Feb 1/Work in progress/commentary in final form at 6:15 est

Gold at (1:30 am est) $1210.60 UP    $17.40

silver  at $17.51:  up 39 cents

Access market prices:

Gold: $1210.65

Silver: $17.56

THE DAILY GOLD FIX REPORT FROM SHANGHAI AND LONDON

.

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

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

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

And now the fix recordings:

MONDAY gold fix Shanghai

Shanghai FIRST morning fix Feb 1/17 (10:15 pm est last night): $  holiday

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

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

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

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

   SPREAD/ 2ND FIX TODAY!!:  $xxx

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

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

London FIRST Fix: Feb1/2017: 5:30 am est:  $1210.00   (NY: same time:  $1210.40   (5:30AM)

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

London Second fix Feb 1.2017: 10 am est:  $1203.65 (NY same time: $1201.60  (10 AM)???

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

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

end

For comex gold:

FEBRUARY/ 

NOTICES FILINGS FOR FEBRUARY CONTRACT MONTH:  1159 NOTICE(S) FOR 115,900 OZ.  TOTAL NOTICES SO FAR: 4450 FOR 445,000 OZ    (13.841 TONNES)

For silver:

 

T

For silver: FEBRUARY

50 NOTICES FILED FOR 250,000 OZ/

TOTAL NO OF NOTICES FILED: 138 FOR 690,000 OZ

Let us have a look at the data for today

.

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In silver, the total open interest  ROSE by 5,656 contracts UP to 186,839 with respect to YESTERDAY’S TRADING.    In ounces, the OI is still represented by just less THAN 1 BILLION oz i.e. .934 BILLION TO BE EXACT or 133% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT FEBRUARY MONTH: 50 NOTICES FOR 250,000

In gold, the total comex gold ROSE BY 6984 contracts WITH THE RISE IN  THE PRICE GOLD ($17.40 with YESTERDAY’S trading ).The total gold OI stands at 398,433 contracts

we had 1,159 notice(s) filed upon for 115,900 oz of gold.

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

GLD:

We had no  changes in tonnes of gold at the GLD

Inventory rests tonight: 799.07 tonnes

.

SLV

we had no changes in silver into the SLV:

THE SLV Inventory rests at: 335.759 million oz

FEDERAL RESERVE BANK OF NY: GOLD MOVEMENT REPORT FOR DECEMBER EXPORTS

JANUARY REPORT

The FRBNY reported that we have 7,841 million dollars worth of gold in inventory valued at $42.22 for December.

The previous month we had 7,841 million dollars worth of gold inventory valued at $42.22 for December.

We thus had 0 gold oz moved out of inventory

end

.

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

1. Today, we had the open interest in silver RISE by 5,656 contracts UP to 186,839 AS SILVER WAS UP 39 CENTS with YESTERDAY’S trading. The gold open interest ROSE by 6,984 contracts UP to 398,433 WITH THE RISE IN THE PRICE OF GOLD OF $17.40  (YESTERDAY’S TRADING)

(report Harvey).

2.a) The Shanghai and London gold fix report

(Harvey)

 

2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY:  Bloomberg

2c) COT report

(Harvey)

3c FEDERAL RESERVE BANK OF NY/GOLD INVENTORY MOVEMENT

(HARVEY)

3. ASIAN AFFAIRS

i)Late  TUESDAY night/WEDNESDAY morning: Shanghai closed HOLIDAY/ /Hang Sang closed . The Nikkei closed UP 106.74 POINTS OR .56% /Australia’s all ordinaires  CLOSED UP 0.51%/Chinese yuan (ONSHORE) closed HOLIDAY at 6.8840/Oil ROSE to 53.16 dollars per barrel for WTI and 55.94 for Brent. Stocks in Europe ALL IN THE GREEN. Offshore yuan trades  6.8295 yuan to the dollar vs 6.8840  for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS QUITE A BIT AS POBC ATTEMPTS TO STOP DOLLARS FROM LEAVING CHINA’S SHORES.

 

REPORT ON JAPAN  SOUTH KOREA NORTH KOREA AND CHINA

3a)THAILAND/SOUTH KOREA

b) REPORT ON JAPAN

c) REPORT ON CHINA

4 EUROPEAN AFFAIRS

i)Italy

Italian youth unemployment rises above 40%. Sovereign Italian bond yields rise but also we witness that sovereign bond risk soars to 3 yr highs (credit default swaps)

( zero hedge)

ii)France

Initially French markets slump as Le Pen gains in the polling:

( zero hedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

6.GLOBAL ISSUES

7. OIL ISSUES

iThe author suggest that an oil price was will begin shortly

(courtesy Paraskova/OilPrice.com)

 

8. EMERGING MARKETS

none today

9.   PHYSICAL MARKETS

10.USA STORIES

Let us head over to the comex:

The total gold comex open interest ROSE BY 6,984 CONTRACTS UP to an OI level of 398,433 WITH THE RISE IN THE  PRICE OF GOLD ( $17.40 with YESTERDAY’S trading).  We are now in the contract month of FEBRUARY and it is one of the better delivery months  of the year. In this next big active delivery month of February we had a LOSS of 2,987 contracts DOWN to 3468.   We had 3291 notices served upon yesterday and therefore we gained 304 contracts or an additional 30,400 oz will stand for delivery.  This is the first time in over 3 years that we have gained in oz standing on the second day notice.  Somebody is in urgent need of physical gold. The next non active contract month of March saw it’s OI rise by 436 contracts up to 2906.The next big active month is April and here the OI rose by 7,977 contracts up to 271,136.

 

We had 1159 notice(s) filed upon today for 115,900 oz

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And now for the wild silver comex results.  Total silver OI ROSE by 5,656 contracts FROM 181,183 up to 186,839 AS the price of silver ROSE IN PRICE TO THE TUNE OF 39 CENTS with respect to 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).

The  active month of February saw the OI FALL by 61 contract(s) DOWN TO  185.  We had 88 notices served upon yesterday so we GAINED 27 CONTRACTS  or an additional 135,000 oz will stand.  I cannot  ever recall seeing both precious metals, gold and silver,  show an increase in amount of oz standing for delivery on the second day notice.

The next big active delivery month is March and here the OI increase by 1466 contracts up to 133,494 contracts. For comparison purposes last year on the same date only 104,561 contracts were standing.

We had 50 notice(s) filed for 250,000 oz for the FEBRUARY contract.

VOLUMES: for the gold comex

Today the estimated volume was 99,907  contracts which is poor.

Yesterday’s confirmed volume was 262,796 contracts  which is good

volumes on gold are getting higher!

INITIAL standings for FEBRUARY
 Feb 1/2017.
Gold Ounces
Withdrawals from Dealers Inventory in oz   nil
Withdrawals from Customer Inventory in oz  
 7963.144 OZ
Manfra
Deposits to the Dealer Inventory in oz nil oz
Deposits to the Customer Inventory, in oz 
 nil  oz
No of oz served (contracts) today
 
1159 notice(s)
115,900 oz
No of oz to be served (notices)
2309 contracts
230,900 oz
Total monthly oz gold served (contracts) so far this month
4450 notices
445,000 oz
13.841 tonnes
Total accumulative withdrawals  of gold from the Dealers inventory this month   NIL oz
Total accumulative withdrawal of gold from the Customer inventory this month     7963.144 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 1 customer withdrawal(s)
ii) Out of Manfra:  7963.144 oz
total customer withdrawal: 7963.144 oz
We had 0  adjustment(s)
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For FEBRUARY:

Today, 0 notice(s) were issued from JPMorgan dealer account and 700 notices were issued from their client or customer account. The total of all issuance by all participants equates to 1159 contract(s)  of which 105 notices were stopped (received) by jPMorgan dealer and 33 notice(s) was (were) stopped/ Received) by jPMorgan customer account.

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To calculate the initial total number of gold ounces standing for the FEBRUARY. contract month, we take the total number of notices filed so far for the month (4450) x 100 oz or 445,000 oz, to which we add the difference between the open interest for the front month of FEBRUARY (3468 contracts) minus the number of notices served upon today (1159) x 100 oz per contract equals 675,900 oz, the number of ounces standing in this  active month of FEBRUARY.
 
Thus the INITIAL standings for gold for the FEBRUARY contract month:
No of notices served so far (4450) x 100 oz  or ounces + {(3468)OI for the front month  minus the number of  notices served upon today (1159) x 100 oz which equals 675,900 oz standing in this non active delivery month of FEBRUARY  (21.023 tonnes)
 we gained 304 contracts or an additional 30,400 oz will stand in this active delivery month.
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On first day notice for FEB 2016, we had 20.124 tonnes of gold standing. At the conclusion of the month we had only 7.9876 tonnes standing. The data suggests that we had almost identical amounts standing in Feb ’16 and Feb 2017; however today’s totals already surpassed the final amt which eventually stood  in 2016.(already 13.841 tonnes vs 7.9876 at the end of Feb).
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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 2016:  7.9876 tonnes (Feb is a delivery month/deliveries this month very low)
March 2016: 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/     3.9004 tonnes
FEB/ 21.023 tonnes
total for the 14 months;  247.120 tonnes
average 17.651 tonnes per month vs last yr  59.51 tonnes total for 14 months or 4.250 tonnes average per month (last yr).
Total dealer inventory 1,428,729.369 or 44.439 tonnes DEALER RAPIDLY LOSING GOLD
Total gold inventory (dealer and customer) = 8,986,318.241 or 279.512 tonnes 
 
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 279.512 tonnes for a  loss of 23  tonnes over that period.  Since August 8/2016 we have lost 74 tonnes leaving the comex. However I am including kilobar transactions and they are very suspect at best
I have a sneaky feeling that these withdrawals of gold in kilobars are being used in the hypothecating process  and are being used in the raiding of gold!

