April 27/Gold steady at $1263.70/ silver down 3 cents but lower in access as we head into First day notice tomorrow/Israel bombs Syrian airport last night/Atlanta Fed lowers first quarter GDP to only .2%/Putin warns that the situation in North Korea is deteriorating rapidly/Japan warns citizens of a possible North Korean nuclear strike/China fires test missiles in a show of strength against the USA/Trump flip flops again on NAFTA/Odds of the government shutting down tomorrow escalates!/

Gold: $1263.70  UP 1.60

Silver: $17.32  DOWN 3  cents

Closing access prices:

Gold $1264.50

silver: $17.26!!!

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

SHANGHAI GOLD FIX:  FIRST FIX  10 15 PM EST  (2:15 SHANGHAI LOCAL TIME)

SECOND FIX:  2:15 AM EST  (6:15 SHANGHAI LOCAL TIME)

SHANGHAI FIRST GOLD FIX: $1276.05 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME:  1266.60

PREMIUM FIRST FIX:  $9.15

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

SECOND SHANGHAI GOLD FIX: $1274.25

NY GOLD PRICE AT THE EXACT SAME TIME: 1266.15

Premium of Shanghai 2nd fix/NY:$8.10

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

LONDON FIRST GOLD FIX:  5:30 am est  $1264.30

NY PRICING AT THE EXACT SAME TIME: $1263.30 ???

LONDON SECOND GOLD FIX  10 AM: $1262.80

NY PRICING AT THE EXACT SAME TIME. 1262.00 ????

For comex gold:

APRIL/

NOTICES FILINGS TODAY FOR APRIL CONTRACT MONTH:  113 NOTICE(S) FOR 11300 OZ. 

 TOTAL NOTICES SO FAR: 922 FOR 92,200 OZ    (2.8678 TONNES)

For silver:

For silver: APRIL

8 NOTICES FILED TODAY FOR 40,000  OZ/

Total number of notices filed so far this month: 925 for 4,625,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

END

The silver open interest fell by 7533 contracts considerably less than yesterday and this corresponded with a tiny 23 cent loss. I am confident that there will be no loss in OI technically as these are held in the EFP’s. Once the new month of May commences, these contracts will be released to the longs so they do the same thing all over again..rinse and repeat..

 

As far as options expiry: same story as yesterday

As I stated yesterday

“Our precious metals will be under much pressure from today until Friday April 28 as we enter options expiry week.”

From the beginning of time, the crooked banks continue to raid on options expiry week and this week so no different

Comex options expiry:  LBMA/OTC options Friday morning at around 11 am

 

The price of the precious metals should begin to rise once first day notice is over. Also the open interest on silver will rise.

Let us have a look at the data for today

.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

In silver, the total open interest FELL BY A LESS THAN EXPECTED 7,533  contracts DOWN to 207,249 WITH THE SMALL LOSS IN PRICE ( 23 CENTS) WITH RESPECT TO YESTERDAY’S TRADING.  FOR THE PAST FEW YEARS WE HAVE NOTICED THAT THE OPEN INTEREST IN AN ACTIVE MONTH COLLAPSES AS WE APPROACH FIRST DAY NOTICE.  WE NOW KNOW THAT THE MAJORITY OF THE LIQUIDATION RECEIVE AN EFP CONTRACT IN A FUTURE MONTH PLUS FIAT BONUS.  WE HAVE BEEN WITNESSING THIS SAME PATTERN NOW FOR AT LEAST THE LAST COUPLE OF YEARS.  i THINK WE HAD NEGLIGIBLE SHORT COVERING BY THE BANKS. In ounces, the OI is still represented by just OVER 1 BILLION oz i.e.  1.036 BILLION TO BE EXACT or 148% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT MARCH MONTH/ THEY FILED: 8 NOTICE(S) FOR 40,000  OZ OF SILVER

In gold, the total comex gold ROSE BY 395 contracts DESPITE THE FALL IN THE PRICE OF GOLD ($3.50 with YESTERDAY’S TRADING). The total gold OI stands at 476,380 contracts.

we had 113 notice(s) filed upon for 11,300 oz of gold.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD:

We had a small change in tonnes of gold at the GLD: a withdrawal of .89 tonnes from the GLD

Inventory rests tonight: 853.36 tonnes

.

SLV

We had no change in silver inventory at the SLV today

THE SLV Inventory rests at: 330.283 million oz

end

.

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

1. Today, we had the open interest in silver FELL BY 7,533 contracts DOWN TO  207,249,( AND FURTHER FROM  THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21 AT 234,787), DESPITE THE RATHER SMALL  FALL IN PRICE FOR SILVER YESTERDAY (23 CENTS). We may have witnessed short covering by the bankers or we may again have witnessed the power of that obscure EFP contract.  For the past few years, strangely we have seen the open interest collapse as we enter first day notice. The EFP allows the longs to liquidate his delivery contract month for a fiat bonus and the receipt of a future contract month once first day notice has occurred. That may have happened again today.

(report Harvey

.

2.a) The Shanghai and London gold fix report

(Harvey)

 

2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY:  Bloomberg

3. ASIAN AFFAIRS

i)Late  WEDNESDAY night/THURSDAY morning: Shanghai closed UP 11.34 POINTS OR 0.36%/ /Hang Sang CLOSED UP 120.05 POINTS OR 0.49%.  The Nikkei closed DOWN 37.56 OR 0.19% /Australia’s all ordinaires  CLOSED UP .13%/Chinese yuan (ONSHORE) closed DOWN at 6.8942/Oil DOWN to 49.09 dollars per barrel for WTI and 51.24 for Brent. Stocks in Europe  IN THE RED   ..Offshore yuan trades  6.9045 yuan to the dollar vs 6.8942 for onshore yuan. NOW  THE OFFSHORE IS MUCH WEAKER TO THE ONSHORE YUAN/ ONSHORE YUAN SLIGHTLY WEAKER (TO THE DOLLAR)  AND THE OFFSHORE YUAN ALSO MUCH WEAKER AND THIS IS COUPLED WITH THE WEAKER DOLLAR. CHINA IS NOT HAPPY

3a)THAILAND/SOUTH KOREA/NORTH KOREA

NORTH KOREA/RUSSIA

Putin warns the world that the Korean situation is deteriorating

( zerohedge)

 

b) REPORT ON JAPAN

Good reason for gold/silver to be down today;  Japan warns its citizens to prepare for a North Korean missile attack

( The AntiMedia.org)

c) REPORT ON CHINA

China steps up to the plate and tests its new weapons in retaliation to the uSA THAAD deployment of which China was visibly upset

( zero hedge)

4. EUROPEAN AFFAIRS

GERMANY/DEUTSCHE BANK

Deutsche bank tumbles as they missed on most major areas including fixed income. Global growth is just now present and the negative yields are having a devastating effect on DB’s earnings

( zerohedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

i)Israel/Syria

It sure looks like the Israelis were at it again:  a massive explosion reported near the Damascus International Airport in Syria

( zero hedge)

 

6 .GLOBAL ISSUES

i)NAFTA

Trump changes his mind and will not terminate NAFTA.  The Loonie and Peso respond northbound on the news

( zero hedge)

ii)Trump explains why he flipped again on NAFTA: Both the Canadian Prime Minister (Trudeau) and the Mexican leader (Nieto) agreed to renegotiate theagreement

( zero hedge)

iii)CANADA

We now know who bailed out the largest mortgage lender in Canada: it was the retired Ontario Healthcare workers union.  The mortgage portfolio was used as collateral. If house prices come down, a feel sorry for those workers.

( zero hedge)

iv)Strange!! Canada hit by a countrywide internet, TV and phone outage from Shaw communications.

 

(courtesy zerohedge)

7. OIL ISSUES

Oil tumbles as the market is running out of patience with IPEC

( zerohedge)

8. EMERGING MARKETS

9.   PHYSICAL MARKETS

Agnico Eagle: the only major to produce good mining results

(Agnico eagle)

10. USA stories

i)Again, hard data seems to suggest a no growth economy.  Core durable good orders tumble

( zero hedge)

ii)Another hard data disappointment.  Wholesale inventories in March slide again and this will  without a doubt hit the  first quarter GDP numbers when finalized

( zerohedge)

iii)We are waiting for the Atlanta Fed to lower its official forecast.  JPMorgan with its tracking formula has cut Q1 GDP to just .3%

( zero hedge)

iv)Then 10 minutes later, the Atlanta Fed wasted no time as it cut its final Q! GDP forecast to just .2%.

( zero hedge)

v)Today the KC Fed crashes from 20 down to 7 on expectation of a 17 reading: a huge 17 deviation miss.

as zero hedge states..probably nothing

( zero hedge)

vi) For two weeks in a row we have seen initial jobless claims rise. The last two weeks has seen the jobless number rise by 23,000 up to 257,000. Another indicator that things are not doing too well!

( zero hedge)

 

vii) No wonder the Trump tax proposal is in trouble: the CRFB the independent government agency that scores proposals has stated that the Trump tax cuts will add as much as 7 billion to the debt in the next 10 years and that is op top of the original 10 trillion debt gain.

this is not going to happen…

( zero hedge)

viii(This does not look good:  credit card defaults are surging to a 4 year high

( zero hedge)

ix)Next on the list for Trump to attack:  aluminum

( zero hedge)

( zero hedge)

xi)The Pentagon Inspector General has now launched an investigation into Michael Flynn with respect to his concealed payments received for a speaking engagement for RT (Russia Television) and for lobbying on behalf of Turkey

(courtesy zero hedge)

 

 

Let us head over to the comex:

The total gold comex open interest ROSE BY 395 CONTRACTS UP to an OI level of 476,380 DESPITE THE  FALL IN THE PRICE OF GOLD ( $3.50 with YESTERDAY’S trading).   The longs still continue to remain stoic as they refused to liquidate any of their contracts despite the constant torment.  We are now in the contract month of APRIL and it is one of the BETTER delivery months  of the year. In this APRIL delivery month  we had A LOSS OF 29 contract(s) FALLING TO 113. We had 43 notices served yesterday so we GAINED 14 contracts or AN ADDITIONAL 1400 oz that will stand for delivery in the active delivery month of April AND NO CONTRACTS WERE CASH SETTLED THROUGH THE OBSCURE EFT ROUTE DESCRIBED BY JAMES TURK AND KOOS JANSEN. 

(At the end of April/2016 only 12.3917 tonnes stood for physical delivery, although 21.306 tonnes stood initially at the beginning of April 2016.)

The non active May/2017 contract month LOST 597 contract(s) and thus its OI is 560 contracts. The next big active month is June/2017 and here the OI LOST by 1362 contracts DOWN to 338,765.

We had 113 notice(s) filed upon today for 113300 oz

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
And now for the wild silver comex results.  Total silver OI FELL BY 7,533 contracts FROM 214,785 DOWN TO 207,249  WITH YESTERDAY’S  23 CENT PRICE LOSS.(THIS WAS MUCH LESS LOSS IN OI THAN YESTERDAY)  I AM SURE  WE HAVE WITNESSED ANOTHER OF THOSE EFP EVENTS ESPECIALLY WHEN YOU SEE THAT GOLD’S OI ROSE.   ONCE WE APPROACH FIRST DAY NOTICE OF AN ACTIVE DELIVERY MONTH, JAMES TURK AND KOOS JANSEN NOTICED AN OBSCURE VEHICLE BEING USED (IN HIGH QUANTITY) BY THE SHORT BANKERS, WHEREBY A LONG CONTRACT HOLDER RECEIVES A FIAT BONUS AND A FUTURES CONTRACT IN RETURN FOR NOT TAKING DELIVERY.  USUALLY THE TOTAL OPEN INTEREST RETURNS TO ITS PREVIOUS LEVEL ONCE THE NEW ACTIVE DELIVERY MONTH COMMENCES AS THE LONG HOLDER WOULD RECEIVE THROUGH A PRIVATE DEAL SAY A JUNE OR JULY SILVER CONTRACT.
The line in the sand is $18.50 for silver and again it has been defended by the criminal bankers.  Once this level is pierced, the monstrous billion oz of silver shorts will blow up. The bankers are defending the Alamo with their last stand at the $18.50 mark. THE NEW RECORD HIGH IN OPEN INTEREST WAS SET FRIDAY APRIL 21/2017 AT:  234,787.
 We are in the NON active delivery month is APRIL  Here the open interest LOST 28 contracts FALLING TO 8 contracts. We had 0 notices filed yesterday so we LOST 28 silver CONTRACTS OR AN ADDITIONAL 140,000 ounces will NOT stand in this non active delivery month of April.  We lost 28 contracts through this route of ERP.

The next active contract month is May and here the open interest LOST 14,992 contracts DOWN to 17,363 contracts which is astonishingly high. It is this front month that the crooked bankers are targeting as they must be frightened to see such a mammoth amount of contracts still standing for metal. We have only 1 trading day before first day notice. The non active June contract GAINED 229 contracts to stand at 711. The next big active month will be July and here the OI GAINED 6774 contracts UP to 152,059.

FOR COMPARISON SAKE, ON   APRIL 28/2016 WE HAD 11,490 CONTRACTS STANDING FOR DELIVERY. (and the exact same number of days left before first day notice, i.e. one day). SO YOU CAN VISUALIZE FOR YOURSELF THE HUGE DIFFERENCE BETWEEN 2016 AND THIS YEAR.

For those keeping score, the initial amount of silver oz that stood for delivery for the May 2016 contract month: 28.01 million oz.  By conclusion of the month only 13.58 million oz stood and the rest was cash settled.(EFP ROUTE)

.

We had 8 notice(s) filed for 40,000 oz for the APRIL 2017 contract

VOLUMES: for the gold comex

Today the estimated volume was 196,806 contracts which is FAIR.

Yesterday’s confirmed volume was 253,451 contracts  which is  good.

volumes on gold are STILL HIGHER THAN NORMAL!

INITIAL standings for APRIL
 April 27/2017.
Gold Ounces
Withdrawals from Dealers Inventory in oz   nil
Withdrawals from Customer Inventory in oz  
 299.95 oz
Delaware
Deposits to the Dealer Inventory in oz nil oz

 

Deposits to the Customer Inventory, in oz 
 nil
No of oz served (contracts) today
 
113 notice(s)
11,300 OZ
No of oz to be served (notices)
0 contracts
nil oz
Total monthly oz gold served (contracts) so far this month
922 notices
92,200 oz
2.8678 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   453,616.7 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)
 i Out of Delaware; 299.95 oz
total customer withdrawal: 299.95 oz
 we had 0 adjustments:
For APRIL:

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 113 contract(s)  of which 0 notices were stopped (received) by jPMorgan dealer and 31 notice(s) was (were) stopped/ Received) by jPMorgan customer account.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
To calculate the initial total number of gold ounces standing for the APRIL. contract month, we take the total number of notices filed so far for the month (922) x 100 oz or 92,200 oz, to which we add the difference between the open interest for the front month of APRIL (113 contracts) minus the number of notices served upon today (113) x 100 oz per contract equals 92,200 oz, the number of ounces standing in this  active month of APRIL.
 
