.

“The focus this morning is on the protectionist rhetoric and the lack of detail on economic stimulus, so it’s a nervous start (to the presidency),” said Investec economist Victoria Clarke. “The other concern is how the Fed interprets Trump’s stance, the worry being the less he does on fiscal stimulus the more nervous they may get on pushing the rate hikes through.”

While the U.S. President’s campaign-trail promises to boost growth and spending helped drive a post-election rally in equities and the dollar, by Monday, investors were calling into question how words would be translated into actions. So far, Trump has focused on a feud with the press over attendance at his inauguration rather than offer concrete plans, leaving investors in limbo. As the chart below shows, while stock dispersion may have risen in recent weeks, cross-asset correlation remains as high as ever, with most asset classes trading largely as a continuation of the Trump trade.

“The markets and a lot of international investors, whilst they’re nervous about Trump’s geopolitical and trade aspirations, have wanted to believe the reflation trade,” Neil Dwane, a chief investment officer at Allianz Global Investors Capital LLC told Bloomberg Television. “We’re seeing now is that it is going to be hard. The optimism was always way ahead of what Trump would be able to deliver and now you’re seeing some profit-taking.”

Rabobank analyst Michael Avery said a more protectionist United States could lead to a U.S. dollar liquidity squeeze, with Mexico and Asia likely the most badly hit. “We would see outright confusion over what currency to invoice, trade, and borrow in: a 19th century world of competing reserve currencies in different geographic zones, but without the underpinning of gold,” Avery said in a note. The problem would be exacerbated if China tightens capital controls further, he said.

Across global equities, the Stoxx 600 benchmark index fell to its lowest level since December. Generali jumped as much as 7.1 percent on speculation of a takeover bid for the Italian insurer. Spanish lender Banco de Sabadell dropped after disclosing that the maximum amount it might have to repay to clients in the mortgage-floors ruling exceeds the last two quarters of profit. Other Spanish banks also dropped as clients prepare to claim back interest payments. European stocks fell 0.7 percent and the broader Euro STOXX 600 fell 0.6 percent in early trades on Monday, both hitting their lowest level this year so far.

Japan’s Nikkei dropped 1.1% while shares in Australia dropped 0.8 percent after Trump’s administration also declared its intention to withdraw from the Trans-Pacific Partnership (TPP), a 12-nation trade pact that Japan and Australia have both signed. Other Asian shares were more resilient, however, in part due to the dollar’s weakness, and MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.3 percent.

The U.S. Federal Reserve, which has indicated that it expects to raise its benchmark interest rate three times this year, is due to hold its next meeting on Jan. 31 and Feb. 1.

S&P 500 futures dropped 0.2 percent, while the main gauge closed 0.3 percent higher Friday.

The nervous start on Monday saw safe haven assets in demand. The yield on Germany’s 10-year government bond, the benchmark for the region, led most euro zone bonds lower, dropping 4 basis points to 0.32 percent in early trade. This followed 10-year U.S. Treasuries yields, which fell to 2.43 percent, after having risen briefly on Friday to 2.513 percent, its highest since Jan. 3. Spot gold prices, meanwhile, rose on Monday to their highest in two months.

Money managers will be dissecting earnings from some of the world’s largest companies this week with Alphabet Inc., Samsung Electronics Co. and Alibaba Group Holding Ltd. all reporting results.

* * *

Bulletin Headline Summary From RanSquawk

  • European equities have kicked the week off on the backfoot with underperformance in financials and macro newsflow relatively light
  • FX markets have seen cautious trade in the lead USD pairings, led by the USD/JPY pullback below 114.00
  • Looking ahead, highlights include potential comments from ECB’s Draghi and Praet

Market Snapshot

  • S&P 500 futures down 0.2% to 2262
  • Stoxx 600 down 0.3% to 362
  • FTSE 100 down 0.6% to 7152
  • DAX down 0.4% to 11581
  • German 10Yr yield down 2bps to 0.4%
  • Italian 10Yr yield up less than 1bp to 2.03%
  • Spanish 10Yr yield down less than 1bp to 1.5%
  • S&P GSCI Index down 0.2% to 398.8
  • MSCI Asia Pacific up 0.2% to 140
  • U.S. 10-yr yield down less than 1bp to 2.46%
  • Dollar Index down 0.35% to 100.39
  • WTI Crude futures down 0.8% to $52.81
  • Brent Futures down 0.5% to $55.24
  • Gold spot up 0.2% to $1,213
  • Silver spot up 0.2% to $17.13

Top News

  • Dollar Drops as Trump’s ‘America First’ Speech Unnerves Traders
  • Trump’s Vow to Break From OPEC Oil Imports Echoes Old Refrain
  • OPEC and Friends Agree on Way to Monitor Oil Cut to End Glut
  • United Air Lifts Halt After Computer Failure Grounded Flights
  • List of U.S.-China Tension Losers May Include Nike to Lenovo
  • Apple-Supplier Foxconn Weighs $7 Billion U.S. Display Plant
  • Yahoo Faces SEC Probe Over Multiple Data Breaches, Journal Says
  • Canada Signals Possible U.S. Trade Deal That Excludes Mexico
  • Beware the Hedge-Fund Wipeout in Treasuries as Bearish Bets Soar
  • Amazon Said to Sign Contracts With Auto Parts Makers: NYP
  • GM, Mastercard Want Your Car to Pick Up the Tab for That Latte

Asia equity markets traded mixed despite last Friday’s positive US close where stocks gained during Inauguration Day for the first time in over 50 years. 5 out of 11 sectors gain in the MSCI Asia Pacific Index with infotech and health care, consumer discretionary underperforming. Nikkei 225 (-1.3%) underperformed as exporter names suffered from a firmer JPY, although Toshiba shares outperformed and rose over 9% after reports Japan’s largest banks could invest in a possible spinoff of the Co.’s chip business. ASX 200 (-0.8%) was also lower with weakness in industrials after Brambles (-15.6%) decreased its profit forecast. Conversely, Hang Seng (+0.1%) was flat while Shanghai Comp. (+0.4%) traded positive as strength in the services sector kept sentiment upbeat after the NBS stated that the services industry grew 7.8% in 2016 and accounted for 51.6% of GDP. 10yr JGBs were higher amid the risk averse tone in Japan and with the BoJ also in the market under its bond-buying programme for JPY 420b1n in 5-10yr bonds, while the curve flattened amid outperformance in the long end.

Top Asian News

  • Yuan Trades Near Two-Month High on Stronger Fixing, Dollar Drop
  • Asia Currency Strength to Fade as Focus Returns to U.S. Stimulus
  • China Slams Western Democracy as Xi Seeks to Build Party Support
  • Hedge Fund Renaissance Picks Winner in Hot Japan Tech Stock
  • Modi Budget May Put Consumers Before Taxes to Spur India Demand
  • Samsung Probe Shows Battery Design, Assembly Behind Note 7 Fires
  • LG Display Said to Reach LCD Panel Supply Pact With Samsung

European bourses sold off this morning after markets had the weekend to digest Trump’s inauguration speech. 10 out of 19 Stoxx 600 sectors decline with banks and telcosunderperforming and basic materials, construction outperforming. 72% of Stoxx 600 members decline, 26% gain. With all the major indices down around 0.4%, the financial sector has been hit the hardest after Credit Agricole booked EUR 491 min writedown on their French retail unit and SocGen admitted they were at fault regarding fraudulently concealing the quality of residential mortgage backed securities. Fixed income markets have benefitted from the risk off sentiment observed in markets with morning with Bund prices gapping higher at the open. European fixed income markets picked up as a whole in the aftermath of Trump taking office, 10 YR BTP yield’s eye a sustained break below the 2% level with technical support at 1.95% lower down, this came after comments this weekend from the Italian PM who stated the government’s relationship with the EU is starting to improve.