The gold comex is an absolute fraud.  The use of kilobars and exact weights makes the data totally absurd and fraudulent! To me, the only thing that makes sense is the fact that “kilobars: are entries of hypothecated gold sent to other jurisdictions so that they will not be short with their underwritten derivatives in that jurisdiction.  This would be similar to the rehypothecated gold used by Jon Corzine at MF Global.
 
IN THE LAST 5 1/2 MONTHS  74 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
AND NOW THE JANUARY DELIVERY MONTH
FEBRUARY INITIAL standings
 feb 1. 2017
Silver Ounces
Withdrawals from Dealers Inventory  nil
Withdrawals from Customer Inventory
nil 0z
Deposits to the Dealer Inventory
894,934.760 oz
Brinks
CNT
Deposits to the Customer Inventory 
301,834.260 OZ
CNT
No of oz served today (contracts)
50 CONTRACT(S)
(250,000 OZ)
No of oz to be served (notices)
135 contracts
(675,000  oz)
Total monthly oz silver served (contracts) 138 contracts (690,000 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   nil oz
 END
today, we had  2 deposit(s) into the dealer account:
 i) Into Brinks: 593,100.500 oz
ii) Into CNT: 301,834.260 oz
total dealer deposit: 894,934.760 oz
we had nil dealer withdrawals:
total dealer withdrawals: nil oz
we had 0 customer withdrawal(s):
TOTAL CUSTOMER WITHDRAWALS: nil oz
 we had 1 customer deposit(s):
i) Into CNT:  297,928.940 oz
i) Into JPMorgan:  zero  oz**
deposits into JPMorgan have now stopped.
total customer deposits;  297,928.940   oz
 
 we had 1  adjustment(s)
i) Out of CNT: 19,928.940 oz  was adjusted out of the customer and this landed into the dealer account of CNT
The total number of notices filed today for the FEBRUARY. contract month is represented by 50 contract(s) for 250,000 oz. To calculate the number of silver ounces that will stand for delivery in FEBRUARY., we take the total number of notices filed for the month so far at  138 x 5,000 oz  = 690,000 oz to which we add the difference between the open interest for the front month of feb (185) and the number of notices served upon today (50) x 5000 oz equals the number of ounces standing 
 
Thus the initial standings for silver for the FEBRUARY contract month:  138(notices served so far)x 5000 oz  + OI for front month of FEB.( 185 ) -number of notices served upon today (50)x 5000 oz  equals  1,365,000 oz  of silver standing for the Feb contract month. This is  huge for a non active delivery month in silver. 
We gained 27 contracts or an additional 135,000 oz will stand.
At first day notice for the FEB/2016 silver contract month we initially had 515,000 oz standing for delivery.  By the conclusion of the delivery month we had 835,000 oz stand as some of the bankers required immediate silver inventory.
END
Volumes: for silver comex
Today the estimated volume was 75,660 which is excellent
YESTERDAY’S  confirmed volume was 67,610 contracts  which is excellent.
 
Total dealer silver:  29.958 million (close to record low inventory  
Total number of dealer and customer silver:   180.804 million oz
The total open interest on silver is NOW moving away from  its all time high with the record of 224,540 being set AUGUST 3.2016.

end

And now the Gold inventory at the GLD

Feb 1

JAN 31/no change in gold inventory at the GLD/Inventory rests at 799.07 tonnes

jan 30/no change in gold inventory at the GLD/Inventory rests at 799.07 tonnes

Jan 27/no changes at the GLD/Inventory rests at 799.07 tonnes

Jan 26/no changes at the GLD/Inventory rests at 799.07 tonnes/

jan 25/another exactly the same withdrawal as yesterday: 50.4 tonnes and again this was used in the whacking of gold today/inventory rests at 799.07 tonnes

jan 24/a huge withdrawal of 5.04 tonnes and probably this was used today in the whacking of gold/inventory rests at 804.11 tonnes

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 9/A WITHDRAWAL OF 8.87 TONNES OF GOLD FROM 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
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Feb 1/2017/ Inventory rests tonight at 799.07 tonnes
*IN LAST 79 TRADING DAYS: 150.74 TONNES REMOVED FROM THE GLD
*LAST 26 TRADING DAYS: 25.47 TONNES HAVE LEFT

end

Now the SLV Inventory
Feb 1
Jan 31.no change in inventory at the SLV/Inventory rests at 335.797 million oz
jan 30/no change in inventory at the SLV/Inventory rests at 335.797 million oz
Jan 27/we had a deposit of 758,000 oz into the SLV/Inventory rests at  335.797 million oz
Jan 26./ a huge withdrawal of 2.369 million oz from the SLV/Inventory rests at 335.039 million oz
Jan 25./another changes at the SLV/Inventory rests at 337.408 million oz
jan 24/ a withdrawal of 948,000 oz at the SLV/Inventory rests at 337.408 million oz
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 11/ A HUGE WITHDRAWAL F 2.843 MILLION OZ/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/
.
feb 1.2017: Inventory 335.797  million oz
 end

NPV for Sprott and Central Fund of Canada

1. Central Fund of Canada: traded at Negative 7.2 percent to NAV usa funds and Negative 7.4% to NAV for Cdn funds!!!! 
Percentage of fund in gold 60.7%
Percentage of fund in silver:39.1%
cash .+0.2%( feb 1/2017) 
.
2. Sprott silver fund (PSLV): Premium RISES to +.33%!!!! NAV (Feb 1/2017) 
3. Sprott gold fund (PHYS): premium to NAV RISES TO – 0.08% to NAV  ( feb 1/2017)
Note: Sprott silver trust back  into POSITIVE territory at +0.33% /Sprott physical gold trust is back into NEGATIVE territory at -0.08%/Central fund of Canada’s is still in jail.
 

end

Major gold/silver trading/commentaries for WEDNESDAY

GOLDCORE/BLOG/MARK O’BYRN

The Alternative Fact of the Cashless Society

Why gold will benefit from the alternative fact of the cashless society

  • Alternative facts prevail in the European Commission’s calls for cash controls
  • Terrorism is blamed for the need to control cash
  • Evidence shows criminals find alternative ways to finance activities
  • Citizens continue to want and to use cash in day-to-day life
  • Cashless society is being used to force through other ‘agendas’
  • Gold and silver will be used as savers are forced to hold assets outside of the financial system

dollar-ascii

Why gold will benefit from the alternative fact of the cashless society

“Those who control the present, control the past and those who control the past control the future.”

George Orwell, 1984

Last week a new phrase was introduced into our lexicon by Trump Adviser Kellyanne Conway. When asked about why press secretary Sean Spicer had made statements that were (according to the press) unverifiable she said that he had used ‘alternative facts’.

This prompted a raft of satire, journalists to flail their arms up at the audacity of Conway and Trump’s administration, and for people to rush out and buy George Orwell’s 1984.

Penguin, the world’s largest publisher, ordered a 75,000 copy reprint last week. Apparently more than the ‘typical reprint’ for the 1949 Orwellian classic. The ‘alternative facts’ statement echoed of ‘Newspeak’ the language used by the totalitarian government in Orwell’s 1984 to influence and control its citizens of Airstrip One (previously Britain).

European Commission Embraces Newspeak

A day after Conway’s interview the European Commission took of the advantage of the furore that continues to surround the Trump administration (the shock that the President is doing exactly what he promised to do) and introduced a proposal enforcing “restrictions on payments in cash.”

The EC apparently like to use their own version of alternative facts when it comes to arguing why we should be going cashless.

The proposal is based on a plan from February 2016 that explained, “Payments in cash are widely used in the financing of terrorist activities… In this context, the relevance of potential upper limits to cash payments could also be explored. Several Member States have in place prohibitions for cash payments above a specific threshold.”

And whilst terrorists do no doubt use cash to finance some activities (the US has purportedly blown-up stockpiles of ISIS’ cash), research shows that countries with higher denominations of cash in fact experience lower levels of crime and corruption.

And what about those non-criminals? EC are failing to address the fact that law-abiding citizens still like to use cash and will continue to whilst negative interest rates and bail-ins remain a reality. Not to mention the privacy it affords us.

This Newspeak is starting to feel like we’re supposed to feel bad about using cash and instead should become inclined to move to a cashless way of life. Whilst the EC is still in proposal-stage we should be reminded that the move to cashless is very much in play, as we explained in Cashless society – War on Cash to Benefit Gold?.

Cash-free does not mean terrorism free

As pointed out by Zerohedge the proposal is very focused on stopping terrorism, crime and money laundering. It states:

‘Potential restrictions to cash payments would be a mean to fight criminal activities entailing large payment transactions in cash by organised criminal networks…Terrorists use cash to sustain their illegal activities, not only for illegal transactions (e.g. the acquisition of explosives) but also for payments which are in appearance legal”

currencyBut, as argued in the Sovereign Man blog, economists such as Rogoff and Stiglitz and government organisations such as the EC are relying on the myth that ‘cash facilitates illegal activity.’

