GOLD: $1256.30 up $2.85
Silver: $17.12 up 9 cent(s)
Closing access prices:
Gold $1255.90
silver: $17.16
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: $1265.56 DOLLARS PER OZ
NY PRICE OF GOLD AT EXACT SAME TIME: 1257.40
PREMIUM FIRST FIX: $8.16
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
SECOND SHANGHAI GOLD FIX: $1277.30
NY GOLD PRICE AT THE EXACT SAME TIME: 1258.75
Premium of Shanghai 2nd fix/NY:$8.55
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
LONDON FIRST GOLD FIX: 5:30 am est $1257.10
NY PRICING AT THE EXACT SAME TIME: $1257.25
LONDON SECOND GOLD FIX 10 AM: $1256.95
NY PRICING AT THE EXACT SAME TIME. $1256.75
For comex gold:
MAY/
NOTICES FILINGS TODAY FOR APRIL CONTRACT MONTH: 4 NOTICE(S) FOR 400 OZ.
TOTAL NOTICES SO FAR: 528 FOR 52800 OZ (1.6423 TONNES)
For silver:
For silver: MAY
11 NOTICES FILED TODAY FOR 55,000 OZ/
Total number of notices filed so far this month: 4584 for 22,970,000 oz
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
END
We have now entered options expiry week:
options expiry on the comex Thurs: May 25. Options expiry for the OTC/LBMA gold/silver contracts: May 31/2017 at around 12 noon.
The big news of the day is the huge open interest at the gold comex. We may have a monstrous amount of gold ounces seeking delivery
Let us have a look at the data for today
.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
In silver, the total open interest ROSE BY 1 contract(s) UP to 203,460 WITH THE TINY FALL IN PRICE OF SILVER THAT TOOK PLACE WITH YESTERDAY’S TRADING (DOWN 2 CENT(S). IT IS OBVIOUS THAT WE ARE GETTING SOME BANKER SHORT COVERING IN CONJUNCTION WITH BANKER DELTA HEDGING. In ounces, the OI is still represented by just OVER 1 BILLION oz i.e. 1.017 BILLION TO BE EXACT or 145% of annual global silver production (ex Russia & ex China).
FOR THE NEW FRONT MAY MONTH/ THEY FILED: 11 NOTICE(S) FOR 55,000 OZ OF SILVER
In gold, the total comex gold ROSE BY A HUMONGOUS 8293 contracts DESPITE THE FALL IN THE PRICE OF GOLD ($2.50 with YESTERDAY’S TRADING). The total gold OI stands at 471,083 contracts. THE BANKERS SUPPLIED THE NECESSARY SHORT PAPER IN TOTAL CONTRAST TO SILVER DESPITE THE FALL IN PRICE ON BOTH METALS. WE MAY HAVE WITNESSED SOME OF THOSE LONG CALLS HIDDEN IN THE EFP’S BEING EXERCISED FOR THE JUNE CONTRACT MONTH
we had 4 notice(s) filed upon for 400 oz of gold.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
With respect to our two criminal funds, the GLD and the SLV:
GLD:
We had no changes in tonnes of gold at the GLD
Inventory rests tonight: 847.45 tonnes
.
SLV
Today: no changes in inventory
THE SLV Inventory rests at: 341.922 million oz
Here is a strange fact for the CFTC to price discover:
when the record OI occurred on April 21, the price of silver was at $18.42 (OI record 234,000 contracts. Interestingly the SLV inventory on April 21 was 325 million oz and today it is 343 million dollars and the price of silver is $1.26 less. And the comex is a price discovery mechanism????
end
.
First, here is an outline of what will be discussed tonight:
1. Today, we had the open interest in silver ROSE BY 1 contract UP TO 203,460, (AND STILL CLOSE TO THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787), WITH THE FALL IN PRICE FOR SILVER WITH YESTERDAY’S TRADING (2 CENTS). NO QUESTION THAT WE HAD SHORT COVERING BY THE BANKERS ALONG WITH SOME BANKER DELTA HEDGING.
(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 43.75 POINTS OR 1.43% / /Hang Sang CLOSED UP 202.28 POINTS OR 0.80% The Nikkei closed UP 70.15 POINTS OR 0.36%/Australia’s all ordinaires CLOSED UP 0.30%/Chinese yuan (ONSHORE) closed WELL UP at 6.8703/Oil DOWN to 50.65 dollars per barrel for WTI and 53.23 for Brent. Stocks in Europe OPENED MIXED / RED ..Offshore yuan trades 6.8511 yuan to the dollar vs 6.8703 for onshore yuan. NOW THE OFFSHORE IS HUGELY STRONGER TO THE ONSHORE YUAN/ ONSHORE YUAN STRONGER (TO THE DOLLAR) AND THE OFFSHORE YUAN IS A MUCH STRONGER TO THE DOLLAR AND THIS IS COUPLED WITH THE WEAKER DOLLAR. CHINA NOT HAPPY WITH THE NEWS THAT ITS DEBT HAS BEEN DOWNGRADED BUT IS HAPPY WITH THE WEAKER DOLLAR AND THUS HAPPY CAMPERS TODAY.
3a)THAILAND/SOUTH KOREA/NORTH KOREA
i)NORTH KOREA/SOUTH KOREA
b) REPORT ON JAPAN
c) REPORT ON CHINA
i)China’s plunge protection team comes to the rescue after Moody’s downgrades the sovereign and commodities like iron ore and nickel are crushed.
( zero hedge)
ii)With the Chinese plunge protection in full gear, the yuan suddenly spikes to 2 month highs.
( zero hedge)
4. EUROPEAN AFFAIRS
i)The UK is furious with leaks from the USA. As such they are stopping sharing attack information with the uSA
( zero hedge)
ii)USA/UK
Trump is also very angry at the leaks. The UK confirms that the leaking is from law enforcement and not the White House
( zero hedge)
Mish Shedlock commented also on the Catalonia succession threat. Catalonia cannot issue debt on its own and calls on sovereign Spain to underwrite her debt. As of this minute Spain’s debt to GDP ratio is over 100% but does not include her provinces. Catalonia’s debt by itself is 25% of GDP and I believe that all of the provinces debt guaranteed by a sovereign is over 160%. If Catalonia does not get its way, and leaves Spain, it can default on the debt guaranteed by the sovereign although it would be no doubt kicked out of the EU. Catalonia is the driving engine of Spain but does not get the money it provides to the state and this is shaping up to be quite a showdown
a must read..
( Don Quijones/WolfStreet)
iv)GREECE
A letter bomb detonates inside the former Greek Prime Minister Papademos
(courtesy zero hedge)
5. RUSSIAN AND MIDDLE EASTERN AFFAIRS
Rand Paul is not happy with the huge Saudi Arms deal and he wants to introduce a vote on the matter
( Jason Ditz/AntiWar.com )
6 .GLOBAL ISSUES
i)the Toronto house bubble just burst:
( Wolf Richter/WolfStreet)
ii)According to a new survey from Manulife Bank, nearly 75% of Canadian homeowners would have great difficulty to pay their mortgage if mortgage increases would rise by 100 dollars:
( zerohedge)
iii)Popular Michael Snyder talks about the political correctness of Islamophobia
( Michael Snyder)
7. OIL ISSUES
i)The market wished for more production cuts which would not be forthcoming as the OPEC meeting ended in a whimper
( zero hedge)
ii)The failure of OPEC causes WTI to tumble below $50.00
( zero hedge)
8. EMERGING MARKET
VENEZUELA/
An excellent commentary as the author describes how Venezuela may be the next battleground between the USA and Russia and fought through proxies due to the loans given by sovereign Venezuela to state owned PDVSA
( AntiMedia.org)
9. PHYSICAL MARKETS
i)Silver demand for silver eagles picks up dramatically in May
Steve St Angelo explains why
( Steve St Angelo/SRSRocco report)
ii)As we explained on previous occasions, the London gold benchmark has been hit with volatility in its pricing after many banks exited. Peter Hobson of Reuters explains
(courtesy Peter Hobson/Reuters)
iii)John Embry notes that assets are exploding wildly except our precious metals
( Kingworldnews/John Embry)
iv)GATA chairman Murphy is interviewed by Finance and Liberty
( GATA/ChrisPowell)
v)This is great for the CFTC as to how could they claim that gold/silver is a price discovery mechanism with bitcoin trading at 4,000 dollars in South Korea and 2700 dollars in China and elsewhere!!.
( zero hedge)
10. USA stories
i)Another insurer quits Obamacare, Blue Cross/Blue Shield of Kansas City MO. This causes 25 counties in Missouri without healthcare options
( zero hedge)
ii)This will be a huge damper to 2nd quarter GDP as both retail and wholesale inventories tumble in the first month of the second quarter, April
( zero hedge)
iii)Oh Great!! Now we have General Motors tumbling after allegations of rigging truck emission tests
( zero hedge)
iv)the trail balloon commences: JPMorgan warns that the Fed may start to shrink its balance sheet by September. If this happens it will be very contractionary on the economy as less dollars circulate:
( JPMorgan/zerohedge)
v)Strange: FBI withholds Russian probe documents requested by Jason Chafferz of ot House oversight committee
( zero hedge)
vi)Strangely Twitter suspends WND (WorldNetDaily) for publishing a story that Donna Brazile demanded to know why a private eye was investigating the murder of Seth Rich with connections to the DNC
(courtesy zero hedge)
Let us head over to the comex:
The total gold comex open interest ROSE BY A HUGE 8293 CONTRACTS UP to an OI level of 470,865 DESPITE THE FALL IN THE PRICE OF GOLD ( $2.50 with YESTERDAY’S trading). THE BANKERS SUPPLIED THE NECESSARY SHORT PAPER AS LONGS STAMPEDED INTO THE GOLD ARENA YESTERDAY. WE MAY HAVE ALSO WITNESSED THE EXERCISING OF LONG CALLS IN THE JUNE GOLD CONTRACT MONTH. We are now in the contract month of MAY and it is one of the POORER delivery months of the year. In this MAY delivery month we had A GAIN OF 3 contract(s) RISING TO 30. We had 3 notices filed yesterday so we gained 6 GOLD CONTRACTS OR AN ADDITIONAL 600 gold ounce will stand for delivery and no contracts were cash settled through the EFP route where they receive a cash bonus plus a future gold contract.
The next big active month is June/2017 and here the OI LOST 17,228 contracts DOWN to 151,926. The non active July contract GAINED another 417 contracts to stand at 1584 contracts. The next big active month is August and here the OI gained 25,013 contracts up to 211,005.
OH OH!! WE HAVE NOW SURPASSED last year’s huge open interest as on May 25 2016 we had at this exact time: 132,143 contracts of JUNE 2016 CONTRACTS OPEN.( compared to JUNE 2017: 151,926). FIRST DAY NOTICE IS WEDNESDAY MAY 31.2017
For the June 2016 contract month initially 48.189 tonnes stood for delivery. Eventually a huge 48.552 tonnes stood.
TONIGHT OUR BANKER FRIENDS ARE QUITE NERVOUS WHEN THEY LOOK OUT THE WINDOW AND SEE THE HIGH OPEN INTEREST THAT IS STILL STANDING IN GOLD FOR JUNE 2017.
We had 4 notice(s) filed upon today for 400 oz
The non active June contract GAINED 20 contracts to stand at 690. The next big active month will be July and here the OI LOST 1194 contracts DOWN to 145,259.
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)
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 had 11 notice(s) filed for 55,000 oz for the MAY 2017 contract
VOLUMES: for the gold comex
Today the estimated volume was 126,449 contracts which is POOR
Yesterday’s confirmed volume was 313,863 contracts which is excellent (BUT MANY ROLLOVERS).
volumes on gold are STILL HIGHER THAN NORMAL!
Gold | Ounces |
Withdrawals from Dealers Inventory in oz | nil |
Withdrawals from Customer Inventory in oz |
7298.05 oz
227 kilobars
Manfra
Scotia
|
Deposits to the Dealer Inventory in oz | nil oz |
Deposits to the Customer Inventory, in oz |
NIL
|
No of oz served (contracts) today |
4 notice(s)
400 OZ
|
No of oz to be served (notices) |
26 contracts
2600 oz
|
Total monthly oz gold served (contracts) so far this month |
528 notices
52800 oz
1.6423 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 | 230,129.2 oz |
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 4 contract(s) of which 0 notices were stopped (received) by jPMorgan dealer and 0 notice(s) was (were) stopped/ Received) by jPMorgan customer account.