Top European News

  • Theresa May Gets Another Brexit Headache Amid Brussels Upheaval
  • Brexit Good for Terra Firma, Bad for Most People, Guy Hands Says
  • Trump Era May Force Europe Into Deciding What Role It Wants
  • Supreme Court Brexit Ruling Unlikely to End May’s Legal Battles
  • May Industrial Strategy Seeks to Pick Winning Areas for U.K.
  • UBS Wealth Sees Too Much Political Risk Baked Into Europe Stocks
  • JPMorgan May Move 2,500 Jobs to Central Europe on Brexit: Puls
  • Starwood Said Planning Sale of London Tower Project on Brexit
  • Generali Climbs Amid Reports of Interest by Intesa, Allianz
  • Euro-Area Debt Falls to Lowest Since 2012 as Prospects Brighten

In commodities, aluminum for delivery in three months increased 0.9 percent on the London Metal Exchange to the highest since May 2015. Copper, lead, nickel and zinc all rose more than 1 percent. Gold rose 0.2 percent to $1,212.28 an ounce. The metal has increased in 10 of the past 11 sessions. West-Texas Intermediate crude oil was down 1.4 percent at $52.50 a barrel after the amount of drilling rigs in the U.S. increased. The key drivers in the commodity markets at the moment are China’s economic prospects as much as anything else, giving base metals the support we are seeing at present. We have had the added boost of infra structure spending plans in the US but this has somewhat waned in recent weeks, leading to the largely sideways price action seen outside of the specific drivers. Copper saw a brief dip under USD2.60 last week, with Oil prices also falling, though there was little correlation to highlight here, with WTI and Brent seeing some erratic trade over the past week, but the former looking comfortable on a USD50.00 handle for now. Gold has recovered some ground over the weekend over USD softening, but we may see some added support coming in from a risk perspective with equities looking a little vulnerable this morning.

In currencies, the Bloomberg Dollar Spot Index slid 0.6 percent as of 10:51 a.m. in London. It has fallen for four straight weeks, its longest retreat since February. The dollar lost 0.7 percent against the South African rand and 1 percent versus the Mexican peso.  The euro climbed 0.4 percent to $1.0740. The yen rose 1 percent to 113.47 per dollar. Cautious trade in the lead USD pairings, led by the USD/JPY pullback below 114.00. USD longs have favoured this pair specifically as the ‘path of least resistance’ and hence remains ever vulnerable to position trimming/profit taking if Trump rhetoric transfers into fresh nervousness in the market. Notable has been the lack of volatility in the USD/CHF rate which is now below parity, but last week we saw 1.0100 reclaimed by with very little conviction. GBP looks to have weathered an uncomfortable period, heightened by the expectations of PM May’s speech last week, but with the market left in no doubt that the UK will leave the EU in in entirety, we now have a clear view on an albeit rocky road ahead, but with the backdrop of parliamentary vote on the final Brexit deal (when) reached. EUR/GBP is now pressing the recent lows ahead of .8600, but given president Trump’s early request to see PM May, the strong US-UK alliance looks to be assisting some of the gains seen in Cable, though pre 1.2500 will draw in fresh offers.


DB’s Jim Reid concludes the overnight wrap

The photo leading the way in the weekend press was that of new US President Donald Trump. As we start the first business day of his new administration I must admit to having high uncertainty about the year ahead. The range of outcomes seem very wide to me which, for someone that’s supposed to be followed for having strong views, leaves me feeling pretty uncomfortable. Of course I do have a central view which can be broadly summed up by better growth than I thought back in October but higher yields, higher volatility and mildly wider credit spreads over the course of 2017 as the technicals of low yields and  extreme QE wear off. One of the reasons I think vol will be high is that Trump’s victory is a break from the old more predictable policy of the establishment. How big a break and whether it works or not we won’t know for sometime and the market will have plenty of opportunity to second guess the outcomes from both sides of the ledger.

I really have no idea what Donald Trump’s administration is going to want to ‘actually’ do in economic policy terms or be able to do. I think fiscal stimulus is going to be relatively large but I’m guessing (hopefully an educated one) on this front. I am slightly less convinced of this than I was straight after his victory though. His inauguration speech on Friday was high on rhetoric, light on specifics but pretty combative with phrases like “American carnage stops right now” and “America first” grabbing the headlines.

This week will continue to be largely focused on all things President Trump related. White House spokesman Sean Spicer confirmed that Trump will meet with Canadian PM Justin Trudeau “in the coming days” with the renegotiating of NAFTA likely to be front and centre. However there’s likely to be more attention on this Friday’s meeting in Washington between the President and UK PM Theresa May. The PM said in a BBC interview yesterday that “we’ll have an opportunity to talk about our possible future trading relationship” and that “I’m going to be talking about how we can build on that special relationship”. As we already know, Trump has previously said that that the US could strike a trade deal with the UK “very quickly” so it’ll be interesting to see what comes out of the meeting. In addition to this the Brexit talk will come to the forefront tomorrow when we get the Supreme Court verdict on whether Parliament needs to vote prior to the government triggering Article 50. Should there be no change from the High Court ruling then May will be forced to rush a brief bill through both Houses in order to prevent any delay from the self-imposed late March deadline. All eyes on that outcome.

Aside from the obvious Trump-related news this weekend, yesterday in France we had the first round of results in the Socialist primary. They revealed that former education minister Benoit Hamon came out on top with 36.1% of the votes, compared to 31.2% for former PM Manuel Valls. Former Industry Minister Arnaud Montebourg came third with 17.9% and endorsed Hamon. Hamon and Valls will now face a run-off next Sunday to be the Socialist Party candidate. According to  the FT, polls have suggested that whoever winds up as the Socialist candidate would likely come fifth in the first round of the presidential election on April 23rd with less than 10% of the voting. So it’s likely to be a fairly uphill task regardless.

Over to markets now and quickly checking in on how Asia is opening the week. Once again it’s been another fairly mixed start with the Hang Seng (+0.10%), Shanghai Comp (+0.60%) and Kospi (+0.10%) all up but the Nikkei (-1.22%) and ASX (-0.57%) in the red. Markets in Japan are however being weighed down by a near 1% gain for the Yen this morning, while other safe haven assets have continued to make strides include Gold (+0.68%) and Treasuries. There’s been some focus on the morning press in China too with Bloomberg reporting that the People’s Daily has a page dedicated to critiquing Western democracies, albeit without directly referencing Trump.

The moves this morning come after equity markets in the US closed out on a mildly more positive note on Friday following the conclusion of Trump’s speech. The S&P 500 finished +0.34% with sector gains  relatively broadly based while the Dow closed +0.48% and so taking it back into positive territory for the year again. The Stoxx 600 had earlier closed -0.07% in Europe and as a result closed with the first negative return week of the New Year. Away from that rates didn’t appear to be particularly excited by Trump’s comments with 10y Treasury yields ending the day little changed around 2.467% – although in fairness there was a decent fade into the close from the early day highs and that’s continued this morning where they are now at 2.428%. That was the same for the US Dollar after the USD index touched an intraday high of a little over +0.30% before paring all of that move and more into the closing bell to end -0.41%. It also means that the Greenback has now fallen for two weeks in a row. Meanwhile WTI Oil (+2.11%) ended up back above $53/bbl and continues to hover in this $51 to $55 range it’s been in since the end of 2016. It’s up a little bit more this morning too after Saudi’s energy minister confirmed that compliance with the agreed OPEC cut between members has so far been “great” and that “it’s been one of the best agreements we’ve had for some time”.