Who is so naive to think that a ban on cash will stop terrorism? What they have missed is that criminal and terrorist leanings facilitate such activities, they will always find some form of means of exchange to facilitate it.

Sovereign Man explains that criminals and terrorists can, miraculously, use means other than physical cash in order to facilitate illegal activities.

“The US military has literally blown up more than a billion dollars worth of ISIS’s stockpiles of physical cash during airstrikes.

But this hasn’t affected their terrorist activities one bit.

That’s because the most notorious terrorist group on the planet famously uses both the world’s oldest currency (gold) and the world’s newest currency (Bitcoin).”

And it’s not just big terrorist groups who are able to work their way around a cash-based monetary system.

“What Stiglitz, and perhaps many law enforcement agencies, fail to realize is that one of the biggest tools in masking illegal activity is actually Amazon.com.

Specifically, Amazon gift cards.

If you’re looking to quietly and easily pay large sums of money, even tens of thousands of dollars, you can do so with Amazon gift cards.

Amazon gift cards are essentially a “cash equivalent”.

Amazon sells just about everything on the planet, so its gift cards can either be spent or quickly resold for cash.”

Cash will soon not be a right

The EC, Rogoff and Stiglitz are all behaving as though cash is only used for illicit activities. There is apparently little thought to those of us who still use cash. Most of us look at cash as something that is both convenient and provides a way to spend money without it being anyone else’s business other than ours and the seller. But governments label this as suspicious with the intention to get us away from cash so that the banking system may be propped up and ‘bailed-in’ by our funds.

There is but a fleeting mention of the fundamental right to use cash in this recent EC proposal but it is quickly dismissed:

It should also be observed that national restrictions to cash payments were never successfully challenged based on an infringement to fundamental rights.”

Cash is still widely used, by both citizens and big businesses but this has not stopped both governments and banks looking to move us away from using cash.

The most recent example of a shift to a cashless society was of course the demonetisation of 500 and 1,000 rupee notes in India. Whilst Prime Minister Modi acknowledged that millions had been affected he reiterated calls for the country to become a cashless society.

Meanwhile In Ireland companies are making investments on the basis of the future cashless society. US company EVO, a payment processing partner of Bank of Ireland, announced a €9.1 million move to the country that is embracing a cashless way of life. Brian Cleary, managing director of BOI Payment Acceptance Ireland and UK, an arm of Evo Payment International told the Irish Independent, ”With over six million debit and credit cards in the market, debit card spend on the increase year-on-year and over 35,000 Irish businesses offering contactless payment facilities, this number continues to grow.”

concentration-of-independent-atms-under-threatIn the UK, cashless is almost as popular as the likes of the Scandinavian countries. In August 2016 More than 260 million contactless transactions were made in the UK, a 200% increase from the year before. According to a Telegraph article, ATMs are close to becoming extinct as banks will no longer finance them. Rural areas will be “the hardest hit with the South West, Scotland, and the South East where 44pc, 40pc and 33pc of cash points are under threat”

The threat of a cashless society is seemingly greater than ever, so much so that MPs are being called to investigate. As Ron Delnevo, director of the ATM Industry Association in Europe, told the Telegraph: “Some organisations want to drive people away from cash because it suits their agenda.” He also warned of a “domino effect”, saying that if one big bank pulled out of the arrangement “the whole thing will just melt”. 

Cash controls will extend beyond cash

The EC doesn’t intend to stop just at putting controls on (or even outright banning) cash. Under the guise of preventing anonymity they believe that restrictions should be placed on all means of payment that mean people can have some privacy:

“In view of the development of cryptocurrencies and the existence of other means of payments ensuring anonymity, an option could be to extend the restrictions to cash payments to all payments ensuring anonymity (cryptocurrencies, payment in kinds, etc.). On the other hand, restrictions on cash payments could promote the development of alternative payments technologies compatible with the non-anonymity objective pursued.”

Aside from what this means for all forms of payments, it ultimately means that the EC has decided that privacyanonymity, i.e. privacy, is a bad thing. To want it is to suggest that you are doing something criminal.

This will no doubt drive up demand for tangible currencies such as gold and silver which should be held outside of the banking system, as outlined in a letter to the FT following Gillian Tett’s article in support for a cashless society:

Sir, Gillian Tett sees some benefits in scrapping cash (February 5). I, instead, see an Orwellian nightmare where citizens’ every step is recorded in a Big Brother database for tax, financial and monetary purposes. In a certain sense cash means freedom. If cash is really scrapped by governments in the future I have no doubt that alternative tangible currencies will emerge. I will be in the front line using them.

At the moment negative interest rates and bail-ins will only work if cash cannot be removed from the system. And central banks and government are well aware of this. This is why ‘tangible currencies’ such as gold and silver are becomingly increasingly more attractive as the push for cashless society and reduced privacy, grows.

As Doctor Constantin Gurdgiev wrote:

Cash and monetary assets, such as gold, cannot be expropriated or bailed-in as long as they are held in physical form and under proper storage. Cashless accounts amplify the importance of monetary assets, such as gold, in fulfilling the function of being safe havens against systemic risks – risks that are associated with high probability of Government expropriation.

Conclusion: gold and silver

A cashless world means a transparent world, which is great if terrorists were the only ones using cash. But they’re really not, so a cashless world means transparent bank accounts which means restricted banks accounts.

Human behaviour and data does not support the argument for a cashless society. Instead this is seemingly a move to force to restrict our freedom and to get us to hold our wealth in a banking system where negative interest rates and bail-ins are a harsh reality and are our financial decisions are there for all to see.

Lars Feld, economic advisor to the German government, referred to cash as ‘printed freedom.’ It seems that this will not be the case for long. Unfortunately under the Newspeak guise of protecting us from criminals our cash will no longer be the ticket to a private life.

Money in a bank account is no longer yours- it is a bank deposit, an unsecured liability in a commercial bank that is entrenched in the global banking system. It relies on trust in a system that is inherently broken and on a downward spiral that is prepared to take savings and wealth with it.

Fyodor Dostoevsky wrote, ‘Money is coined liberty’ and many years later this is still the case for gold and silver. Unfortunately it is no longer the case for cash. History shows multiple attempts of wealth confiscation and restrictions on freedom, each time individuals and governments have returned to gold and silver in order to protect their savings and their privacy.

Going cashless will not rid us of people and organisations who wish to commit horrific and illegal acts. Instead it will encourage them to find additional ways to run their gangs and terrorist cells. For the rest of us it will remind us of the importance of liberty, safe-havens, security and the need to protect our wealth from negative interest rates, bail-ins and currency devaluations.

Whilst a government using ‘alternative facts’ and telling us that something is for the greater good when it is clearly for the greater banking system is disheartening we should embrace the role of gold and silver. The role of precious metals in a cashless society are key and investors should remember the importance of diversification and holding assets, under direct ownership, outside of the vulnerable and exposed banking system.

 

 

 

END

More hints that Trump’s trade policy will focus on currency valuations

Section:

Trump’s Top Trade Adviser Accuses Germany of Currency Exploitation

By Shawn Donnan
Finanancial Times, London
Tuesday, January 31, 2017

Germany is using a “grossly undervalued” euro to exploit the United States and its EU partners, Donald Trump’s top trade adviser has said in comments that are likely to trigger alarm in Europe’s largest economy.

Peter Navarro, the head of Mr Trump’s new National Trade Council, told the Financial Times the euro was like an “implicit Deutsche mark’ whose low valuation gave Germany an advantage over its main partners. His views suggest that the new administration is focusing on currency as part of its hard-charging approach on trade ties.

In a departure from past U.S. policy, Mr Navarro also called Germany one of the main hurdles to a U.S. trade deal with the EU and declared talks with the bloc over a Transatlantic Trade and Investment Partnership dead. …

… For the remainder of the report:

http://tinyurl.com/hj4eooh

END

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

 
 

1 Chinese yuan vs USA dollar/yuan REMAINS AT  6.8840(ZERO DEVALUATION   /CHINA / CHINA ON HOLIDAY/OFFSHORE YUAN NARROWS   TO 6.8294 / Shanghai bourse CLOSED   / HANG SANG CLOSED 

2. Nikkei closed UP 106.74 POINTS OR 0.51%   /USA: YEN RISES TO 113.30

3. Europe stocks opened ALL IN THE GREEN      ( /USA dollar index RISES TO  99.56/Euro DOWN to 1.0799

3b Japan 10 year bond yield: RISES TO    +.098%/     !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 113.30/ THIS IS TROUBLESOME AS BANK OF JAPAN IS RUNNING OUT OF BONDS TO BUY./JAPAN 10 YR YIELD FINALLY IN THE POSITIVE/BANK OF JAPAN LOSING CONTROL OF THEIR YIELD CURVE AS THEY PURCHASE ALL BONDS TO GET TO ZERO RATE!!

3c Nikkei now JUST BELOW 17,000

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

3e WTI::  53.16  and Brent: 55.94

3f Gold UP/Yen DOWN

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

Japan to buy 100% of all new Japanese debt and by 2018 they will have 25% of all Japanese debt. Fifty percent of Japanese budget financed with debt.