Thus the INITIAL standings for gold for the APRIL contract month:
No of notices served so far (922) x 100 oz  or ounces + {(113)OI for the front month  minus the number of  notices served upon today (113) x 100 oz which equals 92,200 oz standing in this non active delivery month of APRIL  (2.8678 tonnes)
We gained 14   contracts or an additional 1400 oz will stand and THERE  WERE NO CONTRACTS   cash settled via the PRIVATE EFP route.   The comex is now one complete massive fraud with no physical component as they settle through the private paper EFP.
 
 
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
 We had 21.206 tonnes of gold initially stand for delivery in April 2016.  By the month’s conclusion we had only 12.39 tonnes stand.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
I have now gone over all of the final deliveries for this year and it is startling.
First of all:  in 2015 for the 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 4 months of  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/2016.   29.931 tonnes
JAN/2017     3.9004 tonnes
FEB/ 18.734 tonnes
March: 0.5816 tonnes
April/2017: 2.8678
total for the 16 months;  247.668 tonnes
average 15.479 tonnes per month
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Total dealer inventory 994,397.311 or 30.933 tonnes DEALER RAPIDLY LOSING GOLD
Total gold inventory (dealer and customer) = 8,954,376.878 or 278.52 tonnes 
 
Over a year ago the comex had 303 tonnes of total gold. Today the total inventory rests at 278.52 tonnes for a  loss of 24  tonnes over that period.  Since August 8/2016 we have lost 75 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 10 MONTHS  75 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
AND NOW THE APRIL DELIVERY MONTH
APRIL INITIAL standings
 April 27. 2017
Silver Ounces
Withdrawals from Dealers Inventory  nil
Withdrawals from Customer Inventory
 13,174.08 oz
 Delaware
1,263,331.380 oz
Scotia
604,920.53 oz
CNT
total: 1,881,425.918 oz
Deposits to the Dealer Inventory
nil oz
Deposits to the Customer Inventory 
601,615.410 oz
JPMorgan
total:  601,615.410 oz
No of oz served today (contracts)
 8 CONTRACT(S)
(40,000 OZ)
No of oz to be served (notices)
0 contracts
(NIL  oz)
Total monthly oz silver served (contracts) 925 contracts (4,625,000 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  17,187,139.5 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 3 customer withdrawal(s):
i) Out of Delaware:  13,174.08 oz
ii) Out of Scotia:  1,263,331.380 oz
iii) out of CNT: 604,920.53 oz
TOTAL CUSTOMER WITHDRAWALS: 1,881,425.918  oz
 We had 1 Customer deposits:
i) Into JPMorgan: 601,615.410 oz
***deposits into JPMorgan have now resumed.
In the month of March and February, JPMorgan stopped (received) almost all of the comex silver contracts.
why is JPMorgan bringing in so much silver??? why is this not criminal in that they are also the massive short in silver
total customer deposits  601,615.410 oz
 
 we had 1 adjustment(s)
Out of the Delaware vault:
55,837.203 oz was adjusted out of the dealer and this landed into the customer account of Delaware
The total number of notices filed today for the APRIL. contract month is represented by 8 contract(s) for 40,000 oz. To calculate the number of silver ounces that will stand for delivery in APRIL., we take the total number of notices filed for the month so far at 925 x 5,000 oz  = 4,625,000 oz to which we add the difference between the open interest for the front month of APRIL (8) and the number of notices served upon today (8) x 5000 oz equals the number of ounces standing 
 
Thus the initial standings for silver for the APRIL contract month:  925(notices served so far)x 5000 oz  + OI for front month of APRIL.(8 ) -number of notices served upon today (8)x 5000 oz  equals  4,625,000 oz  of silver standing for the APRIL contract month. 
We lost 140,00 additional silver oz (28 contracts) that will not stand  in this non active delivery month of April and THESE CONTRACTS WERE NO DOUBT CASH SETTLED THROUGH THE EFP ROUTE ALONG WITH CONSIDERABLE MAY CONTRACTS. 
 

FOR COMPARISON

Initially for the April 2016 contract1,180,000 oz stood for delivery.  At the end of April 2016: 6,775,000 oz stood as bankers needed much silver to fill major holes elsewhere.

Volumes: for silver comex
 
Today the estimated volume was 128,842 which is very Huge 
Yesterday’s  confirmed volume was 174,385 contracts which is humongous
(TODAY’S EST. VOLUME OF 174,385 CONTRACTS EQUATES TO 872 MILLION OZ OF SILVER OR 125% OF ANNUAL GLOBAL PRODUCTION OF SILVER EX CHINA EX RUSSIA)
 
Total dealer silver:  29.151 million (close to record low inventory  
Total number of dealer and customer silver:   196.551 million oz
The record level of silver open interest is 234,787 contracts set on April 21./2017  with the price at that day at  $18.42
The previous record was 224,540 contracts with the price at that time of $20.44
 
end

NPV for Sprott and Central Fund of Canada

will update later tonight the central fund of Canada figures

1. Central Fund of Canada: traded at Negative 7.1 percent to NAV usa funds and Negative 6.9% to NAV for Cdn funds!!!! 
Percentage of fund in gold 61.3%
Percentage of fund in silver:38.6%
cash .+0.1%( April 27/2017) 
 
2. Sprott silver fund (PSLV): Premium RISES TO   -.56%!!!! NAV (April 27/2017) 
3. Sprott gold fund (PHYS): premium to NAV FALLS to -0.55% to NAV  ( April 27/2017)
Note: Sprott silver trust back  into NEGATIVE territory at -.56% /Sprott physical gold trust is back into NEGATIVE/ territory at -0.55%/Central fund of Canada’s is still in jail  but being rescued by Sprott.

Sprott’s hostile 3.1 billion bid to take over Central Fund of Canada

(courtesy Sprott/GATA)

Sprott makes hostile $3.1 billion bid for Central Fund of Canada

 Section: Daily Dispatches

From the Canadian Press
via Canadian Broadcasting Corp. News, Toronto
Wednesday, March 8, 2017

http://www.cbc.ca/news/canada/calgary/sprott-takeover-bid-central-fund-c…

Toronto-based Sprott Inc. said Wednesday it’s making an all-share hostile takeover bid worth $3.1 billion US for rival bullion holder Central Fund of Canada Ltd.

The money-management firm has filed an application with the Court of Queen’s Bench of Alberta seeking to allow shareholders of Calgary-based Central Fund to swap their shares for ones in a newly-formed trust that would be substantially similar to Sprott’s existing precious metal holding entities.

The company is going through the courts after its efforts to strike a friendly deal were rebuffed by the Spicer family that controls Central Fund, said Sprott spokesman Glen Williams.

“They weren’t interested in having those discussions,” Williams said.

 Sprott is using the courts to try to give holders of the 252 million non-voting class A shares a say in takeover bids, which Central Fund explicitly states they have no right to participate in. That voting right is reserved for the 40,000 common shares outstanding, which the family of J.C. Stefan Spicer, chairman and CEO of Central Fund, control.

If successful through the courts, Sprott would then need the support of two-thirds of shareholder votes to close the takeover deal, but there’s no guarantee they will make it that far.

“It is unusual to go this route,” said Williams. “There’s no specific precedent where this has worked.”

Sprott did have success last year in taking over Central GoldTrust, a similar fund that was controlled by the Spicer family, after securing support from more than 96 percent of shareholder votes cast.

The firm says Central Fund’s shares are trading at a discount to net asset value and a takeover by Sprott could unlock US$304 million in shareholder value.

Central Fund did not have any immediate comment on the unsolicited offer. Williams said Sprott had not yet heard from Central Fund on the proposal but that some shareholders had already contacted them to voice their support.

Sprott’s existing precious metal holding companies are designed to allow investors to own gold and other metals without having to worry about taking care of the physical bullion.

end

I will update gold inventory and silver inventory (GLD and SLV) at 11 pm tonight.

And now the Gold inventory at the GLD

April 27/a small withdrawal of .89 tonnes/Inventory is now at 853.36 tonnes

APRIL 26/we had no changes at the GLD/Inventory rests at 854.25 tonnes

April 25/2017/A WITHDRAWAL OF 5.92 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 854.25 TONNES

April 24/a deposit of 1.48 tonnes of gold into the GLD/inventory rests at 860.17 tonnes

April 21/A DEPOSIT OF 4.44 TONNES OF GOLD INTO THE GLD/INVENTORY RESTS AT 858.69 TONNES

APRIL 20/A WITHDRAWAL OF 6.51 TONNES FROM THE GLD/INVENTORY RESTS AT 854.25 TONNES

April 19/ A DEPOSIT OF 11.84 TONNES INTO THE GLD/INVENTORY RESTS AT 860.76 TONNES

April 18/no changes at the GLD/Inventory remains at 848.92 tonnes

April 17/no changes at the GLD/Inventory remains at 848.92 tonnes

April 13/a deposit of 6.51 tonnes into the GLD/Inventory rests at 848.92 tonnes

this no doubt is a paper deposit/

APRIL 12/no changes in gold inventory at the GLD/Inventory rests at 842.41 tonnes

April 11/a huge deposit of 4.12 tonnes into inventory/Inventory rests at 842.41 tonnes

this would no doubt be a paper gold entry. It would be difficult to find that amount of physical gold.

April 10/1.77 tonnes added into inventory at the GLD/inventory rests at 838.29 tonnes

April 7/a small withdrawal of .28 tonnes from the GLD/Inventory rests at 836.49 tonnes

April 6/no change in gold tonnage at the GLD/Inventory rests at 836.77 tonnes

April 5/no change in gold tonnage at the GLD/Inventory rests at 836.77 tonnes

April 4/no change in gold tonnage at the GLD/Inventory rests at 836.77 tonnes

April 3.2017: a huge deposit of 4.45 tonnes of gold into the GLD/Inventory rests at 836.77 tonnnes

March 31/another withdrawal of 1.19 tonnes of gold inventory fro the GLD/this inventory would no doubt be heading for Shanghai/GLD inventory: 822.32 tonnes

March 30/no changes in gold inventory at the GLD/Inventory rests at 833.51 tonnes

March 29/a withdrawal of 1.78 tonnes of gold out of the GLD/Inventory rests tongith at 833.51 tonnes

March 28/this is good!! A deposit of 2.67 tonnes of gold into the GLD/Inventory rests at 835.29 tonnes.

March 27/no changes in gold inventory at the GLD/Inventory rests at 832.62 tonnes

March 24/another withdrawal of 1.78 tonnes from the GLD/Inventory rests at 832.62 tonnes

March 23/no change in gold inventory at the GLD/Inventory rests at 834.40 tonnes

March 22/no changes in gold inventory at the GLD/Inventory rests at 834.40 tonnes

March 21/a deposit of 4.15 tonnes of gold into the GLD/Inventory rests at 834.40 tonnes

March 20/WE HAD A MASSIVE 6.81 TONNE WITHDRAWAL FROM THE GLD/INVENTORY RESTS AT 830.25 TONNES/THIS GOLD MUST BE ON ITS WAY TO SHANGHAI.  WITH GOLD RISING THESE PAST FEW DAYS, IT MAYS NO SENSE WHATSOEVER ON GOLD LIQUIDATION.

March 17/a huge withdrawal of 2.37 tonnes from the GLD/Inventory rests at 837.06 tonnes

March 16/no changes in gold inventory at the GLD/Inventory rests at 839.43 tonnes

March 15/ANOTHER HUGE DEPOSIT OF 4.44 TONNES/inventory rests at 839.43 tonnes

March 14/strange they whack gold and yet the GLD adds 2.93 tonnes of gold./inventory rests at 834.99 tonnes

March 13/a deposit of 6.78 tonnes of gold into the GLD/Inventory rests at 832.03 tonnes

March 10/ a withdrawal of 4.886 tonnes from the GLD/Inventory rests at 830.25

this tonnage no doubt is off to Shanghai

March 9/a withdrawal of 2.67 tonnes from the GLD/Inventory rests at 834.10

March 8/no change in gold inventory at the GLD/inventory rests at 836.77 tones

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
April 27 /2017/ Inventory rests tonight at 853.36 tonnes
*IN LAST 139 TRADING DAYS: 94.77 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 82 TRADING DAYS: A NET  32,66 TONNES HAVE NOW BEEN ADDED INTO GLD INVENTORY.
*FROM FEB 1/2017: A NET  58.00 TONNES HAVE BEEN ADDED.

end

Now the SLV Inventory

April 27.2017/Strange!! no change in inventory at the SLV/Inventory remains at 330.283 million oz  (no liquidation???)

APRIL 26/2017/another huge deposit of 2.934 million oz into the SLV/Inventory rests at 330.283 million oz

April 25/a huge deposit of 1.98 million of into inventory/inventory rests at 327.349 million oz/

April 24/no changes in inventory at the SLV/Inventory rests at 325.361 million oz/

April 21/A WITHDRAWAL OF 719,000 OZ OF SILVER AT THE SLV/INVENTORY RESTS AT 325.361 MILLION OZ/

APRIL 20/NO CHANGES IN INVENTORY AT THE SLV/INVENTORY RESTS AT 326.308 MILLION OZ

April 19/a withdrawal of 1.893 million oz/inventory rests at 326.308 million oz/

April 18/no changes in inventory at the SLV/Inventory rests at 328.201 million oz

April 17/no changes in inventory at the SLV/Inventory rests at 328.201 million oz

April 13/no changes in inventory at the SLV/Inventory rests at 328.201 million oz

April 12/no changes in inventory at the SLV/Inventory rests at 328.201 million oz/

April 11/a paper deposit of 11.131 million oz into the SLV/no doubt yesterday’s entry of a withdrawal of 11.231 million oz was in error/328.201 million oz

April 10/ a paper withdrawal of 11.231 million oz of silver from the SLV and this silver was used in the raid today. Inventory rests at 317.231 million oz

April 7./ a withdrawal of 947,000 oz of silver from the SLV/Inventory rests at 328.201 million oz.