Elsewhere on Friday we also heard some more comments out of the Fed. San Francisco Fed President, John Williams, said that he doesn’t expect any disruption when the Fed begins to let the balance sheet roll off. Philadelphia Fed President, Patrick Harker, warned that since the US is already at full employment, “any large stimulus to the economy may run the risk of inflation growing faster than we hope” and that “if we had a significant trade war, say with China, the lower 10% of the income distribution would lose 50% of their purchasing power”. Harker also highlighted that the Fed “should consider stopping reinvestment” once the Fed funds rate is above 100bps and that “we are actively discussing and researching the question of what is the appropriate size in the long run”.

Away from that chatter there was little in the way of data out of the US although we did see the NY Fed revise up their Q4 GDP forecast to 2.1% from 1.9% and raise their Q1 2017 GDP forecast to 2.7% from 2.1% with positive news including industrial production and capacity utilization data last week. The Atlanta Fed is at 2.8% for Q4. Meanwhile over in the UK the December retail sales numbers were a bit disappointing with ex-fuel sales in the month down -2.0% mom (vs. -0.4% expected) and so which has had the effect of lowering the YoY rate from +6.4% to +4.9%.

Moving now to this week’s calendar. It’s a pretty quiet start to the week for data today with the only releases of note being the Euro area consumer confidence reading this afternoon and China’s leading economic index. Things pick up on Tuesday however when we’ll get the various flash January PMI’s in Europe. As well as that we’ll also get the latest public sector net borrowing data in the UK. In the US the data due out includes the flash manufacturing PMI, existing home sales and Richmond Fed manufacturing survey. Wednesday kicks off in Japan where the December trade numbers will be due. During the European session we’ll get various confidence indicators in France along with the IFO survey in Germany and CBI trends orders data in the UK. The only data due in the US on Wednesday is the FHFA house price index. In Asia on Thursday we’ll get some data out of China with the December industrial profits numbers. During the European session we’ll get consumer confidence in Germany and the advanced Q4 GDP reading in the UK. The US calendar finally picks up on Thursday with the advance goods trade balance, wholesale inventories, initial jobless claims, flash services and composite PMI’s, new home sales, leading index and Kansas Fed manufacturing survey all due. We close the week out in Asia on Friday with CPI in Japan. During the European session we’ll get M3 money supply for the Euro area and consumer confidence in France. Over in the US it’s all eyes on the advance Q4 GDP print in the US. We’ll also get a first look at durable and capital goods orders during December as well as the final University of Michigan consumer sentiment reading.

Away from the data there’s no Fedspeak this week with the Fed entering the blackout period. However we will hear from the ECB’s Praet, Weidmann and Lautenschlaeger at various points this week. BoE Governor Carney will also speak on Wednesday. Meanwhile earnings season will also start to ramp up with 107 S&P 500 companies set to report, accounting for about 29% of the index market cap. The notable reporters include Yahoo and McDonald’s today, Verizon and Johnson & Johnson on Tuesday, AT&T, eBay and Boeing on Wednesday, Caterpillar, Ford, Intel, Alphabet and Microsoft on Thursday followed by Chevron on Friday. The other key event for markets will of course be the UK Supreme Court decision tomorrow, before PM May meets with President Trump on Friday.


i)Late  SUNDAY night/MONDAY morning: Shanghai closed UP 13.64 POINTS OR 0.44%/ /Hang Sang closed UP 12.61 OR 0.06%. The Nikkei closed DOWN 246.88 POINTS OR 0.1.29% /Australia’s all ordinaires  CLOSED DOWN 0.73%/Chinese yuan (ONSHORE) closed UP at 6.8536/Oil FELL to 52.56 dollars per barrel for WTI and 54.92 for Brent. Stocks in Europe ALL IN THE RED. Offshore yuan trades  6.8235 yuan to the dollar vs 6.8536  for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE COMPLETELY NARROWS AS POBC ATTEMPTS TO STOP DOLLARS FROM LEAVING CHINA’S SHORES. HOWEVER BOTH CHINESE YUANS RISE WITH THE LOWER DOLLAR 




none today


My goodness: China manipulates its stock market on a daily basis.  How we see that their Carl Icahn,Xu Xiang, was sentenced to 5 1/2 yrs in prison for manipulating their stock market… go figure…

(courtesy zero hedge)

“China’s Carl Icahn” Hedge Fund Billionaire Sentenced To Five And A Half Years In Prison

Back in late 2015, when the Chinese stock bubble had violently burst and was suffering daily moves of 10% in either direction as retail traders scrambled to get out of what until recently was a “sure thing”, Beijing did what it does best, and found a convenient scapegoat on which to blame the market crash – which was function of the country’s relentless debt bubble and lack of trading regulations – in late 2015 it arrested one of the most prominent hedge fund traders, Xu Xiang, also known as “hedge fund brother No. 1” and “China’s Carl Icahn” for his phenomenal, and rigged, winning record in the stock market, who ran the Shanghai-based Zexi Investment.

Which is not to say that Xu wasn’t engaged in shady activites: while the country’s stock prices plummeted in 2015, Zexi’s investments earned an average 218%, far more than the second-most profitable player, Shen Zhou Mu Fund, which reported a 94% yield, according to market analysis website Licai.com.

Xu was detained by police in November 2015 on the highway between Shanghai and Ningbo, in an arrest that was captured in photographs and widely circulated on social media. Police later froze over $1 billion of shares in listed companies with connections to Xu’s investments, according to exchange filings by those firms. Xu, born in 1976, started investing at high school in the eastern city of Ningbo, according to the official People’s Daily. Skipping university, he instead became a professional investor, accumulating over 4 billion yuan in personal wealth and managing tens of billions of yuan, the People’s Daily reported in 2015.

Fast forward to today, when China sentenced the former billionaire hedge fund manager to five and a half years in prison for stock-price manipulation, in one of the country’s most high-profile cases following the 2015 market rout. Xu Xiang, founder of Shanghai-based asset management firm Zexi Investment, and two associates were convicted of driving up share prices, the Qingdao Intermediate People’s Court in Shandong province said on Monday. Xu was also fined 11 billion yuan ($1.6 billion), sources who attended the court hearing said. It is the highest-ever fine for an individual committing a financial crime in China.

Wang Wei, owner of three asset-management companies, received a three-year prison term and was slapped with a 1 billion yuan fine. And Zhu Yong, the third defendant, was sentenced to two years behind bars with a three-year reprieve. He was told to pay 50 million yuan in penalties. The three men shared insider tips and connections to high-ranking executives, people with knowledge of the matter told Caixin.

Demonstrating he has learned from the most successful US hedge funds, Xu and the two investment firm managers were accused of colluding with senior executives of 13 listed companies from 2010 to 2015 to issue positive news about companies and even purchasing stocks in large quantities — all in a bid to boost prices and lure retail investors. The fund managers and executives then dumped their stock at the higher prices.

Between 2010 and 2015, Xu – either alone or with Wang and Zhu – colluded with the chairmen or the “actual controlling shareholders” of 13 listed companies to trade on insider information on topics such as dividends, according to the statement seen by Bloomberg. Xu controlled almost 100 trading accounts opened by his relatives, employees and employees’ relatives, the court said last year. The executives and owners have been charged separately.