March 2016: 2.311 tonnes (March is a non delivery month)
Silver | Ounces |
Withdrawals from Dealers Inventory | nil |
Withdrawals from Customer Inventory |
63,548.95 oz
CNT
SCOTIA
|
Deposits to the Dealer Inventory |
nil oz
|
Deposits to the Customer Inventory |
377,950.116 oz
HSBC
|
No of oz served today (contracts) |
11 CONTRACT(S)
(55,000 OZ)
|
No of oz to be served (notices) |
54 contracts
( 270,000 oz)
|
Total monthly oz silver served (contracts) | 4594 contracts (22,970,000 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 | 6,757,619.8 oz |
NPV for Sprott and Central Fund of Canada
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
Submitted by cpowell on Thu, 2017-03-09 01:19. 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
And now the Gold inventory at the GLD
May 25./no change in inventory at the GLD/Inventory rests at 847.45 tonnes
May 24/no change in inventory at the GLD/inventory rests at 847.45 tonnes
May 23/a paper withdrawal of 5.03 tonnes of gold from the GLD/Inventory rests at 847.45 tonnes
May 22/A DEPOSIT OF 1.77 TONNES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 852.48 TONNES
May 19/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 850.71 TONNES
May 18/a withdrawal of 1.18 tonnes of gold from the GLD/Inventory rests at 850.71
May 17/no change in the GLD inventory/inventory rests at 851.89 tonnes
May 16./ no change in the GLD inventory/inventory rests at 851.89 tonnes
May 15/no change in the GLD inventory/inventory rests at 851.89 tonnes
May 12/no changes in GLD/inventory rests at 851.89 tonnes
may 11/no changes in GLD inventory/inventory rests at 851.89 tonnes
May 10/no changes in GLD inventory/inventory rests at 851.89 tonnes/
May 9/a withdrawal of 1.19 tonnes from the GLD/Inventory rests tonight at 851.89 tonnes
May 8/no change in inventory at the GLD/Inventory rests at 853.08 tonnes
May 5/no changes in inventory at the GLD/Inventory rests at 853.08 tonnes
May 4/A tiny change in inventory at the GLD /a withdrawal of .28 tonnes to pay for fees/inventory rests at 853.08 tonnes
May 3/no change in inventory at the GLD/Inventory rest at 853.36 tonnes
May 2/no change in inventory at the GLD/Inventory rests at 853.36 tonnes
May 1/ no changes in inventory at the GLD/inventory rests at 853.36 tonnes
April 28/no changes in inventory at the GLD/Inventory rests at 853.36 tonnes
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
end
Now the SLV Inventory
May 25/no change in silver inventory at the SLV/Inventory rests at 341.922 million oz
May 24./a “paper” withdrawal of 1.893 million oz from the SLV/inventory rests tonight at 341.922 million oz
May 23/no change in silver inventory at the SLV/inventory rests at 343.815 million oz
May 19/no change in silver inventory at the SLV/Inventory rests at 343.815 million oz.
may 18/2017/another big deposit of 1.42 million oz added to the SLV/inventory rests at 343.815 million oz.
may 17/no change in silver inventory at the SLV/Inventory rests at 342.395 million oz/
May 16./we had a huge addition of 1.416 million oz of silver into the SLV/inventory rests at 342.395 million oz
May 15/no changes in silver inventory/inventory rests at 340.979 million oz/
May 12/a huge change in silver: a deposit of 2.369 million oz/inventory rests at 340.979 million oz
May 11/no changes in silver inventory at the SLV/Inventory rests at 338.610 million oz
May 10/ a gigantic 3.833 million oz of silver added to the SLV and this occurred with the constant whacking of silver for the past 17 trading sessions/inventory rests at 338.610 million oz
may 9Again, no movement of inventory at the SLV. Inventory rests at 334.777 million oz
May 8/no change in silver inventory at the SLV/inventory rests at 334.777 million oz/
May 5/Strange!! no change in silver inventory at the SLV/Inventory rests tonight at 334.777 million oz
May 4/a very tiny withdrawal of 144,000 oz to pay for fees/inventory rests tonight at 334.777 million oz/
May 3/strange!! with the drop in price of silver we had no change in inventory at the SLV/inventory rests at 334.921 million oz
May 2/extremely strange again/a huge 3.502 million oz deposit into the SLV despite silver being in the toilet for the past several trading days.Inventory 334.921 million oz
may 1/extremely strange/with silver being walloped these past several days, the inventory rises again by a huge 1.136 million oz/(maybe someone can explain this phenomena??)
April 28/Strange again!! no change in inventory at the SLV/Inventory remains at 330.283 million oz (no liquidation with a drop in silver price??)
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
Major gold/silver trading/commentaries for THURSDAY
GOLDCORE/BLOG/MARK O’BYRNE.
GOLD/SILVER
Should I Invest My Fortune in Gold? Inaugural Lecture by Dr Brian Lucey
PRESENTATION HIGHLIGHTS
– Should I invest my fortune in gold?
– Lessons from gold and silver: Reviewing the research
– What precious metals can tell us about finance?
– What are precious metals and why should we care?
– What size of market and how evolved over time?
– Long and detailed history of gold and silver as money
– What does a tonne of gold look like?
– Research on precious metals including volatility and inflation
– Where produced and where demand from and how evolved and who studying precious metals
– Game of Thrones & Scrooge McDuck’s gold and the Hyperinflation of Smaug
– Gold and silver manipulation – “Was the fix a fix”?
– Gold a ‘permabubble’ or in correction?
– Gold costs $1,000/oz to mine so unlikely to fall below that level
– Drivers of retail coin and bar investment
– How does sentiment and mood affect precious metals?
– Why do central banks continue to buy and hold gold?
– Historical studies of precious metals
– How much to hold and when?
– Gold is proven safe haven – rises sharply when uncertainty and in economic crisis
– Research says 10% a good allocation; 30% is high
– Silver similar – 1% to 5% and 10% allocation good in crisis
– One of Ireland’s great exporting services, small to medium size enterprise (SME) is here in the form of GoldCore and can help
– Do not spend too long staring at and obsessing about gold or might turn into Gollum
– Question and answer session
How the economics of gold and silver can help us understand the challenges facing financial economics and whether we should invest in gold and silver was explored in an inaugural lecture by Professor Brian Lucey, Professor of International Finance and Commodities in Trinity Business School.
In the lecture, entitled Golden Opportunities: What precious metals can tell us about finance, Professor Lucey examined the research space in the financial economics of precious metals.
“Precious metals, and gold in particular, are much more widely traded and invested in than might be thought. Total precious metals trading in 2015 was probably of the order of $30 trillion, nearly two years GDP for the whole of Europe.
Precious metals remain a very significant industrial and retail asset class, as well as financial. In 2016 probably 6,000 tons of precious metal was used in luxury goods, 2,400 tons of which was gold.”
Despite the size of the markets for various precious metals such as gold, silver, platinum and palladium, they remain under-researched and as a result can provide a good starting point for the testing of theoretical propositions.
Precious metals research wordcloud
“All the gold ever mined in history could be compressed into a 20m¦ cube and if you think of that in a stadium like Wimbledon you could fit it very comfortably. There has been about 180,000 tonnes of gold ever mined out, about $8 trillion worth.”
“The financial side, in other words the gold put aside for exchanges to back up gold products or to backup exchange traded funds or gold funds, is actually a pretty small amount of the entirety of the demand for gold. The vast majority of the demand for gold is from luxury goods and retail investment, which begs the question why is nobody looking in great detail at this.”
According to Professor Lucey, many of the traditional assumptions around financial economics may not hold when examining precious metal assets and as such many of these assets pose a challenge – being industrial, adornment, monetary, and financial assets all at once – as to how to deploy financial techniques to analyse.
Dr Brian Lucey is Professor of International Finance and Commodities in Trinity Business School, where he has worked since 1992. Professor Lucey works mainly in the area of the financial economics of precious metals.
‘Golden Opportunities: What precious metals can tell us about finance’ is a fascinating must watch presentation and can be listened to and watched here
http://www.goldcore.com/us/gold-blog/invest-fortune- gold-inaugural-lecture-dr-brian-lucey/
-END-
end
Silver demand for silver eagles picks up dramatically in May
Steve St Angelo explains why
(courtesy Steve St Angelo/SRSRocco report)
SOMETHING CHANGED IN THE SILVER MARKET IN MAY: Here Are 3 Reasons Why
By the SRSrocco Report,
Something changed in the silver market in May as U.S. Silver Eagle sales have surged compared to the previous month. This is quite interesting as precious metals sales and sentiment have declined in the West, especially in the United States, ever since Donald Trump was elected President.
Many precious metals investors thought that if Trump was elected, it would have been very positive for the gold and silver market. Unfortunately, it seems as if the opposite was (is) the case. Not only has demand for precious metals declined considerably in 2017 versus last year, so has sales of guns, ammo and survival food-supplies. I gather many of those who follow the alternative media believe Trump is actually going to make America Great Again. So, why protect oneself from a collapse?
This is a very bad assumption… as nothing has changed with Trump in the White House. Furthermore, many analysts are saying that what Trump is doing could actually speed up the collapse of the U.S. economy and financial system.
Regardless, the fundamentals in the U.S. economy continue to disintegrate. We are seeing economic bubble indicators reach or surpass the what took place in 2007, before the bloodbath took place in the U.S. Housing and Financial Markets. However, there is one additional negative factor that wasn’t a problem in 2007 that is now a BLINKING RED LIGHT.
What is this new lousy fundamental? It’s the U.S. and Global Oil Industry. Back in 2007, most of the oil and gas companies were making decent cash flow and profits. Unfortunately, the situation in the Oil Sector is orders of magnitude much worse than what is was in 2007. Not only are the majority of oil and gas companies losing money, they have been also cutting their oil reserves.
This is extremely bad news which very few Americans are aware. Thus, we are now facing an extremely negative DOUBLE-EDGE SWORD of bubble economic indicators on top of a disintegrating oil industry. Which means… the situation today is much worse than what took place back during the 2008 Global meltdown.
U.S. Silver Eagle Sales Surge In May Due To 3 Reasons
U.S. Silver Eagle sales surged 140% in May versus April… and we still have another week remaining in the month. According to the recent update by the U.S. Mint, Silver Eagle sales reached 2,005,000 so far in May compared to 835,000 in April:
After seeing this spike in Silver Eagle demand, I called up a few of my contacts in the industry and asked if they could shed some light as to why sales jumped in May. According to several sources, they stated that the huge increase in Silver Eagle sales was due to three reasons:
1) There was an extremely large purchase by a single wholesaler in the Northeast.
2) The small retail buyer came in a big way as premiums were lowered the most in seven years
3) A group of respected technical analysts in the silver market gave a buy signal when silver was trading between $16-$16.25
These three reasons stated by my contacts, are what has likely driven demand for Silver Eagles to the highest level seen so far this year… if we exclude sales in January, which are always elevated as wholesalers are stocking up on the debut of the new coin release.
It seems as if a large buyer in the Northeast believes silver is a good deal at this price. Furthermore, when the wholesalers lowered the premiums (lowest in seven years), there was an immediate surge in Silver Eagle buying via small retail investors which caused the premium to increase once again. Also, the silver market underestimates the reaction when certain Technical Analysts put out a BUY SIGNAL. Many of the folks who follow or subscribe to these analysts, are big investors. So, when they see a buy signal… they do so in a BIG WAY.
That being said, I would like to remind those reading this article (that might be new to the precious metals industry) please make sure you understand the difference between “PREMIUM” and “COMMISSION” when you decide to purchase precious metals. There are a group of very widely advertised precious metals dealers that may have lowered their premium along with the other dealers, but still charge very high commissions for their products or services.
IMPORTANT NOTE: The PREMIUM is what the dealer pays the wholesaler for the coin or bar. The COMMISSION is what the dealer charges his client above the premium. You need to ask what the commission you are being charged as many new investors are being taken advantage of… but don’t realize it until later, when it is too late.
While two million Silver Eagle so far in May are less than they were last year (4,498,500), this surge in demand suggests that the hype surrounding a Trump Presidency may be fading… and quickly. If we take a look at Silver Eagle sales from FEB to MAY, we can clearly see that something has changed recently:
If the strong demand trend continues for the remainder of May, we could see Silver Eagle Sales reach 2.5-2.8 million. Again, this is lower than what it was last year, but it is a sign that market is starting to SMELL A RAT. And that RAT is a totally inflated STOCK, BOND & REAL ESTATE MARKET.
In addition, Silver Eagle sales are now out-performing Gold Eagle sales. For example, in March when U.S. Silver Eagle sales were 1,615,000, Gold Eagle sales were 56,000 oz. However, Gold Eagle sales in May are only 42,000 oz, while Silver Eagle sales are over 2 million. Thus, the market is purchasing 48 times more Silver Eagles than Gold currently.
Lastly, for those precious metals investors who are frustrated by the disappointing paper Gold and Silver price performance since 2012, the STOCK, BOND and REAL ESTATE markets have never been in such BUBBLE TERRITORY. For some odd reason, some precious metals investors tend to overlook the $7 trillion in Central Bank assets purchases from 2011-2016, and the whopping $1 trillion in the first four months of 2017.
It seems as if many Americans are suffering from BRAIN DAMAGE as the MainStream Media continues to put out the most misinformation and propaganda in history. This causes individuals to lose the ability to think CRITICALLY. And with that will come a great deal of pain and misfortune when we finally see the collapse value of most STOCK, BOND and REAL ESTATE prices.
Lastly, if you haven’t checked out our new PRECIOUS METALS INVESTING section or our new LOWEST COST PRECIOUS METALS STORAGE page, I highly recommend you do.
Check back for new articles and updates at the SRSrocco Report.
end
As we explained on previous occasions, the London gold benchmark has been hit with volatility in its pricing after many banks exited. Peter Hobson of Reuters explains
(courtesy Peter Hobson/Reuters)
Exclusive: London’s gold benchmark hit by volatility after banks exit
London’s gold benchmark experienced large, unpredictable fluctuations after some banks left the auction that sets the price relied upon by the $5 trillion-a-year bullion market, according to a Reuters analysis of trading data.
The benchmark is meant to be a fair and accurate daily snapshot of the fast-moving “spot” market and is used by gold producers and consumers around the world to price contracts.
Its level is set by the London Bullion Market Association (LBMA) Gold Price auction, which sees big banks and brokers electronically input their trading orders, with an algorithm matching buyers to sellers and setting the price.
But trading volumes fell sharply after April 10, when four of the 14 participating banks and brokers stopped taking part after the auction’s administrator, Intercontinental Exchange (ICE), introduced a requirement to clear that meant participants had to modify their own IT systems and procedures.
Lower liquidity – which fuels volatility – led to the benchmark diverging more widely from the underlying spot price, according to the analysis of ICE and trading data, leaving gold buyers and sellers around the world with large unexpected gains or losses.
In the three weeks after clearing was launched, average trading volumes were a quarter lower than in the previous three weeks and the average difference from the spot price tripled to 87 cents from 29 cents, the analysis shows.
The biggest divergence, on April 11, saw the auction settle $12.20 – or 1 percent – away from the spot price. Even excluding this large swing, the average divergence in the period rose to 42 cents.
Volumes have, however, recovered since the start of May and divergences have narrowed.
Market and banking sources have told Reuters that ICE had moved fast to introduce clearing into the benchmark before the London Metal Exchange (LME) launched a rival set of cleared gold futures contracts in July, even though not all participants were ready to use the service.
Four sources familiar with the matter said that ICE was warned by at least two participating banks that the loss of those banks who were not ready to handle clearing would make the benchmark significantly more volatile.
The LBMA referred requests for comment about the price divergences and the effect of the banks leaving the benchmark to ICE.
ICE declined to comment.
Clearing – where an exchange acts as an intermediary to guarantee and settle trades – is regarded as a necessary progression for the gold trade as tighter regulatory capital requirements increase the cost of trading off-exchange.
ICE has said it will widen participation in the auction by making it easier for newcomers to join, and will ultimately boost liquidity and reduce volatility. Indeed, quantitative trading firm Jane Street Global Trading joined the auction on May 15.
MANIPULATION FEARS
When clearing for the auction was launched last month, four banks – China Construction Bank, UBS, Standard Chartered and Societe Generale – ceased participating.
The reason, according to 10 banking sources and an LBMA source, is that they did not have the necessary IT systems and procedures in place in time, and were thus suspended from the auction by ICE.
UBS, Standard Chartered and Societe Generale are highly unlikely to rejoin the auction, according to three sources familiar with the matter.
UBS, Standard Chartered and Societe Generale declined to comment, while China Construction Bank did not respond to requests for comment.