April 6/a tiny withdrawal of 136,000 oz of silver from the SLV/Inventory rests at 329.148 million oz

April 5/ a withdrawal of 1.042 million oz from the SLV/Inventory rests at 329.284 million oz

April 4/no change in inventory at the SLV/Inventory rests at 330.326 million oz/

April 3.2017; a withdrawal of 568,000 oz from the SLV/Inventory rests at 330.326

million oz/

March 31/no change in inventory at the SLV/Inventory rests at the SLV/Inventory rests at 330.894 million oz/
March 30/a huge withdrawal of 2.746 million oz from the SLV/inventory rests at 330.894 million oz/
March 29/a deposit of 1.136 million oz into the SLV/Inventory rests at 333.640 million oz
March 28/no changes in inventory at the SLV/Inventory rests at 332.504 million oz/
March 27/no changes in inventory at the SLV/Inventory rests at 332.504 million oz/
March 24/no change in inventory at the SLV/Inventory rests at 332.504 million oz/
March 23/no change in inventory at the SLV/Inventory rests at 332.504 million oz
March 22/no change in inventory at the SLV/Inventory rests at 332.504 million oz
March 21/no change in inventory at the SLV/Inventory rests at 332.504 million oz/
March 20/a gain of 1.232 million oz of silver into the SLV/inventory rests at 332.272 million oz/
March 17/no change in silver inventory/SLV inventory rests at 331.272 million oz
March 16/no changes in silver inventory/SLV inventory rests at 331.272 million oz
March 15/no change in silver inventory/SLV inventory rests at 331.272 million oz
March 14/ a deposit of 1.136 million oz of inventory into the SLV/Inventory rests at 331.272 million oz
March 13/no change in silver inventory at the SLV/Inventory rests at 330.136 million oz.
March 10/no change in silver inventory at the SLV/Inventory rests at 330.136 million oz/
March 9/another big withdrawal of 1.137 million oz from the SLV/Inventory rests at 330.136 million oz/
March 8/a big change; a withdrawal  of 1.515 million oz from the SLV/Inventory rests at 331.273 million oz/
April 27.2017: Inventory 330.283  million oz
 end

Major gold/silver trading/commentaries for THURSDAY

GOLDCORE/BLOG/MARK O’BYRNE.

Last month 192 tonnes were withdrawn (equals demand) for gold from mainland China. This equates to around 46.8 tonnes per week which is great.  Slowly but surely China is draining the west’s gold

Trump 100, Margin Debt Stock Bubble and Gold

– Stocks and the dollar look vulnerable due to Trump’s policies, America’s civil war politics and economic vulnerability
– Stock bubble on margin debt – ‘Powerful time bomb’
– “There is no alternative” to stock bubble? Gold?
– Bank Of America sets a date for the market’s “Great Fall”
– Even uber bull Cramer compares 2000 dotcom bubble bust to today
– Gold to stay elevated on safe haven demand – Economist
– Gold’s tempered climb makes gains more ‘sustainable’

Trump’s first 100 days in office have been a whirlwind but so far the ‘Trump Trade’ of being long stocks has worked for investors and speculators. Will markets continue to be so forgiving of the many foreign and domestic policy failures including the failure to repeal ‘Obamacare’?

It is possible but we think it unlikely as many stock and bond markets, particularly U.S. markets, are now priced for close to perfection – in a far from perfect, massively indebted, volatile financial world.

So far during his Presidency, markets have remained high on the cocaine of massive monetary stimulus and still near o%, ultra low interest rates and record margin debt.

There remain hopes of a further “Trump bump” from aggressive fiscal easing and deregulation and this and increasing “irrational exuberance” has seen the S&P 500 move back towards record territory, driven by increasingly bubble like technology stocks and a Nasdaq at all time record highs above 6,000.

The smart money continues to be be concerned about the bubbles that continue to inflate. Risk appetite is near record highs and even bearish news is greeted as a buying opportunity. The mantra is ‘TINA’ – ‘there is no alternative’ to stocks and bonds.

The obvious alternative in these uncertain and volatile times is a diversification into gold. A very similar mantra was heard in 1999 and 2007 and this is typical of bubbles. The obvious alternative in 1999 and 2007 was a diversification into gold.

Our advice is that, a la 1999 and 2007, it is time to become more risk averse and become more rigorous in your asset allocation. Our clients and more risk aware and averse investors are slowly and prudently placing themselves besides the fire exit and reducing allocations to stocks and bonds and increasing allocations to cash and gold.

Wolf Richter of the Wolf Street blog says the market “sits blithely on a powerful time bomb” and “no one knows the full magnitude, but it’s huge.” The time bomb he’s referring to is the explosive growth of margin debt (see chart above), a trend that usually eventually leads to a market crash or at the very least a severe market correction.

The question is when and from what levels.

Stock market margin debt, as reported by the NYSE, has now surged to a record high of $528 billion. That’s not including loads of unreported margin, or “shadow margin,” that Richter says could put the total figure somewhere near $800 billion.

“Margin debt is in an uncanny relationship with the stock market … It soars when stocks soar and crashes when stocks crash. They feed on each other.”

Clearly, the stock market has become crazy leveraged. And, also clearly, that often leads to big losses when it starts to fall apart.

“Margin debt … has the unnerving habit of peaking right around the time the bubble turns into a selloff … While it’s a terrible predictor of a crash — no one knows if February was the peak or just another stage on the way to an even more dazzling peak — it is associated with enormous risks.”

Quite.

In this context we believe, like Bank of America, that the stock market may be set for a “Great Fall” and that gold will begin to outperform and build on the 10% gain in 2016 and 10% gain YTD 2017 when this happens and risk aversion returns as it inevtiably does.

Even uber stock market and America bull, Jim Cramer of CNBC compares the 2000 dotcom bubble bust to today. Cramer has advocated diversifying into gold.

Gold’s 10% gain year to date in 2017 is a “tempered climb” which makes the gains very ‘sustainable’ according to State Street’s Milling-Stanley.

Gold is likely to stay elevated on safe haven demand according to most gold analysts including the economist Barnabas Gan of Singapore Bank OCBC, as reported by Frank Holmes.

It is hard to argue with Bank of America, Cramer, Milling-Stanley and Barnabas Gan on this one.

end

 

All of the major mining companies have had terrible trouble as mining costs increased and production curtailed.

Agnico Eagle seems to be the only guys out there that are holding their own in this terrible environment

They will be producing 1.57 million oz this yr and the earnings this quarter 33 cents non GAAP or 28 cents GAAP

 


Agnico Eagle Reports First Quarter 2017 Results; Strong Operational Performance Continues; Full Year Production Guidance Increased; Canadian Malartic Extension Receives Government Approval; Exploration Drilling Yields Favourable Results at Amaruq

April 27, 2017

Stock Symbol: AEM (NYSE and TSX)
(All amounts expressed in U.S. dollars unless otherwise noted)

TORONTO, April 27, 2017 /PRNewswire/ – Agnico Eagle Mines Limited (NYSE:AEM, TSX:AEM) (“Agnico Eagle” or the “Company”) today reported quarterly net income of $76.0 million, or $0.33 per share, for the first quarter of 2017.  This result includes non-cash foreign currency translation gains on deferred tax liabilities of $7.9 million ($0.03 per share), non-recurring gains of $3.5 million ($0.02 per share), unrealized gains on financial instruments of $2.8 million ($0.01 per share), various mark-to-market and other adjustment losses of $1.4 million ($0.01 per share) and non-cash foreign currency translation losses of $0.9 million (nil per share).  Excluding these items would result in adjusted net income1of $64.1 million or $0.28 per share for the first quarter of 2017.  In the first quarter of 2016, the Company reported net income of $27.8 million or $0.13 per share.

Not included in the first quarter of 2017 adjusted net income above is non-cash stock option expense of $7.6 million ($0.03 per share).

In the first quarter of 2017, cash provided by operating activities increased by greater than 50% to $222.6 million ($224.7 million before changes in non-cash components of working capital) compared with cash provided by operating activities of $145.7 million in the first quarter of 2016 ($167.5 million before changes in non-cash components of working capital).  The increase in cash provided by operating activities before changes in working capital during the current period was mainly due to a combination of higher gold sales volumes and realized prices (approximately 7% and 3%, respectively).

_________________________________

1 Adjusted net income is a Non-GAAP measure. For a discussion regarding the Company’s use of non-GAAP measures, please see “Note Regarding Certain Measures of Performance”.

 

“Operationally, 2017 has started strongly with solid performance on both the production and cost fronts.  Higher gold production at lower costs has resulted in stronger cash flow generation and has allowed us to increase our production guidance for the year”, said Sean Boyd, Agnico Eagle’s Chief Executive Officer.  “In the first quarter we also made very good progress at several of our growth projects with Meliadine progressing as expected, the Canadian Malartic extension receiving government approval and the Goldex Deep project ahead of schedule and under budget”, added Mr. Boyd.

First Quarter 2017 highlights include:

  • Strong production and cost performance continue – Payable gold production2in the first quarter of 2017 was 418,216 ounces of gold at production costs per ounce of $578, total cash costs3per ounce of $539 and all-in sustaining costs per ounce4(“AISC”) of $741
  • Full year production guidance increased – Production is now expected to exceed 1.57 million ounces compared to previous guidance of 1.55 million ounces. The increase reflects the extension of the mine life at Lapa to the end of the second quarter of 2017
  • Canadian Malartic Extension project receives Government of Quebec approval – Production activities at the project are currently forecast to begin in late 2019, subject to obtaining ancillary certificates of authorization and the progress of the road diversion
  • Goldex Deep 1 production expected to come in ahead of schedule and under budget – At the end of the first quarter of 2017 construction was 75% complete, while mine infrastructure development was 100% complete. Deep 1 is now expected to start ramping up production in the third quarter of 2017, approximately one quarter ahead of schedule. Production guidance at Goldex is unchanged at this time but will be reviewed next quarter
  • Exploration drilling at Amaruq extends and infills Whale Tail Deposit to the west and infills V Zone – Recent drilling indicates the potential to increase the depth of the western part of the Whale Tail pit, and expand the Whale Tail pit farther to the west. An infill drill program in the near-surface portion of the V Zone has confirmed high gold grades in multiple lenses
  • Meliadine project on schedule and budget – Underground development is 5% above plan and engineering was 67% complete at the end of March 2017. Construction activities are progressing well with the concrete batch plant being commissioned and pile installation restarted in March. Full camp facilities are expected to be completed in May ahead of the barge season
  • A quarterly dividend of $0.10 per share was declared

end

 

Seeking alpha on Agnico eagle results;

 

Agnico Eagle beats by $0.17, beats on revenue

Apr. 27, 2017 5:04 PM ET|About: Agnico Eagle Mines Limited (AEM)|By: , SA News Editor

Agnico Eagle (NYSE:AEM): Q1 EPS of $0.28 beats by $0.17.

Revenue of $547.5M (+11.6% Y/Y) beats by $35.7M.

Press Release

end

 

Your early THURSDAY 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 WEAKER  6.8942(   DEVALUATION SOUTHBOUND   /OFFSHORE YUAN MOVES WEAKER TO ONSHORE AT   6.9045/ Shanghai bourse up 11.34 POINTS OR 0.36%   / HANG SANG CLOSED UP 120.05 POINTS OR 0.49%

2. Nikkei closed DOWN 37.56 POINTS OR 0.19%   /USA: YEN RISES TO 111.37

3. Europe stocks opened IN THE RED        ( /USA dollar index FALLS TO  98.99/Euro DOWN to 1.0898

3b Japan 10 year bond yield: RISES TO   +.023%/     !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 111.37/ 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::  49.09 and Brent: 51.24

3f Gold DOWN/Yen DOWN

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund FALLS TO  +.350%/Italian 10 yr bond yield UP  to 2.304%    

3j Greek 10 year bond yield FALLS to  : 6.41%   

3k Gold at $1265.40/silver $17.45 (8:15 am est)   SILVER ABOVE  RESISTANCE AT $18.50 

3l USA vs Russian rouble; (Russian rouble UP 39/100 in  roubles/dollar) 56.73-

3m oil into the 49 dollar handle for WTI and 51 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 SMALL DEVALUATION SOUTHBOUND 

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 111.37 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  .9933 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0825 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/LOWER PARLIAMENT APPROVES BREXIT COMMENCEMENT/ARTICLE 50 COMMENCES MARCH 29/2017 

3r the 10 Year German bund now POSITIVE territory with the 10 year FALLS to  +.350%

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 2.307% early this morning. Thirty year rate  at 2.967% /POLICY ERROR)GETTING DANGEROUSLY HIGH

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

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

Stocks Dazed After Trump NAFTA Flop, Tax Plan Disappointment; ECB Looms

European shares are lower, pressured by disappointing results by Deutsche Bank and ending a six-session gain, as Asian equities and S&P futures were little changed after a record-setting rally in world stocks which pushed the MSCI World index to over $50 trillion yesterday, fizzled after Trump released unconvincing tax cut plans prompting traders to “sell the news” while caution set in as the ECB met.

Markets were disappointed after Trump’s plans to slash company tax rates to 15 percent from the current 35 percent and 39.6 percent for small firms offered no details on how they would be paid for. Billed beforehand as the biggest tax cut in history, it amounted to little more than a one-page plan and fueled the suspicion that it could run into opposition from U.S. lawmakers worried about increasing the country’s debt levels.

“There was virtually no new information, just as expected. He was essentially repeating his campaign promises,” said Tomoaki Shishido, senior fixed income strategist at Nomura Securities.

In Europe, key markets traded as much as 0.7% lower as traders pulled back after six days of unbroken gains fueled by relief at the outcome of the first round of France’s presidential election and encouraging earnings and economic data. As Reuters observes “Asia felt groggy too” despite the BOJ offering its most upbeat economic assessment in nine years but Asia-Pacific shares ended flat a day after hitting their highest in almost two years.The yen slipped as the Bank of Japan kept its stimulus policies unchanged.

Deutsche Bank shares fell as much as 3.5 percent even as its first-quarter net profit more than doubled following a rebound in bond trading. It shares have nearly doubled though after worries about its future late last year. Elsewhere, upbeat results from the likes of SKF, Bayer and Subsea 7, companies closely geared to economic growth, were cheered as more investors piled into the European recovery story.

For currency traders, it was a session full of drama as the Mexican peso and Canadian dollar jumped, reversing earlier declines, after the White House said it won’t immediately terminate participation in the North American Free Trade Agreement. As reported previously, Trump’s top advisers have been embroiled in a debate over how aggressively to proceed on reshaping U.S. participation in Nafta, with hard-liners favoring a threatened withdrawal as soon as this week and others advocating for a more measured approach to reopening negotiations with Canada and Mexico. Elsewhere in FX, a surprise move by Sweden to expand its stimulus program pushed the crown down sharply.

The focus now turns to the ECB and what its head Mario Draghi and his colleagues have made of the recent improvement in euro zone economic data. The bank is not expected to make any changes to its record low interest rates or mass-stimulus program, so market reaction to this meeting may hinge on just a few crucial words (see our ECB preview here).