The money involved and illicit gains from their manipulation was “especially huge, and the circumstances specially serious,” the court said without disclosing the amounts. They won’t appeal their sentences, according to the court.

The Chinese government has stepped up its crackdown on market irregularities after the stock market meltdown in the summer of 2015, in which the Shanghai index plunged more than 40% from mid-June to September. The sentence may have been prompted by China’s desire to refocus the local population’s attention on stock investing yet again, now that China’s housing bubble has burst again.

Sources told Caixin that the three defendants poured 40 billion yuan raised through their wealth management operations to prop up stock prices. Considering the huge amount of money involved in the illicit trading, the sentence was lenient, said a criminal defense lawyer who spoke on the condition of anonymity. According to the country’s Criminal Law, a conviction for stock manipulation could result in a prison term of up to 10 years and a fine up to five times as much as the illegal proceeds.





China ready for “war” with Trump policies.  They state that capitalism is in trouble and thus they must be ready to assume “world leadership”.  Simply amazing…

(courtesy zero hedge)


China Says It Is Ready To Assume “World Leadership”, Slams Western Democracy As “Flawed”

Over the weekend China used the Trump inauguration to warn about the perils of democracy, touting the relative stability of the Communist system as President Xi Jinping heads toward a twice-a-decade reshuffle of senior leadership posts.

Without directly referencing the new president, China wrote that democracy has reached its limits, and deterioration is the inevitable future of capitalism, according to the People’s Daily, the flagship paper of China’s Communist Party. It devoted an entire page on Sunday to critiquing Western democracies, quoting former Chairman Mao Zedong’s 1949 poem asking people to “range far your eyes over long vistas” and saying the ultimate defeat of capitalism would enable Communism to emerge victorious.

“The emergence of capitalism’s social crisis is the most updated evidence to show the superiority of socialism and Marxism,” said one of the People’s Daily articles.

“Western style democracy used to be a recognized power in history to drive social development. But now it has reached its limits,” said another article on the same page. “Democracy is already kidnapped by the capitals and has become the weapon for capitalists to chase profits.”

The Chinese comments came after Trump in his inauguration speech said his administration would focus on an “America first” approach to foreign policy, undermining hopes abroad that the new president would moderate his protectionist tone. His pledge to abandon a U.S.-led Pacific trade pact has enabled China to step in as the chief advocate of an alternative Asia-wide deal.

Sensing a global feeling of discontent, China was quick to appease the public and deflect US woes to the terminal decline of its democratic system. With ministries and senior officials stressing unity as a priority for China, smoothing the path for the party’s congress in the fourth quarter, state media were quick to highlight divisions within America shown by Trump’s elevation.

As Bloomberg observes, the unusual series of commentaries in the People’s Daily mirrors Soviet efforts to promote an alternative political and economic system during the Cold War. The rise of anti-establishment, protectionist politicians like Trump, amid populist winds on several continents, has sent political parties scurrying to shore up their support, helping China to portray itself as relatively steady.

Ironically, realizing a power vacuum is forming in global “governance”, Xi has used recent speeches to international audiences to tout China’s economic and political values and has said that globalization, despite its flaws, should endure via the existing international system of finance and trade. That’s even as state media criticizes democracy and capitalism amid efforts to build support at home for the party. Translation: China remains largely an export-driven economy, and any threats to the global trade model could have dire consequences for social stability in China.

“China’s rising wealth has brought greater global presence, but that’s not enough,” said Zhang Ming, a political science professor at Renmin University in Beijing. “The Communist leaders want that someday China will matter globally for the nature of its political system and create its own universal values.”

As a result, Trump’s policies will give China a chance to take a bigger global role, said Zhang. “China doesn’t have a better Communist system than it used to have, but the global economic and political turmoil has undermined public confidence in western democracy,” he said.

Separately, in comments made by Zhang Jun, director general of the Chinese Foreign Ministry’s international economics department during a briefing with foreign journalists to discuss President Xi Jinping’s visit to Switzerland last week, he said that China does not want world leadership but could be forced to assume that role if others step back from that position. The senior Chinese diplomat’s statement also followed Trump’s pledge to put “America first” in his first speech.

Speaking days before Trump assumed the presidency, Xi also urged countries to resist isolationism, signaling Beijing’s desire to play a bigger role on the global stage. Elaborating on that theme, Zhang said China had no intention of seeking global leadership.

“If anyone were to say China is playing a leadership role in the world I would say it’s not China rushing to the front but rather the front runners have stepped back leaving the place to China,” Zhang said.

“If China is required to play that leadership role then China will assume its responsibilities,” he added.

“We still hope that the United States and other Western economies can continue to make an even bigger contribution to the world economic recovery. We’ve heard Trump announce that the United

States will achieve four percent growth and we’re very happy about that,” he added.

Returning to Trump, Zhang said he thought Trump would not be able to achieve his economic growth goals if he was also fighting trade wars. “A trade war or an exchange rate war won’t be advantageous to any country,” Zhang added. But mostly China.

Separately, Chinese Foreign Ministry spokeswoman Hua Chunying said Xi had sent a congratulatory message to Trump upon his assumption of office, but gave no other details.






The German Press has finally realized that Trump is declaring economic war against all nations with its protectionist policies.  They stated that the inaugural speech was a “Declaration of War”

(courtesy zero hedge)


German Press: “That Was No Presidential Speech; That Was A Declaration Of War”

Following yesterday’s openly confrontational, deliberately protectionist presidential address by president Trump, which in various circles has been dubbed the “American carnage” speech for obvious reasons, some of Obama’s closest foreign friends are scrambling to find a role in a world that has drastically changed in less than 24 hours. One of them is the foreign leader whom Obama spoke to last before vacating the White House, German Chancellor Angela Merkel, who vowed on Saturday to seek compromises on issues like trade and military spending with Trump, adding she would work on preserving the important relationship between Europe and the United States.

“He made his convictions clear in his inauguration speech,” Merkel said in remarks broadcast live, a day after Trump vowed to put ‘America first’.

Speaking at a news conference in the south-western town of Schoental, Merkel – and finding herself in a world where many of her “established” friends have been swept away by the tide of “populist anger” – suddenly struck a more conciliatory tone toward Trump than Vice Chancellor Sigmar Gabriel, who on Friday said Germany should prepare for a rough ride under the new U.S. president.

“I say two things with regards to this (speech): first, I believe firmly that it is best for all of us if we work together based on rules, common values and joint action in the international economic system, in the international trade system, and make our contributions to the military alliances,” Merkel said. Judging by Trump’s fiery sermon, he disagrees.

“And second, the trans-Atlantic relationship will not be less important in the coming years than it was in past years. And I will work on that. Even when there are different opinions, compromises and solutions can be best found when we exchange ideas with respect,” added Merkel.

The conservative German leader, who is seeking a fourth term and enjoyed a close relationship with former president Barack Obama, is seen by liberals across the Atlantic as a voice of reason that counterbalances rising populist parties in Europe. That voice, however, has rising problems at home, where her approval rating has tumbled over the past year due to her immigration policies, where “radical” views such as those espoused by Trump are gaining traction.

As Reuters notes, relations with the United States, Germany’s biggest trading partner, are likely to be a hot topic in electioneering in coming months leading to a general election in September. And in the aftermath of the Trump speech, which defined Trump’s “negotiating baseline”, Merkel will have no choice but admit weakness in accepting compromises with a man who has criticized her decision in 2015 to throw open Germany’s borders to asylum seekers fleeing wars and conflicts, and has said he believes other countries will leave the EU after Britain and that the NATO military alliance was obsolete.