The volatility was heightened by the reluctance of participants to add so-called flexible liquidity to the benchmark by buying or selling gold during the auction to ensure it stays close to the spot price.
Traditionally banks did so, but most changed their approach after the scandal over the manipulation of the Libor interest rate benchmark and are now unwilling to intervene beyond inputting their orders beforehand, fearing that might be construed as price manipulation by regulators.
Five banking sources said that of the 14 banks and brokers that participated in the auction before clearing began, only four at the most were willing to adjust their orders during the auction. These were key to keeping the benchmark stable because they could respond to imbalances between buy and sell orders, the sources said.
At least one of the four banks that left the auction last month were among those willing to offer flexible liquidity during the auction, according to the sources.
“Adjusting liquidity definitely went down (after clearing began),” said one of the sources, who works at a bank still involved in the benchmark.
On April 11, when the divergence was $12.20, buy and sell volumes did not change for much of the auction as the benchmark moved away from the spot price.
The remaining participants in the benchmark are Bank of China, Bank of Communications, Goldman Sachs, HSBC, ICBC, JPMorgan, Morgan Stanley, ScotiaMocatta, Toronto-Dominion Bank and INTL FCStone.
Goldman Sachs, JPMorgan, Morgan Stanley and Toronto-Dominion Bank declined to comment. Bank of China, Bank of Communications, HSBC, ICBC and ScotiaMocatta did not respond to requests to comment, while INTL FCStone was not available for comment.
(Reporting by Peter Hobson; Editing by Pravin Char)
END
John Embry notes that assets are exploding wildly except our precious metals
(courtesy Kingworldnews/John Embry)
Everything inflates wildly except monetary metals, Embry notes at KWN
Submitted by cpowell on Wed, 2017-05-24 23:39. Section: Daily Dispatches
7:40p ET Wednesday, May 24, 2017
Dear Friend of GATA and Gold:
Sprott Asset Management’s John Embry, interviewed today by King World News, notes the seemingly absurd contrast between exploding prices for assets like trendy artwork and crypto-currencies, on one hand, and, on the other, the ever-suppressed monetary metals. With most economic sectors extremely over-indebted, Embry says, interest rates may have to stay low indefinitely and hyperinflation seems inevitable. His comments are posted at KWN here:
http://kingworldnews.com/john-embry-there-will-be-a-catastrophic-outcome…
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org
END
GATA chairman Murphy is interviewed by Finance and Liberty
(courtesy GATA/ChrisPowell)
GATA Chairman Murphy interviewed by Finance and Liberty
Submitted by cpowell on Thu, 2017-05-25 01:32. Section: Daily Dispatches
9:34p ET Wednesday, May 24, 2017
Dear Friend of GATA and Gold:
Elijah Johnson of Finance and Liberty today interviews GATA Chairman Bill Murphy about the special danger silver poses to the gold cartel. Murphy argues that amid the inflation of so many other assets, gold and silver, whose prices long have been suppressed by central banks, may be more undervalued than they ever has been. The interview is 15 minutes long and can be heard at You Tube here:
https://www.youtube.com/watch?v=7eApX_vvlC8&index=1&list=PLNwUWnJgSq_LsS…
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org
END
This is great for the CFTC as to how could they claim that gold/silver is a price discovery mechanism with bitcoin trading at 4,000 dollars in South Korea and 2700 dollars in China and elsewhere!!.
(courtesy zero hedge)
Bitcoin Explodes, Trades Above $4,000 In South Korea
In recent weeks it has been Japanese demand (and notable premia) that has driven the exponential rise in Bitcoin, but recently, as CoinTelegraph reports, it has been South Korea. Overenight saw Bitcoin prices explode once again, smashing through $2500, $2600, and $2700 for the first time…
As CoinTelegraph.com reports, South Korean Bitcoin traders are facing asking prices of $4,500 as the virtual currency’s price continues to surge.
Order books from domestic exchange Coinone list a current price of 4,254,000 won ($3805), with a 24-hour high of 5,025,000 ($4494).
As Bitcoin.com reports, the region has also been blossoming with startups dedicated to bitcoin remittance and financial tech advancement.
The South Korean government has been very friendly towards digital currencies, and the country is steadily becoming a technology hub. Just recently the government lowered the equity capital requirement for bitcoin companies working with remittances. The new statutes will begin on June 18 with a reduction of required capital to 1 billion KRW in contrast to the prior requirement of 2 billion KRW.
Additionally, researchers from the South Korean central bank recently released a report that detailed that virtual currencies like bitcoin can “coexist with fiat.”
“The recent emergence of digital currency opens up a new type of dual currency regime in which digital currency, which has no intrinsic value and a government-issued fiat currency coexist,” explained the researchers from Seoul’s Hongik University and members of the Bank of Korea’s (BOK) report.
The wide spreads are unprecedented even compared to other recently inflated markets such as Japan, local exchange bitFlyer listing a price of 333,200 yen ($2980).
On Coinbase, one Bitcoin is currently selling for $2667.53 as of press time on Thursday.
Users have presented various theories as to why South Korea’s exchange market is so varied, these ranging from capital controls to en masse arbitrage and even a “debt-fuelled bubble” economy.
Bitcoin itself, meanwhile, is continuing to produce new price highs, flying in the face of those concerned that a new bubble has formed.
end
It then crashes back to 2400.00
just a flesh wound!
(courtesy zerohedge)
Bitcoin Is Crashing
What goes up exponentially, falls vertically… or something like that…
Bitcoin has plunged 13% in the last few minutes… no catalyst evident for now…
Bear in mind this plunge merely corrects to the highs of yesterday.
And, in context, it’s a fleshwound…
BITCOIN EXCHANGE COINBASE SAYS “WE’RE CONTINUING TO EXPERIENCE DEGRADED PERFORMANCE ON OUR WEBSITE AND MOBILE APP”
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 A LOT STRONGER 6.8703(REVALUATION NORTHBOUND /OFFSHORE YUAN MOVES HUGELY STRONGER TO ONSHORE AT 6.8511/ Shanghai bourse CLOSED UP 43.75 POINTS OR 1.43% / HANG SANG CLOSED UP 202.28 POINTS OR 0.80%
2. Nikkei closed UP 70.15 POINTS OR 0.36% /USA: YEN RISES TO 111.75
3. Europe stocks OPENED IN THE RED/MIXED ( /USA dollar index FALLS TO 97.15/Euro DOWN to 1.1207
3b Japan 10 year bond yield: FALLS TO +.050%/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 111.75/ 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:: 50.65 and Brent: 53.23
3f Gold UP/Yen DOWN
3g Japan is to buy the equivalent of 108 billion uSA dollars worth of bond per month or $1.3 trillion. Japan’s GDP equals 5 trillion usa./“HELICOPTER MONEY” OFF THE TABLE FOR NOW /REVERSE OPERATION TWIST ON THE BONDS: PURCHASE OF LONG BONDS AND SELLING THE SHORT END
Japan to buy 100% of all new Japanese debt and by 2018 they will have 25% of all Japanese debt. Fifty percent of Japanese budget financed with debt.
3h Oil DOWN for WTI and DOWN for Brent this morning
3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund FALLS TO +.365%/Italian 10 yr bond yield DOWN to 2.113%
3j Greek 10 year bond yield RISES to : 6.13% ???
3k Gold at $1258.05/silver $17.23 (8:15 am est) SILVER BELOW RESISTANCE AT $18.50
3l USA vs Russian rouble; (Russian rouble UP 19/100 in roubles/dollar) 56.30-
3m oil into the 50 dollar handle for WTI and 53 handle for Brent/
3n Higher foreign deposits out of China sees huge risk of outflows and a currency depreciation (already upon us). This can spell financial disaster for the rest of the world/China forced to do QE!! as it lowers its yuan value to the dollar/GOT A HUGE SIZED REVALUATION NORTHBOUND
JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 111.75 DESTROYING JAPANESE CITIZENS WITH HIGHER FOOD INFLATION
30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF. It is not working: USA/SF this morning 0.9731 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0905 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 +0.365%
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 2.2480% early this morning. Thirty year rate at 2.922% /POLICY ERROR)GETTING DANGEROUSLY HIGH
5. Details Ransquawk, Bloomberg, Deutsche bank/Jim Reid.
(courtesy Jim Reid/Bloomberg/Deutsche bank/zero hedge)
Traders Spooked After Night Of Sharp, Violent Moves Across All Asset Classes
It has been a seesion of violent, volatile gaps, starting with sharp gap up in S&P futures on Wednesday night, just around 10pm, which saw ES spike and rally to new all time highs on no news…
… which in turn helped generate a sea of green in Asian stock markets, with the Kospi rising after the Bank of Korea left rates on hold, while China’s H shares surged 1.5% higher and the SHCOMP eventually closing up 1.4%; more interesting is that just an hour after the sudden jerk in S&P futures, there was a similar gap higher in both the on and offshore Chinese Yuan, with the CNY surging 0.25% within a 5-minute span…
… which a few hour hours later was followed by a sharp spike lower in both Brent and WTI after OPEC announced that despite “whispers” of a production cut, it was likely to stick with just the largely “priced in” 9 month extension, which yanked Brent back under $54 and WTI below $51…
… in turn sending the DAX and European stocks sharply lower in what until then had been a quiet morning session.
And all throughout these sharp, sudden gaps and spike, US Treasuries remains well bid, while the VIX was again slammed back under 10 as the momentum chasing and stop hunting algos have fun in an increasingly more illiquid, fragmented and broken “market.”
And while traders remain focused on oil as the anticlimatic OPEC Vienna meeting concludes, and which has emerged as a “sell the news” event, we go back to the Chinese currency which surged the most in 2 months after at least two Chinese banks sold dollars in the onshore market, driving the yuan higher, according to three traders quoted by Bloomberg. The suggestion is that Beijing was directly manipulating the currency as the PBOC’s daily fixings had “materially diverged” from the prescribed formula, resulting in a gap between the reference rate and currency’s spot value, Khoon Goh, head of Asia research for Australia & New Zealand Banking Group in Singapore, writes in note Thursday. So, instead of sticking to fixing formula, the central bank opted for active intervention to narrow the difference, considering Thursday’s trading. According to Goh, the main rationale for stronger reference rates could be to prevent CFETS RMB Index from dropping too much as the dollar weaken. Ironically all of this took place just hours after the said that PBOC’s injection of U.S. dollars into the market when necessary isn’t exchange-rate manipulation. It followed this up with some very blatant and direct FX manipulation just to be safe.
Whatever the reason, this was the first session in months in which the Yuan saw an unexpected burst of volatility, which as observed previously may be the catalyst for a return of vol to both China and the EM complex.
And now, we go back to Vienna, where moments ago an OPEC delegate announced that OPEC had agreed to extend the existing oil production cuts for nine months, as expected, without any additional production cuts:
- OPEC AGREES TO EXTEND OIL PRODUCTION CUTS FOR NINE MONTHS – DELEGATE
So after all this, to summarize: European shares opened higher, but quickly dipped into negative territory after an oil selloff led to some profit taking. The STOXX 600 index was unchanged, after opening higher, led lower by resources companies, after another 4 percent drop in iron ore on China’s Dalian Commodity Exchange. Earlier, Asian stocks, as measured by MSCI gained almost 1% to a two-year high after U.S. S&P futures surged late on Wednesday night to all time highs. This helped push MSCI’s 46-country world stock index to a record high of 464.38 percent, up 0.3 percent on the day. E-mini index futures rose by 0.3% to 2410, trading at the highest in history, while the VIX .VIX “fear gauge” of expected volatility in the S&P 500 opened at 9.82, its lowest since May 10.
Following events in Vienna, c rude was trading 0.3 percent lower at $51.20 a barrel as of 10:23 a.m. in London, after touching the highest level in more than a month. Gold slipped less than 0.1 percent to $1,258.29 an ounce.
In rates, the yield on 10-year Treasury notes fell less than 0.1 percent to 2.25 percent after losing three basis points to 2.25 percent on Wednesday. French 10-year yields fell three basis points while those in Germany dropped four basis points.
Market Snapshot
- S&P 500 futures up 0.3% to 2,407.80
- STOXX Europe 600 down 0.3% to 391.28
- MXAP up 0.8% to 152.84
- MXAPJ up 0.9% to 499.72
- Nikkei up 0.4% to 19,813.13
- Topix up 0.2% to 1,578.42
- Hang Seng Index up 0.8% to 25,630.78
- Shanghai Composite up 1.4% to 3,107.83
- Sensex up 0.8% to 30,548.35
- Australia S&P/ASX 200 up 0.4% to 5,789.63
- Kospi up 1.1% to 2,342.93
- German 10Y yield fell 4.4 bps to 0.359%
- Euro up 0.3% to 1.1250 per US$
- Brent futures fall 0.7% to $53.58/bbl
- Italian 10Y yield rose 1.4 bps to 1.844%
- Spanish 10Y yield fell 2.6 bps to 1.584%
- Gold spot down 0.1% to $1,257.51
- U.S. Dollar Index down 0.2% to 97.05
Top Overnight Headlines via BBG
- The U.K. economy slowed more sharply than initially estimated in the first quarter as shoppers flagged and trade dragged on growth. Gross domestic product rose 0.2 percent, less than the 0.3 percent published late last month and down from 0.7 percent at the end of 2016
- Prime Minister Theresa May will raise British concerns over leaks of intelligence related to the Manchester terror attack with President Donald Trump as the BBC reported that police investigating the bombing have stopped sharing information with the U.S.
- Donald Trump’s demands to step up the fight against terrorism are set to resonate with his NATO partners when he visits the alliance headquarters for the first time on Thursday
- OPEC and its allies were poised to extend their production cuts for an additional nine months after last year’s agreement failed to clear a global supply glut or deliver a sustainable price recovery
- Fed’s Kaplan repeats his baseline outlook is for three rate hikes in 2017; Evans says U.S. has essentially returned to full employment
- Attorney General Jeff Sessions didn’t disclose Russia meetings, DOJ says
- BOJ’s Sakurai says vital to continue monetary easing with quantity, interest rates; Iwata says BOJ to avoid causing sharp yield rise at exit
- Fitch says China’s finances and track record underpin A+ rating
- Bank of Korea keeps interest rate at 1.25% as expected
- New Zealand budget forecasts surpluses rising to NZ$7.2b by 2021
Asia equity markets traded mostly higher following the positive US lead where stocks gained for a 5thconsecutive day and both S&P 500 and Nasdaq 100 posted fresh record highs, after FOMC minutes suggested a prudent and gradual approach on rate hikes. This resulted to gains in ASX 200 (+0.24%) and Nikkei 225 (+0.36%), with the latter also helped by commentary from BoJ board member Sakurai that it is vital to maintain monetary easing due to moderate inflation and uncertainty abroad. Shanghai Comp. (+0.9%) and Hang Seng (+0.6%) have also edged gains after the PBoC continued to inject liquidity into the interbank market and amid reports that China is mulling allowing foreign investors access to the futures markets. Finally, 10yr JGBs were indecisive with demand lacking amid positive risk appetite, while the 40yr auction also failed to spur demand with the b/c slightly lower than prior. Fitch stated that China’s finance and track record underpin its A+ rating, but added that the nation’s imbalances pose risks to economic stability.