3h Oil UP for WTI and UP for Brent this morning

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund RISES TO  +.466%/Italian 10 yr bond yield UP  to 2.312%    

3j Greek 10 year bond yield FALLS to  : 7.69%   

3k Gold at $1211.20/silver $17.59(8:15 am est)   SILVER BELOW RESISTANCE AT $18.50 

3l USA vs Russian rouble; (Russian rouble UP 6/100 in  roubles/dollar) 60.13-

3m oil into the 53 dollar handle for WTI and 55 handle for Brent/

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

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 113.30 DESTROYING JAPANESE CITIZENS WITH HIGHER FOOD INFLATION

30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF. It is not working: USA/SF this morning  0.9889 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0683 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.

3p BRITAIN VOTES AFFIRMATIVE BREXIT

3r the 10 Year German bund now POSITIVE territory with the 10 year RISES to  +.466%

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

The bank withdrawals were causing massive hardship to the Greek bank. the Greek referendum voted overwhelming “NO”.  Next step for Greece will be the recapitalization of the banks and that will be difficult.

4. USA 10 year treasury bond at 2.474% early this morning. Thirty year rate  at 3.078% /POLICY ERROR)GETTING DANGEROUSLY HIGH

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

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

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

Global Stocks, Futures, Dollar Rise Ahead Of “Uneventful” Fed Announcement

European stocks rise the first day in four, with Asian stocks, S&P futures and the Dollar all gaining following strong Apple earnings ahead of today’s Fed decision and the U.K. parliament’s first vote on the Article 50 bill.

World stocks made their first gain in five days on Wednesday as the dollar steadied from turbulence after the Trump administration accused Germany, Japan and China of devaluing their currencies to gain a trade advantage. The U.S. currency suffered its worst January in three decades after President Donald Trump complained that every “other country lives on devaluation”. Bargain hunters nudged the dollar up 0.15% in Asian and European trading, reassuring themselves that the Federal Reserve should signal later that it still plans to raise U.S. interest rates a number of times this year

Speaking of, today’s main event – in addition to any off the cuff Trump statements and/or tweets – is the Fed decision, however it should be relatively uneventful as officials aren’t expected to increase rates when the Federal Open Market Committee convenes, but investors will trawl the statement accompanying the decision for any change in forward guidance which earlier indicated there could be three hikes this year. The Fed watchers will also look for clues on how the Fed interprets Trump’s impact on the US economy. The overall tone should still be one that is relatively positive but it’s hard to see much new information that would really shift market expectations. A reminder that Yellen’s Humphrey-Hawkins testimony is only two weeks away so that may end up being the more relevant event for markets.

“The markets are caught in this dilemma about whether to pay more attention to fundamentals or to politics,” said Andrew Milligan, head of global strategy at Standard Life Investments Ltd. in Edinburgh. “We’re getting a fairly steady stream of profits exceeding expectations. The dollar is the canary in the coal mine — it’s the asset to watch because it’s so closely correlated to risk-on, risk-off sentiment across all other assets.”

Following a weak two-day close to the month in US markets, an upbeat mood in Europe’s aided by generally strong final Mfg PMI readings as well as strong corporate earnings underpinned a rebound in global stocks, while the dollar stabilized as investors prepare to scour today’s Fed statement for clues on the path of interest rates this year. The mood was also better in Asia this morning, with the Nikkei, Kospi and ASX all higher while in FX the Dollar index has also rebounded.

“European shares are trading higher this morning receiving a boost from firmer markets across Asia, better than expected Apple earnings and Siemens revising upwards its profit forecast,” Markus Huber, a trader at City of London Markets said in a note. “Focus will be on the FOMC meeting with the interest rate decision due out later tonight.”

The positive sentiment was bolstered by positive data out of China which released the latest, January PMI report. All in all the data was relatively stable with the manufacturing reading falling a modest 0.1pts to 51.3 (vs. 51.2 expected) in January, offset by a 0.1pt rise in the non-manufacturing reading to 54.6.

“We believe that the manufacturing sector will continue to underperform the services sector,” analysts at BMI Research, Fitch Group’s research arm, wrote in a note. “Weaker domestic demand and an uncertain external environment due to rising U.S. protectionism will weigh on the former, while services will benefit from continued investment by the government and the private sector.”

“Behind the headline is still an outperformance of large enterprises, suggesting that China’s manufacturing industry continues to consolidate,” said Raymond Yeung, chief greater China economist at Australia & New Zealand Banking Group Ltd. in Hong Kong. “Looking ahead, the government will continue to juggle growth and capacity reduction. This headline PMI will still stay above the threshold of 50, but it’s hardly impressive.”

Exports from tech bellwether South Korea also grew at the fastest pace in almost five years, another sign the global economy had been on the mend before all the talk of U.S. protectionism darkened the air.

Over to Europe, where stocks climbed alongside S&P 500 futures rising by 0.3%, offsetting yesterday’s loss, after companies including Apple, Siemens AG and Volvo AB posted results that exceeded expectations, along with optimistic forecasts for the year ahead. After its worst month since March, the greenback edged higher as frets over President Donald Trump’s policies were overshadowed by the Federal Reserve’s first meeting of the year.

The pound rose before a parliamentary vote on formally triggering an exit from the European Union. The U.K. parliament on Wednesday holds its first vote on the Article 50 bill. Bank of England Governor Mark Carney faces a delicate balancing act when policy makers meet to decide interest rates on Thursday.

Looking at markets, the Stoxx Europe 600 Index jumped 1% as of 10:41 a.m. in London, rebounding after a three-day decline. Futures on the S&P 500 rose 0.3%. The benchmark for American equities advanced 1.8 percent in January for a third monthly gain, and is higher by more than 6% since Nov. 8. The FTSE 100 Index gained the most in a month, advancing 0.8%. Oil touched $53 a barrel.

The yield on the 10-year U.S. Treasury note added two basis points to 2.47 percent. It fell four basis points on Tuesday. European government bonds extended a decline, with the yield on bunds due in a decade rising three basis points to 0.46 percent. French 10-year yields rose six basis points to 1.09 percent.

* * *

Overnight Bulletin Summary from RanSquawk

  • European equities are trading modestly in the green this morning with price action largely dictated by the latest batch of earnings across Europe
  • Despite the upcoming FOMC, it has been GBP in the spotlight, as the prospects for inflation and growth have spurred calls for a possible BoE rate hike later in the year
  • Looking ahead, highlights include FOMC rate decision, Global Mfg. PMI data, US ISM Mfg. PMI and DoE crude oil inventory report

Market Snapshot

  • S&P 500 futures up 0.3% to 2,281
  • Stoxx 600 up 1% to 364
  • FTSE 100 up 0.9% to 7166
  • DAX up 1% to 11648
  • MSCI Asia Pacific up 0.1% to 142
  • Nikkei 225 up 0.6% to 19148
  • Hang Seng down 0.2% to 23318
  • S&P/ASX 200 up 0.6% to 5653
  • German 10Yr yield up 3bps to 0.46%
  • Italian 10Yr yield up 3bps to 2.29%
  • Spanish 10Yr yield up 4bps to 1.64%
  • S&P GSCI Index up 0.1% to 396.4
  • Brent Futures up 0.3% to $55.73/bbl
  • Gold spot down 0.01% to $1,210.63
  • U.S. Dollar Index up 0.2% to 99.70

Top Overnight News

  • Fed to Hold Rates Steady to Reassess Outlook: Decision-Day Guide
  • Trump Court Pick Gorsuch Faces Senate Riven by Bitter Fights
  • Japan Hits Back at Trump Charge That It Is Devaluing the Yen
  • Iran’s Missile Launch ‘Unacceptable,’ Senior U.S. Official Says
  • GE’s Immelt Talks Up Global Ties as Trump Pivots Away From Trade
  • Apple Attracts New IPhone Fans as Existing Owners Await Upgrade
  • Apple Weighs Legal Action on Trump’s Immigration Order, WSJ Says
  • Disney Agrees to Pay $100 Million to End No-Poaching Lawsuit
  • Ford Seen Reaping Edge Over Toyota in U.S. Border Tax Overhaul
  • Tesla Falls Short of Top Safety Pick Awarded to 42 Other Cars
  • Dakota Access Oil Pipeline Seen Gaining U.S. Approval Soon
  • Amazon Plans $1.5 Billion Air Hub Near Cincinnati for Fleet
  • Medtronic Said to Prepare Sale of Medical-Supplies Business
  • First Hawaiian Prices Secondary Stock Offering at $32/Shr

Asia stocks traded mostly higher as the region digests the latest expectation-beating Chinese PMI data and after having shrugged off the negative lead from US where equity markets were dampened by Trump policy concerns and on month-end, pre-FOMC position squaring. ASX 200 (+0.6%) was led by miners after gains in the metals complex in which gold rose over 1% and copper rallied around 3% to its highest level since May 2015, while KOSPI (+0.6%) was underpinned after South Korean trade data showed exports increased by the most since February 2012. Nikkei 225 (+0.5%) was initially subdued by a firmer JPY, but then recovered alongside a rebound in USD/JPY and the Hang Seng (-0.2%) lagged as it reacted to the recent weakness in global stocks on return from the Lunar New Year holiday. 10yr JGBs saw uneventful trade with prices subdued amid an improvement in risk sentiment and after the BoJ also refrained from purchases of 5yr-10yr in today’s buying operation, which resulted in a mixed curve and some mild underperformance in the belly.