* * *

Yet while Merkel may be hoping for a fresh start with the new US president, her domestic institutions and media will be far less forgiving to any indication of weakness from the chancellor.

The best example of this, so far, is an article penned this morning by Gabor Steingart, chief in chief of Handelsblatt, Germany’s leading economic newspaper, who burned all compromise bridges when he said that “that was no presidential speech; that was a veritable declaration of war.

The savage criticism continued:”Threatening in tone. Cold and calculating in logic. Change minus the hope. Donald Trump used the traditional Inauguration Day address to settle a score with the U.S. political establishment going back decades. With four ex-presidents sitting a few feet behind him, the 45th president delivered a populist manifesto.”

He notes than any attempts at compromise will fail because “the new president loves a good fight, not consensus. He doesn’t want to hug, but to smother, to overwhelm” and add that in domestic policy, the Trump agenda sounds like a blueprint for civil war; in foreign policy, it sounds like the dawn of a new ice age.

Hardly an amicable setting for Merkel to be demand compromises.

For the German press what hope there is that the Trump phenomenon will be promptly overthrown lies in the face of three opponents: “Opponent No. 1: The other America. Across the country, an anti-Trump movement is growing”… Opponent No. 2: The Media. Among publishers, producers, filmmakers and journalists, Trump has hardly any friends. CNN, The Washington Post, The New York Times and Hollywood couldn’t warm to the volcanic personality of the new president.”… Opponent No. 3: The Political Party System. Washington is having an allergic reaction to Trump. Democrats and even Republicans are cooperating on Capitol Hill to investigate the Trump team’s contacts to Russia in a special committee.”

It is clear on whose side the German economic press is; the bigger question for Merkel is whether in the aftermath of this “war” by Trump, the German people will side with her, and distance themselves from the “American populist”, or whether the backlash against the establishment will reverberate further, leading to even more pain for Merkel in the upcoming polls.

Finally, should Merkel’s “compromise” approach fail, will Germany respond to Trump’s “declaration of war” in kind, and will it be simply trade, or conventional?

Full Handelsblatt letter below:

The Demons Have Been Unchained

That was no presidential speech; that was a veritable declaration of war. Threatening in tone. Cold and calculating in logic. Change minus the hope. Donald Trump used the traditional Inauguration Day address to settle a score with the U.S. political establishment going back decades. With four ex-presidents sitting a few feet behind him, the 45th president delivered a populist manifesto.   

Until his victory, the nation’s political elite used days like these, he told America, to celebrate amongst themselves. Their triumph was not your triumph. Their well-being was not your well-being. But this time, power would transfer not just from one party to the other, but from Washington back to the people. In the people’s name, he will put America “first.” In their name, he will “take back” America’s factories. In their name, he will “exterminate” Islamic terrorism, end inner-city drug gang “bloodbaths” and get NATO partners like Germany to pay more for Europe’s security. In domestic policy, the Trump agenda sounds like a blueprint for civil war; in foreign policy, it sounds like the dawn of a new ice age. Not that he’s cold-bloodedly planning either one, but he knows where his fiery rhetoric will lead him. The new president loves a good fight, not consensus. He doesn’t want to hug, but to smother, to overwhelm. 

Yesterday was his day, but the days that follow may belong to his opponents. There are three main opponents that could bring him down politically.

Opponent No. 1: The other America. Across the country, an anti-Trump movement is growing. While only 10,000 people came to an open-air concert in Washington celebrating his victory on the night before the inauguration, 20,000 people took to the streets in New York to protest his elevation. Their signs shouted: Not My President. The security and surveillance costs around Trump Tower on Fifth Avenue, at the corner of 56th Street, is costing taxpayers about a half million dollars – each day.

Opponent No. 2: The Media. Among publishers, producers, filmmakers and journalists, Trump has hardly any friends. CNN, The Washington Post, The New York Times and Hollywood couldn’t warm to the volcanic personality of the new president. Even an unbroken Twitter assault has no chance against such a monolithic wall of media rejection. He hates them, and they hate him right back. He pushes forward his agenda, and they push back unabashedly with theirs. Trump enters The White House with the lowest approval rating ever of an elected president.

Opponent No. 3: The Political Party System. Washington is having an allergic reaction to Trump. Democrats and even Republicans are cooperating on Capitol Hill to investigate the Trump team’s contacts to Russia in a special committee. House Speaker Paul Ryan doesn’t see himself as a Trump follower but as a Trump successor. He is the wolf in sheep’s clothing, biding his time, waiting for an opening. Put another way: Not only Democrats are hoping for an impeachment proceeding.

America is now on the brink of a new period of polarization. The demons in this fraternal battle have been unchained. The greatness that Trump seeks will not be borne under these conditions. An icy wind is blowing across the land.

Yours sincerely,

Gabor Steingart




In a stunning admission, Draghi states that a country can leave the Eurozone is it wishes but it must settle its bill first.  This means its target 2 balances.  For Italy it means that it must pay: 357 billion euros as this is the amount of euros paid to EU countries like Germany net of incoming receipts.


In Stunning Admission, Draghi Says A Country Can Leave Eurozone But Must “Settle Bill First”

Less than 4 years ago, and shortly after his infamous “whatever it takes” threat to speculators, Mario Draghi responded to a question from Zero Hedge readers, saying “there is no Plan B” when it comes to contingency plans for a Eurozone nation leaving the monetary union. The reasoning was simple: the mere contemplation of such a scenario assigned a probability to its occurrence, which is why the ECB was desperate to give the impression that no matter what, Europe’s cohesion is unbreakable.

Fast forward four years later, when not only has this particular strategy been thoroughly rejected, but for the first time ever the head of the ECB provided a framework, vague as it may be, laying out what a Eurozone exit would look like.

In a letter to two Italian lawmakers in the European Parliament released on Friday, and first reported by Reuters, Mario Draghi implied that a country could leave the euro zone – so much for “No Plan B” –  but first it would need to settle or debts with the bloc’s TARGET2 payments system before severing ties. 

“If a country were to leave the Eurosystem, its national central bank’s claims on or liabilities to the ECB would need to be settled in full,” Draghi said in the letter. He did not specify in what currency the “settlement” would have to take place. It was also not clear just what the ECB would do in response if a country did not “settle its claims in full”: at last check the ECB did not have a policy-enforcing army.

As Reuters confirms, the comment by Draghi is “a rare reference by Draghi to the possibility of the currency zone losing members.” We would say not just “reference” but admission that a Italexit is all too possible, however the only way the ECB would allow it, would be for Italy first to pay its €357 billion TARGET2 bill (which various confused and clueless tenured economists over the past five years claimed would never be used by the ECB as a bargaining chip in “exit” negotiations and has no political implications; oops).

To be sure, the beneficiary of such a transfer payment would be the country most reliant on the perpetuation of the status quo: Germany, which has some €754 billion in Target2 “assets” which could be nullified should one or more Eurozone countries exit without satisfying their payment obligations.

In the letter, Draghi reiterated that the imbalances were due to the ECB’s own bond buying-program, where many of the sellers are foreign investors with accounts in Germany, and ensuing portfolio rebalancing.

Draghi’s admission that “QuItaly” or UscIta as it is known domestically – is an all too real possibility coincides with a groundswell of anti-euro sentiment in Italy and other euro zone states, fueled in part by last June’s unprecedented decision by Britain to leave the European Union.