Top Asian News
- Vanguard Starts New China Unit as Fund Management Market Expands
- Iron Ore Sinks to 7-Month Low in China After Moody’s Downgrade
- Japan Stocks to Watch: Toshiba Machine, Fuji Electric, Lawson
- Hong Kong Downgrade Over China Ties Masks Signs of Local Health
- China Says It Tracked U.S. Vessel and Warned It to Leave Waters
European equities kicked the session off broadly higher (Eurostoxx 50 +0.1%) in a continuation of the sentiment seen during US and Asia-Pac trade following last night’s FOMC minutes release. However, with volumes light across Europe amid the Ascension Day holiday (not a market holiday for most of Europe), the DAX took a tumble amid no new newsflow. This has largely been attributed to mundane trading conditions with those on the continent in the market today also potentially sitting on the sidelines ahead of OPEC today. From a sector standpoint, energy names lag ahead of the cartel’s announcement today with notable downside seen specifically in Petrofac (-14%) after suspending their COO. In fixed income markets, prices were dealt a helping hand by the dip seen in equities with prices also supported initially by the fallout from yesterday’s FOMC minutes. More specifically the German 10yr June contract took out yesterday’s highs at 161.13 with some also attributing the move to model buying and covering of shorts. In peripheral markets, yields are slightly softer with modest outperformance seen in BTPs with investors seemingly confident heading into today’s exchange (announced yesterday).
Top European News
- Unemployment So Low It’s Time for Poland to Worry About It
- Cosco’s Serb Deal to Help Push Chinese Belt and Road Into Europe
- Daily Mail Falls Victim to Slumping Real Estate, Oil Markets
- Man United’s Europa Win Sends Ajax Stock Down Most in a Year
- Dialog Declines; Liberum Says Iphone Report ‘Highly Speculative’
- Intermediate Capital Jumps to Nine-Year High as Results Surprise
In currencies, the USD kicked off the session in close-proximity to the levels seen following the fallout of the Fed minutes with not too much else for traders to initially feed off. The main highlight on the data front came in the form of the second readings of UK GDP which printed softer than expected (Q/Q 0.2% vs. Exp. 0.3%), subsequently adding some modest pressure to GBP/USD despite firmer than anticipated business investment. Elsewhere, FX has been particularly rangebound with modest choppy price action seen following the budget release in which surplus forecasts for FY 16/17 were revised higher, although surplus estimates for the approaching years were reduced.
In commodities, WTI and Brent crude futures initially traded in close proximity to yesterday’s highs with the base-case set at a 9-month extension to existing cuts. When this was largely confirmed by various oil ministers as they entered the meeting WTI and Brent crude futures faced heavy selling pressure, largely algo driven before retracing the majority of the move. Furthermore, the cartel have refrained from any deeper cuts (outside bet) and Libya and Nigeria are still free to produce without constraints. Additionally, the UAE minister said that the focus will be on output, not exports which is interesting given the cartel have been subject to criticism for doing little to control exports. Elsewhere, gold traded sideways overnight to hold on to the gains seen following the FOMC minutes release, while copper saw muted trade with prices flat for the entire Asia-Pac session.
Looking at the day ahead now, we’ll get the April advance goods trade balance, April wholesale inventories, May Kansas City Fed manufacturing activity index and last week’s initial jobless claims print. Away from the data the Fed’s Brainard is scheduled to speak at 10am. The other big focus for markets is the aforementioned OPEC meeting. It’s worth noting also that President Trump is due to meet with the EU’s Tusk and Juncker today in Brussels while also taking part in the NATO summit. That starts at 3pm BST.
US Event Calendar
- 8:30am: Advance Goods Trade Balance, est. $64.5b deficit, prior $64.8b deficit, revised $64.2b deficit
- 8:30am: Wholesale Inventories MoM, est. 0.2%, prior 0.2%; Retail Inventories MoM, prior 0.4%
- 8:30am: Initial Jobless Claims, est. 238,000, prior 232,000; Continuing Claims, est. 1.93m, prior 1.9m
- 9:45am: Bloomberg Consumer Comfort, prior 50.2
- 11am: Kansas City Fed Manf. Activity, est. 10, prior 7
- 10am: Fed’s Brainard Takes in Panel Discussion on Global Economy
- 10pm: Fed’s Bullard Speaks on U.S. economy in Tokyo
DB’s Jim Reid concludes the overnight wrap
One thing that hasn’t changed much after last night is the view of the Fed after they released their minutes. The expectations of a June hike were probably reinforced by remarks that it would “soon be appropriate” to raise rates but markets saw the overall release as dovish (10yr yields rallied 3.0bps after the release) as the Fed signalled that balance sheet reduction would involve a process of rolling caps on reinvestment which perhaps means a slower initial early pace. The suggestion is that the limits would initially be set at low levels and then raised every three months, over a set period of time, to their fully phased-in levels. The minutes confirmed that “nearly all policymakers expressed a favourable view of this approach”. The statement also added that “policymakers agreed that the committee’s policy normalization principles and plans should be augmented soon to provide additional details about the operational plan to reduce the Federal Reserve’s securities holdings over time”. It’s worth adding that prior to the minutes the Fed’s Harker also said that the strategy for the balance sheet should be to “keep it simple and let the markets know what we’re doing”.
As well as Treasury yields slipping the US Dollar (-0.12%) was also a touch weaker following the statement, likely for the same reason. While it feels like a rate hike next month is near to a done deal, pricing for next month was actually a little lower too, albeit at still relatively well priced-in levels. Based on pricing of OIS forwards the odds of a June hike finished at 75% versus 77% prior to the minutes. This method uses the effective rate and seems to be a more reliable and realistic pricing method compared to Bloomberg’s calculator which still shows the odds at 100% (and unchanged over the last few days). Meanwhile there appears to be no stopping US equity markets at the moment. The S&P 500 finished +0.25% last night and back above 2,400 to a new record high close. It also came to within a whisker (0.01%) of hitting the all time intraday high seen back on May 16th. The Dow (+0.36%) also had another decent day while the minutes appeared to be another vol-killer with the VIX dropping over 6% to a near two-week low of 10.02. Markets were quiet in Europe prior to all this with the Stoxx 600 (+0.09%) closing a touch higher.
Before we look at how markets are doing this morning, it’s noting that today is the Ascension Day Holiday in Europe. While it’s observed in several countries in this continent most major markets will still be open with just Swiss and Nordic markets due to remain closed, although expect volumes to be a bit thinner than usual.
The main event today is the OPEC and non-OPEC producers meeting in Vienna. The tentative schedule suggests a 2pm BST start but as always with these sorts of things it wouldn’t be a great surprise to see leaks and speculation throughout this morning. All the chatter is that we’ll get an extension on the production cut deal, likely for another 9 months based on comments from various energy ministers. Our commodity strategists note that given the profusion of reassuring noises coming from oil ministers, there are apparently few points of potential friction. They highlight that while earlier reports variously indicated that either “all producers are in agreement” (Saudi Arabia) or that “almost all” countries are in agreement (Iraq), Iraq’s public acceptance of a nine-month extension establishes this as the most likely outcome. A deepening of cuts, though, has more potential to provide an upside surprise as the idea had been dismissed earlier by oil ministers. The inclusion of smaller producing non-OPEC countries such as Turkmenistan, Egypt and the Ivory Coast in the deal would be a negligible boost, in our team’s view. Oil is going into the meeting on a bit of a tear of late, no doubt fuelled by rising expectations of a positive outcome. WTI is sitting at $51.82/bbl this morning (up +0.90%) which is about +13% from the April lows, although still below the YTD high of $54.45/bbl.
Refreshing our screens, despite a slightly soft start most major bourses are following the lead from Wall Street last night and edging higher. The Nikkei (+0.54%), Hang Seng (+0.42%), Kospi (+0.79%), Shanghai Comp (+0.39%) and ASX (+0.11%) are all up with US equity futures. It’s worth adding that Chinese equities made a decent u-turn yesterday post the sovereign downgrade to finish flat on the day and the move this morning suggests markets have already shrugged it off. It’s also worth noting that Hong Kong has since been downgraded by one notch by Moody’s to Aa1 post that China move. Also worth highlighting, the Congressional Budget Office in the US has found that the Republicans legislation to overhaul the US healthcare system is estimated to result in an increase in the number of uninsured people by 23 million while also reducing the budget deficit by $119bn over 10 years. That is $32bn less than under the previous version of the legislation.
Moving on. As well as hearing from the Fed yesterday there was also some focus on ECB President Draghi’s speech in Madrid, especially following Coeure’s comments on Tuesday. Ultimately the tone from Draghi appeared to confirm that sequencing would not change. The key passage of his speech was his mention that “there is no reason to deviate from the indications we have been consistently providing in the introductory statement to our press conferences”. He added that “asset purchases are inevitably more difficult to calibrate, more complex to implement, and more likely to produce side effects that other instruments, including moderately negative rates”. So this suggests a more close alignment between ECB officials that a taper will come first, followed by rate hikes later.
Wrapping up, yesterday’s economic data was largely a sideshow although in fairness it was all fairly second tier in nature. In the US we learned that existing home sales fell slightly more than expected in April (-2.3% mom vs. -1.1% expected) while the FHFA house price index edged up +0.6% mom in March. In Europe the only data released came from Germany where consumer confidence edged up to its highest level since 2001 at 10.4 (from 10.2).
Before we look at the day ahead, there was some noise around Italy yesterday after the Industry Minister Carlo Calenda said that the country still has much work to do before it could hold an election, suggesting he would be opposed to an early vote this year. Calenda said that Italy has to “arrive at elections at the right time….with an electoral law that gives, if not the certainty, as least a reasonable probability that a government can be formed afterwards”. It’s worth reiterating that political risks still very much remain an issue in Italy with opinion polls tightly bunched (and within the margin of error). It’s also worth noting that the banking sector is still far from being fixed and one would imagine that the hope would be for recaps to happen before the election.
Looking at the day ahead now, in terms of data, this morning in Europe the only real release of note is a second estimate of Q1 GDP in the UK where no change from the +0.3% qoq flash reading is expected. We’ll also get the growth component details. In the US this afternoon we’ll get the April advance goods trade balance, April wholesale inventories, May Kansas City Fed manufacturing activity index and last week’s initial jobless claims print. Away from the data the Fed’s Brainard is scheduled to speak at 3pm BST while the ECB’s Constancio is due to speak this evening. The other big focus for markets is the aforementioned OPEC meeting. It’s worth noting also that President Trump is due to meet with the EU’s Tusk and Juncker today in Brussels while also taking part in the NATO summit. That starts at 3pm BST.
3. ASIAN AFFAIRS
i)Late WEDNESDAY night/THURSDAY morning: Shanghai closed UP 43.75 POINTS OR 1.43% / /Hang Sang CLOSED UP 202.28 POINTS OR 0.80% The Nikkei closed UP 70.15 POINTS OR 0.36%/Australia’s all ordinaires CLOSED UP 0.30%/Chinese yuan (ONSHORE) closed WELL UP at 6.8703/Oil DOWN to 50.65 dollars per barrel for WTI and 53.23 for Brent. Stocks in Europe OPENED MIXED / RED ..Offshore yuan trades 6.8511 yuan to the dollar vs 6.8703 for onshore yuan. NOW THE OFFSHORE IS HUGELY STRONGER TO THE ONSHORE YUAN/ ONSHORE YUAN STRONGER (TO THE DOLLAR) AND THE OFFSHORE YUAN IS A MUCH STRONGER TO THE DOLLAR AND THIS IS COUPLED WITH THE WEAKER DOLLAR. CHINA NOT HAPPY WITH THE NEWS THAT ITS DEBT HAS BEEN DOWNGRADED BUT IS HAPPY WITH THE WEAKER DOLLAR AND THUS HAPPY CAMPERS TODAY.
3a)THAILAND/SOUTH KOREA/NORTH KOREA
i)NORTH KOREA/SOUTH KOREA
b) REPORT ON JAPAN
c) REPORT ON CHINA
China’s plunge protection team comes to the rescue after Moody’s downgrades the sovereign and commodities like iron ore and nickel are crushed.
(courtesy zero hedge)
China “National Team” Rescues Stocks As Downgrade Crushes Commodities
Iron ore led a slump in industrial commodities after Moody’s Investor Service downgraded China’s credit rating and warned that the country’s debt position will worsen as its economic expansion slows. However, one glance at the divergence between industrial metals’ collapse and the sudden buying panic in Chinese stocks confirms what Asher Edelman noted yesterday about the US markets, China’s so-called “National Team” was clearly intervening…
As Bloomberg reports, Iron ore futures on the Dalian Commodity Exchange fell as much as 5.6 percent to 452 yuan a metric ton, almost by the daily limit, before closing at 455.50 yuan, extending Tuesday’s 3 percent loss. Nickel led a broad slump among base metals, dropping as much as 2.4 percent to $9,125 a ton on the London Metal Exchange. Nickel stockpiles rose the most in more than a year.
In context, the overnight reversal in Chinese stocks is even more obvious…
Moody’s move, downgrading China’s debt to A1 from Aa3, adds to concerns about the effects of a slowdown in the country’s economic growth, following on from downbeat manufacturing readings and weak commodity imports, Simona Gambarini, an analyst at Capital Economics Ltd., said by phone from London. “We’re not particularly concerned about credit growth getting out of hand, but in regards to industrial metals, we have been negative on the outlook for some time on the basis that Chinese growth will slow.”
Will The National Team be back tonight?
end
With the Chinese plunge protection in full gear, the yuan suddenly spikes to 2 month highs.