Top Asia News

  • Hong Kong Shares Fall as Market Reopens to U.S. Policy Concerns
  • Missing Billionaire Stokes Fears of China Meddling in Hong Kong
  • China’s Factory PMI Shows Stabilization Carried into New Year
  • IndiGo Declines on Surprise Drop in Profit, Costlier Jet Fuel
  • Japan’s Takeda Beats Sales Estimates on Gastroenterology Drugs

European equities are trading modestly in the green this morning with price action largely dictated by the latest batch of earnings across Europe. Industrials have been lifted by German heavyweight Siemens after company profits beat analyst forecasts while they also raised their outlook. Elsewhere, Julius Baer tops the SMI after net profit beat expectations. Additionally, sentiment has also been supported by firm Chinese PMI figures overnight, alongside firmer than expected Eurozone PMI data. Fixed income markets have centred around the continued widening of the 10yr French/German spread which is now at its widest since Jan’14 as uncertainty increases over Fillon’s Presidential bid (Previously favourite to win). While some of the downside in French debt has been attributed to the unwind of yesterday’s month-end extensions.

Top Europe News

  • Euro-Area Manufacturing Picks Up as Demand Drives Prices Higher
  • Siemens Taps New Boss With Head in the Cloud as Profits Surge
  • BBVA Profit Beats Estimates, Bank Moves to All-Cash Dividend
  • Trans-Atlantic Mood Sours as Merkel Refutes Trump on Euro
  • Fund That Beat 90% of Its Peers Is Now Betting on Greek Banks
  • VW, U.S. Drivers Reach $1.2 Billion Settlement as Costs Rise
  • BMW CEO Pleads for Free Trade After Trump Border Tariff Threat
  • Volvo Stock Surges as Truck Orders Jump 10% on European Growth

In currencies, the pound was the biggest gainer among Group of 10 nation currencies, advancing 0.3 percent to $1.2616; U.K. manufacturing PMI for January was in line with estimates, hovering near a 2 1/2-year high. The Bloomberg Dollar Spot Index rose 0.1 percent, after completing a 2.6 percent loss for January and sliding to its lowest level since Nov. 11. The euro retreated 0.1 percent to $1.0789.  Despite the upcoming FOMC, it has been GBP in the spotlight, as the prospects for inflation and growth have spurred calls for a possible BoE rate hike later in the year. This was loosely underlined by the manufacturing PMI report this morning, which highlighted firmer PPI and output production at 32 month highs. Many accept this is significantly due to the weaker GBP of late, but this was further addressed as Cable managed to push through 1.2600 after some initial hesitation this morning. Little momentum to suggest we will test the recent 1.2680 highs in the very near term — ahead of tomorrow’s BoE – but with EUR/GBP demand having passed through, we have also seen some softness in the cross rate as we dip into the mid 0.8500’s. Elsewhere the USD looks to be on the front foot against the JPY again, having rejected the 111.00-112.50 support zone, but failure to break back above 114.00 puts the latest move back in the balance. EUR/USD also still looks intent on retesting 1.0800+ in the wake of the better than expected 2016 Q4 GDP and CPI numbers released yesterday, with the risk of any dovish moderation in tonight’s Fed statement also supportive in the near term.

In commocidites, copper prices are back above 2.70 after Chile’s largest mine voted against the BHP Billiton’s wage offer and voted to go on strike. Modest moves seen recently as much of this was priced in — many anticipating this. Base metals elsewhere continue to chop around, with Iron Ore demand out of China clearly supportive. West Texas Intermediate crude gained 0.2 percent to $52.90 a barrel amid cuts from OPEC producers including Iraq.  Russian oil output has been reported down 100k a day in January, and this may have provided some modest support, but also ‘fits in’ to a more supportive tone rather than providing fresh impetus for the upside — $51-54 WTI looks set to continue in the near term here. Finally for Gold, USD1200+ looks set to hold into the FOMC, but USD1220.00 looks firm resistance which will need a significant turn in the USD and/or risk sentiment (in the aftermath?).  U.S. natural gas rose 3 percent to $3.211 per million British thermal units. Prices were rebounding from the lowest settlement price in three weeks amid forecasts for warmer-than-normal weather across the country.

Looking at the day ahead, we’ve got a busy diary to get through in the US: we’ll kick off with the January ADP employment change reading which should offer some early clues as to what to expect in Friday’s payrolls. Thereafter we’ll get the final manufacturing PMI revision followed closely by the ISM manufacturing print which the market expects to nudge up 0.5pts to 55.0. Construction spending data for December and vehicle sales in January rounds out the data before attention then turns to this  evening’s conclusion of the FOMC meeting. As a reminder there is no Yellen press conference due today. On the earnings side of things we’ll also receive reports from 27 S&P 500 companies including Facebook.

DB’s Jim Reid concludes the overnight wrap

It’s difficult to know what’s normal in financial markets these days as the world tries to get used to the ebbs and flows of a Trump Presidency. Although January saw a lot of talk of a reversal of “Trump trades” the reality is that the only leg that has been weak has been the dollar which was down -2.59% in the month. Risk assets have generally performed well across the month. Talking of currencies there was plenty of Trump administration talk on the subject yesterday. The main focus was on the comments from President Trump’s top trade adviser, Peter Navarro, who said to the FT that Germany is using a “grossly undervalued” euro in order to gain an advantage over both the US and EU trade partners. It didn’t stop there though with Trump also saying at a meeting with US drug makers that Japan and China “play the money market” and “play the devaluation market while we sit here like a bunch of dummies”. The comments from Navarro about the euro has prompted a response from the head of the European Council, Donald Tusk, who said that the “worrying declarations” have only increased the uncertainty levels facing Europe and “puts the EU in a difficult situation”.

All in all that contributed to another rough day for the Greenback yesterday with the US Dollar index falling -0.91% and to the lowest closing level since November 11th. On the other side of that we saw the Japanese Yen rally +0.86%, Euro +0.96% and the onshore Chinese Renminbi +0.36%. These moves come ahead of today’s Fed meeting although we’re not expecting much new to come out of it. The overall tone should still be one that is relatively positive but it’s hard to see much new information that would really shift market expectations. A reminder that Yellen’s Humphrey-Hawkins testimony is only two   weeks away so that may end up being the more relevant event for markets.

Back to Trump briefly. With all the furore and fallout from the weekend immigration executive order it has been interesting to see the first poll released in the aftermath. A Reuters/Ipsos poll released yesterday and conducted over January 30th/31st from 1201 respondents found that 49% of US respondents “strongly” or “somewhat” agreed with the order. 41% “strongly” or “somewhat” disagreed while 10% said that they were unsure. It was interesting to see the party split too with 53% of Democrat supporters saying that they “strongly disagreed” and 51% of Republican supporters saying that they “strongly agree”. This follows a Quinnipiac poll conducted at the start of the month which showed that voters supported “suspending immigration from terror prone regions, even if it means turning away refugees” by a majority of 48% to 42%.

Staying with politics, early this morning we also had the announcement of the Supreme Court nominee with federal appellate judge Neil Gorsuch picked by Trump. The event ended up being a bit of a spectacle with the announcement also broadcast on live TV – although that may also come as little surprise to readers. Gorsuch is said to be known for his conservative approach and originalist philosophy and if confirmed, will bring the split between liberals and conservatives on the court to 5-4 in favour of the conservatives. According to the WSJ, Gorsuch is known as a well established conservative figure but also having been outspoken about the need for courts to have a limited role in American life and also being critical about disproportionate powers amongst federal agencies.

Back to markets. Away from the jolts in FX it was another day of relative Trump driven unease for risk assets with earnings misses from the likes of UPS and Under Armour also helping to drag stocks lower, although in fairness a late bounce into the close at least helped momentum finish on a high. The S&P 500 ended -0.09% after being down as much as -0.60% although the loss still meant that the index closed down for the fourth session in a row which is the longest such streak since early November and prior to the election result. The Dow also finished -0.54% although US equity index futures are pointing higher this morning after Apple reported after the close. The tech giant beat both Q1 sales and earnings street estimates sending shares up as much as 3% in aftermarket trading.

Elsewhere yesterday equity markets also had a rough time of it in Europe with the Stoxx 600 closing -0.67% which takes the three-day loss to -2.00% now. Credit indices also edged wider with CDX IG and iTraxx Main +0.5bps and +1.5bps wider respectively while sovereign bond yields dipped lower. 10y Treasury yields fell 3.5bps to 2.454% while Bunds (-1.3bps) also tracked lower. With the exception of Greece – where yields rose another 23bps on those concerns over the lack of progress over talks with creditors that we highlighted yesterday – the periphery also had a bounce back day with yields 3bps to 6bps lower. The big movers in the commodity complex meanwhile were precious metals with Gold (+1.26%) and Silver (+2.53%) both up sharply.

The mood is a bit better in Asia this morning. The Nikkei (+0.28%), Kospi (+0.49%) and ASX (+0.51%) are all higher while in FX the Dollar index has also rebounded +0.18%. The Hang Seng (-0.71%) has retreated although that reflects some catch up with the market reopening for the first time this week. There’s also been some data out of China to digest with the latest official PMI’s having been released. All in all the data was relatively stable with the manufacturing reading falling a modest 0.1pts to 51.3 (vs. 51.2 expected) in January, offset by a 0.1pt rise in the non-manufacturing reading to 54.6.

Away from Trump the other political focus at the moment is in France where it feels like with each passing day the presidential race is blowing more and more open. The focus currently is on the scandal  facing Francois Fillon with the candidate now facing fresh claims over the employment of family members as well as his wife, and the use of public funds in the employment. Fillon has said that he will withdraw from the race should the preliminary inquiry turn into a formal inquiry. In addition, the Washington Post ran an article yesterday suggesting that the National Front could be open to implementing a similar immigration order to that put in place by Trump, should Le Pen be elected. Certainly these political developments are worth monitoring.