The threat of defaults on cross-border debts has often been credited as one element keeping the euro zone together throughout the financial crisis. As these payments are not generally settled, weaker economies including Italy, Spain and Greece have accumulated huge liabilities towards Target 2 while Germany stands out as the biggest creditor with net claims of 754.1 billion euros.

Target 2 imbalances have worsened in recent months, with Harvard economist Carmen Reinhart warning of capital flight from Italy. This can be seen in the chart below, which confirms that below the calm surface portrayed by low – if recently rising – Italian bond yields, tremendous capital imbalances are piling up.

Draghi’s admission, which is meant as a quasi-threat to Italy, may have opened up a whole new can of worms for European stability in addition to concerns about Trump, because not only has Draghi confirmed that an exit from the Eurozone has been explicitly modeled by the central bank, but also lays out the conditions under which it would be considered and permitted.

More importantly, it also once again provides the basis for an aggressive “negotiation”, potentially escalating to rancorous bargaining between Italy and Germany, as suddenly the ECB has made it clear that Italy’s gain in a “hypothetical” Euro zone exit would be a tremendous loss for Berlin and Merkel. We are confident that the question of “how much” preventing such a loss would be worth to Merkel, will emerge in very short order. As for what Draghi’s statement means for countries with a far smaller Target2 liability which may also consider exiting the monetary union, the answer is two words: “green light.”





Turkey is now in its final stages of having Erdogan as a dictator for life.  The only way he can be removed is by a coup


(courtesy Mish Shedlock/MishTalk)


Erdogan Seeks Powers To Stay In Office Until 2029: Expect Perpetual State Of Emergency

Submitted by Michael Shedlock via MishTalk.com,

Recep Tayyip Erdogan’s carefully planned move to become legal dictator of Turkey is in its final stages. In the wake of a foiled coup, Erdogan removed or imprisoned every judge not on his side, shut down all opposition newspapers, and jailed all of his political opponents.

After his hand-picked court approved the changes Erdogan wanted, all that remains is a Public Referendum which Erdogan will win simply because he gets to count the votes.  

Recep Tayyip Erdogan has begun a final push to increase his power as Turkey’s president — a goal he has sought for years — after the country’s parliament agreed far-reaching constitutional changes that will now be put to referendum.

The proposed changes, which were shepherded through parliament on Friday night in alliance between Turkey’s ruling AKP and a nationalist party, would crown Mr Erdogan’s 14-year rule by boosting his formal role as president and allowing him to remain in post until 2029.

In a sign of the tension that may mark the referendum, fist fights broke out in parliament over several days, while a television blackout of the opposition speeches forced one opposing MP to bring his own cameras into parliament, only to have his microphone stolen.

Since the failed coup and the introduction of emergency powers, he has ruled the country by decree and 100,000 people accused of backing the coup have been imprisoned.

It is unclear if the president will lift the state of emergency before the poll, scheduled for an unspecified date after April 2, but some of the permanent powers he seek resemble the emergency powers he currently holds.

Expect a Permanent Emergency

Expect a permanent emergency with increasing power every step of the way to Erdogan. This is likely to continue until he is overthrown in a coup, assassinated, or until Turkey disintegrates into hyperinflation.

Turkish Lira Down 62 Percent Since September 2010

That’s not close to hyperinflation material, but hyperinflation is an increasing possibility when madmen dictators are in charge.

Meanwhile, German Chancellor Angela Merkel is in bed with Erdogan who wants visa-free access to the EU for 80 million Muslim Turks.

Are German election threats and fireworks due to Erdogan coming up?




Trump ready this morning to sign executive order to renegotiate NAFTA: down goes the Mexican Peso and the Cdn Loonie. He also stated that he was going to abandon the TPP”

(courtesy zero hedge)

Peso, Loonie Drop After NAFTA Renegotiation Executive Order Headlines

Confirming his campaign rhetoric and inaugural address tone, President Donald Trump is expected to sign an executive order as early as Monday to renegotiate the North American Free Trade Agreement (NAFTA) with Canada and Mexico,according to NBC News’ Kristen Welker.

President Donald Trump is expected to sign an executive order as early as Monday stating his intention to renegotiate the free trade agreement between the United States, Canada and Mexico, a White House official told NBC News.


Eliminating the North American Free Trade Agreement (NAFTA), which was crafted by former President Bill Clinton and enacted in 1994, was a frequent Trump campaign promise.


The deal was intended to eliminate most trade tariffs between the three nations, increase investment and tighten protection and enforcement of intellectual property.

The reaction in the Mexican Peso and Canadian Dollar is clear…

This should hardly be surprise…

I will renegotiate NAFTA. If I can’t make a great deal, we’re going to tear it up. We’re going to get this economy running again.

Canada’s ambassador to the United States said it was clear the Trump team were concerned above all about trade deficits with Mexico and China.

“I don’t think Canada is the focus at all,” David MacNaughton told reporters in Calgary, Alberta, ahead of a two-day government retreat focused on how to handle the new Trump administration.

Additionally, as CNN’s Jake Tapper tweeted, Trump is expected to abandon TPP…


Sr WH official: POTUS’s first executive action on Monday will be to withdraw from the Trans-Pacific Partnership, per @JDiamond1

All of which confirms the new White House’s statement:

“This strategy starts by withdrawing from the Trans-Pacific Partnership and making certain that any new trade deals are in the interests of American workers,”


“President Trump is committed to renegotiating NAFTA. If our partners refuse a renegotiation that gives American workers a fair deal, then the president will give notice of the United States’ intent to withdraw from NAFTA.”

The Mexican Peso tumbles as the Mexican President wants that he will take immediate action against the USA.  To tell you the truth, he only has to do one thing which will cause tremendous grief to the USA: cut off silver shipments to the USA
(courtesy zero hedge)

Peso Tumbles As Mexican President Warns “Will Take Immediate Actions To Defend Interests… Doesn’t Believe In Walls”

In a much anticipated speech, Mexican President Enrique Pena Nieto warned that “Mexico is obliged to take steps to defend itself given the new vision in U.S.,” reaffirming Mexico “as a nation open to the world on trade.” The peso is leaking lower as he speaks, erasing post-inauguration gains.

Further headlines include:




Russia boosted exports by 24% to China and clearly have taken market share away from Saudi Arabia.  It seems that the Russians have supplied oil and in return they take yuan.  The yuan is then used to purchase gold (in yuan) at the Shanghai gold exchange  (SGE). This is totally putting a nail in the  petrodollar scheme  and thus the dollar.

(courtesy zerohedge)

For The First Time Ever Russia Beats Saudi Arabia As China’s Top Oil Supplier

While OPEC members were infighting over crude production and export quotas, posturing with temporary production cuts (just so the Saudis could get a six month reprieve during which it clears out a massive internal crude glut), Russia was busy capturing market share, and according to overnight Chinese data, Russia overtook Saudi Arabia as China’s top oil supplier last year for the first time ever boosted by robust demand from independent Chinese “teapot” refineries.

Russia boosted oil exports to China by 24% from 2015 to 52.5 million metric tons, or 1.05 million barrels per day, according to data released Monday by the General Administration of Customs, cited by Bloomberg. In a blow to Ridyah’s ambitions, the Middle Eastern kingdom slipped to second place, shipping 51 million tons, or 1.02 million barrels per day, little changed from a year earlier.

For December, Russia also held the top spot with supplies up 4.8 percent from the same month a year earlier at 1.19 million bpd. Meanwhile Saudi sales dropped nearly 20 percent from a year earlier to 841,820 bpd, data from the Chinese General Administration of Customs showed.