(courtesy zero hedge)
“Something’s Breaking” – Yuan Suddenly Spikes To 2-Month Highs
Traders in Asia are bemused as offshore Yuan suddenly spikes by the most in 2 months (following dollar’s post-Fed-Minutes breakdown) to 2-month highs…
It seems The Fed’s potentially dovish realisation that data-dependence is going to hold them back from their plans to hike rates no matter what is rippling through the world’s risk markets as Yuan spikes suddenly and dramatically in Asia trading…
Sending offshore Yuan to 2-month highs..
As we warned earlier it seems The National Team are active in stocks…
Rebounding once again even as Iron ore plumbs new depths.
As one Hong Kong based trader said “something’s breaking!”
END
4. EUROPEAN AFFAIRS
The UK is furious with leaks from the USA. As such they are stopping sharing attack information with the uSA
(courtesy zero hedge)
“Outraged” UK Stops Sharing Attack Information With US Due To Media Leaks
Leaks are not just plaguing the Trump administration and FBI these days, it appears.
As we reported yesterday, when we discussed why the UK is angry with the US, we observed that Britain’s Interior minister Amber Rudd was asked by the BBC about the fact that information about Manchester suicide bomber Salman Abedi, including his name, had first come out from the United States and whether she would look again at how information was shared with other countries, to which she responded: “Yes, quite frankly. I mean the British police have been very clear that they want to control the flow of information in order to protect operational integrity, the element of surprise, so it is irritating if it gets released from other sources and I have been very clear with our friends that should not happen again.” Asked whether the U.S. leaks had compromised the investigation, she said: “I wouldn’t go that far but I can say that they are perfectly clear about the situation and that it shouldn’t happen again.”
Salman Abedi, the suspect in the Manchester attack
24 hours later, there has been a material deterioration in intelligence relations between the UK and US, and as Reuters reports, British police have officially stopped sharing information on the suicide bombing in Manchester with the United States, a British counter-terrorism source told the news agency, after police said leaks to U.S. media risked hindering their investigation. The decision to stop sharing police information with U.S. agencies “was an extraordinary step as Britain sees the United States as its closest ally on security and intelligence.”
Earlier, the BBC reported that “UK officials were outraged when photos appearing to show debris from the attack appeared in the New York Times. It came after the name of bomber Salman Abedi was leaked to US media just hours after the attack, which left 22 dead. Theresa May said she would tell Donald Trump at a Nato meeting that shared intelligence “must remain secure“.
“This is until such time as we have assurances that no further unauthorized disclosures will occur,” said Reuters’ counter-terrorism source.
Cited by Bloomberg, U.K. police said late Wednesday that “leaks to American media amounted to a breach of trust and undermined their investigation into the attack, stepping up criticism earlier from Home Secretary Amber Rudd.
“The BBC reported that U.K. officials were furious about a story in the New York Times on Wednesday that included photos of the crime scene. The story didn’t cite a source, and the U.K. government had no comment on the piece.”
Reuters confirms that “police chiefs have made clear they are furious about the publication of confidential material in U.S. media, including bomb site photographs in the New York Times, saying such leaks undermined relationships with trusted security allies.”
“This damage is even greater when it involves unauthorized disclosure of potential evidence in the middle of a major counter-terrorism investigation,” a National Counter Terrorism Policing spokesman said in a statement.
The pictures published by the New York Times included remains of the bomb and of the rucksack carried by the suicide bomber, and showed blood stains amid the wreckage. “I think it’s pretty disgusting,” said Scott Lightfoot, a Manchester resident, speaking outside a train station in the city. He criticized media for publishing such material.
“Who’s leaking it? Where’s it coming from? This is British intelligence at the end of the day, people shouldn’t be finding out about this.”
The Financial Times reported that such images are available across a restricted-access encrypted special international database used by government ordnance and explosives experts in about 20 countries allied with Britain. It said the database was built around a longstanding U.S.-British system.
As emerged during the Snowden revelations, Britain routinely shares intelligence with the United States bilaterally, and also as part of the “Five Eyes” network which also includes Australia, Canada and New Zealand. Earlier, the BBC added that Manchester police hoped to resume normal intelligence relationships soon but were furious about the leaks.
Meanwhile, Bloomberg adds that Prime Minister Theresa May will raise the issue with U.S. President Donald Trump when she meets him at a NATO summit in Brussels later on Thursday, “as one of the closest intelligence-sharing partnerships is tested as never before in the fight against global terrorism.”
Why blame Trump? Simple: to deflect attention from the dramatic failure of UK intel services to stop a known member of a terror cell.
More:
The Times story was published after Rudd rebuked the U.S. for naming of suspected suicide bomber hours before U.K. authorities were ready to share it. Police hit out on Wednesday at what they said was the publication of evidence in a live investigation.
“We greatly value the important relationships we have with our trusted intelligence, law enforcement and security partners around the world,” the National Counter Terrorism Policing office said in a statement on Wednesday evening. “When that trust is breached it undermines these relationships and undermines our investigations.”
The dispute could have wider implications for intelligence sharing between the U.S. and its closest allies. Trump shared sensitive information about Islamic State in a meeting with Russian officials last week; he denied that the details came from Israel, which some media had reported, and defended providing the information about airline safety.
Bloomberg also reports that amid concerns the U.K. faces the risk of another attack imminently, May will cut short her trip to a G7 meeting in Sicily, returning Friday night after the first day of the two-day summit. As shown yesterday, soldiers are on the streets of London, a deployment designed to free up police officers to pursue the terrorists behind the attack, as the UK raised its alert level to “critical”, the highest possible.
Manchester police are hunting down a network they think orchestrated the bombing, and the suspected perpetrator’s father and brother were arrested in Tripoli. Eight people are being held in the U.K. in connection with the attack.
end
USA/UK
Trump is also very angry at the leaks. The UK confirms that the leaking is from law enforcement and not the White House
(courtesy zero hedge)
Trump Responds To UK Accusations Of Suicide Bombing Leaks
Overnight saw one of the closest intelligence-sharing partnerships tested as never before in the fight against global terrorism, as Prime Minister Theresa May confronted President Donald Trump over U.S. media leaks from the Manchester bombing probe.
As Bloomberg reports, police investigating the suicide bombing that killed 22 people at a pop concert in the city in northern England have suspended sharing information with the U.S., according to a report by the security correspondent of the BBC.
“I will make clear to President Trump that the information shared between our law-enforcement agencies must remain secure,” May told reporters.
U.K. police said late Wednesday that leaks to American media amounted to a breach of trust and undermined their investigation into the attack, stepping up criticism earlier from Home Secretary Amber Rudd.
The BBC reported that U.K. officials were furious about a story in the New York Times on Wednesday that included photos of the crime scene. The story didn’t cite a source, and neither the U.K. government nor police commented on the piece.
A senior White House official said that the leaks only underscored the president’s assertion that U.S. authorities should investigate the intelligence community to see who is doing the leaking. The source pointed out that the BBC report specified that the U.S. law officials were the source of the leaks — not the White House.
“These leaks were reprehensible, deeply distressing, we unequivocally condemn them,” U.S. acting ambassador in London, Lewis Lukens, said on BBC Radio.
“The U.S. government is launching an investigation into these leaks and will take appropriate action if they are in the U.S.”
Trump was also clearly angered also and made a statement this morning regarding the leaks..
The alleged leaks coming out of government agencies are deeply troubling. These leaks have been going on for a long time and my Administration will get to the bottom of this. The leaks of sensitive information pose a grave threat to our national security.
I am asking the Department of Justice and other relevant agencies to launch a complete review of this matter, and if appropriate, the culprit should be prosecuted to the fullest extent of the law.
There is no relationship we cherish more than the Special Relationship between the United States and the United Kingdom.
Is this the final straw that breaks the camel’s back and enables Trump to really clean house? One can only hope…
The question is – without their leaker-in-chief, how will NYT, WaPo, CNN et al. actually cover The White House?
end
Mish Shedlock commented also on the Catalonia succession threat. Catalonia cannot issue debt on its own and calls on sovereign Spain to underwrite her debt. As of this minute Spain’s debt to GDP ratio is over 100% but does not include her provinces. Catalonia’s debt by itself is 25% of GDP and I believe that all of the provinces debt guaranteed by a sovereign is over 160%. If Catalonia does not get its way, and leaves Spain, it can default on the debt guaranteed by the sovereign although it would be no doubt kicked out of the EU. Catalonia is the driving engine of Spain but does not get the money it provides to the state and this is shaping up to be quite a showdown
a must read..
(courtesy Don Quijones/WolfStreet)
Catalonia Threatens Spain With “Financial Bloodbath”
Authored by Don Quijones via WolfStreet.com,
Catalonia’s independence would set off Spain’s debt time-bomb.
On Monday El Pais published leaked excerpts from what it claims to be the Catalonian regional government’s road map to independence. The secret document includes a plan for the region to unilaterally break away from Spain should its citizens be prevented from holding a referendum on independence in the fall.
It provoked a fierce backlash from Madrid. “This proposal is an unacceptable attempt to blackmail the state,” Spain’s Prime Minister Mariano Rajoy said in a hastily convened press conference. Spain’s defense minister María Dolores de Cospedal likened the plot to a coup d’état. In the meantime, Madrid continues to refuse to even entertain the idea of allowing a referendum on Catalan independence, despite the fact that in just about every survey of the last few years 80% of Catalans, including many unionists, have requested one.
It would mean the loss of 25-30% of Spain’s gross domestic product (GDP), says Spain’s Minister of the Economy, Luis de Guindos. And that’s something the government “will never let happen.”
But Catalonia knows it has a card up its sleeves: its tick-tocking debt bomb. Catalonia can no longer issue its own debt and depends on the central government’s national liquidity fund (FLA, for its Spanish acronym) for about 60% of its funds. As ratings agency Fitch warned in April last year when it sent Catalonian debt even deeper into junk territory, the region has grave liquidity problems that will require “proactive management” and “close collaboration with the central state ” — something that’s clearly not on the cards any time soon.
At the same time, Spain’s public debt continues to grow, recently bursting through 100% of GDP. Even with historically low interest rates (gracie, Signor Draghi), the price of servicing government debt can spiral out of control. Between 2011 and 2015 Spain’s central government spent €121 billion – the equivalent of 12% of annual GDP – on interest payments.
As Catalonia’s finance minister, Oriol Junqueras, recently noted, Rajoy’s government has already burnt through the €65 billion social security fund surplus it inherited in 2011 and is now using a toxic blend of tax funds and public debt to finance the country’s widening pension deficit, which is forecast to reach between €10 billion and €15 billion a year.
In other words, Spain’s deficit, already one of the largest in Europe, is going to remain high for the foreseeable future, despite all the threats of multi billion-euro fines emanating from Brussels. As the widely renowned Columbia University Professor of Economics (and fervent Catalan separatist) Xavier Sala i Marti recently pointed in an interview on Catalan television, all of the debt, including the debt owed by the Catalan regional government, is in the name of the King of Spain:
It’s (Spain’s) debt. They already have a debt load of 100% of GDP. If Catalonia declared independence tomorrow, and Spain were to say “you’re going to be kicked out of the EU for three generations” and everything else they threaten us with, we’d just say to them, “well, these little papers of debt (bonds), you can have them for the next three generations.” All of a sudden, they’d have a much smaller GDP and a much larger debt overhang (around 125%)… A debt-to-GDP ratio of 125% would not be feasible. Spain would not be able to pay the debt they owe the Spanish banks, the biggest holders of Spanish bonds. And that would ruin them, triggering a financial bloodbath.
Such an outcome has also been postulated by the U.S. rating agency Moody’s: in effect, any default on Catalonia’s debt would be interpreted by the markets as a Spanish default. In other words, whence goeth Catalonia, goeth Spain.
And right now, Catalonia’s government seems determined to stage the mother of all showdowns with the central government in Madrid: a financial fiasco for both sides. Catalans are a notoriously prudent, cautious people. As such, it’s fair to assume that at least some of what lies behind the regional government’s recent escalation of tensions with Madrid is bluff and bluster.
But a big bluff can sometime set one down a very dangerous path from which it can be difficult to extricate oneself. The Catalan government may be hoping that threatening to declare independence unilaterally, or even following through on the threats, will finally push the Spanish government into having to compromise. But it’s a massive gamble.
In some parts of Catalonia, including Barcelona (from where I’m writing this article), public support for independence appears to be on the wain. But for many nationalists in the Catalan government, turning back with so little of substance to show pro-independence voters after promising them so much may not be an option.
As for Rajoy’s government, its staunch defense of the country’s territorial unity is a vital vote winner for its core supporters. And right now, with new corruption scandals engulfing senior members of Rajoy’s People’s Party breaking every week or two, these are votes it can ill afford to lose, especially with new snap general elections growing increasingly likely.
In other words, the prospects of a win-win solution being found in the coming months are by now slim. The chances of a lose-lose outcome are growing by the day. Does this mean that Spain, the Eurozone’s fourth largest economy, is on the verge of breaking up? Probably not. But to prevent that from happening, Madrid may end up having to take drastic (and deeply symbolic) actions, including invoking article 155 of the constitution, which will effectively put an end to all forms of Catalan self governance. And that could merely serve to strengthen the resolve of Catalan separatists while further polarizing divisions within Spain’s richest region. By Don Quijones.
When locals can’t afford to live there anymore, they get restless. Read… The Backlash to Spain’s New Property Boom Has Begun
end
5. RUSSIAN AND MIDDLE EASTERN AFFAIRS
Rand Paul is not happy with the huge Saudi Arms deal and he wants to introduce a vote on the matter
(courtesy Jason Ditz/AntiWar.com )
Rand Paul To Force Vote On Massive Saudi Arms Deal, Warns Sales Would Drag US Into Yemen War
Authored by Jason Ditz viaAntiWar.com,
Sen. Rand Paul (R – KY) intends to force a vote in the Senate on the record US arms sales to Saudi Arabia, a deal which the Trump Administration has estimated will be worth some $350 billion over the decade.
Paul was expected to introduce the bill on Wednesday.
The Arms Export Control Act gives senators 10 days to bring up opposition to arms sales, and Paul will have to act particularly fast this time because the Senate is leaving Friday for the Memorial Day holiday, during which they take an entire week off.
Sen. Paul argued that increasing US armament of the Saudis would mean deeper US involvement in the Saudi invasion of Yemen. That of course is something many in the Trump Administration want at any rate, so for them that is seen as a bonus, if anything.