Yesterday’s economic data in the US again played second fiddle to Trump related headlines. The Q4 employment cost index was reported as rising +0.5% qoq during the quarter which was a tad below the consensus for +0.6%. That saw the annual rate edge down to +2.2% yoy and so remain below the post financial crisis high mark of +2.6%. Meanwhile, the Chicago PMI for January slipped 3.6pts to 50.3 (vs. 55.0 expected) which is actually lowest level since May last year. The conference board’s consumer confidence index also edged down to 111.8 from 113.3 although there was a reasonable divergence in the two components. The expectations component tumbled 6.6pts to 99.8 while the present situations gauge rose 6.2pts to 129.7. The jobs plentiful diffusion index also suggested that the labour market remained solid during the month.

Over in Europe the main focus was on the inflation data. Euro area headline CPI surprised to the upside in January after printing at +1.8% yoy (vs. +1.5% expected) which follows a +1.1% reading in December. The big driver was energy and food and it was more notable that the more relevant core reading stayed unchanged at +0.9% yoy. Keep in mind that core inflation 12 months ago was +1.0% yoy. In addition, Q4 GDP for the Euro area came in-line at +0.5% qoq and so keeping the YoY constant at +1.8%. Our economists argue that core inflation is still too low and the ECB needs to observe a self-sustained improvement in core inflation above +1.0%. As such, our team expect the ECB to make its next taper decision in September, although strong data in the mean time could bring this forward to June.

In terms of the other data yesterday, the Euro area unemployment rate was reported as dipping one-tenth to 9.6% helped by a similar fall for the rate in Germany to 5.9%. Meanwhile in the UK mortgage approvals in December edged up to 67.9k from 67.5k although still missed relative to consensus (of 69.2k). Finally net consumer credit was weaker than expected in the UK in December (£1.0bn vs. £1.7bn) which saw Sterling temporarily dip before then coming roaring back with the weakness in the US Dollar to finish back above $1.250.

Looking at the day ahead, this morning in Europe the focus will be on the final revisions to the January manufacturing PMI’s as well as a first look at the data for the periphery and the UK. Following that we’ve got a busy diary to get through in the US this afternoon. We’ll kick off with the January ADP employment change reading which should offer some early clues as to what to expect in Friday’s payrolls. Thereafter we’ll get the final manufacturing PMI revision followed closely by the ISM manufacturing print which the market expects to nudge up 0.5pts to 55.0. Construction spending data for December and vehicle sales in January rounds out the data before attention then turns to this  evening’s conclusion of the FOMC meeting. As a reminder there is no Yellen press conference due today. On the earnings side of things we’ll also receive reports from 27 S&P 500 companies including Facebook.

END

i)Late  TUESDAY night/WEDNESDAY morning: Shanghai closed HOLIDAY/ /Hang Sang closed . The Nikkei closed UP 106.74 POINTS OR .56% /Australia’s all ordinaires  CLOSED UP 0.51%/Chinese yuan (ONSHORE) closed HOLIDAY at 6.8840/Oil ROSE to 53.16 dollars per barrel for WTI and 55.94 for Brent. Stocks in Europe ALL IN THE GREEN. Offshore yuan trades  6.8295 yuan to the dollar vs 6.8840  for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS QUITE A BIT AS POBC ATTEMPTS TO STOP DOLLARS FROM LEAVING CHINA’S SHORES.

3a)THAILAND/SOUTH KOREA/:

END

b) REPORT ON JAPAN

c) REPORT ON CHINA

4 EUROPEAN AFFAIRS

Italy

 

Italian youth unemployment rises above 40%. Sovereign Italian bond yields rise but also we witness that sovereign bond risk soars to 3 yr highs (credit default swaps)

(courtesy zero hedge)

Italy Bond Risk Soars To 3-Year Highs As Youth Unemployment Tops 40%

The last 4 months have seen something ‘odd’ happen in Europe’s periphery. Sovereign ‘risk’ has conspicuously (and rationally) risen as macro-fundamentals have deteriorated – something that we have not seen since Draghi’s 2012 “whatever it takes” moment.

For the first time since June 2015, Italian youth unemployment has risen above 40% and notably, Italian bond yields are rising...

And the result is growing concerns about Italy’s idiosyncratic risk as the risk premium of BTPs over Bunds soars to its highest sicne 2014 (worst now than the Referendum peak)…

Time for moar “whatever it takes” – just ignore the transitory inflation surge and currency war warnings from Trump.

END

France

Initially French markets slump as Le Pen gains in the polling:

(courtesy zero hedge)

 

END

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

RUSSIA/GERMANY

Germany Deploys Tanks, Troops To Lithuania To “Bolster Confidence In Face Of Russian Aggression”

Three weeks after the “largest US military deployment into Eastern Europe since the cold war“, consisting of thousands of tanks and troops under a planned NATO operation to “reassure the alliance’s Eastern European allies”, on Tuesday Germany started the deployment of tanks to Lithuania as part of the same NATO mission meant to “bolster confidence” in the face of what NATO member states call “Russian aggression.”

Germany is one of the countries that agreed to provide troops and weapons for the NATO mission, which involves deploying four battalions in Poland and the three Baltic states.

German soldiers sit on a Bueffel (“buffalo”) armoured tank recovery vehicle in
Grafenwoehr, Germany January 31, 2017, before deployment to Lithuania

According to Reuters, the German army command said it was sending about 200 vehicles, including 30 tanks, by train to Lithuania along with 450 troops, the first of whom arrived last week. The transports would continue until late February. Seven decades after the end of World War Two, the movement of German troops to eastern Europe, even on a NATO mission, remains a sensitive issue both in Germany and the region.

On Monday the U.S. military deployed thousands of soldiers and heavy weaponry to Poland, the Baltic states and southeastern Europe in its biggest build-up since the Cold War.

The 28-nation Western alliance decided to move four battalions totaling 3,000 to 4,000 troops into northeastern Europe on a rotating basis to display its readiness to defend eastern members against any Russian aggression. The deployments focus on Poland and the Baltic states of Estonia, Latvia and Lithuania, which fear Moscow could try to destabilize them by cyber attacks, territorial incursions or other means.

The military buildup meant to put pressure on the Kremlin, is the largest since the Cold War and could put into question the NATO-Russia agreement permanently banning the deployment of significant forces by the alliance in Eastern Europe. NATO rejects such notions, saying the agreement did not specify how big a force should be for it to be considered “significant,” and insists that the deployment is rotational rather than permanent.

The bloc decided to boost its military presence on the Russian border in the wake of the political crisis in Ukraine.  The most vocal members of NATO, such as Poland and the Baltic states, claimed that Russia could attack them after the events in Ukraine, prompting leading members of the alliance to agree on the troop deployments.

Moscow has denied any aggressive intentions towards NATO members and says the bloc is using a pretext to compromise Russia’s national security. The Russian armed forces have boosted their strength near the western border in response to the buildup.

end

IRAN

Iran Admits It Test Fired New Missile, Putting Nuclear Deal In Jeopardy

After yesterday US officials reported that Iran conducted a nuclear ballistic missile test on Sunday, which some claimed would be another violation of the UN resolution and Obama’s nuclear deal, on Wednesday Iran’s defense minister admitted that the Islamic Republic had indeed tested a new missile, but added the test did not breach Tehran’s nuclear accord with world powers or a U.N. Security Council resolution endorsing the pact.

Iran has test-fired several ballistic missiles since the nuclear deal in 2015, but this is the first during U.S. President Donald Trump’s administration. Trump said in his election campaign that he would stop Iran’s missile program. Furthermore, the confirmed launch comes at a precarious time, with president Trump seemingly looking for excuses to scrap the Iran deal, which could potentially lead to the reestablishment of Iran sanctions and the halt of Iranian oil exports to global markets, taking away as much as 1 million barrels of daily supply.

“The recent test was in line with our plans and we will not allow foreigners to interfere in our defense affairs,” Defence Minister Hossein Dehghan said, according to Tasnim news agency . “The test did not violate the nuclear deal or the (U.N.)resolution 2231,” he said.

A U.S. official said on Monday that Iran test-launched a medium-range ballistic missile on Sunday and it exploded after traveling 630 miles (1,010 km). Iran’s Foreign Minister Mohammad Javad Zarif neither confirmed nor denied the U.S. report, but said on Tuesday that Tehran would never use its ballistic missiles to attack another country.

The U.N. Security Council resolution, adopted in a deal to curb Iran’s nuclear activities, “called upon” Iran to refrain from work on ballistic missiles “designed to” deliver nuclear weapons. Critics say the language does not make this obligatory.

However, the landmark nuclear deal between Iran and world powers does not include provisions preventing Iran from conducting ballistic missile tests.

Ultimately, it will be up to Trump to decide whether and how to retaliate to Iran’s latest show of force, which comes just days after Trump announced travellers from Iran could be temporarily banned from entering the US, sparking retaliation on behalf of Iran which blocked US visitors to the Islamic Republic.