“We would expect the commentary to remain relatively upbeat on the growth outlook,” Mike Bell, global market strategist at JPMorgan Asset Management said in a note. He expects the ECB to wait until January to begin withdrawing stimulus. “Despite the result of the first round of the French election soothing market fears of potential euro disintegration risk we still expect this week’s ECB meeting to be too early to signal any meaningful shift in policy.”  However, “it is possible that the ECB will remove the language stating that the risks (to the economy) “remain tilted to the downside,” Bell added.

Euro zone government bond yields nudged up along with the euro which dropped sharply below 1.0900 having been as high as $1.0950 this week after pro-EU centrist Emmanuel Macron topped the first round vote in France.

Investors are searching for fresh impetus after an underwhelming tax cut plan from U.S. President Donald Trump. The Nafta statement emerged as a distraction for the currency market, while in the bond market, the next flashpoint will be the tone of the European Central Bank’s meeting Wednesday. Emmanuel Macron’s ascent in the French election blunted euroskepticism, creating room for policy makers to chart out their stimulus exit plan.

China’s growth accelerated at the fastest pace since mid-2015 in the January-March quarter, while South Korea on Thursday also reported stronger than expected first-quarter growth, fueled by improving global demand.

Among commodities, industrial metals steadied though oil prices dipped again on concerns about globally bloated markets[O/R]. Brent futures dropped to $51.60 per barrel, down 22 cents, or 0.42 percent, from their last close. Brent is almost 9 percent below its April peak. The dollar, meanwhile, slipped to 111.23 yen from near a one-month high of 111.78 yen scored earlier on Wednesday.

Economic data include durable goods orders, initial jobless claims. Alphabet, Microsoft, Amazon and AbbVie are among companies scheduled to publish results.

Global Market Snapshot

  • S&P 500 futures are unchanged to 2,383.
  • STOXX Europe 600 down 0.45% to 387.00
  • MXAP unchanged at 149.33
  • MXAPJ down 0.03% to 487.46
  • Nikkei down 0.2% to 19,251.87
  • Topix down 0.05% to 1,536.67
  • Hang Seng Index up 0.5% to 24,698.48
  • Shanghai Composite up 0.4% to 3,152.19
  • Sensex up 0.01% to 30,135.83
  • Australia S&P/ASX 200 up 0.2% to 5,921.48
  • Kospi up 0.07% to 2,209.46
  • German 10Y yield unchanged at 0.353%
  • Euro up 0.2% to 1.0920 per US$
  • Italian 10Y yield rose 4.4 bps to 2.016%
  • Spanish 10Y yield unchanged at 1.7%
  • Brent Futures down 1% to $51.29/bbl
  • Gold spot down 0.4% to $1,264.34
  • U.S. Dollar Index down 0.2% to 98.87

Top Overnight News from Bloomberg

  • Trump Rules Out Swift Nafta Withdrawal in Favor of Renegotiation
  • Trump’s Corporate Tax Rewrite Faces Major Obstacle: Its Cost
  • Samsung Gives Activist Elliott Concessions But Not Restructuring
  • World’s Most Indebted Developer Battles Short-Sellers Again
  • China Aims to Reach Airworthiness Pacts With U.S., EU This Year
  • Chinese Coal Miner Said to Vie for Singapore Mobile Carrier M1
  • Oil Declines as Investors Weigh U.S. Output Against Stockpiles
  • Draghi Has History Lesson to Tell in ECB’s Exit Discussion
  • New Cholesterol Drug Falls Short as Sales Driver for Amgen
  • BOJ Cuts Inflation Forecast While Keeping Stimulus Unchanged
  • STMicro Delays Succession as Apple, Cars Boost Chip Demand
  • Bayer Raises Profit Outlook on Chemicals, Crops Rebound

Asian equity markets traded mixed following the similar lead from Wall St. where the announcement of Trump’s tax plans left much to be desired and failed to provide the impetus many had hoped for. As such, mild weakness was seen in Nikkei 225 (-0.2%) with participants also uninspired following a mundane BoJ policy decision, while ASX 200 (+0.2%) was resilient as strength in financials offset losses across commodity-related sectors. Shanghai Comp. (+0.4%) and Hang Seng (+0.5%) benefited from encouraging Chinese Industrial Profits which surged 23.8% Y/Y last month. Price action in 10yr JGBs was also subdued as the BoJ provided no surprises, while a cautious tone in stocks only resulted to minimal support for the Jun’17 contract. BoJ maintained its QQE with yield curve control policy and kept NIRP at -0.10% as expected. BoJ raised its economic assessment and stated that Japan’s economy is turning towards moderate expansion. BoJ also said Japan is likely to see inflation hit 2% target around fiscal 2018, although added that momentum towards target is lacking and that risks for economy and prices are tilted to the downside.

Top Asian News

  • Mizuho Sec. Buys 8.59% of Seibu, Says It Will Sell Immediately
  • South Korea’s Economy Rebounds as Exports, Investment Improve
  • China to Step Up Measures Preventing Financial Risks: PBOC
  • Nomura Returns to Profit on Trading, Overseas Recovery

This morning has seen European earnings crank up a notch with plenty of large caps reporting including the likes of Deutsche Bank who stated that profits rose 143% Y/Y, however shares are trading lower as the bank announced a 9% fall in revenue. The broad tone in Europe in negative following the soft lead from their US and Asian counterparts with investors seemingly disappointed by Trump’s tax plan announcement. While the BoJ also stuck to the script by keeping all policy tools unchanged, as expected. In credit markets, price action has been somewhat tame with Bund yields a touch lower by 0.5bps, while many investors will be awaiting the ECB’s rate decision to guide price action. Additionally, as we approach the end of the month, Citi note that EGB’s are set to benefit from moderate month-end extension buying needs, while Gilts will only see a very marginal extension.

Top European News

  • Deutsche Bank Return to Growth Delayed as Trading Trails
  • Gazprom Profit Jumps on Currency Gain, Exports to Europe
  • U.K. Regrets Brexit for First Time Since Referendum, Poll Says
  • Switzerland March Watch Exports Rose 7.5% Y/Y
  • Total’s Profit Beats Estimates as French Giant Plans Growth
  • Nordea CEO Says Swedish HQ Exit Highly Likely Unless Rules Eased
  • Dijsselbloem Says He’s Confident of Greek-Aid Deal ‘Very Soon’
  • Italy Manufacturing Confidence Rises to Highest Since Early 2008
  • U.K. Seen Benefiting From Lower Cost of Offshore Wind in Auction

In currencies, it was a busy session so far, with the Bloomberg Dollar Spot Index was steady as of 10:13 a.m. in London, after increasing 0.3 percent on Wednesday. The Mexican peso jumped 0.8 percent after tumbling 1.7 percent on Wednesday. The Canadian dollar rose 0.2 percent, after a four-day selloff. The yen slid 0.3 percent to 111.36 per dollar, bringing its weekly loss to 2 percent. The euro was little changed at $1.0903, while the pound strengthened 0.4 percent. It will likely be a just as volatile session ahead as the market has ‘set’ some expectations from the ECB press conference later today. Early in the week, ‘source’ stories have suggested the governing council may take a less dovish stance (not hawkish as some have suggested), in preparation for some policy tweaking later on in the year. The EUR has adjusted higher in this respect, but clearly 1.0950 was a step too far, and we have held off this level this morning after a brief upturn. Back under 1.0900, buyers anticipated ahead of 1.0850, but the larger orders lie in the mid 1.0700’s, if not a little higher. A good morning for GBP as the Cable rate has put in another test on 1.2920 resistance higher up. We usually look to highlight resistance areas rather than levels, but in this case, this one data point looks fairly solid. An eventual breach is likely, but once the ECB trade is out of the way, we will watch out for more month end demand to kick in. EUR/GBP has slipped under the 0.8450 mark this morning, but with very little momentum. CAD has weakened again despite the Trump withdrawal of his threat to abandon NAFTA. In the wake of meeting hits counterparts in Canada and Mexico, the president has softened his tone — again — and this may have wider implications on his future remarks, but we will consider these points later. For now, USD/CAD has retested 1.3600, but held. This was a tech based re-push higher from the 1.3525-30 support, but lower levels may be a little more vulnerable given extended CAD levels.

In commodities, oil prices have pulled back in the wake of the EIA rally seen yesterday, with the drawdown in Crude inventories more than double what was expected. However, WTI met a wall of selling interest just in front of USD 50.00, and we are back at the lows seen ahead of the report. We continue to hear talk from both OPEC and non OPEC members that they are open to an extension to the production cuts, but this is doing little to support price. Marginal movement seen in base metals as the risk mood largely dictates from here, with little impetus offered from the initial tax plans reported by the Trump administration last night. Precious metals remain heavy but Gold hold off USD 1250.00 as Silver has now slipped under USD17.50.

It’s a busy session , with preliminary March data due for durable goods orders (+1.3% expected), capital goods orders (+0.5% expected) and wholesale inventories (+0.2%). We will also see March numbers for the advance goods trade balance (-$65.2bn expected; -$64.8bn previous), and pending home sales (-1.0% expected; +5.5% previous). We also get the initial and continuing jobless claims numbers, and the Kansas City Fed’s manufacturing survey for April (17 expected; 20 previous) . Earnings season also continues as Alphabet, Amazon, Intel, Ford Motor and Microsoft are due to report today amongst other

US Event Calendar

  • 8:30am: Advance Goods Trade Balance, est. $65.2b deficit, prior $64.8b deficit, revised $63.9b deficit
  • 8:30am: Wholesale Inventories MoM, est. 0.2%, prior 0.4%; Retail Inventories MoM, prior 0.4%
  • 8:30am: Durable Goods Orders, est. 1.3%, prior 1.8%; Durables Ex Transportation, est. 0.4%, prior 0.5%; Cap Goods Orders Nondef Ex Air, est. 0.5%, prior -0.1%
  • 8:30am: Initial Jobless Claims, est. 245,000, prior 244,000; Continuing Claims, est. 2.01m, prior 1.98m
  • 9:45am: Bloomberg Consumer Comfort, prior 49.9
  • 10am: Pending Home Sales MoM, est. -1.0%, prior 5.5%; Pending Home Sales NSA YoY, prior -2.4%
  • 11am: Kansas City Fed Manf. Activity, est. 16.5, prior 20

DB’s Jim Reid concludes the overnight wrap

The Trump administration has much loftier ambitions fiscally and yesterday we received the long awaited tax principles that will start negotiations. It mirrors much of the campaign promises albeit with differences including one repealing a code allowing individuals to deduct state and local taxes from their reported income. This will apparently hit high tax states like California, NJ and NY and may cause problems for Republicans there. Elsewhere the highlights of the plan are reducing 7 tax brackets to 3 (10%, 25%, 35%) and cutting the top rate from 39.6%, a 15% business rate tax, a territorial tax to “leveling the playing field” for US companies and a onetime repatriation tax. However details remain vague in this one-page document, especially on the costing side and as we know unless its budget neutral (which it’s hard to see at this stage) then all we may get is a temporary tax cut for a decade. However such a temporary cut might still boost short-term activity but at what point would worries about the deficit kick in (assuming blockbuster growth didn’t offset it) and at what point would we debate Ricardian equivalence. Maybe not for a while but as we’ll see below markets were left a little disappointed after all the anticipation. If we’re right in our long held belief that helicopter money will become more normal across the globe over say 3-10 years maybe we need a big unfunded budget expansion to set the wheels in motion. We definitely think 2016 marked an inflection point in the balance between global monetary and fiscal policy even if the journey will be full of bumps.

On a very busy day in Washington we also saw speculation from Politico that Mr Trump was close to scrapping Nafta but the same organisation claiming that a White House compromise on Obamacare government payments is reducing the risk of a shutdown on Friday. It really was hard to keep up. Overnight we’ve learnt from the White House that Mr Trump won’t immediately abandon Nafta after speaking with the leaders of Mexico and Canada and agreeing to renegotiate the accord “to the benefit of all three countries”.

The S&P 500 gave up gains of around half a percent to close -0.05% with the reversal seemingly coinciding with the abandon Nafta story, although a lack of tax reform detail didn’t help. Earlier European equities (STOXX +0.5%) continued to gain, with the STOXX now posting its sixth straight day of gains and hitting its highest levels since August 2015. However Eurozone banks finally ran out of steam with the index dropping by -0.3% after five consecutive days of positive returns. The CAC (+0.2%) and DAX (+0.1%) edged higher on the day.

Over in government bond markets we saw the US yield curve flatten somewhat as 2Y yields fell 1bp while the 10Y and 30Y points were about -3bp lower after the late sell-off in stocks, and thus ending a 5 day climb in yields. European bond markets saw Bund and OAT yields drop across all maturities, with the 10Y points falling by -3bps and -1bp respectively. However BTP yields rose across the curve with 10Y yields up by +5bps on the day.

Asian equities have retreated after a 5 day rally with the Nikkei -0.2%, the Hang Seng flat and Shanghai Comp -0.55% as we go to print. The BOJ meeting has just ended and they’ve kept their policy settings unchanged but have lowered their inflation forecast which backs up comments last week from Governor Kuroda that accommodative policies and asset purchases will continue for some time on low inflation. China is weak on continued concerns of governmental crackdown in financial markets. Elsewhere overnight the dollar has fallen with the Mexican peso and Canadian dollar reversing the declines after the initial Nafta fears. There was no market moving data out yesterday. Over in Europe French consumer confidence for April came in at 100 as expected, unchanged from the month before. There was no data of note out of the US.

It’s a busier day ahead today and the key event in Europe will be the ECB rate decision around midday with Draghi due to speak afterwards. The consensus remains that there will be no change of policy rates, and DB rates strategist Abhishek Singhania reiterated this view in a note yesterday. He noted that despite the market friendly outcome of the first round of the French presidential election the ECB is unlikely to indicate any change in its policy stance as yet. He argues that (from the ECB’s perspective) there is still limited evidence of self-sustaining improvements in underlying inflation – the recent fluctuations in  Eurozone core inflation due to the timing of Easter could make the ECB wait for inflation to settle down before being able to decisively interpret the recent dynamics. The link to the report is as follows: https://goo.gl/dhtxQt. A reminder that the house view is for forward guidance to be adjusted in June, tapering to be pre-announced in September and a one-off deposit rate hike in December; the probability of the latter has declined but it remains the baseline. Our economists expect tapering in H1 2018 and the first refi hike around the end of 2018.

Aside from the rate decision we’ll get preliminary German CPI numbers for April (+1.9% YoY expected; +1.5% previous). In terms of other data we will get the German GfK consumer confidence survey indicator for May (9.9 expected; 9.8 previous) as well as the final Euro area consumer confidence reading for April which is not expected to be revised from the preliminary reading (-3.6).