Sen. Paul has been supported in the past in trying to rein in Saudi arms sales by some Democrats, particularly Sen. Chris Murphy (D – CT). It is unclear at this point if he has much support, though the arms industry’s eagerness to secure this lucrative deal is likely to have them lobbying against his efforts.
end
GREECE
A letter bomb detonates inside the former Greek Prime Minister Papademos
(courtesy zero hedge)
Bomb Detonates Inside Car Of Former Greek Prime Minister And Central Banker Papademos
Greek media reports that an explosion targeting the car of former Greek prime minister and central banker Lucas Papademos was reported on Thursday afternoon, at roughly 6.30 p.m. local time, in central Athens.
Reuters confirms:
- EXPLOSIVE DEVICE DETONATES INSIDE CAR OF FORMER GREEK CENTRAL BANKER LUCAS PAPADEMOS, INJURING HIM AND HIS DRIVER- GREEK POLICE
One injury was reported, with the first indications pointing to the vehicle’s driver. The incident took place in central Athens, a few blocks from the Athens Polytechnic in a central part of the city.
Accoridng to Press reports that Papademos opened a letter bomb, injuring himself and his driver. Both rushed to Greece¨s largest hospital Evangelismos.
6 .GLOBAL ISSUES
the Toronto house bubble just burst:
(courtesy Wolf Richter/WolfStreet)
All Heck Breaks Loose in Toronto’s House Price Bubble
by Wolf Richter • May 24, 2017 • 21 Comments
“It’s fear.”
During the first two weeks in May, according to preliminary data from Toronto Real Estate Board, home listings surged 47% from the same period last year even as sales plunged 16%. The average selling price dropped 3.3% from April – and this, after a 33% year-over-year spike in home prices in March and a 25% surge in April. Something is happening to Toronto’s blistering house price bubble.
Canada’s largest alternative mortgage lender, Home Capital Group, which focuses on new immigrants and subprime borrowers turned down by the banks, is melting down after a run on its deposits that crushed its funding sources. The industry is worried about contagion.
At the same time, the provincial government of Ontario announced a slew of drastic measures, including a 15% tax on purchases by non-resident foreign investors to tamp down on the housing market insanity that left many locals unable to buy even a modest home.
It comes after Bank of Canada Governor Stephen Poloz warned in April that home prices are in “an unsustainable zone,” that the market “has divorced itself from any fundamentals that we can identify,” that there was “no fundamental story that we could tell to justify that kind of inflation rate in housing prices,” and that “It’s time we remind folks that prices of houses can go down as well as up. People need to ask themselves very carefully, ‘Why am I buying this house?”’
A few days ago, Moody’s Investors Service downgraded Canada’s six largest banks on concerns over their exposure to the housing bubble and household indebtedness that ranks among the highest in the world.
Now even the relentlessly optimistic industry begins to fret:
“We are seeing people who paid those crazy prices over the last few months walking away from their deposits,” Carissa Turnbull, a Royal LePage broker in the Toronto suburb of Oakville, told Bloomberg. She said they didn’t get a single visitor to an open house over the weekend. “They don’t want to close anymore.”
“Definitely a perception change occurred from Home Capital,” Shubha Dasgupta, owner of Toronto-based mortgage brokerage Capital Lending Centre, told Bloomberg.
“In less than one week we went from having 40 or 50 people coming to an open house to now, when you are lucky to get five people,” Case Feenstra, an agent at Royal LePage Real Estate Services Loretta Phinney in Mississauga, Ontario, told Bloomberg. “Everyone went into hibernation.”
“I’ve had situations where buyers are trying to find another buyer to take over their deal,” Toronto real estate lawyer Mark Weisleder told Bloomberg. Some clients want out of transactions, he said. “They are nervous whether they bought right at the top and prices may come down.” Home Capital had “a bigger impact on the market” than Ontario’s announcement of the new rules, he said.
“Home Capital is affecting things because people who can’t get mortgages from the banks rely on them and other b-lenders,” Lorand Sebestyen, an agent with iPro Realty in Toronto, told Bloomberg. “If you can’t get the mortgage then you obviously can’t buy anything and it’s going to affect the market, especially for the higher-priced properties.”
“It’s fear,” said Joanne Evans, owner of Century 21 Millennium, about the impact of Home Capital on housing. “It’s another contributing factor to the fear of ‘what’s going to happen?”’
And it’s ever so slowly sinking in more broadly.
In Canada, where real estate values are now known to never go down in any significant way, not even during the Financial Crisis, optimism about rising home prices had been huge. Now weekly polling data by Nanos Research for Bloomberg is showing the first signs of second thoughts. Two weeks ago, the share of people saying home prices would rise in the next six months was a record 50.1%. The following week, it dropped to 47.7%. In the most recent poll, it dropped to 46%.
But those who are able to sell at what appears to be the very tippy-top of the market are not complaining. Bloomberg cites business school professor Michael Hartmann who put his north Toronto home up for sale on May 17 sold it on May 22 for C$1.65 million, C$10,000 above asking price. He and his wife are planning to rent and see.
What are homes & mortgages worth when push comes to shove? Read… Chilling Thing Insiders Said about Canada’s House Price Bubble
END
According to a new survey from Manulife Bank, nearly 75% of Canadian homeowners would have great difficulty to pay their mortgage if mortgage increases would rise by 100 dollars:
(courtesy zerohedge)
$100 Increase In Monthly Mortgage Payment Would Sink 75% Of Canadian Homeowners
According to a new survey from Manulife Bank, nearly 75% of Canadian homeowners would have difficulty paying their mortgage every month if their payments increased by as little as 10%. And, given that the average house in Canada costs roughly $200,000 and carries a monthly mortgage payment of $1,000, that means that most Canadians couldn’t incur and $100 hike in their monthly mortgage payments without possibly going under. Per CBC:
The bank polled 2,098 homeowners — between the ages of 20 to 69 with household incomes of $50,000 or higher — online in the first two weeks of February.
Fourteen per cent of respondents to Manulife’s survey said they wouldn’t be able to withstand any increase in their monthly payments, while 38 per cent of those polled said they could withstand a payment hike of between one and five per cent before having difficulty. An additional 20 per cent said they could stomach a hike of between six and 10 per cent before feeling the pinch.
Add it all up, and that means 72 per cent of homeowners polled couldn’t withstand a hike of just 10 per cent from their current record lows.
Of course, such a huge sensitivity to small budget fluctuations isn’t a great sign when we’re in the midst of record-low interest rates and about to enter a period of sustained hikes.
“What these people don’t realize is that we’re at record low interest rates today,” said Rick Lunny, president and CEO of Manulife Bank.
If mortgage rates increase by as little as one percentage point, some borrowers could be facing a hike of 10 per cent on their monthly bills. A bigger mortgage rate hike would bring more pain.
Meanwhile, 45% of millennials in the same survey said they had to borrow money from their parents to purchase their home and 25% admitted they have no savings.
Well, at least Americans aren’t the only ones that have no idea how to save.
END
Popular Michael Snyder talks about the political correctness of Islamophobia
(courtesy Michael Snyder)
Snyder: Desperate Liberals Try To Blame The Manchester Terror Attack On Anyone Other Than Islamic Terrorists
Authored by Michael Snyder via The End of The American Dream blog,
The left just can’t seem to understand that Islamic terrorists are going to try to destroy our way of life no matter how nice we are to them. On Monday night, a bombing at Ariana Grande’s Manchester concert made headlines all over the globe. 22 people, including an 8-year-old girl, were killed and 59 were wounded. It is exactly the sort of “soft target” attack that I have been warning about, and ISIS quickly claimed responsibility. Within the last 30 days, there have been 169 Islamic terror attacks in a total of 24 different countries. Last year, the number of global terror attacks was up 25 percent from the year before, and this year we will almost certainly see another all-time record high. But many liberals never even want to use the phrase “Islamic terror” because it doesn’t fit their agenda.
In fact, many liberals immediately jumped on Twitter after the terror attack in Manchester and started warning about the spread of “Islamophobia”.
For example, Quen Took posted the following tweet…
Don’t use incident as an excuse for Islamophobia. Stand with our beautiful Muslim siblings & don’t scapegoat innocent people.
And TheBardAsPundit warned that engaging in “Islamophobia” may provoke more terror attacks…
I have a good idea. Let’s piss off more Muslims with mindless Islamophobia. That should help.
Of course the mainstream media here in the United States attempted to put their own politically-correct spin on things. On ABC, there was far more concern about “anti-Islamic backlash” than there was for the victims of the attack…
Despite the horrific nature and impact, ABC was eager to downplay the motive behind the deadly attack. In fact, ABC was more worried about the perpetrators than the victims, warning that this could provoke an “anti-Islamic backlash” across Europe.
And on the Today show on NBC, counter-terrorism “expert” Richard Clarke seemed to blame President Trump for the rise in terror attacks that we have been seeing…
They have a good police and security service and so do we, but we have no ostracized, we’ve embraced our Muslim Americans. That’s why the talk against Muslims in the last year in the campaign and since has been very counterproductive. The only way to solve this problem is to have everyone think they’re on the same side.
Yes, let’s follow Clarke’s advice and try to convince the Islamic terrorists that we are on their side.
That should work.
Until the entire western world is willing to embrace Islam and swear allegiance to Allah, the radical Islamists will never stop. Their faith tells them that it is their destiny to rule the world, and they will never rest until they have achieved that goal.
Unfortunately, most people believe what they want to believe, and what most politically-correct pundits in the western world want to believe is that radical Islam is not the problem.
On CNN, one “analyst” even suggested that the attack in Manchester may have been a “false flag” conducted by “right-wing” extremists…
CNN “Terror Analyst” Paul Cruickshank said Monday night on Anderson Cooper’s AC360 that the bombing attack in Manchester could be a “right-wing” “false flag.”
“It must also be noted that in recent months in Europe, there’s been a number of false flag plots where right-wing extremists have tried to frame Islamists for terrorism,” Cruickshank said. “We have seen that in Germany in recent weeks.”
Of course that theory didn’t last long once the authorities identified the attacker as a Muslim.
It is absolutely imperative that we understand the mindset of these Islamic radicals. If they could press a button that would annihilate all non-Muslims on the entire planet, many of them would do it.
Some of the more “moderate” jihadists would prefer to give everyone a chance to convert to Islam first before killing them, but the end result would be the same.
There is no possible way to compromise with people that are intent on exterminating you. And as they get their hands on more powerful weapons, the size and scale of these terror attacks is going to increase exponentially.
We must make every effort to defeat terror groups such as ISIS militarily, but even more importantly we must seek to turn hearts and minds away from radical Islam all over the planet. It is a bankrupt worldview, and we need to show those that are following radical Islam that there is a much better way.
Unfortunately, nations all over the western world are turning away from the values and the principles that they were founded upon, and so western leaders have very little to offer at this point.
One recent report found that Islam is on track to surpass Christianity and will become the largest faith on the entire planet by the year 2070. Violence and bloodshed will continue to be used by jihadists to advance their faith, but another way that the goal of global domination is moved forward is by migration. Paul Nehlen, the author of an upcoming book entitled “Wage The Battle”, recently explained how this works…
“Hijrah means ‘migration in the name of Allah,’” said Nehlen, who explained that the ultimate goal is to populate non-Muslim nations to the extent needed to impose Shariah law.
“The hijrah is one way of spreading the Shariah, spreading the law of Islam, this political doctrine, to land where Islam isn’t,” Nehlen said. “That’s what this documentary covers. It talks about the bigger picture here of what we saw here. It stems directly from their fundamental texts.”
He said hijrah is another method by which Muslims can earn their salvation.
“Quite unlike a Christian, who believes you can’t earn your way in and only by the grace of God are you granted access to heaven through Christ’s sacrifice on the cross, Muslims believe they can earn their way in,” Nehlen said. “They believe they have to earn their way in.”
Radical Islam has declared war on us, but most liberals don’t even think that we are in a war.
And in any war, if one side chooses not to fight the other side wins by default.
The western world desperately needs to wake up, because we are in a life or death battle, and right now this fight is only in the early rounds.
end
7. OIL ISSUES
The market wished for more production cuts which would not be forthcoming as the OPEC meeting ended in a whimper
(courtesy zero hedge)
Oil Tumbles After OPEC Ends With A Whimper; Agrees Only To Nine Month Extension
The OPEC Vienna meeting has not officially concluded just yet, but moments ago a delegate told the WSJ and Reuters that the oil producing cartel had decided to do what had been widely telegraphed previously, and merely extend output cuts by nine months to March 2018. While the full quota breakdown has not been released yet, the cuts are likely to be shared again by a dozen non-members led by top oil producer Russia, while several nations like Iran and Nigeria will remain exempt from production caps.
OPEC cuts had helped push oil back above $50 a barrel this year, giving a fiscal boost to producers, many of which rely heavily on energy revenues and have had to burn through foreign-currency reserves to plug holes in their budgets, however in recent weeks oil dropped to the mid-$40s again, forcing OPEC to agree to the production extension in hopes of creating backwardation in the oil strip, in order to eliminate shale producers from the question. The rebound in oil prices has in turn spurred growth in shale output, which is not participating in the output deal and whose breakeven prices have tumbled, slowing the market’s rebalancing with global crude stocks still near record highs while US producers steal market share from Saudi Arabia and other OPEC members.
Meanwhile, as news of the agreement leaked several hours earlier, Oil prices fell off a a “bit of a cliff” as it was unveiled that a further production decline would not follow, resulting in a classic “buy the rumor, sell the fact” move. These were the headlines that hit shortly after Europe opened”
- EXTENSION OF OIL CUTS WILL BE FOR 9 MONTHS STRAIGHT: AL-FALIH
- FALIH: DEEPER CUTS HAVE BEEN SUGGESTED BUT NOT THOUGHT NEEDED
- 9-MONTH EXTENSION AT SAME OUTPUT LEVEL IS `SAFE BET’: AL-FALIH
- OPEC WILL MONITOR MARKET, PRICES AFTER 9 MONTHS: IRAQ OIL MIN
And judging by the market’s reaction, with WTI falling to a low of $50.17 after reaching a high of 52.00 in a very aggressive move, with Brent plunging in tandem, it was clear that the market was hoping for more.