Total crude oil imports in December hit a record as refiners stepped up purchases ahead of a deal by oil-producing countries to reduce supply and bolster prices, Reuters reports. For the whole of 2016, imports gained nearly 910,000 bpd over 2015, the strongest annual growth on record and mostly driven by teapot buying. While Saudi Arabia counts China’s state oil firms as backbone clients through long-term supply contracts, China’s independent refineries, called “teapots” due to their smaller processing capacity, saw Russia as a more flexible, and perhaps cheaper, supplier.

Over the past year in which China’s growing demand has proven to be the holy grail for oil exporters, “Russia has been tussling with Saudi Arabia for dominance in the Asian nation amid efforts by oil producers to defend market share during a worldwide glut.”

Chinese demand, much of which has been to fill its strategic petroleum resreve, has been seen as a key to a sustainable recovery in prices, while benchmark rates are climbing from the worst crash in a generation amid output cuts by major producing nations. China last year bought the commodity at the fastest pace since 2010 amid growing appetite from private refiners, known as teapots, according to Bloomberg.

The proximity of Kozmino port, from where Russia ships Siberian crude, to Qingdao, where teapots typically receive their supplies, has helped boost cargoes after the processors were allowed to use overseas oil in 2015. “With teapots’ import growth set to continue in 2017 and the expected expansion of Sino-Russia pipeline by year-end, Russia is likely to aim for the top spot again this year,” said Sun.

“Saudis have always dominated the top supplier spot to China,” said Amy Sun, an analyst with Shanghai-based commodities researcher ICIS-China. “High imports from Russia mostly can be attributed to growing demand from teapots and strategic reserves purchase.” For the teapot plants, authorized to import crude oil for the first time in late 2015, shipments from Russia’s eastern ports are easier to process, coming in smaller cargo sizes at a closer proximity.

Looking at 2017, Russia may be able to maintain the top spot as it expands exports of its East Siberian-Pacific Ocean (ESPO) pipeline blend crude. Saudi Arabia, meanwhile, is set to shoulder the lion’s share of supply cuts agreed to last year by the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers. Should the Saudis lose even more market share to Russia, it is virtually certain that the kingdom will promptly nullify the Vienna deal, as it scrambles to regain China’s top supplier status in what will soon be a matter of national pride.

“OPEC cuts means Gulf producers take a hit in terms of market share, even though most of their cuts are to Europe and US …Russia has an ESPO expansion coming up as well as supplies via Kazakhstan earmarked for China,” said Michal Meidan of consultancy Energy Aspects.

Angola was the third-largest supplier in 2016, exporting 43.7 million tons, or about 875,000 barrels per day, 13 percent higher from last year, today’s customs data showed. China’s total crude imports climbed 13.6 percent last year to 381 million tons, according to customs data released on Jan. 13. China also boosted imports from South American producers last year, with growth of 37.6 percent from Brazil and 26 percent from Venezuela, the data showed.

Finally, imports from Iran expanded nearly 18 percent last year to a record 624,260 bpd, as Chinese state oil firms started to lift barrels from their investments in Iranian oilfields in addition to term supply agreements.



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



GBP/USA 1.2451 UP .0079 (Brexit by March 201/UK government loses case/parliament must vote/PRIME MINISTER MAY  DECIDES ON A HARD BREXIT)


Early THIS MONDAY morning in Europe, the Euro ROSE by 44 basis points, trading now WELL BELOW the important 1.08 level RISING to 1.0736; Europe is still reacting to Gr Britain HARD 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+ AND TODAY MONTE DEI PASCHI NATIONALIZATION / Last night the Shanghai composite CLOSED UP 13.64 or 0.44%     / Hang Sang  CLOSED UP 12.61 POINTS OR 0.06%  /AUSTRALIA  CLOSED DOWN 0.73%  / EUROPEAN BOURSES ALL IN THE RED 

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

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

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

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

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

The NIKKEI: this MONDAY morning CLOSED DOWN 246.89 OR 1.29% 

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

2/ CHINESE BOURSES / : Hang Sang CLOSED UP 12.61 OR 0.06%  Shanghai CLOSED UP 13.64 POINTS OR 0.44%   / Australia BOURSE CLOSED DOWN 0.73% /Nikkei (Japan)CLOSED DOWN 246.88 OR 1.29%  /  INDIA’S SENSEX IN THE GREEN

Gold very early morning trading: $1214.60


Early MONDAY morning USA 10 year bond yield: 2.454% !!! DOWN 1 IN POINTS from FRIDAY 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  3.037, DOWN 1 IN BASIS POINTS  from FRIDAY night.

USA dollar index early MONDAY morning: 100.40 DOWN 23 CENT(S) from FRIDAY’s close.

This ends early morning numbers MONDAY MORNING


And now your closing MONDAY NUMBERS

Portuguese 10 year bond yield: 3.79% DOWN 8  in basis point yield from FRIDAY  (does not buy the rally)

JAPANESE BOND YIELD: +.057%DOWN 1  in   basis point yield from FRIDAY/JAPAN losing control of its yield curve

SPANISH 10 YR BOND YIELD:1.425%  DOWN 8  IN basis point yield from  FRIDAY (this is totally nuts!!/

ITALIAN 10 YR BOND YIELD: 1.993  DOWN  3 POINTS  in basis point yield from FRIDAY 

the Italian 10 yr bond yield is trading 43 points HIGHER than Spain.





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

Euro/USA 1.0720 up .0030 (Euro UP 30 basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 113.11 DOWN: 1.453(Yen UP 143 basis points/ 

Great Britain/USA 1.2474 UP 0.01004( POUND UP 100 basis points)

USA/Canada 1.3306 DOWN 0.0008(Canadian dollar UP 8 basis points AS OIL FELL TO $52.73


This afternoon, the Euro was UP by 30 basis points to trade at 1.0720


The POUND ROSE 100  basis points, trading at 1.2474/

The Canadian dollar ROSE  by 8 basis points to 1.3306,  WITH WTI OIL FALLING TO :  $52.73

The USA/Yuan closed at 6.8513
the 10 yr Japanese bond yield closed at +.057% DOWN 1 IN  BASIS POINTS / yield/ 

Your closing 10 yr USA bond yield DOWN 9 IN basis points from FRIDAY at 2.397% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic  USA 30 yr bond yield: 2.997 DOWN 8  in basis points on the day /

Your closing USA dollar index, 100.37 DOWN 26 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 MONDAY: 1:00 PM EST

London:  CLOSED DOWN 47.26 OR 0.66% 
German Dax :CLOSED DOWN 84.38 POINTS OR 0.73%
Paris Cac  CLOSED DOWN 29.26 OR 0.62%
Italian MIB: CLOSED DOWN 151.050 POINTS OR 0.78%

The Dow closed DOWN 27.40 OR .14%

NASDAQ WAS closed DOWN 2.39 POINTS OR .04%  4.00 PM EST
WTI Oil price;  52.73 at 1:00 pm; 

Brent Oil: 55.13  1:00 EST






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

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


BRENT: $55.34


USA 30 YR BOND YIELD: 2.986%

EURO/USA DOLLAR CROSS:  1.0761 up .0069 

USA/JAPANESE YEN:112.83  down 1.739

USA DOLLAR INDEX: 100.01  down 62  cents ( HUGE resistance at 101.80)

The British pound at 5 pm: Great Britain Pound/USA: 1.2521 : up 143  BASIS POINTS.