It’s a busier session over in the US as well, with preliminary March data due for durable goods orders (+1.3% expected), capital goods orders (+0.5% expected) and wholesale inventories (+0.2%). We will also see March numbers for the advance goods trade balance (-$65.2bn expected; -$64.8bn previous), and pending home sales (-1.0% expected; +5.5% previous). We also get the initial and continuing jobless claims numbers, and the Kansas City Fed’s manufacturing survey for April (17 expected; 20 previous) . Earnings season also continues as Alphabet, Amazon, Intel, Ford Motor and Microsoft are due to report today amongst others

3. ASIAN AFFAIRS

i)Late  WEDNESDAY night/THURSDAY morning: Shanghai closed UP 11.34 POINTS OR 0.36%/ /Hang Sang CLOSED UP 120.05 POINTS OR 0.49%.  The Nikkei closed DOWN 37.56 OR 0.19% /Australia’s all ordinaires  CLOSED UP .13%/Chinese yuan (ONSHORE) closed DOWN at 6.8942/Oil DOWN to 49.09 dollars per barrel for WTI and 51.24 for Brent. Stocks in Europe  IN THE RED   ..Offshore yuan trades  6.9045 yuan to the dollar vs 6.8942 for onshore yuan. NOW  THE OFFSHORE IS MUCH WEAKER TO THE ONSHORE YUAN/ ONSHORE YUAN SLIGHTLY WEAKER (TO THE DOLLAR)  AND THE OFFSHORE YUAN ALSO MUCH WEAKER AND THIS IS COUPLED WITH THE WEAKER DOLLAR. CHINA IS NOT HAPPY

3a)THAILAND/SOUTH KOREA/NORTH KOREA

NORTH KOREA/RUSSIA

Putin warns the world that the Korean situation is deteriorating

(courtesy zerohedge)

Stocks Slump As Putin Warns Korea Situation Is “Deteriorating”

Having been unable to stage any kind of recovery from yesterday’s Trump Tax Plan disappointment, comments from Vladimir Putin that “the situation in Korea is deteriorating” urging all sides to “avoid belligerent rhetoric” along with remarks by Chuck Schumer over the short-term spending bill (to avoid government shutdown), has sparked a leg lower in US stocks…

House Democrats will oppose a short-term spending bill if Republican leaders attempt to expedite an ObamaCare repeal bill this week, Rep. Steny Hoyer (D-Md.) warned Thursday. Hoyer, the Democratic whip, spoke with House Majority Leader Kevin McCarthy (R-Calif) Thursday morning to warn him of the Democrats’ position.

The market appears to have woken up…

 

Trannies have erased all post-Macron gains…

b) REPORT ON JAPAN

Good reason for gold/silver to be down today;  Japan warns its citizens to prepare for a North Korean missile attack

(courtesy The AntiMedia.org)

Japan Warns Citizens To Prepare For North Korean Missile Attack

Via TheAntiMedia.org,

As the United States begins to move elements of its Terminal High Altitude Area Defense (THAAD) system to a deployment site in South Korea earlier than expected – in the name of defending against the “evil North Korea” of the mainstream narrative – Japan is warning its citizens they’ll have little time to find safety if Kim Jong-un launches an attack.

From the Washington Post:

“North Korea might be talking about building missiles that can reach the United States, but Kim Jong-un’s regime already has lots of missiles that can reach Japan. So the Japanese government is preparing its citizens in case a missile comes their way — possibly with less than 10 minutes’ warning.

 

“The prime minister’s office issued new ‘actions to protect yourself’ guidelines this week, including for the first time instructions on how to respond if a North Korean ballistic missile is heading toward Japan.”

The government’s advice, essentially, is to find cover, meaning a sturdy building or structure — in itself a largely ineffectual tip, given their own guidelines admit“It is extremely difficult to be able to pinpoint missile landing areas before their launch.”

So, randomly choose the right building and you might make it.

As to after the missiles launch and the warning bells sound, one Japanese mayor wants people to understand they’ll have precious little time to act.

“A missile may not be detected as soon as it leaves the launch pad…and that could take several minutes,” said Osaka Mayor Hirofumi Yoshimura, according to The Japan Times. “Depending on the case, the warnings and alarms might only sound four or five minutes before a missile arrives.”

Just like its counterpart in the United States, the Japanese government wants its citizens to understand that the North Korean threat is real — though, apparently, there isn’t much they can do about it should Kim Jong-un choose to attack, despite what the mainstream narrative would have you believe.

*  *  *

Full Japanese Guide below…

c) REPORT ON CHINA

China steps up to the plate and tests its new weapons in retaliation to the uSA THAAD deployment of which China was visibly upset

(courtesy zero hedge)

China To Test New Weapons, Stage Live Fire Drills In Retaliation To US THAAD Deployment

Two days after the US military began to move the controversial THAAD anti-missile system into its deployment site in a South Korean golf course (over the protests of hundreds of locals who were promptly quieted when the police showed up), despite vocal protests from China which is “resolutely opposed” to the THAAD deployment and  believes such a move would destabilize the regional balance of power, China said on Thursday that it would stage live fire drills and test new weapons to protect its national security, its Defense Ministry said.

“The deployment of the THAAD anti-missile system in South Korea damages the regional strategic balance and stability. The Chinese side is resolutely opposed to this” Defense Ministry spokesman Yang Yujun told reporters on Thursday when asked about the Terminal High Altitude Area Defense system.

He also said that “China’s military will continue to carry out live-fire military exercises and test new military equipment in order to firmly safeguard national security and regional peace and stability,” he said, as quoted by Reuters.

Beijing has been an outspoken opponent of THAAD over fears it will undermine its own deterrence capabilities. In March, and editorial in the state-run Global Times newspaper said Washington should “pay the price” for the deployment of the system, which it said was “on China’s front door.”  Meanwhile, the US insists the system is for purely defensive purposes, against any potential attacks from Pyongyang. US Admiral Harry Harris told Congress on Wednesday that it “poses no threat to China.”

China disagrees.

As we reported at the time, a THAAD installation, which was moved onto a golf course in Seongji, South Korea, on Tuesday, is designed to intercept short, medium, and intermediate-range ballistic missiles during their terminal flight phase. It is equipped with long-range radar and is believed to be capable of intercepting North Korea’s intermediate-range ballistic missiles. The system will be operational in the “coming days,” according to Harris.

As Reuters further adds, the Chinese Defense Ministry’s statements come as the US continues to urge Beijing to put pressure on North Korea, as China is the country’s main economic lifeline. Referring to the increased tensions between Washington and Pyongyang on Thursday, China said it approves of a recent statement by the Trump administration which said the White House is still “open to negotiations” to achieve stability and “peaceful denuclearization” on the Korean Peninsula.

When asked about such statements, Chinese Foreign Ministry spokesman Geng Shuang said Beijing had noted that many US officials had recently made similar remarks.

“We have noted these expressions, and have noted the message conveyed in these expressions hoping to resolve the Korean nuclear issue peacefully through dialogue and consultation,” he said. “We believe this message is positive and should be affirmed.”

Earlier this week, China urged restraint from all sides of the conflict during a call with US President Donald Trump, whose administration continues to state that “all options are on the table” when it comes to North Korea.

So far, aside from engaging in a massive live-fire drill on Tursday, North Korea has abstained from any provocative moves.

end

4. EUROPEAN AFFAIRS

GERMANY/DEUTSCHE BANK

Deutsche bank tumbles as they missed on most major areas including fixed income. Global growth is just now present and the negative yields are having a devastating effect on DB’s earnings

(courtesy zerohedge)

Deutsche Bank Tumbles Most In 5 Weeks After Earnings Disappoint Across The Board

On the surface, Deutsche Bank’s results this morning came in better than expected with first quarter earnings more than doubling as Germany’s biggest bank benefited from a pick-up in market activity at the start of the year. In the three months to March, Deutsche managed to make a net profit of €575m, more than double from €236m in the same period a year earlier, when market were shaken by concerns over Deutsche’s viability, and above consensus estimates of €522m.

However, not only did revenues fall 9% to €7.3bn, largely the result of an accounting effect known as debt-valuation adjustment, or DVA, but a more careful read of the report thru explains why DB stock is down 3%, after tumbling as much as 3.9% earlier in the session – the most in 5 weeks – making it the second biggest decliner in 46-member SX7P after Popular.

As Bloomberg points out, Europe’s largest investment bank on Thursday reported an 11% increase in FICC revenue, less than half the 24% jump in the combined fixed income revenue at the five biggest U.S. investment banks. Income from dealing in stocks, which the firm has sought to expand because of its lower capital requirements, declined 10 percent while it was broadly flat at the U.S. lenders, which appear to have taken significant market share from the German banking giant.

At the securities unit, revenue from both rates and credit trading rose last quarter while foreign exchange business saw income fall from a year earlier in a “low volatility environment.” Emerging markets revenues were flat across the Latin America and central and eastern Europe, the Middle East and Africa regions. The bank said that while cash equity and equity derivatives revenue rose in the quarter from a year earlier, income from its prime finance business was “significantly lower.” That reflected higher funding costs as well as lower client balances, which have recovered compared to their level in the fourth quarter.

Analysts had expected an 18% increase in fixed-income trading and a 2.6% decline in equities trading revenue, according to the average of eight estimates. Advisory revenue was down 24 percent.

The results suggest the bank has yet to fully win back the trust of clients, including hedge funds that reduced business in the final months of last year amid concern about the lender’s capital strength. Cryan has vowed to return to “controlled growth” after misconduct charges sapped years of earnings and forced the firm to tap investors for 8 billion euros ($8.7 billion) in fresh capital this month.

Deutsche Bank recovered about half the prime brokerage balances it lost in the fourth quarter, Chief Financial Officer Marcus Schenck, who was named co-head of the investment bank last month, said in an interview. Debt-trading revenue was hit by the bank’s 2015 decision to exit from securitized trading, he said. “We’re definitely not yet firing on all cylinders,” Schenck said in the interview with Bloomberg Television, adding it takes some time for prime brokerage balances to be rebuilt when clients return.

“We are rather disappointed,” Kian Abouhossein and Amit Ranjan, analysts at JPMorgan Chase & Co., wrote in a note. “This should normally be the best quarter in terms of revenue performance and market conditions were solid.”

“Some investors will be looking critically at the debt and equity trading numbers and asking whether this shows a loss in market share,” said Philipp Haessler, an analyst at Equinet Bank AG in Frankfurt who has a buy recommendation on the shares. “But there’s some positive news in there, too, if you look at the stable capital ratio, lower underlying costs and the inflows in the asset management business.”

Citi, which had the most critical read through of Deutsche Bank’s results, said, Q1 earnings missed across all divisions except Postbank, and reiterated a sell rating on the stock. Citi also noted that statutory pretax missed estimates due to a 9% decline in revenue, while underlying pretax “also looks worse,” while noting that capital guidance is “a concern.”

Other details from the earnings report:

  • GM revenues remained weak with FICC up 14% y/y, Equity down 7%, underperforming U.S. peers
  • Corporate & Investment Bank pretax at EU489m is a 5% miss vs Citi est.
  • Private, Wealth and Commercial Clients underlying pretax of EU93m
  • Guidance for CET1 ratio to drop to ~13% by year end and for leverage ratio to remain stable at 4% is worse than Citi expected
  • CET1 ratio is 14.1% pro-forma for rights issue, leverage ratio of 4% pro-forma is the binding constraint
  • Even with AT1 issuance of EU2b and divestments, 2018 leverage ratio won’t be more than 4.3%, below the 4.5% target
  • Global Markets pretax of EU490m missed Citi est. by 16%

* * *

Finally, here is a summary of several sellside reactions to DB’s disappointing earnings, courtesy of Bloomberg”

RBC CAPITAL (sector perform)

  • Says 1Q showed no bounce back in revenue
  • That’s disapppointing given better trading environment, fact that 1Q is seasonally the strongest quarter
  • Revenue is key delta in meeting a cost of equity ROTE
  • Global Markets revenue doesn’t compare well with peers
  • Divisions were in line with RBC ests at adjusted pretax level with Global Markets 9% below consensus, CIB 7% above

JPMORGAN (neutral)

  • 1Q results were disappointing because of revenue
  • Disappointed that Deutsche is only making about 25% of JPM’s est for 2017 revenue in 1Q, would have hoped for 30%
  • Revenue decline was only partly offset by CIB provisions write-backs
  • Cost savings remain on track
  • Global Markets revenue also missed, underperformed U.S. peers

BANKHAUS LAMPE (buy)

  • 1Q results were in line
  • While revenue of EU7.3b was 9% miss vs consensus, adj. revenue was flat at EU8b and a 1% beat
  • Adj. costs of fell 5% to EU6.3b were in line with consensus
  • Pretax EU878m is 7% miss amid revamp costs of EU179m
  • Outlook is for regaining market share, CET1 to remain above 13%, litigation costs probably below 2016, LLPs below 2016

ODDO BHF (neutral) 

  • Operating results are a bit below estimates, net revenue is in line
  • Operating profit EU878m vs consensus EU938m, adj operating Profit is 21% miss
  • Global Markets performance was weaker than U.S. peers’ with 1Q revenue of EU2.6b down 6.5%
  • Fixed Income (sales & trading) revenue rose 12% vs U.S. peers up 24%
  • Equity (sales & trading) revenue fell 7.5% vs U.S. peers gain of 1.2%
  • Notes other trading income was strongly negative without much comment
  • CIB revenue from ECM+DCM+M&A up 29% vs U.S. peers up 34%

CITI (sell) 

  • Earnings missed across all divisions except Postbank
  • Statutory pretax missed estimates due to an 8% decline in revenue, while underlying pretax “also looks worse”
  • Capital guidance is “a concern”
  • Guidance for CET1 ratio to drop to ~13% by year end and for leverage ratio to remain stable at 4% is worse than Citi expected
  • CET1 ratio is 14.1% pro-forma for rights issue, leverage ratio of 4% pro-forma is the binding constraint
  • Even with AT1 issuance of EU2b and divestments, 2018 leverage ratio won’t be more than 4.3%, below the 4.5% target
  • Global Markets pretax of EU490m missed Citi est. by 16%; GM revenues remained weak with FICC up 14% y/y, Equity down 7%, underperforming U.S. peers
  • Corporate & Investment Bank pretax at EU489m is a 5% miss vs Citi est.
  • Private, Wealth and Commercial Clients underlying pretax of EU93m is significantly below Citi est. as revenue fell 5% y/y
  • Sees risk of low, single-digit downgrades to EPS consensus

NATIXIS (reduce)

  • Says while visibility on litigation has improved uncertainty remains
  • Says market reaction should be “slightly positive” to this first quarterly earnings in some time without big litigation or revamp charges
  • Says revenue miss driven by knock-on impact of narrowing of credit spreads
  • 1Q net profit EU575m beat consensus EU531m on lower taxes
  • Notes costs and loan loss provisions were lower
  • Capital situation largely unchanged with CET1 ratio at 11.9% vs end 2016’s 11.8%; given capital increase pro-forma CET1 ratio is 14.1%
  • Deutsche Bank remains “fairly cautious” on macro-economic outlook and negative impact of past disposals
  • Deutsche Bank is more optimistic on regaining market share

end

 

GREECE/MACEDONIA

The Macedonia Parliament could not elect a speak so masked men stormed parliament and stated that it was a coup

(courtesy zero hedge)

“This Is A Coup”: Masked Men Storm Macedonia Parliament – Live Feed

Supporters of the movement “For The Common Macedonia” stormed the Macedonian parliament and attacked the deputies of the parliamentary majority, following a vote for a new speaker. In addition, journalists were detained in the press center of the Parliament.