And then this:
- BRENT CRUDE EXTENDS DROP, FALLS $1.24 TO DAY-LOW $52.72/BBL
Finally, courtesy of Bloomberg, here are some sellside reactions and suggestions of what to expect next:
JPMorgan head of oil and gas for Asia Pacific region Scott Darling
- OPEC extending oil cuts by 9 months seen “price positive”
- “OPEC needs to address around the world excess oil and oil product inventories”
- Cuts need to remove another 325m bbl of excess oil from storage
CME Group senior economist Erik Norland
- All OPEC’s options are bad, $35 oil would be no shock
- Increase in non-OPEC production, particularly in U.S., has cost the group market share; deeper output cuts would worsen that situation
- Sees OPEC extension of cuts priced in, while U.S. production likely to increase further
Citigroup analysts including Ed Morse
- Sees RBOB +35c/gal. y/y in 3Q; retail price gain to $2.50
- Gasoline “should be enmeshed in a tug-of-war between underlying oil prices pulling against slackening demand growth and too much supply”
- RBOB seen at $1.75/gal. in 3Q vs $1.40 in 3Q16; retail gasoline price estimated rising to $2.50/gal., +13% y/y
Fearnleys report
- LPG arb looks “very poor” from U.S. and there is hardly any incentive to charter in spot tonnage for it
Energy Aspects report
- Oil-market tightening to help clear diesel glut
- Global oil-market tightening to accelerate in 3Q, resulting in narrower refining margins that “will help clean up the diesel market even if stocks build seasonally in the summer months first”
- Market appears to be pricing in new sources of diesel supply in coming months in addition to extra supply as seasonal work is completed; market doesn’t seem to be anticipating a tightening in crude markets that would suppress refining margins and as such restrict stockpiles of the distillate
WoodMackenzie report
- Will raise Brent 2018 outlook to $55/bbl if OPEC extends cuts
- That will be up from $50 forecast in January based on no output cuts and supply growth of 2.4m b/d y/y vs demand gain of 1.2m b/d y/y next year
- Little impact likely on 2017 forecast of $55/bbl
Energy Aspects report
- U.S. Gulf-Europe diesel arb “viable,” export demand strong
- “Strong demand from Brazil and a viable arbitrage to Europe” has supported U.S. diesel crack, and limited increases in U.S. Gulf distillate stocks as refineries in that area run at record rates
- Export demand “to remain strong in the near term, which will keep margins supported,” though high supplies remain a concern
END
The failure of OPEC causes WTI to tumble below $50.00
(courtesy zero hedge)
“Sell The News” – WTI Tumbles Below $50 After OPEC Disappointment
Confident anchors across the media have been proudly proclaiming the rise above $50 as proof that the oil market is heading toward equilibrium again and OPEC’s production cut deal extension will be awesome… except the market seems to be disappointed as it’s clear no other non-OPEC nations will join the agreement (cough US shale cough) and “sell the news” has sent crude back below $50…
The full details are as follows:
- No new countries will join the supply cut
- Cut remains set at -1.8mmb/d, a continuation of the original deal
- The next OPEC meeting will be November 30
And the reaction…
end
8. EMERGING MARKET
VENEZUELA/
An excellent commentary as the author describes how Venezuela may be the next battleground between the USA and Russia and fought through proxies due to the loans given by sovereign Venezuela to state owned PDVSA
(courtesy AntiMedia.org)
Will Venezuela Be The Battleground In The Next U.S.-Russia Proxy War?
There’s no denying that Venezuela is deeply embroiled in a significant crisis. While most are aware of the country’s recent string of violent protests, food shortages and government crackdowns on opposition protesters, few are aware of the opposition’s use of underhanded and downright illegal tactics, as well as the United States’ role in funding opposition forces.
The U.S. has long had its sights set on Venezuela, which possesses the largest proven oil reserves in the world, particularly following the “revolution” that began with the election of the late President Hugo Chávez and has continued under his successor Nicolás Maduro. But changing circumstances within Venezuela may soon push the U.S. to repeat a nefarious practice it has carried out elsewhere – funding a proxy war in order to prevent Venezuelan oil from falling into Russian and Chinese hands.
At first, the U.S. government seemed content to let Maduro’s administration run out of steam on its own. But the U.S. has already issued separate sanctions against the country three times this year alone, with more planned in the coming months, as evidenced by the introduction of a recent U.S. Senate bill that would target Venezuelan government officials. The bill, titled “Venezuela Humanitarian Assistance and Defense of Democratic Governance Act” (S.1018), would funnel $20 million to the Venezuelan opposition, which has already received an estimated $50 to $60 million since Chávez’s election in 1998.
And now, the stakes may now be too high for the U.S. to allow Maduro’s regime to collapse under the weight of economic sabotage. By all accounts, Venezuela’s state-owned oil company PDVSA is already on the brink of collapse.
While this would normally be good news for those who seek to see Maduro toppled, there is a caveat that is causing panic in Washington. As the text of S.1018 points out, PDVSA – if and when it collapses – would default on its $4 to $5 billion loans from Rosneft, Russia’s state-owned oil company.
Although Russia and Venezuela enjoy a political alliance, Russia has already taken action over the unpaid debt. In April, a Russian state-run shipping company took $30 million in Venezuelan oil hostage over PDVSA’s unpaid debt. Rosneft would likely follow suit in the event of a major default.
If such an event were to occur, it would mean that Rosneft would take control of a substantial part of PDVSA. But what is more troubling to the U.S. than Russia’s potential control over the world’s largest oil reserves is the fact that one of Russia’s loans to Venezuela came with the condition that PDVSA offers Rosneft a 49.9-percent stake in Citgo as collateral.
As the text of S.1018 makes clear, Citgo – PDVSA’s U.S. subsidiary – “controls critical energy infrastructure in 19 states in the United States.” It seems doubtful that the U.S. establishment would sit back while Russia comes into possession of an ownership stake in one of its largest petroleum refiners.
In addition, Venezuela has underwritten many of its loans from China with an oil-for-credit framework, again meaning that a Venezuelan default would mean that significant amounts of Venezuelan oil could also pass into Chinese hands. It seems unlikely that the U.S. would let its two greatest rivals to global hegemony claim the world’s largest oil reserves.
The U.S. is eager to avoid playing a direct role in preventing their worst-case scenario. However, now that the stakes are higher, the U.S. has already begun setting the stage for a potential proxy war.
In addition to funding Maduro’s opposition, the U.S. is set to lead a multilateral military drill in South America that will involve the installation of a temporary military base on the triple border shared by the drill’s other participating nations: Peru, Brazil and Colombia. BBC Brasil reported that the drill will give the U.S. the “opportunity” to focus on Venezuela’s political situation. In addition, as Telesur reported, President Donald Trump has already met with the presidents of Peru and Colombia to discuss the U.S.’ interest in Venezuela.
With the U.S. funding the Venezuelan opposition and gearing up to lead a multi-nation military drill in close proximity to Venezuela, the foundation for yet another U.S.-Russia proxy war over fossil fuels is being laid. Worth mentioning here is the fact that Maduro’s government is armed largely by Moscow. Between 2005 and 2013, Venezuela was the largest purchaser of Russian weapons in Latin America and the estimated value of Russia-Venezuela arms deals clocks in around $12 billion.
Alternatively, were the U.S.-funded opposition in Venezuela to take control following a default by the current administration, they would likely deny Russia and China their promised collateral of Venezuelan oil at the behest of their long-time donors in Washington. It is highly unlikely that Russia and China would willingly surrender billions of dollars of oil and money to a U.S. puppet regime.
Either way, crisis-stricken Venezuela may soon find itself in an even more troubling conflict – a U.S.-Russia proxy war that could last for years and do even more damage to the already struggling country.
Will the U.S. willingly turn Venezuela into another Syria just to keep its oil out of Russian hands? The size and value of Venezuela’s massive oil reserves makes it seem likely.
end
Your early morning currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings THURSDAY morning 7:00 am
Euro/USA 1.1207 DOWN .0024/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 MIXED HEADING TOWARDS THE RED
USA/JAPAN YEN 111.75 UP 0.211(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 1.2948 DOWN .0029 (Brexit March 29/ 2017/ARTICLE 50 SIGNED
USA/CAN 1.3434 UP .0018 (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 24 basis points, trading now ABOVE the important 1.08 level FALLING to 1.1207; 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 43.75 POINTS OR 1.43% / Hang Sang CLOSED UP 202.28 POINTS OR 0.80% /AUSTRALIA CLOSED UP 0.30% / EUROPEAN BOURSES OPENED MIXED HEADING TOWARDS 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 UP 70.15 POINTS OR 0.36%
Trading from Europe and Asia:
1. Europe stocks OPENED IN THE RED EXCEPT LONDON
2/ CHINESE BOURSES / : Hang Sang CLOSED UP 202.28 POINTS OR 0.80% / SHANGHAI CLOSED UP 43.75 POINTS OR 1.43% /Australia BOURSE CLOSED UP 0.30% /Nikkei (Japan)CLOSED UP 70.16 POINTS OR 0.36% / INDIA’S SENSEX IN THE GREEN
Gold very early morning trading: 1258.35
silver:$17.21
Early THURSDAY morning USA 10 year bond yield: 2.248% !!! UP 0 IN POINTS from WEDNESDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%.
The 30 yr bond yield 2.922, DOWN 0 IN BASIS POINTS from WEDNESDAY night.
USA dollar index early THURSDAY morning: 97.15 DOWN 9 CENT(S) from WEDNESDAY’s close.
This ends early morning numbers THURSDAY MORNING
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And now your closing THURSDAY NUMBERS
Portuguese 10 year bond yield: 3.193% DOWN 4 in basis point(s) yield from WEDNESDAY
JAPANESE BOND YIELD: +.050% DOWN 3/10 in basis point yield from WEDNESDAY/JAPAN losing control of its yield curve
SPANISH 10 YR BOND YIELD: 1.584% DOWN 3 IN basis point yield from WEDNESDAY (this is totally nuts!!/
ITALIAN 10 YR BOND YIELD: 2.119 DOWN 2 POINTS in basis point yield from WEDNESDAY
the Italian 10 yr bond yield is trading 54 points HIGHER than Spain.
GERMAN 10 YR BOND YIELD: +.362% DOWN 1 IN BASIS POINTS ON THE DAY
END
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IMPORTANT CURRENCY CLOSES FOR THURSDAY
Closing currency crosses for THURSDAY night/USA DOLLAR INDEX/USA 10 YR BOND YIELD/1:00 PM
Euro/USA 1.1216 DOWN .0014 (Euro DOWN 14 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/
USA/Japan: 111.73 UP 0.187 (Yen DOWN 19 basis points/
Great Britain/USA 1.2959 DOWN 0.0018( POUND DOWN 18 basis points)
USA/Canada 1.3467 UP .0053 (Canadian dollar DOWN 53 basis points AS OIL FELL TO $49.29
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This afternoon, the Euro was DOWN by 14 basis points to trade at 1.1216
The Yen FELL to 111.73 for a LOSS of 19 Basis points as NIRP is STILL a big failure for the Japanese central bank/HELICOPTER MONEY IS NOW DELAYED/BANK OF JAPAN NOW WORRIED AS AS THEY ARE RUNNING OUT OF BONDS TO BUY AS BOND YIELDS RISE /OPERATION REVERSE TWIST ANNOUNCED SEPT 21.2016
The POUND FELL BY 18 basis points, trading at 1.2959/
The Canadian dollar FELL by 53 basis points to 1.3467, WITH WTI OIL FALLING TO : $49.79
Your closing 10 yr USA bond yield DOWN 4 IN basis points from WEDNESDAY at 2.250% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 2.921 DOWN 2 in basis points on the day /
Your closing USA dollar index, 97,13 DOWN 11 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 UP 2.81 POINTS OR 0.04%
German Dax :CLOSED DOWN 21.15 POINTS OR 0.17%
Paris Cac CLOSED DOWN 4.18 POINTS OR 0.08%
Spain IBEX CLOSED UP 30.30 POINTS OR 0.28%
Italian MIB: CLOSED DOWN 78.01 POINTS/OR 0.37%
The Dow closed UP 70.53 OR 0.33%
NASDAQ WAS closed up 42.23 POINTS OR 0.69% 4.00 PM EST
WTI Oil price; 49.79 at 1:00 pm;
Brent Oil: 51.76 1:00 EST
USA /RUSSIAN ROUBLE CROSS: 56.74 UP 20/100 ROUBLES/DOLLAR
TODAY THE GERMAN YIELD FALLS T0 +0.362% 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 5:00 PM:$48.71
BRENT: $51.23
USA 10 YR BOND YIELD: 2.255% (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)
USA 30 YR BOND YIELD: 2.92%
EURO/USA DOLLAR CROSS: 1.1208 DOWN .0021
USA/JAPANESE YEN:111.84 UP 0.298
USA DOLLAR INDEX: 97.23 DOWN 1 cent(s) ( HUGE resistance at 101.80 broken TO THE DOWNSIDE)
The British pound at 5 pm: Great Britain Pound/USA: 1.2974 : UP .0019 OR 19 BASIS POINTS.
Canadian dollar: 1.3483 UP .0072 (CAN DOLLAR DOWN 72 BASIS PTS)
German 10 yr bond yield at 5 pm: +.362%
END
And now your more important USA stories which will influence the price of gold/silver
TRADING IN GRAPH FORM FOR THE DAY
Stocks Up, Bonds Up, VIX Up, Dollar Up, Gold Up… As Crude Crashes
Jeff Bezos and Bill Gates vying for the world’s richest man title…
Today’s biggest story outside of AMZN $1000, was OPEC’s epic fail… OPEC announced a 9-month extension of its production cuts that have not worked. The market was disappointed…WTI saw its biggest down day since Feb 2016
And so the jawboning began…
- *OPEC CONSENSUS THAT OIL PRICE SHOULD BE $50-$60/BBL: KACHIKWU
- *RUSSIA’S NOVAK SEES OIL PRICE AVERAGE AT $55-$60 IN 2017
- *NOVAK SAYS NOT `MUCH CONCERNED’ OVER TODAY’S OIL-PRICE FALL
- *NOVAK: OPEC/NON-OPEC COOPERATION TO CONTINUE
- *OIL MKT RESPONSE TO OPEC DECISION WAS SURPRISING: IRAN MINISTER
- *OIL PRICE DROP BASED ON SPECULATION, NOT FUNDAMENTALS: IRAN
- *FALIH DOESN’T BELIEVE THERE’S CONFRONTATION BETWEEN OPEC, SHALE
- *FALIH HOPES U.S. SHALE PRODUCERS WILL `MODERATE’ THEIR GROWTH
- *AL-FALIH: LONG-TERM TREND FOR OIL DEMAND `VERY HEALTHY’
- *FALIH: IF FUNDAMENTALS REQUIRE ANOTHER EXTENSION, `WE ARE OPEN’
- *AL-FALIH: 6 MONTHS `TECHNICALLY’ WOULD BE ENOUGH TO REBALANCE
- *OPEC WILL DECIDE IF MORE ACTION NEEDED IN NOVEMBER: NIGERIA
Bitcoin was insane today with a $1300 roundtrip in price… a $400 ramp overnight on South Korean demand, sudden $600 collapse, and then $400 rebound to leave Bitcoin up for the 28th day of the last 30!