German 10 yr bond yield at 5 pm: +.363%


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


“Sell The Inauguration” – Dow & Dollar Drop As Bonds & Bullion Pop


Was it really that easy – Buy The Election (hope), Sell The Inauguration (reality)?…


The Dow continues to cling to unchanged for 2017 (small caps red)…


Since the inauguration…


VIX was the main play thing in American markets again (but The Dow ended down for the 6th day in the last 7… NOTE – the overnight futures ramp dragged cash up to perfectly tag stops at Trump Address highs…


Europe’s VIX spiked most in 4 months today, above 17…


Notably, Treasury VIX remains notably elevated relative to Equity VIX post-Trump…

With SKEW at over 146, markets have only been more fearful of a collapse twice in its 27 year history…

Breadth remains divergent for the S&P 500…


But Kuwait is in panic melt-up mode…


Bank stocks dropped once again (contining the trend of up-down-up-down started since the beginning of 2017)…


Notably XLF – the US financials ETF – has fallen to key 50-day moving average…


QCOM was crushed but it didn’t really help AAPL…


While the biggest Emerging Market ETF ripped higher today (as the dollar dropped), we note that it suffered a ‘death cross’...


While health insurers all tumbled on the the Aetna, Humana deal blockage, only Aetna held on to losses…


Trumphoria is stalling as financial conditions have tightened post-election…


The 30Y Treasury yield fell back below 3.00% – notably, the 30Y yield has gone nowhere since 2 days after the election…


Treasury yields fell across the curve with the long-end outperforming…(note bonds did sell off after Europe closed)


Two words – “policy error”?


The Dollar Index extended its losses from Friday afternoon, stalling at Fed rate-hike lows…

Yen and Sterling strength were the heaviest weights on the dollar index today but everything was bid against the greenback…


While not the perfect analog, one wonders if the post fiscal year spike in the USD is starting to fade once again…


Crude slide despite USD weakness but copper gained…


Gold closed at its highest since Nov 17th…


Bonus Chart: Turning Japanese?


Early trading Monday:

(courtesy zero hedge)


Dow Gives Up Inauguration-Day Gains, Dollar Dumps To Pre-Fed Rate-Hike Lows

Bonds and Bullion continue to surge higher as the brief stock market gains experienced post-inauguration speech drop have now been erased…



The USD Index has tumbled back from earlier gains…


Now at its lowest since the Fed hiked rates…

Late Friday night:

Trump wastes no time as he signs his first executive order to ease the burden of Obamacare

(courtesy zero hedge)


Trump Signs First Executive Order To “Ease The Burden Of Obamacare”

Obama’s second executive order/Friday night


The FHA’s fee cut, initiated by Obama in the last day’s executive order was cancelled as it exposed the taxpayer to a dwindling FHA account.

(courtesy zero hedge)

One Hour After Taking Office, Trump Suspends FHA Mortgage Fee Cut


Trump warns that the USA is going ahead with a border tax as well as cut regulations by 75%

(courtesy zero hedge)

Trump Warns “We Are Going To Be Imposing A Very Major Border Tax”, Will “Cut Regulations By 75%”


(courtesy Pepe Escobar)

(courtesy zero hedge)


Trump Wins The Unions: Teamsters Praise TPP Withdrawal, Labor Chiefs Describe “Incredible” Meeting With Trump

Shortly after Donald Trump made good on one of his core campaign promises on Monday morning by signing an executive order formally withdrawing the U.S. from the Trans-Pacific Partnership free-trade deal, Trump told labor union leaders that he would renegotiate the North American Free Trade Agreement “at the appropriate time.”

The remarks came at the start of a meeting at the White House with leaders of construction, carpenters, plumbers and sheet metal unions, during which Trump pledged to stop trade deals that harmed American workers.

According to the White House, participants included North America’s Building Trades Unions President Sean McGarvey, Laborers’ International Union of North America President Terry O’Sullivan, SMART sheet metal workers’ union President Joseph Sellers, United Brotherhood of Carpenters President Doug McCarron and Mark McManus, president of the United Association that represents plumbers, pipefitters, welders and others. The union meeting also included several local union officials and follows a gathering of 12 chief executives of large companies at the White House to discuss revitalizing the U.S. manufacturing economy.

“We’re gonna get ’em working again, right?” says Pres Trump, hosting photo op with union leaders in the Oval.. “Great meeting,” he said.

“This is a group that I know well,” Trump said referring to the union bosses, adding “we’re going to put a lot of people back to work” and “stop the ridiculous trade deals.”

When Trump said the administration “just officially terminated TPP,” it prompted applause from the labor chiefs (and this time it certainly wasn’t by paid members of the studio audience), who later described their meeting with Trump as “incredible.”

Union leaders speak to WH reporters and described meeting with President Trump as “incredible”

Trump also added that he doesn’t blame former President Obama for decades of bad trade deals, which – at least mathematically – makes sense.

But even more notable, was the dramatic pivot by the US labor unions, historically stalwart democrat supporters, who have suddenly emerged as big supporters of Trump policies, and perhaps no one more so than AFL-CIO President Rich Trumka who said TPP withdrawal is “a good first step toward building trade policies that benefit workers.”

As a reminder, nearly all major unions endorsed Trump’s rival, Hillary Clinton, during the presidential election campaign: they now appear to be shifting their allegiance.

Below is the full statement issued by the Teamsters’ Jimmy Hoffa, who said “Withdrawal from TPP the Right Choice for U.S. Trade Policy

The following is a statement from Teamsters General President James P. Hoffa on President Donald Trump signing an executive order to formally withdraw the United States from the Trans Pacific Partnership.


“Today, President Trump made good on his campaign promise to withdraw the United States from the Trans-Pacific Partnership. With this decision, the president has taken the first step toward fixing 30 years of bad trade policies that have cost working Americans millions of good-paying jobs.


“The Teamsters Union has been on the frontline of the fight to stop destructive trade deals like the TPP, China PNTR, CAFTA and NAFTA for decades. Millions of working men and women saw their jobs leave the country as free trade policies undermined our manufacturing industry. We hope that President Trump’s meeting with Canadian Prime Minister Justin Trudeau and Mexican President Enrique Peña Nieto on Jan. 31 opens a real dialogue about fixing the flawed NAFTA.


“We take this development as a positive sign that President Trump will continue to fulfill his campaign promises in regard to trade policy reform and instruct the USTR to negotiate future agreements that protect American workers and industry.”

And with that statement, pundit attention will closely follow the Trump-Trumka relationship which promises to be one of the more interesting in US politics over the next few years. As Axios points out, “Trump and top advisers like Steve Bannon see an opportunity to destroy traditional political alliances. Their theory worked in the election: They peeled white working class voters (and many union households) away from the Democrats. Now, they believe that delivering major items for this constituency — watch also for a confrontation with Big Pharma — could further wreck the Democrats’ hold on organized labor.





At 4:30 the USA dollar dumped against all currencies when Sec Treasury to be Mnuchin warns of an excessively strong dollar

(courtesy zero hedge)

USD Dumps After Treasury Sec Nominee Mnuchin Warns Of “Excessively Strong” Dollar

In Treasury Secretary nominee Steven Mnuchin’s written responses to Senate questions, he made it clear that the “strong dollar” policy may not always be his priority as he noted “an excessively strong dollar may be negative in the short-term.”

“The strength of the dollar has historically been tied to the strength of the U.S. economy and the faith that investors have in doing business in America,” Mnuchin said in written responses to questions from U.S. senators obtained by Bloomberg News.


“From time to time, an excessively strong dollar may have negative short-term implications on the economy.”

Additional headlines include:


The reaction is clear in USDJPY…


The Dollar Index has dropped below 100 for the first time The ECB’s December meeting…

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