Live Feed:

The attack injured several members, including the leader of the opposition SDSM party, Zoran Zaev.

 

“This is a coup,” shouted the deputies of VMRO-DPMNE party of former Prime Minister Nikola Gruevski, reports plusinfo.mk.

BREAKING: Barricades broken through journalists attacked by masked men!

The ‘coup’ follows the Macedonian opposition leader’s calls for an end to a political deadlock that has left parliament unable to elect a speaker for three weeks. As AP reports, Zoran Zaev suggested a new speaker could be elected outside normal procedures, an idea immediately rejected by the conservative party as an attempted coup.

Macedonia has been without a government since December, when former Prime Minister Nikola Gruevski’s conservative party won elections, but without enough votes to form a government. Coalition talks broke down over ethnic Albanian demands that Albanian be recognized as an official second language. A quarter of Macedonia’s population is ethnic Albanian.

Zaev secured the cooperation of another ethnic Albanian party, giving him 69 of parliament’s 120 seats. But President Gjorge Ivanov refused to hand him the mandate to form a government.

end

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

Israel/Syria

It sure looks like the Israelis were at it again:  a massive explosion reported near the Damascus International Airport in Syria

(courtesy zero hedge)

Massive Explosion Reported Near Damascus International Airport In Syria

In what is believed, but has not been confirmed, to be an Israeli air strike, moments ago the area around the Damascus International Airport in Syria was rocked by at least one massive explosion.

Video showing the explosion in international airport

: Huge explosion reported near Damascus International Airport in Syria

Bunch of Activist Saying a Huge Explosion from the countryside Shaked . & No Info on what it was yet

A Reporter is now Saying the Sound of HUGE EXPLOSION came from Vicinity of Damascus International Airport.

If confirmed, it would be the second Israeli attack on Syria in the past week: on Sunday, Israeli forces bombed a camp for pro-government forces killed three fighters near the Golan Heights on Sunday according to AFP. Two fighters were also wounded in the attack on the Al-Fawwar camp near Quneitra in southwestern Syria, adding that it was unclear whether the damage was inflicted by an air strike or shelling.

Israel’s army declined to comment Sunday on the attack. On Friday the army said it targeted positions inside Syria in retaliation for mortar fire that hit the northern part of the Golan Heights.

Syria’s official news agency SANA said Israel had struck a Syrian army position in the province of Quneitra on the Golan plateau, “causing damage”. The Syrian government labels rebel groups and jihadists fighting the regime as “terrorists” and accuses Israel of backing them.

One thing is certain: the party behind today’s attack on Syria was not the US – otherwise CNN would be blasting it in real time – although with Russia having withdrawn half of its warplanes and with the Syrian army eager to avoid further airborne confronations, it is easy to imagine why the IDF can now enter the sovereign territory unopposed and without fear of reprisals.

end

6 .GLOBAL ISSUES

NAFTA

Trump changes his mind and will not terminate NAFTA.  The Loonie and Peso respond northbound on the news

(courtesy zero hedge)

 

Trump Changes Mind On NAFTA, Decides Not To Terminate Treaty; Loonie, Peso Soar

President Trump assured a sleepless night for currency traders when in the span of just a few hours, he appeared to change his mind on NAFTA by 180 degrees, and shortly after White House officials disclosed that the president was contemplating an executive order to exit NAFTA, perhaps in days, late on Wednesday Trump told the leaders of Canada and Mexico on Wednesday that he will not terminate the NAFTA treaty at this stage, but will move quickly to begin renegotiating it with them, a White House statement said.

The White House had been considering an executive order exiting NAFTA as early as Trump’s 100th day in office on Saturday, Politico reported n Wednesday, but there was a split among his top advisers over whether to take the step. As Reuters first reported, the White House said Trump spoke by telephone with Mexican President Enrique Pena Nieto and Canadian Prime Minister Justin Trudeau and that he would hold back from a speedy termination of NAFTA, in what was described as a “pleasant and productive” conversation.

“President Trump agreed not to terminate NAFTA at this time and the leaders agreed to proceed swiftly, according to their required internal procedures, to enable the renegotiation of the NAFTA deal to the benefit of all three countries,” a White House statement said.

“It is my privilege to bring NAFTA up to date through renegotiation. It is an honor to deal with both President Peña Nieto and Prime Minister Trudeau, and I believe that the end result will make all three countries stronger and better,” Trump was quoted as saying in the statement. During his election campaign Trump threatened to renegotiate NAFTA and in the past week complained bitterly about Canadian trade practices.

Having tumbled earlier in the day, when the news of Trump’s NAFTA pullout first emerged, both the Mexican and Canadian currencies spiked in Asian trading after Trump said the U.S. would stay in NAFTA for now. The U.S. dollar dropped as much as 0.6% against the loonie and 1% against the peso, stopping out numerous currency traders on both sides in the span of 12 hours.

“To totally abandon that agreement means that those gains are lost,” said Paul Ferley, an economist at Royal Bank of Canada.

Trump has repeatedly vowed to pull out from the 23-year-old trade pact if he is unable to renegotiate it with better terms for America. He has long accused Mexico of destroying U.S. jobs. The United States went from running a small trade surplus with Mexico in the early 1990s to a $63 billion deficit in 2016. Details about the draft executive order on NAFTA were not immediately available.

Withdrawing from NAFTA would enable him to say he delivered on one of his key campaign promises, but it could also hurt him in states that voted for him in the election, Reuters pointed out. “Mr. President, America’s corn farmers helped elect you,” the National Corn Growers Association said in a statement. “Withdrawing from NAFTA would be disastrous for American agriculture.”

The first administration source told Reuters that there were diverging opinions within the U.S. government about how to proceed and it was possible that Trump could sign the executive order before the 100-day mark of his presidency. The source noted that the administration wanted to tread carefully. “There is talk about what steps we can take to start the process of renegotiating or withdrawing from NAFTA,” this source said.

Meanwhile, Mexico had expected to start NAFTA renegotiations in August but the possible executive order could add urgency to the timeline. The Mexican government had no comment on the draft order. The country’s foreign minister said on Tuesday that Mexico would walk away from the negotiating table rather than accept a bad deal. Trump recently ramped up his criticism of Canada and this week ordered 20 percent tariffs on imports of Canadian softwood lumber, setting a tense tone as the three countries prepared to renegotiate the pact.

Canada said it was ready to come to talks on renewing NAFTA at any time. “At this moment NAFTA negotiations have not started. Canada is ready to come to the table at any time,” said Alex Lawrence, a spokesman for Canadian Foreign Minister Chrystia Freeland.

 

END

Trump explains why he flipped again on NAFTA: Both the Canadian Prime Minister (Trudeau) and the Mexican leader (Nieto) agreed to renegotiate theagreement

(courtesy zero hedge)

Trump Explains Why He Flipped On NAFTA: Canadian, Mexican Leaders Called Me To Renegotiate

In one of the most striking reversals for President Trump to date, as reported earlier, just hours after the White House said the president is contemplating terminating NAFTA before his 100th day, sending the loonie and peso crashing, Trump reversed his position and as Bloomberg put it, made a “huge U-turn” in his NAFTA stance, allowing the trade agreement to continue after he spoke with the presidents of Mexico and Canada about ways to renegotiate the accord.

“Both conversations were pleasant and productive. President Trump agreed not to terminate Nafta at this time and the leaders agreed to proceed swiftly, according to their required internal procedures, to enable the renegotiation of the Nafta deal to the benefit of all three countries,” the White House said in a statement late Wednesday. Needless to say, currency traders were turmoiling, first watching Mexico’s peso and Canada’s dollar plunged then surge after the White House’s Wednesday night announcement.

As Bloomberg added, Trump’s top advisers had been embroiled in a debate over how aggressively to proceed on reshaping U.S. participation in Nafta, with hard-liners favoring a threatened withdrawal as soon as this week and others advocating for a more measured approach to reopening negotiations with Canada and Mexico.

This morning, it appears that Trump has gotten an earful on his latest stark reversal, and as a result the president took to twitter, tweetsplaining the motives behind his move. This is what he said:

“I received calls from the President of Mexico and the Prime Minister of Canada asking to renegotiate NAFTA rather than terminate. I agreed” Trump tweeted, and in a following tweet added “subject to the fact that if we do not reach a fair deal for all, we will then terminate NAFTA.” He concluded: “Relationships are good-deal very possible!”

I received calls from the President of Mexico and the Prime Minister of Canada asking to renegotiate NAFTA rather than terminate. I agreed..

…subject to the fact that if we do not reach a fair deal for all, we will then terminate NAFTA. Relationships are good-deal very possible!

As a reminder, during his campaign, the president repeatedly bashed the trade agreement as a “disaster for our country.”

 

 

end

 

CANADA

We now know who bailed out the largest mortgage lender in Canada: it was the retired Ontario Healthcare workers union.  The mortgage portfolio was used as collateral. If house prices come down, a feel sorry for those workers.

 

(courtesy zero hedge)

Crashing Canadian Mortgage Lender Bailed-Out By 321,000 Retired Ontario Healthcare Workers

With Canada’s housing bubble popping amid the collapse of the country’s largest mortgage lender, it was no surprise that a bailout had been orchestrated, and now we know the source of the $1.5 billion ‘loan’ – 321,000 retired healthcare workers in Ontario.

As we noted yesterday, the stock of Home Capital Group cratered by over 60%, its biggest drop on record, after the company disclosed that it struck an emergency liquidity arrangement for a C$2 billion ($1.5 billion) credit line to counter evaporating deposits at terms that will leave the alternative mortgage lender unable to meet financial targets, and worse, may leave it insolvent in very short notice.

As part of this inevitable outcome, one which presages the company’s eventual disintegration and likely liquidation, Bloomberg reported that the non-binding rescue loan with an unnamed counterparty will be secured by a portfolio of mortgage loans originated by Home Trust, the Toronto-based firm said in a statement Wednesday. Home Capital shares dropped by 61% in Toronto to the lowest since 2003, dragging down other home lenders.

 

And now we know the source.

As Bloomberg reports, the Healthcare of Ontario Pension Plan (HOOPP) is the lender behind Home Capital Group’s C$2 billion loan ($1.5 billion) to shore up liquidity, citing people familiar with the matter.

The Toronto-based pension plan is said to have given the struggling Canadian mortgage lender the loan to shore up liquidity as it faces a run on deposits amid a probe by the provincial securities regulator. Home Capital has retained RBC Capital Markets and BMO Capital Markets to advise on “strategic options” after it secured the loan, according to a statement Thursday. Home Capital didn’t identify the lender.

 

HOOPP, which represents more than 321,000 healthcare workers in Ontario, was not immediately available to comment. HOOPP President and Chief Executive Officer Jim Keohane sits on Home Capital’s board and is a shareholder. Home Capital’s external spokesman Boyd Erman declined to comment.

 

The one-year credit line has a 10 percent interest rate on outstanding balances and a 2.5 percent rate on undrawn amounts, the Toronto-based lender said. The finalized agreement follows an announcement early Wednesday that Home Capital had reached a non-binding agreement in principle with an institutional investor for the loan.

And in case you are one of the 321,000 retirees who are nervous about your pension managers’ actions, don’t worry: The loan is secured by a pool of mortgages originated by Home Trust, and as everyone knows, in Canada home prices never go down.

I do not use Shaw so you are receiving this tonight.

(courtesy zerohedge)

Canada Hit By Countrywide Internet, TV And Phone Outage As Shaw Goes Dark

Tens of thousands of Canadian clients of Shaw are suffering what appears to be a nationwide loss of internet, cable and phone services. According to the outage map below, the service interruption is widespread and has impacted most Canadian metropolitan centers.

Shortly before 4pm ET, the telecom company posted to its website advising that an outage was in progress and pologizing:

“Some customers nationally may be experiencing an interruption to Internet, Television and Home Phone services. We are investigating the situation and working to restore service as quickly as possible. We apologize for any inconvenience this may cause.”

At 4:20 ET they issued an update, saying they don’t know when services will be restored.

“Our network technicians are working to restore services as quickly as possible. Currently no ETA. If we get any further information to share we will post another update. Thank you for your patience so far.”

At 4:50 ET Shaw updated that its broadband team is still working to resolve service.

\

For more information on the service interruptions, see http://bit.ly/2oBlwjJ 

Shaw customers across the country were not impressed, as can be seen by the thousands of angry tweets.

7. OIL ISSUES

Oil tumbles as the market is running out of patience with IPEC

(courtesy zerohedge)

WTI/RBOB Tumble As Market “Runs Out Of Patience With OPEC”

Just as we warned yesterday following the EIA inventory and production data release, the exuberance over the crude draw was misplaced (due to the surge in product builds and almost unprecedented refining activity along with continued resurgent oil production). Saudi imports continue to show no sign of the OPEC cuts and asone anylst noted “the market looks like it wants to turn lower, maybe it has run out patience waiting for OPEC”

As a reminder, U.S. crude inventories declined 3.6m bbl in EIA data Wednesday, but gasoline, distillate stockpiles grew by a combined 6m bbl, and U.S. production also grew for 10th week. 

As Bloomberg reports, WTI, Brent deepen declines and erase Wednesday’s post-EIA rally as market’s focus switches to big builds in gasoline and distillate inventories, rather than the crude draw.

“The gasoline numbers took the edge off the headline,” in EIA data Wednesday, says Jasper Lawler, senior market analyst at London Capital Group. “In the last couple of days we’ve had two afternoon attempts to reverse the downtrend and both have heavily been sold into.”