Trannies outperformed on the day, as S&P and Nasdaq hit intraday record highs…Small Caps ended flat…
Trannies pushed higher today but Small Caps remain the laggard post the Trump-Dump – NOTE the market has only risen on knee-jerk moves with no trending in between…
Volume remains minimal at best…6th up day in a row – longest streak since mid-Feb
VIX held steady with a 9-handle until the close and limped to 10 and higher on the day… as S&P hit a new record high…
Short-Term VIX slipped to a 7-handle – a record low intraday…
Amazon (and Netflix) traded to record highs with Bezos’ bubble hitting $999.00 for the first time ever…as EPS expectations for 2017, 2018, and 2019 have slumped…
Treasuries were unchanged today (long-end was marginally lower in yield, outperforming)…
30Y remains well below 3.00%
The Dollar Index reversed some of yesterday’s losses, rallying once Europe opened…
Pushing the dollar index back to unchanged on the week…
Gold and Silver managed gains on the day – holding above pre-FOMC Minutes levels
Bonus Chart: Nasdaq Record Highs because of fun-durr-mentals…
end
Another insurer quits Obamacare, Blue Cross/Blue Shield of Kansas City MO. This causes 25 counties in Missouri without healthcare options
(courtesy zero hedge)
Another Insurer Quits Obamacare Leaving 25 Counties In Missouri With No Healthcare Options
Blue Cross Blue Shield of Kansas City (Blue KC) has just joined the growing ranks of insurers across the country that have decided they’ve lost just about enough money on Obamacare. According to a press release issued earlier today, Blue KC’s CEO said the company has lost $100 million on the Obamacare exchanges since 2014, a fact that prompted their decision to exit their 32-county service area.
Blue Cross and Blue Shield of Kansas City (Blue KC) today announced the company’s decision to not offer or renew individual Affordable Care Act (ACA) plans in the company’s 32-county service area in Kansas and Missouri for 2018. This decision will affect Blue KC members with both on- and off- exchange individual plans but does not affect individual plans that were purchased on or prior to October 1, 2013.
“Since 2014, we’ve expended significant resources to offer individual ACA plans to increase access to quality healthcare coverage for the Kansas City community,” said Danette Wilson, President and CEO of Blue KC. “Like many other health insurers across the country, we have been faced with challenges in this market. Through 2016, we have lost more than $100 million. This is unsustainable for our company. We have a responsibility to our members and the greater community to remain stable and secure, and the uncertain direction of this market is a barrier to our continued participation.”
“This decision is necessary at this time, but we’ll continue to work with federal and state legislators to identify solutions that will stabilize the individual market and bring costs down for our members, the community and Blue KC,” said Wilson.
The move will leave residents in 25 Missouri counties, or roughly 19,000 Obamacare enrollees, with no healthcare options in 2018.
Of course, this follows similar developments in both Iowa (see “Obamacare Implosion: Last Major Healthcare Provider Pulls Out Of Iowa Leaving No Options In 2018“) and Tennessee (see “Knoxville, TN Could Be Ground Zero For The Obamacare Explosion“) in the past several weeks. To be fair, after Humana’s exit from Obamacare left 16 counties surrounding Knoxville with no health plans, Blue Cross Blue Shield of Tennessee stepped in to cover that area, though it’s unknown whether someone would step up to do the same in Missouri.
But sure, Republicans are ruining healthcare in America.
end
This will be a huge damper to 2nd quarter GDP as both retail and wholesale inventories tumble in the first month of the second quarter, April
(courtesy zero hedge)
Q2 GDP To Suffer As Retail, Wholesale Inventories Tumble In April
Retail and Wholesales Inventories in April dropped 0.3% MoM – dramatically missing expectations of a 0.2% rise (no economists at all expected a drop in inventories).
Retail Weak…
And Wholesale weak…
The biggest driver of the drop was a 0.5% MoM drop in Motor Vehicle inventories.
This does not bode well for Q2 GDP…
END
Oh Great!! Now we have General Motors tumbling after allegations of rigging truck emission tests
(courtesy zero hedge)
GM Tumbles After Allegations Of Rigging Truck Emissions Tests
General Motors’ stock price is tumbling after reports that the carmaker is accused of putting defeat devices in its trucks to beat emissions tests, becoming the sixth carmaker accused of diesel cheating since 2015, when Volkswagen AG admitted to installing software to bypass pollution rules.
Bloomberg reports that People who own or lease more than 705,000 GM Duramax diesel trucks filed a class-action lawsuit Thursday, claiming GM installed multiple such devices in two models of heavy-duty trucks from 2011 to 2016.
The 190-page complaint is littered with more than 80 references to VW, and asserts that the environmental damage caused by each truck could surpass that of the German automaker’s vehicles.
And the result is GM down 4%…
end
the trail balloon commences: JPMorgan warns that the Fed may start to shrink its balance sheet by September. If this happens it will be very contractionary on the economy as less dollars circulate:
(courtesy JPMorgan/zerohedge)
Fed Trial Balloon: JPM Warns Fed May Start Shrinking Balance Sheet In September
It appears the Fed’s balance sheet “trial balloons” using primary dealers as intermediaries have begun.
After yesterday’s unexpectedly explicit guidance on the future of the Fed’s balance sheet, which prompted Goldman, Citi, and various other banks to suggest they may bring forward their estimates for when the Fed will announce the start of “renormalization”, moments ago JPM’s Michael Feroli, traditionally the analysts “closest” to the Fed, did just that when he issued a report stating that that there is now “chance of a September start” to renormalization, with the values for monthly roll-off caps and phase-in period to be “revealed at the June FOMC meeting.”
According to Feroli, JPM continues to look for normalization to commence at the December FOMC meeting but “there is some chance of a September start, though this would not have a material difference for our projections on a multi-year horizon. At the meeting at which normalization starts we expect the Committee to announce a set of monthly roll-off caps for the following year, which increase regularly every three months.
“Our best guess is that the initial caps are $4 billion a month for MBS and $8 billion a month for US Treasuries. In the preannounced schedule, these caps would be augmented each quarter by $4 billion and $8 billion, respectively, until at the end of the year they are $16 billion and $32 billion. Consistent with yesterday’s minutes, even after the normalization process is fully phased in the monthly caps will still be in place, though in most months after the full phase-in they would cease to bind.”
And here are the finer details which the Fed may or may not have leaked to select banks, in an attempt to prepare for what is coming, and talking down the equity bubble:
The Committee has yet to communicate values for the monthly caps or the length of the phase-in period. Presumably they will do this in the minutes to the June FOMC meeting. It is less clear that the Committee will have decided on a monetary policy implementation framework by the time roll-off begins (i.e. the current ratesetting system vs reverting to the pre-2008 system) and hence whether they will have decided on an ultimate amount of excess reserves available when the balance sheet is fully normalized. We have assumed a $500 billion target for excess reserves in our projections below. The other key assumption on the liability side of the Fed’s balance sheet is currency growth, which we have penciled in at 4% per year.
Under these assumptions the balance sheet is fully normalized in late 2021 at a level close to $3.0 trillion, down from about $4.5 trillion now. After normalization the Fed would turn to become a net buyer of Treasuries, at a pace of around $400 billion per year, partly to meet growing demand for currency and partly to replace MBS which will continue to roll off the balance sheet. During the normalization process we see the funds rate as the tool of first resort for adjusting policy to both economic strength and weakness, unless the funds rate returns to the effective lower bound around zero, at which point roll-offs would stop. This latter eventuality is a risk for normalization being completed later than we anticipate.
end
Strange: FBI withholds Russian probe documents requested by Jason Chafferz of ot House oversight committee
(courtesy zero hedge)
FBI Withholds Russia Probe Docs Requested By House Intel Committee
House Oversight Committee Chairman Jason Chaffetz said today that the FBI had decided to withhold documents, including memos, notes, summaries, and recordings, requested by his committee in regards to the ongoing Russia probe. This was revealed in a letter sent by Chaffetz to the FBI responding to the agency’s decision to withhold documents requested by the Committee on May 16, 2017.
The FBI’s denial to cooperate is presented below:
According to a statement by the Oversight Committee, “Chaffetz requested memos, notes, summaries, and recordings to assist in the Committee’s investigation of the FBI’s independence, and which are outside the scope of the Special Counsel’s investigation.”
The documents are due June 8, 2017, but that may not happen as it appears the FBI is suddenly unwilling to cooperate.
As Chaffetz elaborates, after a New York Times report that former Federal Bureau of Investigation Director James Corney memorialized the content of phone calls and meetings with the President in a series of memoranda, he requested those memoranda and any related notes, summaries, and recordings. The FBI is withholding those documents, citing to the appointment of Robert Mueller as Special Prosecutor. According to a letter from your staff: “In light of this development and other considerations [the Bureau] is undertaking appropriate consultation to ensure all relevant interest implicated by your request are properly evaluated.
The letter states:
“The Committee has its own, Constitutionally-based prerogative to conduct investigations. But the Committee in no way wants to impede or interfere with the Special Counsel’s ability to conduct his investigation. In fact, the Committee’s investigation will complement the work of the Special Counsel. Whereas the Special Counsel is conducting a criminal or counterintelligence investigation that will occur largely behind closed doors, the Committee’s work will shed light on matters of high public interest, regardless of whether there is evidence of criminal conduct.
“The focus of the Committee’s investigation is the independence of the FBI, including conversations between the President and Comey and the process by which Comey was removed from his role as director. The records being withheld are central to those questions, even more so in light of Comey’s decision not to testify before the Committee at this time.”
“I am seeking to better understand Comey’s communications with the White House and Attorney General in such a way that does not implicate the Special Counsel’s work.”
As Chaffetz concludes, “Congress and the American public have a right and a duty to examine this issue independently of the Special Counsel’s investigation. I trust and hope you understand this and make the right decision-to produce these documents to the Committee immediately and on a voluntary basis.”
The American public is certainly looking forward to the FBI’s release of the full content of the Comey’s memos, not only those relating to his meetings with Trump, but just as importantly, with Loretta Lynch, as well as Barack Obama and/or Hillary Clinton.
Full text of Chairman Chaffetz letter can be viewed here.
Full text of FBI letter can be viewed here.
end
Strangely Twitter suspends WND (WorldNetDaily) for publishing a story that Donna Brazile demanded to know why a private eye was investigating the murder of Seth Rich with connections to the DNC
(courtesy zero hedge)
Twitter Suspends WND For Seth Rich Story
A couple of days ago, WND ran a story entitled “Bombshell: Donna Brazile Warned Off Private Eye On Seth Rich Murder.” The story was sourced back to on-the-record quotes provided by Detective Rod Wheeler who was hired by the Rich family shortly after their son’s suspicious murder in July 2016. Among other things, Wheeler said that it was former Democratic National Committee interim chairwoman Donna Brazile who allegedly called police and the Rich family and demanded to know why a private investigator was “snooping” into Rich’s death.
“The high-ranking DNC official that called the police after I inquired about Rich’s case was Donna Brazile,” veteran homicide detective Rod Wheeler told WND. “Why shouldn’t I reveal who it was?”
To promote the story, WND sent the following tweet:
Unfortunately, Twitter seemed to take issue with the story and sent a message to WND demanding that they “Delete Tweet.”
When they refused, a follow-up message from Twitter informed WND that their account had been effectively frozen.
“We have determined that you have violated the Twitter Rules, so we’ve temporarily limited some of your account features. While in this state, you can still browse Twitter, but you’re limited to only sending Direct Messages to your followers – no Tweets, Retweets, or likes.”
Of course, Twitter refused to highlight which of their rules (which can be found here) had been violated when asked by WND. After a quick review, we must admit that we would have a hard time identifying which rule was ‘violated’ as well. Here is a list of Twitter’s “Abusive Behavior” rules…see if you can figure out which of them was violated.
- Violent threats (direct or indirect): You may not make threats of violence or promote violence, including threatening or promoting terrorism.
- Harassment: You may not incite or engage in the targeted abuse or harassment of others. Some of the factors that we may consider when evaluating abusive behavior include:
- if a primary purpose of the reported account is to harass or send abusive messages to others;
- if the reported behavior is one-sided or includes threats;
- if the reported account is inciting others to harass another account; and
- if the reported account is sending harassing messages to an account from multiple accounts.
- Hateful conduct: You may not promote violence against or directly attack or threaten other people on the basis of race, ethnicity, national origin, sexual orientation, gender, gender identity, religious affiliation, age, disability, or disease. We also do not allow accounts whose primary purpose is inciting harm towards others on the basis of these categories.
- Multiple account abuse: Creating multiple accounts with overlapping uses or in order to evade the temporary or permanent suspension of a separate account is not allowed.
- Private information: You may not publish or post other people’s private and confidential information, such as credit card numbers, street address, or Social Security/National Identity numbers, without their express authorization and permission. In addition, you may not post intimate photos or videos that were taken or distributed without the subject’s consent. Read more about our private information policy here.
- Impersonation: You may not impersonate others through the Twitter service in a manner that is intended to or does mislead, confuse, or deceive others. Read more about our impersonation policy here.
- Self-harm: You may encounter someone considering suicide or self harm on Twitter. When we receive reports that a person is threatening suicide or self harm, we may take a number of steps to assist them, such as reaching out to that person expressing our concern and the concern of other users on Twitter or providing resources such as contact information for our mental health partners.
But that’s not really the point now is it? Perhaps the reason we can’t find the ‘rule’ that was violated is because Twitter doesn’t overtly publish their policy which demands the censoring all media which conflicts with their ‘progressive’ worldview.
Or maybe Twitter simply deemed the story to be ‘fake news’? If so, perhaps Twitter could share their evidence that negates the on-the-record quotes reported by WND. Or, maybe Twitter just assumed that an upstanding citizen like Brazile, a woman who destroyed her own integrity by sharing debate questions with Hillary’s campaign and subsequently lying about those actions on every media outlet in existence, would never do such a thing.
Moreover, if Twitter is now in the business of censoring ‘fake news’ then perhaps they can explain why our friends at CNN, the New York Times and the Washington Post seem to be able to publish numerous ‘fake news’ stories, on a daily basis, without consequence? Remember that whole ‘Golden Showers’ dossier that CNN pumped relentlessly over Twitter that was subsequently debunked with very minimal efforts…
Curiously, we don’t remember CNN or Jim Acosta being temporarily suspended for pumping that story.
end
Well that about does it for tonight
I will see you tomorrow night
h
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