 

END

 

end

6.GLOBAL ISSUES

7. OIL ISSUES

The author suggest that an oil price was will begin shortly

(courtesy Paraskova/OilPrice.com)

The Oil War Is Only Just Getting Started

ubmitted by Tsvetana Paraskova via OilPrice.com,

It’s been a month now that investors and analysts have been closely watching two main drivers for oil prices: how OPEC is doing with the supply-cut deal, and how U.S. shale is responding to fifty-plus-dollar oil with rebounding drilling activity. Those two main factors are largely neutralizing each other, and are putting a floor and a cap to a price range of between $50 and $60.

The U.S. rig count has been rising, while OPEC seems unfazed by the resurgence in North American shale activity and is trying to convince the market (and itself) and prove that it would be mostly adhering to the promise to curtail supply in an effort to boost prices and bring markets back to balance. In the next couple of months, official production figures will point to who’s winning this round of the oil wars.

This would be the short-term game between low-cost producers and higher-cost producers.

In the longer run, the latest energy outlook by supermajor BP points to another looming battle for market share, where low-cost producers may try to boost market shares before oil demand peaks.

BP’s Energy Outlook 2017 estimates that there is an abundance of oil resources, and “known resources today dwarf the world’s likely consumption of oil out to 2050 and beyond”.

“In a world where there’s an abundance of potential oil reserves and supply, what we may see is low-cost producers producing ever-increasing amounts of that oil and higher-cost producers getting gradually crowded out,” Spencer Dale, BP group chief economist said.

In BP’s definition of low-cost producers, the majority of the lowest-cost resources sit in large, conventional onshore oilfields, particularly in the Middle East and Russia.

Although this view that low-cost producers would try to seize more market share comes from an oil major with significant interests in Russia and Iraq, for example, BP may not be wrong in predicting that the abundance of oil resources would prompt the lowest-cost producers to pump the most out of low-cost barrels before the world starts to unwind from too much reliance on oil.

Oil demand growth is expected to slow down in the years to come. BP pegs the cumulative oil demand until 2035 at around 700 billion barrels, “significantly less than recoverable oil in the Middle East alone”.

Middle East OPEC production growth would account for all OPEC output growth by 2035, BP reckons, noting that other OPEC production typically has a higher cost base and its market share would drop.

The U.S. liquids production is expected to rise by 4 million bpd to 19 million bpd by 2035, with growth mostly in the first half of the period, driven by tight oil and NGL output.

So, both OPEC’s Middle East members and the U.S. are seen increasing oil and liquids production in the next two decades.

However, OPEC – especially Saudi Arabia – has the recent bitter experience of its pump-at-will policy for market share backfiring on its economy when oil prices crashed.

Another market-share war would involve too many unknowns, including supply-demand basics, leaner and meaner non-OPEC producers, oil price effects on oil-revenue-dependent economies, or rationale for investments in higher-cost areas.

OPEC’s decision to deliberately cut supply and abandon the strategy of pursuing market share at all costs is currently benefiting the cartel’s competitor, U.S. shale.

Commenting on OPEC’s current and future relevance and influence on the oil markets, Wood Mackenzie said in an analysis last week:

“The group may still be able to control oil prices to a limited degree, but the benefits of that control will accrue to parties outside the cartel. If OPEC remains a functional entity by the end of 2017, its greatest hits will surely be in the past.”

Five or ten years from now, a possible market share ‘oil war’ would take place on a totally different battleground, and some regiments or battalions may lack essential armory to wage such war.

8. EMERGING MARKETS

end

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

Euro/USA   1.0799 DOWN .0001/REACTING TO  + huge Deutsche bank problems + USA election:/TRUMP WINS THE ELECTION/USA READY TO GO ON A SPENDING BINGE WITH THE TRUMP VICTORY/ITALIAN REFERENDUM DEFEAT/AND NOW ECB TAPERING BOND PURCHASES/USA RISING RATE/EUROPE BOURSES DEEPLY IN THE GREEN

USA/JAPAN YEN 113.30 UP 0.529(Abe’s new negative interest rate (NIRP), a total DISASTER/SIGNALS U TURN WITH INCREASED NEGATIVITY IN NIRP/JAPAN OUT OF WEAPONS TO FIGHT ECONOMIC DISASTER/KURODA:  HELICOPTER MONEY  ON THE TABLE AND DECISION ON SEPT 21 DISAPPOINTS WITH STIMULUS/OPERATION REVERSE TWIST

GBP/USA 1.2643 UP .0057 (Brexit by March 201/UK government loses case/parliament must vote/PRIME MINISTER MAY  DECIDES ON A HARD BREXIT)

USA/CAN 1.3052 PU .0014 (CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT FROM EU)

Early THIS WEDNESDAY morning in Europe, the Euro FELL by 1 basis points, trading now WELL BELOW the important 1.08 level FALLING to 1.0799; 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 FOR THE WEEK/NEW YEARS     / Hang Sang  CLOSED FOR CHINESE NEW YEAR   /AUSTRALIA  CLOSED UP 0.51%  / EUROPEAN BOURSES ALL IN THE GREEN 

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

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

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

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

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

The NIKKEI: this WEDNESDAY morning CLOSED UP 106.74 OR 0.56% 

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

2/ CHINESE BOURSES / : Hang Sang CLOSED HOLIDAY   Shanghai CLOSED FOR THE WEEK: NEW YEAR’S CELEBRATION    / Australia BOURSE CLOSED UP 0.51% /Nikkei (Japan)CLOSED UP 106.74 OR 0.56%  /  INDIA’S SENSEX IN THE GREEN

Gold very early morning trading: $1211.35

silver:$17.59

Early WEDNESDAY morning USA 10 year bond yield: 2.474% !!! UP 2 IN POINTS from TUESDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%. THE RISE IN YIELD WITH THIS SPEED IS FRIGHTENING

 The 30 yr bond yield  3.078, UP 1 IN BASIS POINTS  from TUESDAY night.

USA dollar index early WEDNESDAY morning: 99.56 UP 1 CENT(S) from TUESDAY’s close.

This ends early morning numbers WEDNESDAY MORNING

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And now your closing WEDNESDAY NUMBERS

Portuguese 10 year bond yield: 4.191% DOWN 5  in basis point yield from TUESDAY 

JAPANESE BOND YIELD: +.087%  UP 2/10 (DESPITE INTERVENTION)  in   basis point yield from TUESDAY/JAPAN losing control of its yield curve

SPANISH 10 YR BOND YIELD:1.598%  DOWN 4 IN basis point yield from  TUESDAY (this is totally nuts!!/

ITALIAN 10 YR BOND YIELD: 2.262  DOWN 6 POINTS  in basis point yield from TUESDAY 

the Italian 10 yr bond yield is trading 66 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: +.436% DOWN 1 IN  BASIS POINTS ON THE DAY

END

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IMPORTANT CURRENCY CLOSES FOR WEDNESDAY

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

Euro/USA 1.0784 UP .0076 (Euro UP 76 basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 113.06 DOWN: 0.622(Yen UP 62 basis points/ 

Great Britain/USA 1.2576 UP 0.0078( POUND UP 78 basis points)

USA/Canada 1.3032 DOWN 0.0032(Canadian dollar UP 32 basis points AS OIL ROSE TO $53.43

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This afternoon, the Euro was UP by 76 basis points to trade at 1.0784

The Yen ROSE to 113.06 for a GAIN of 62 Basis points as NIRP is STILL a big failure for the Japanese central bank/HELICOPTER MONEY IS NOW DELAYED/BANK OF JAPAN NOW WORRIED AS AS THEY ARE RUNNING OUT OF BONDS TO BUY AS BOND YIELDS RISE  /OPERATION REVERSE TWIST ANNOUNCED SEPT 21.2016

The POUND ROSE 78  basis points, trading at 1.2576/

The Canadian dollar ROSE  by 72 basis points to 1.3032,  WITH WTI OIL RISING TO :  $53.43

The USA/Yuan closed at 6.8767/CHINA NOW CLOSED FOR NEW YEAR
the 10 yr Japanese bond yield closed at +.087% UP 2/10 IN  BASIS POINTS / yield/ 

Your closing 10 yr USA bond yield DOWN 2 IN basis points from TUESDAY at 2.459% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic  USA 30 yr bond yield: 3.065 DOWN 1 /2 in basis points on the day /

Your closing USA dollar index, 99.71 DOWN 66 CENT(S)  ON THE DAY/1.00 PM 

Your closing bourses for Europe and the Dow along with the USA dollar index closing and interest rates for WEDNESDAY: 1:00 PM EST

London:  CLOSED DOWN 19.33 OR 0.27% 
German Dax :CLOSED DOWN 146.58 POINTS OR 1.25%
Paris Cac  CLOSED DOWN 35.34 OR 0.75%
Spain IBEX CLOSED DOWN 46.10 POINTS OR 0.49%
Italian MIB: CLOSED DOWN 168.67 POINTS OR 0.90%

The Dow closed DOWN 107.04 OR 0.54%

NASDAQ WAS closed UP 1.07 POINTS OR 0.02%  4.00 PM EST
WTI Oil price;  53.26 at 1:00 pm; 

Brent Oil: 56.26  1:00 EST

USA /RUSSIAN ROUBLE CROSS:  60.09 ROUBLES/DOLLAR  (DOWN 18/100 roubles from YESTERDAY)

TODAY THE GERMAN YIELD FALLS TO +0.436%  FOR THE 10 YR BOND  1:30 EST

END

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

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

WTI CRUDE OIL PRICE 5 PM:$52.85

BRENT: $55.59

USA 10 YR BOND YIELD: 2.455%  (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)

USA 30 YR BOND YIELD: 3.062%

EURO/USA DOLLAR CROSS:  1.0797 UP .0089 

USA/JAPANESE YEN:112.78  DOWN 0.909

USA DOLLAR INDEX: 99.57  DOWN 80  cents ( HUGE resistance at 101.80)

The British pound at 5 pm: Great Britain Pound/USA: 1.2577 : UP 79   BASIS POINTS.