 

“The market looks like it wants to turn lower, maybe it has run out patience waiting for OPEC”

The result is clear…

 

In context, this is a major problem for OPEC hopers…

Energy ministers from Saudi Arabia, Venezuela plan to meet with their Russian counterpart to discuss extending supply cuts – we suspect it will be too little, too late, as we noted previously, OPEC has lost the confidence of its hedge-fund-reinforcing backstop.

end

8. EMERGING MARKETS

 

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

Euro/USA   1.0898 DOWN .0010/REACTING TO  + huge Deutsche bank problems + USA election:/TRUMP HEALTH CARE DEFEAT//ITALIAN REFERENDUM DEFEAT/AND NOW ECB TAPERING BOND PURCHASES/ /USA RAISING INTEREST RATES/EUROPE BOURSES IN THE RED

USA/JAPAN YEN 111.37 UP 0.197(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 1.2894 UP .0047 (Brexit  March 29/ 2017/ARTICLE 50 SIGNED

USA/CAN 1.3564 DOWN .0054 (CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/TRUMP INITIATES LUMBER TARIFFS ON CANADA)

Early THIS THURSDAY morning in Europe, the Euro FELL by 10 basis points, trading now ABOVE the important 1.08 level  FALLING to 1.0898; 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+ TRUMP HEALTH CARE BILL DEFEAT AND MONTE DEI PASCHI NATIONALIZATION / Last night the Shanghai composite CLOSED UP 11.34  POINTS OR 0.36%    / Hang Sang  CLOSED UP 120.05 POINTS OR 0.49%/AUSTRALIA  CLOSED UP .13% 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 THURSDAY morning CLOSED DOWN 37.56 POINTS OR 0.19%

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

2/ CHINESE BOURSES / : Hang Sang CLOSED UP 120.05 OR 0.49%  / SHANGHAI CLOSED UP 11.34 POINTS OR 0.36%/Australia BOURSE CLOSED UP .13% /Nikkei (Japan)CLOSED DOWN 37.56 OR 0.19%  / INDIA’S SENSEX IN THE RED

Gold very early morning trading: $1264.50

silver:$17.44

Early THURSDAY morning USA 10 year bond yield: 2.307% !!! DOWN 0 IN POINTS from TUESDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%.

 The 30 yr bond yield  2.967, UP 1  IN BASIS POINTS  from WEDNESDAY night.

USA dollar index early THURSDAY morning: 98.99 DOWN 5  CENT(S) from WEDNESDAY’s close.

This ends early morning numbers THURSDAY MORNING

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

And now your closing THURSDAY NUMBERS

Portuguese 10 year bond yield: 3.46%  DOWN 11  in basis point(s) yield from WEDNESDAY 

JAPANESE BOND YIELD: +.023%  UP 1   in   basis point yield from WEDNESDAY/JAPAN losing control of its yield curve

SPANISH 10 YR BOND YIELD: 1.626%  DOWN 7  IN basis point yield from WEDNESDAY (this is totally nuts!!/

ITALIAN 10 YR BOND YIELD: 2.244 DOWN 7  POINTS  in basis point yield from WEDNESDAY 

the Italian 10 yr bond yield is trading 61 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: +.296% DOWN 6 IN  BASIS POINTS ON THE DAY

END

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

IMPORTANT CURRENCY CLOSES FOR THURSDAY

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

Euro/USA 1.0876 DOWN .0032 (Euro DOWN 32 basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 111.27 UP  .100 (Yen DOWN 10 basis points/ 

Great Britain/USA 1.2900 UP 0.0053( POUND UP 53 basis points)

USA/Canada 1.3640 UP 0.0021(Canadian dollar DOWN 21 basis points AS OIL FELL TO $48.68

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

This afternoon, the Euro was DOWN by 32 basis points to trade at 1.0876

The Yen FELL to 111.27 for a  LOSS of 10 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 BY 53  basis points, trading at 1.2900/

The Canadian dollar fell by 21 basis points to 1.3640,  WITH WTI OIL FALLING TO :  $48.68

The USA/Yuan closed at 6.8957/
the 10 yr Japanese bond yield closed at +.023% UP 1 IN  BASIS POINTS / yield/ 

Your closing 10 yr USA bond yield DOWN 3 IN basis points from WEDNESDAY at 2.298% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic  USA 30 yr bond yield: 2.966 DOWN 1  in basis points on the day /

Your closing USA dollar index, 99,17 UP  5  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 THURSDAY: 1:00 PM EST

London:  CLOSED DOWN 51.55 POINTS OR 0.71% 
German Dax :CLOSED DOWN 29.01 POINTS OR .23% 
Paris Cac  CLOSED DOWN 16.18 POINTS OR 0.31%
Spain IBEX CLOSED DOWN 79.50 POINTS OR 0.74%
Italian MIB: CLOSED DOWN 239.17 POINTS OR 1.15%

The Dow closed UP 6.24 OR 0.03%

NASDAQ WAS closed UP 23.21 POINTS OR 0.39%  4.00 PM EST
WTI Oil price;  48.68 at 1:00 pm; 

Brent Oil: 50.98 1:00 EST

USA /RUSSIAN ROUBLE CROSS:  57.18 down 5/100 ROUBLES/DOLLAR 

TODAY THE GERMAN YIELD RISES TO +0.296%  FOR THE 10 YR BOND  4.PM EST 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 4:45 PM:$49.24

BRENT: $51.63

USA 10 YR BOND YIELD: 2.302%  (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)

USA 30 YR BOND YIELD: 2.970%

EURO/USA DOLLAR CROSS:  1.0906 DOWN .0021

USA/JAPANESE YEN:111.24  UP 0.07

USA DOLLAR INDEX: 99.13  UP 0  cents ( HUGE resistance at 101.80 broken TO THE DOWNSIDE)

The British pound at 5 pm: Great Britain Pound/USA: 1.2902 : up .0054  OR 54 BASIS POINTS.

Canadian dollar: 1.3626  UP .0007 (CAN DOLLAR DOWN 7 BASIS PTS)

German 10 yr bond yield at 5 pm: +.296%

END

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

TRADING IN GRAPH FORM FOR THE DAY

VIX Crush Saves Stocks As Crude Drops, GDP Flops, & US Credit Risk Pops

A slew of disappointing data (hard and soft), government shutdown fears growing, collapsing GDP expectations, and declining earnings expectations… WTI and RBOB plunging, bonds bid, and gold higher… and then there’s North Korea!!

 

VIX was clubbed like a baby seal again intraday (who the fuck needs protection ahead of a possible government shutdown) in utter desperation to keep The Dow green on the day…

VIX has only closed lower than this once since February 2007!

 

While Nasdaq and Trannies rallied, Small Caps ended red and The Dow and S&P desperately clung to unch…

 

Trump’s Tax Plan continues to disappoint with bonds & bullion bid still as banks and stocks weaker…

 

And the big banks are all down since Trump unveiled the tax plan…

 

Government shutdown remains a real possibility but stocks don’t care (USA CDS do though jumping 3bps today)…

 

The Energy complex was big news today as machines seemed to read yesterday’s DOE report and realize that OPEC is failing…

 

Treasuries were bid once again (but remain higher on the week)…

 

Some volatility in EURUSD surrounding Draghi’s on-again, off-again QE chatter…

 

Left the USD Index modestly lower on the day…

 

The Peso and Loonie were once again swinging around on every headline from The White House regarding NAFTA

 

 

Bitcoin surged to record highs, overtaking gold once again…

 

Silver is down for 9 of the last 10 days to 6-week lows (below ist 100DMA) and goldis finding support at its 200DMA…

 

And finally, this…

 

end

Again, hard data seems to suggest a no growth economy.  Core durable good orders tumble

(courtesy zero hedge)

 

Core Durable Goods Orders Tumble Most Since June

After 8 months of gains, amid crowing analysts celebrating America’s revival, core durable goods orders dropped 0.2% in March – the biggest drop since June 2016.

Furthermore the headline durable goods data missed dramatically (+0.76%
vs +1.3% expected) as did Capital Goods Orders (non-defense, ex-air)
rising only 0.2% MoM.

Once again it seems ‘hard’ data is not supporting the exuberant ‘soft’ data.

 

end

Another hard data disappointment.  Wholesale inventories in March slide again and this will  without a doubt hit the  first quarter GDP numbers when finalized

 

(courtesy zerohedge)

 

Q1 GDP Takes Another Hit As Wholesale Inventories Slide In March

With non-hope-based GDP forecasts for Q1 at cycle lows, today’s wholesale inventories decline will not help. After dropping in January, and rebounding in Feb, March saw inventories drop 0.1% (against expectations of a 0.2% rise).

 

This is the first quarterly decline in wholesale inventories since Q1 2016 (when the world was feared to be heading into recession).

Yet another ‘hard’ data disappointment.

end

We are waiting for the Atlanta Fed to lower its official forecast.  JPMorgan with its tracking formula has cut Q1 GDP to just .3%

(courtesy zero hedge)

JPM Cuts Q1 GDP Forecast To Just 0.3%

While we wait to see if the Atlanta Fed will cut its final Q1 GDP estimate ahead of tomorrow’s official print to 0% or negative, here comes JPM which after slashing its Q1 GDP tracker from 0.6% to 0.4% yesterday, having started the quarter – like most others on Wall Street – at 3%, just trimmed its Q1 GDP estimate to the lowest yet, at just 0.3%.

Here is the full note from JPM’s Daniel Silver

We now believe that real GDP increased 0.3% saar in 1Q. This incorporates the various source data that were released this morning as well as a correction to our treatment of the annual revision to the retail sales data that was released yesterday. The updated details of our forecast are in the table below.

 

In terms of the retail sales data, it appears that this year the BEA will not incorporate the updated figures until the May GDP report, so this Friday’s GDP release will be based on an older vintage of retail sales data. Reverting to the older data, we think Friday’s GDP report will show real consumption at 0.9% saar.

 

Turning to today’s reports, the flurry of information was a negative for 1Q growth on net, mainly through the inventory components. Wholesale inventories declined 0.1% in March, retail inventories increased 0.4%, and durable manufacturing inventories ticked up 0.1%. These figures continued what has been a weak run for much of the inventory data, and we now think that the real change in inventories in 1Q will actually be negative (at -$2bn saar). This very weak inventory figure expected for 1Q should be a positive development for 2Q growth, but we hold our 2Q growth forecast at 3.0% saar.

 

Separately, the nominal goods balance widened from -$63.9bn to -$64.8bn in March, with declines in both exports (-1.7%) and imports (-0.7%) during the month. This was slightly less widening in the deficit than we had been expecting for the month and it looks like net exports will be a small positive for growth in 1Q. However, the trade report did have some negative implications for equipment spending, and we now think that real equipment spending increased 5.2% saar in 1Q despite a modest upside surprise on the core capital goods shipments data that were also released today. Core capital goods orders and shipments have both been trending higher lately, with the latest figures showing core orders up 0.2% in both February and March and core shipments up 0.4% in March after a 1.1% gain in February.

For two weeks in a row we have seen initial jobless claims rise. The last two weeks has seen the jobless number rise by 23,000 up to 257,000. Another indicator that things are not doing too well!

(courtesy zero hedge)

Initial Jobless Claims Jump Most In 5 Months; Higher Since Trump’s Election

The last two weeks have seen initial jobless claims rise 23k to 257k. This is the biggest 2-week rise since Thanksgiving last year and is back above the Trump election levels and the start of 2017 levels.

 

This is a four-week high but could perhaps be impacted by the holiday during the most recent period.

end

 

This does not look good:  credit card defaults are surging to a 4 year high

(courtesy zero hedge)

US Consumers Tap Out: Credit Card Defaults Surge To 4 Year High And It’s Getting Worse

Two weeks ago, when JPMorgan launched Q1 earnings season, we noted that while the results were generally good, one red flag emerged: the company’s credit card charge offs rose to just shy of $1 billion, the highest in four years.

It wasn’t just JPM: all other money-center banks reported similar trends, so we decided to look into it.

What we found was not pretty. According to the latest data from the S&P/Experian Bankcard Default Index, as of March 2017, the default rate on US credit cards had jumped to 3.31%, an increase of 13% from a year ago, and the highest default rate since June 2013.

This is how S&P/Experian explained the recent 5 consecutive month surge in bank card default rates:

The bank card default rate recorded a 3.31% default rate, up nine basis points from February. Auto loan defaults came in at 1.00%, down five basis points from the previous month. The first mortgage default rate came in at 0.75%, up one basis point from February and reaching a one-year high.

 

The National bank card default rate of 3.31% in March sets a 45-month high. When comparing the bank card default rate among the four census divisions, the bank card default rate in the South is considerably higher than the other three census divisions. Upon further analysis to the South’s three census regions, East South Central – comprised of Kentucky, Tennessee, Alabama, and Mississippi – has the highest bank card default rate.

“Currently the debt service ratio for consumer credit – the percentage of disposable income required to service consumer credit debt – is 5.58%, up from its recent low of 4.92% in 2012 but lower than the 6.01% peak seen shortly before the financial crisis.  The higher interest rates that most analysts expect over 2017-2018 are likely to combine with continued growth in consumer credit to push the debt service ratio back towards the 6% level,” said David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices

Making matters worse, based on the latest credit card data reported overnight from pure-plays Discover and CapitalOne, the deteriorating trends are rapidly accelerating (resulting in the stock of both DFS and COF getting slammed).

Add to this what CoreLogic warned earlier in the day, namely that that stalwart of any viable business cycle, mortgage performance, has finally started to deteriorate…

While loan performance improved across various loan types throughout the first five years of the expansion, over the last year three of the four major types of loans began experiencing a deterioration in loan performance. The exception to the deterioration in credit performance was real estate, which continues to improve. However, a closer look reveals performance is deteriorating, albeit from pristine levels of performance.

 

While performance for the 2016 vintage is still very good from relative to the last two decades, it is beginning to worsen. Historically, when the mortgage credit cycle begins to deteriorate it continues to do so until the economy bottoms and the credit cycle begins to improve again.

… and it is becoming clear that the US consumer, responsible for 70% of US economic growth, has finally rolled over.

 

 

end

 

No wonder the Trump tax proposal is in trouble: the CRFB the independent government agency that scores proposals has stated that the Trump tax cuts will add as much as 7 billion to the debt in the next 10 years and that is op top of the original 10 trillion debt gain.

this is not going to happen…

(courtesy zero hedge)

Trump Tax Cuts To Add As Much As $7 Trillion In Debt

While today’s “tremendously” vague one-page summary of Trump’s tax plan had barely any detail – it did not even include the income ranges for the three personal income tax brackets – it did contain enough information for the CRFB to be able to score it, and calculate how much it would cost, or in other words assuming little or no offsetting revenues, this is how much additional debt it would add to the existing upward trajectory in US national debt.

While it is in a way amusing that after 8 years and $10 trilion in debt accumulated under the Obama administration, US sovereign debt suddenly matters, we admit that the CRFB’s findings are troubling. This is how the CRFB phrased it: “the White House released principles and a framework for tax reform today. We applaud the President’s focus on tax reform, but the plan includes far more detail on how the Administration would cut taxes than on how they would pay for those cuts. Based on what we know so far, the plan could cost $3 to $7 trillion over a decade– our base-case estimate is $5.5 trillion in revenue loss over a decade. Without adequate offsets, tax reform could drive up the federal debt, harming economic growth instead of boosting it.