German 10 yr bond yield at 5 pm: +.436%

END

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

TRADING IN GRAPH FORM

Despite Late P

end

Meet America’s Newest Supreme Court Justice: Judge Neil Gorsuch

confirming a choice that many had already pegged as a front-runner to fill Antonin Scalia’s vacant seat, President Trump officially announced Judge Neil Gorsuch as his nominee for the Supreme Court of the United States. Gorsuch, 49, the youngest supreme court nominee in 25 years, was among a group of federal judges reported in recent weeks to be on Trump’s shortlist. A strict adherent of judicial restraint known for sharply-written opinions and bedrock conservative views, Gorsuch, a Colorado native, is popular among his peers and is seen as having strong backing among Republicans generally.

A fly-fishing enthusiast and skier who lives outside Boulder, Colorado, Gorsuch lived in Washington DC as a boy, after his mother Anne Gorsuch Burford was appointed by Reagan to lead the Environmental Protection Agency. After graduating from Columbia University, Gorsuch, who is said to have “an inexhaustible store of Winston Churchill quotes”, went on to Harvard Law school and attended Oxford University on a Marshall scholarship. He worked as a corporate lawyer in Washington for a decade before his appointment to the circuit court by George W Bush in 2006, a post to which the Senate confirmed him by voice vote.

Per Politico, Gorsuch has the typical pedigree of a Supreme Court Justice with degrees from Columbia, Harvard and Oxford.  Moreover, Gorsuch’s professional background includes time at a Washington law firm, the Department of Justice and clerkships with Justices Byron White and Anthony Kennedy, and some conservative analysts theorize that he could assert a rightward influence on the centrist Ronald Reagan nominee.

Gorsuch has the typical pedigree of a high court justice. He graduated from Columbia, Harvard and Oxford, clerked for two Supreme Court justices and did a stint at the Department of Justice.  He attended Harvard Law with former President Barack Obama.

His work background includes time as a partner with the Washington law firm Kellogg Huber Hansen Todd Evans & Figel, a stint with the U.S. Department of Justice and clerkships with Supreme Justices Byron White and Anthony Kennedy.

Since 2006, he has served on the 10th Circuit Court of Appeals, in Colorado. His supporters note that he is an outdoorsman who fishes, hunts and skies. On the court, conservatives hope he could become the intellectual heir to Scalia, long the outspoken leader of the conservative bloc.

Gorsuch

For conservatives, Gorsuch meets conservative standards as an originalist and a textualist — someone who interprets the Constitution and statutes as they were originally written. His family has ties to the Republican party locally and in Washington, and at the age of 49, he could sit on the high court for decades — a big plus for conservative supporters.  Per The Denver Post:

Gorsuch is best known nationally for taking the side of religious organizations that opposed parts of the Affordable Care Act that compelled coverage of contraceptives. In one of those cases, Burwell vs. Hobby Lobby Stores, he wrote of the need for U.S. courts to give broad latitude to religious beliefs.

It is not for secular courts to rewrite the religious complaint of a faithful adherent, or to decide whether a religious teaching about complicity imposes ‘too much’ moral disapproval on those only ‘indirectly’ assisting wrongful conduct,” he noted in a concurring opinion.

The Supreme Court later ruled in favor of Hobby Lobby, which now is not required to subsidize birth control that it finds objectionable.

Gorsuch also has written against euthanasia and assisted suicide, the latter of which Colorado legalized last November. “All human beings are intrinsically valuable and the intentional taking of human life by private persons is always wrong,” he wrote in his 2006 book “The Future of Assisted Suicide and Euthanasia.”

Of course, while his conservative record will no doubt be enticing to Republican Senators, Gorsuch’s past support of term limits may draw criticism from both sides of the aisle, as can’t have anyone disrupting the power structure of Washington D.C. now can we.

One position that might give pause to the lawmakers voting on his nomination is his past advocacy on behalf of term limits. In 1992 he co-wrote a paper for the Cato Institute that argued term limits are “constitutionally permissible.”

“Recognizing that men are not angels, the Framers of the Constitution put in place a number of institutional checks designed to prevent abuse of the enormous powers they had vested in the legislative branch,” he wrote. “A term limit, we suggest, is simply an analogous procedure designed to advance much the same substantive end.”

As the Guardian notes, Trump’s nominee has the potential to tip the court one way or the other on those questions. If confirmed, Gorsuch would return the court to nine justices, filling a seat left vacant since the death of Justice Antonin Scalia in February 2016.  Working for the last year with an even number of justices, the court issued split 4-4 decisions on high-stakes questions such as the protection of undocumented immigrants and the health of public unions, leaving lower court rulings in place.

The next justice to be confirmed may break such ties, giving new strength to the court’s conservative bloc, which could be further buttressed by future Trump nominations in the case of the retirement or death of a justice. One of the four liberal-leaning justices on the court, Ruth Bader Ginsburg, turns 84 in March. Justice Anthony Kennedy, a centrist on the court who has sometimes split tie votes for the progressive wing, is 80 years old.

Gorsuch’s track record as a judge on the US court of appeals for the 10th circuit does not shed obvious light on how he might rule as a supreme court justice on hot-button topics such as abortion and marriage equality. He is the author of a book about euthanasia in which he writes, “to act intentionally against life is to suggest that its value rests only on its transient instrumental usefulness for other ends.”

Ideological strands running through Gorsuch’s appeals court rulings would seem likely to endear him to congressional Republicans and Trump’s conservative base. He has shown himself to be solicitous to claims of religious exemptions from the law, to gun rights claims and to the prosecution of death penalty cases.

During Trump’s announcement, Gorsuch addressed the crowd briefly, declaring himself “honored and humbled” and promising to be a “faithful servant to the constitution and laws of this great country” and paying tribute to the principles of partiality, independence, collegiality and courage.

For a lawyer’s view on Gorsuch, read this SCOTUSblog profile on Gorsuch. Some of his key legal positions are below

  • Second Amendment: He wrote in United States v. Games-Perez these rights “may not be infringed lightly.”
  • Roe v. Wade: Gorsuch has never had the opportunity to write on Roe v. Wade. But, for any indication on how he would vote on abortions, the “right to privacy” defense from the dormant commerce clause is relevant, and he isn’t buying it. This clause, known as “dormant” since it is not explicitly written out in the Constitution, indicates that since Congress regulates interstate commerce, states cannot pass legislation that unduly burdens or discriminates against other states and interstate commerce.
     
  • Hobby Lobby v. Sebelius: He distrusts efforts to remove religious expression from public spaces generally, but watch out for cases citing RFRA and RLUIPA — he ruled in Hobby Lobby v. Sebelius that the contraception mandate in Obamacare placed an undue burden on the company’s religious exercise and violated RFRA.
  • Capital punishment: Gorsuch is not friendly to requests for relief from death sentences through federal habeas corpus.
  • Criminal law: Gorsuch believes there is an overwhelming amount of legislation about criminal law, and believes that cases can be interpreted in favor of defendants even if it hurts the government. On mens rea — which means “guilty mind,” or essentially the intent to commit a crime — Gorsuch is willing to read narrowly even if it means it doesn’t favor the prosecution.
  • Checks and balances: Gorsuch does not like deferring to federal agencies when they interpret laws, so watch out for use of the Chevron rule, which allows federal agents to enforce laws in any way that is not expressly prohibited. Gorsuch may push back.

As a side note, per the The Denver Post, Gorsuch comes from a well known Republican family whose mother served in the Reagan Administration before being forced to resign in 1983, facing a criminal investigation and a House contempt of Congress citation over records related to alleged political favoritism in toxic-waste cleanups.

Gorsuch comes from a well-known Colorado Republican family. His mother, the late Anne Gorsuch Burford, was Environmental Protection Agency director for the Reagan administration for 22 months. She slashed the agency’s budget and resigned under fire in 1983 during a scandal over mismanagement of a $1.6 billion program to clean up hazardous waste dumps.

With that, let the Senate confirmation theatrics commence.

Under current Senate rules, which require 60 votes for a supreme court confirmation, Gorsuch would need to win the support of multiple Democrats, who count 48 Senate caucus members to the Republicans’ 52.

If the Democrats follow through with a filibuster, however, those rules could change. The previous Democratic leadership of the Senate changed the rules to require fewer votes for the confirmation of most executive nominees, and the current Republican leadership could make an additional change to the rules. McConnell earlier had vowed to confirm Trump’s nominee. White House press secretary Sean Spicer downplayed the looming threat of an all-consuming political brawl over Trump’s nominee, telling reporters on Tuesday that he believed the Senate would reach the 60-vote threshold required to confirm supreme court appointees.

Interest groups across the political spectrum will spend millions on a public campaign to legitimize or tear down a supreme court nominee. Already, conservative groups are running ads to pressure Senate Democrats in red states into siding with Republicans over the nominee.

END

Despite Majority Of Americans In Favor Of Trump Immigration Policy, 900 State Department Staff Dissent

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