The framework proposes a number of specific changes including: consolidating and reducing individual income tax rates to 10, 25, and 35 percent; doubling the standard deduction; cutting the business tax rate to 15 percent on both corporations and pass-through businesses; repealing the Alternative Minimum Tax (AMT) and estate tax; repealing the 3.8 percent investment surtax from the Affordable Care Act (“Obamacare”); moving to a territorial tax system; and imposing a one-time tax on money held overseas.

 

The plan also includes some vaguer proposals, including “providing tax relief for families with child and dependent care expenses” and eliminating “targeted tax breaks that mainly benefit the wealthiest taxpayers.” Although the framework itself is vague on the latter, at their press conference Secretary of the Treasury Steven Mnuchin and National Economic Director Gary Cohn seemed to imply it meant repealing all individual deductions unrelated to savings, charitable giving, or mortgage interest (revenue would come mostly from repealing the state and local tax deduction).

While the CRFB admits that even with the detailed portions of the plan, there are not enough parameters specified to provide a certain revenue estimate of the tax plan, the agency said that “making some assumptions based on prior proposals, our best rough estimate suggests the specified parts of the plan would cost $5.5 trillion. Assuming tax break limits only apply only to higher earners, that cost could be as high as $7 trillion; assuming credits and exclusions are eliminated as well as deductions, it would cost $3 trillion.

The conclusion: adding interest costs, a $5.5 trillion tax plan would be enough to increase debt to 111 percent of Gross Domestic Product (compared to 89 percent of GDP in CBO’s baseline) by 2027.

That would be higher than any time in U.S. history, and no achievable amount of economic growth could finance it.

Here we go back to our original cynical observation: suddenly, after years and years and trillions of new debt, the experts – especially those on the left – are suddenly so very concerned about it. That aside, at 77 percent of GDP, debt is currently higher than at any time in history outside of World War II and its aftermath. Even under current law, debt will rise to 89 percent of GDP by 2027. Based on the details of what has been put forward by the Trump Administration so far, debt could rise to 111 percent of GDP by 2027 – a new historical record. In dollar terms under this estimate, debt held by the public would total $31 trillion in 2027 and gross debt would total $36 trillion.

Of course, one look at the chart above – assuming Trump does not come up with offsetting revenue measures, which so far he has not proposed – means that it has a snowball’s chance in hell of passing Congress. As Reuters more politely puts it, “Trump’s proposal may be unpalatable to party fiscal hawks. It lacks plans for raising new revenue and could potentially add billions of dollars to the federal deficit.”

Finally, here are some analysts quoted by Reuters, on the opinion of the proposed plan.

GREG MCBRIDE, CFA, BANKRATE.COM CHIEF FINANCIAL ANALYST, WEST PALM BEACH, FLORIDA:

“In the eyes of financial markets, apparently all the concerns about North Korea, Syria, etc have been vanquished as the euphoria about tax reform has taken over. Wake me when something actually gets signed into law.”

DAVID LEFKOWITZ, SENIOR EQUITY STRATEGIST AT UBS WEALTH MANAGEMENT AMERICAS IN NEW YORK:

“A lot to digest on the tax side and to be honest we don’t have a lot of details at this point aside from just a few bullet points from the press conference. The key question really is what is doable from a budgetary and political perspective in Congress and this is going to be a bit of an uphill fight to get this plan enacted into law. But it is early innings, early days and the White House is going to have to try to convince a lot of people this is the right way to go.”

MICHAEL PURVES, CHIEF GLOBAL STRATEGIST AT WEEDEN & CO, IN NEW YORK:

“There’s no question that lower taxes means higher earnings and stronger balance sheets. From a market perspective its a positive. From an economic perspective for the country its much more complicated.
“There’s a long way to go between now and a done deal. The fact the market has gone nowhere today is telling you something.

JOE MANIMBO, SENIOR MARKET ANALYST AT WESTERN UNION BUSINESS SOLUTIONS IN WASHINGTON DC:

“The lack of specificity with regard to the tax announcement offered little for dollar bulls to get excited about. If anything, it dimmed the spotlight on Europe and it put the focus back on ‘Trumponomics’ that could ultimately benefit the dollar. I think the market still has a bad taste in its mouth for how the healthcare reform went, so there’s a degree of skepticism in how soon we could see tax relief.”

 

end

 

Next on the list for Trump to attack:  aluminum

(courtesy zero hedge)

 

 

Trump Administration Begins Probe Into Aluminum Imports’ “National Security Threat”

Having slapped Canadian softwood with tariffs, and begun investigating steel imports last week, it appears – as Commerce Secretary Wilbur Ross promised – the Trump adminstration has shifte its focus to aluminum imports. Specifically, as AP reports, Washington has begun an investigation into whether aluminum imports are jeaoparding national security.

Commerce Secretary Wilbur Ross says the president will sign a memo ordering him to determine the impact of rising aluminum imports. High-purity aluminum is used in a number of defense applications, including military planes and the armor-plating of military vehicles.

Ross says there is only one American smelter that produces high-purity, aerospace-quality aluminum.

He says, “It’s very, very dangerous, obviously from a national defense point of view, to only have one supplier of an absolutely critical material.”

This is the president’s second such move. He initiated an investigation into steel imports last week.

The investigation could lead to tariffs on aluminum imports.

Ironically, just as with lumber, and steel…

Prices for the commodity have been surging recently (despite a broad-based commodity selloff worldwide).

(courtesy zero hedge)

Trump Tweet: “Democrats Want To Shut Government” Over “OCare Failure” and Puerto Rico

After President Trump flipped on two major campaign promises yesterday, funding for the border wall and Obamacare subsidies, many believed that a government shutdown crisis had been averted.

But, that is only because most of the mainstream media doesn’t understand, or is simply unwilling to admit, that Democrats aren’t looking for a ‘deal’ on a funding bill… they actually want a government shutdown.  Here’s what we said yesterday (see:  “Flipper-In-Chief: Trump Caves On Obamacare Subsidies To Avoid Government Shutdown“):

Of course, it’s only logical that Democrats would secretly want a government shut down.  In the end, Republicans (i.e. the fiscally conservative party that is generally looking to reduce entitlements rather than increase them) typically tend to take the brunt of the public backlash for government shutdowns and all of the media coverage provides a very effective bully pulpit for liberals.  Well played, Chuck and Nancy.

Of course, in that context, it’s not terribly surprising at all that Democrats keep piling on new demands for a budget deal.

And now it seems as if President Trump is finally catching on to the gamesmanship after tweeting early this morning that “The Democrats want to shut government…”

“The Democrats want to shut government if we don’t bail out Puerto Rico and give billions to their insurance companies for OCare failure. NO!”

The Democrats want to shut government if we don’t bail out Puerto Rico and give billions to their insurance companies for OCare failure. NO!

As The Hill points out, after originally saying that border wall funding was the only red line, Democrats are now demanding funds for more Obamacare subsidies, bailout money for Puerto Rico and healthcare payments for coal miners.

Democratic leaders had said they would not support a government spending bill unless they received specific language ensuring the continuation of the subsidy payments, which are currently the subject of a lawsuit by House Republicans.

 

Democrats also want help for Puerto Rico, which is trying to restructure its debt to avoid filing for bankruptcy, and to extend healthcare for miners that would otherwise expire this month.

And when Trump flips on these demands we’re sure there will be more to take their spot.

end

The Pentagon Inspector General has now launched an investigation into Michael Flynn with respect to his concealed payments received for a speaking engagement for RT (Russia Television) and for lobbying on behalf of Turkey

(courtesy zero hedge)

Pentagon Inspector General Launches Investigation Of Michael Flynn

Moments ago, AP reported that Trump’s embattled former national security advisor Michael Flynn had been warned not to accept foreign government payments in 2014.

BREAKING: Army documents: Ousted National Security Adviser Michael Flynn warned not to accept foreign government payments in 2014.

As CNN details, former national security adviser Michael Flynn was warned by the Defense Intelligence Agency in 2014 against accepting foreign payments as he entered retirement.

“These documents raise grave questions about why General Flynn concealed the payments he received from foreign sources after he was warned explicitly by the Pentagon,” said Rep. Elijah Cummings, the top Democrat on the House oversight committee, in a statement. “Our next step is to get the documents we are seeking from the White House so we can complete our investigation. I thank the Department of Defense for providing us with unclassified versions of these documents.”

This follows a report from earlier this week according to which the House overnight Committe said there was no evidence Flynn properly disclosed payments for his foreign lobbying connected to Turkey and Russia, and noted that Flynn likely broke the law on overseas payments.

As The Washington Post reported, Jason Chaffetz (R-Utah) and ranking member Elijah Cummings (D-Md.) said they believe Flynn neither received permission nor fully disclosed income he earned for a speaking engagement in Russia and lobbying activities on behalf of Turkey when he applied to reinstate his security clearance, after viewing two classified memos and Flynn’s disclosure form in a private briefing Tuesday morning. “Personally I see no evidence or no data to support the notion that General Flynn complied with the law,” Chaffetz told reporters following the briefing. “He was supposed to get permission, he was supposed to report it, and he didn’t,” Cummings said.

Chaffetz confirmed that Flynn had failed to reveal the more than $45,000 he was paid to speak at a 2015 gala for RT, the Kremlin-run TV network, as well as the money he was paid by an air freight company and a cybersecurity firm with direct connections to Russia. Chaffetz added that the White House had refused to provide his committee with information and documents related to Flynn’s security clearance and payments from organizations tied to the Russian and Turkish governments. The committee made six requests, and the White House cited reasons it could not comply with each of them, Cummings said.

Flynn’s life got even more complicated when Cummings also revealed that the inspector general of the Department of Defense opened an investigation of Flynn earlier this month, according to an April 11 letter released by the oversight committee Thursday.

: @RepCummings releases three new docs on fired Michael https://democrats-oversight.house.gov/news/press-releases/cummings-releases-three-new-docs-on-flynn 

Cummings Releases Three New Docs on Flynn

Cummings Releases Three New Docs on Flynn   Pentagon Explicitly Warned Flynn Not to Accept Foreign Government Payments; Newly Unclassified Letter Confirms Flynn Did Not Report Foreign Payments; Def…

democrats-oversight.house.gov

Flynn’s lawyer, Robert Kelner, had previously said that Flynn briefed the DIA on his speech to RT and the payments, but Cummings said Thursday that another document that was declassified this week shows no evidence to support that statement. CNN has reached out to Flynn’s attorney Thursday and have yet to receive a response.

As Cummings said,”These documents raise grave questions about why General Flynn concealed the payments he received from foreign sources after he was warned explicitly by the Pentagon. Our next step is to get the documents we are seeking from the White House so we can complete our investigation. I thank the Department of Defense for providing us with unclassified versions of these documents.”

This is the full statement Cummins released this morning:

Cummings Releases Three New Docs on Flynn

Pentagon Explicitly Warned Flynn Not to Accept Foreign Government Payments; Newly Unclassified Letter Confirms Flynn Did Not Report Foreign Payments; Defense Department IG Launches Its Own Investigation

Washington, D.C. (Apr. 27, 2017)—Today, Rep. Elijah E. Cummings, the Ranking Member of the House Committee on Oversight and Government Reform, released new documents relating to Lt. General Michael Flynn, who was fired by President Trump from his position as National Security Advisor after concealing information about his communications with the Russian Ambassador to the United States.

“These documents raise grave questions about why General Flynn concealed the payments he received from foreign sources after he was warned explicitly by the Pentagon,” said Ranking Member Cummings. “Our next step is to get the documents we are seeking from the White House so we can complete our investigation.  I thank the Department of Defense for providing us with unclassified versions of these documents.”

First, the Oversight Committee has obtained a letter to Flynn on October 8, 2014, from the Defense Intelligence Agency (DIA) Office of General Counsel explicitly warning Flynn, as he entered retirement, that he was prohibited by the Constitution from receiving payments from foreign sources without advance permission:

“Foreign Compensation Requires Advance Approval

The Emoluments Clause of the U.S. Constitution, article I, section 9, clause 8, as interpreted in Comptroller General opinions and by the Department of Justice Office of Legal Counsel, prohibits receipt of consulting fees, gifts, travel expenses, honoraria, or salary by all retired military personnel, officer and enlisted, regular and reserve, from a foreign government unless congressional consent is first obtained.  Consent is provided by Congress under 37 U.S.C. 908, which requires advance approval from the relevant service secretary and the Secretary of State before accepting employment, consulting fees, gifts, travel expenses, honoraria, or salary from a foreign government. … Accordingly, if you are ever in a position where you would receive an emolument from a foreign government or from an entity that might be controlled by a foreign government, be sure to obtain advance approval from the Army prior to acceptance.” (emphasis in original)

In addition, this week, the Defense Department produced to the Oversight Committee an unclassified, redacted version of a letter that DIA originally sent to the Committee in classified form on April 7, 2017.

The new DIA letter counters the suggestion by Flynn’s attorney on Tuesday that Flynn followed appropriate procedures for accepting foreign funds for his trip to Moscow in December 2015 when he dined with Russian President Vladimir Putin.  The DIA letter states:

“DIA did not locate any records referring or relating to LTG Flynn’s receipt of money from a foreign source. … DIA did not locate any records of LTG Flynn seeking permission or approval for the receipt of money from a foreign source.”

Flynn’s attorney issued the following statement on Tuesday:

“As has previously been reported, General Flynn briefed the Defense Intelligence Agency, a component agency of the Department of Defense, extensively regarding the RT speaking event trip both before and after the trip, and he answered any questions that were posed by DIA concerning the trip during those briefings.”
In other words, regardless of whether Flynn discussed his trip to Moscow with DIA, the Committee has obtained no evidence that he disclosed the payments he received from the Kremlin-backed propaganda outlet RT or that he obtained permission from the Secretary of the Army and the Secretary of State, as required.

The new DIA letter also confirms that the Pentagon warned Flynn explicitly when he retired in 2014 not to accept payments from foreign government sources without obtaining advance approval:

“LTG Flynn was advised of the legal restrictions concerning foreign compensation and instructed to report any potential receipt of compensation in advance.”

In another development, on April 11, 2017, the Inspector General of the Department of Defense sent a letter informing the Oversight Committee that it has now launched its own investigation:

“This office has initiated an investigation to determine whether Lieutenant General (LTG) Flynn, U.S. Army (Retired) failed to obtain required approval prior to receiving any emolument from a foreign government.”

The White House is still refusing to provide even a single document as part of the Committee’s investigation and has refused to comply with the bipartisan document request sent by Chairman Jason Chaffetz and Ranking Member Cummings on March 22, 2017.

end

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: