July 7/RAID!!

GOLD: $1210.40  DOWN $13.40

Silver: $15.43  DOWN 53  cent(s)

Closing access prices:

Gold $1213.00

silver: $15.62

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: $1231.29 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME:  $1219.65

PREMIUM FIRST FIX:  $11.64

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SECOND SHANGHAI GOLD FIX: $1233.06

NY GOLD PRICE AT THE EXACT SAME TIME: $1221.20

Premium of Shanghai 2nd fix/NY:$11.86

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LONDON FIRST GOLD FIX:  5:30 am est  $1220.40

NY PRICING AT THE EXACT SAME TIME: $1221.30  

LONDON SECOND GOLD FIX  10 AM: $1215.65

NY PRICING AT THE EXACT SAME TIME. $1215.30   

For comex gold:

JULY/

NOTICES FILINGS TODAY FOR APRIL CONTRACT MONTH:  3 NOTICE(S) FOR 300  OZ.

TOTAL NOTICES SO FAR: 61 FOR 6100 OZ    (.1897 TONNES)

For silver:

JULY

 292 NOTICES FILED TODAY FOR

1,460,000  OZ/

Total number of notices filed so far this month: 2262 for 11,310,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

end

Let us have a look at the data for today

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In silver, the total open interest SURPRISINGLY ROSE BY A TINY 344 contract(s) UP to 207,805 WITH THE SMALL RISE IN PRICE THAT SILVER  DELIVERED WITH YESTERDAY’S TRADING (UP 8 CENT(S) ON TOP OF THE  CONSTANT TORMENT THESE PAST FEW WEEKS including today. 

 In ounces, the OI is still represented by just OVER 1 BILLION oz i.e.  1.0390 BILLION TO BE EXACT or 149% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT MAY MONTH/ THEY FILED: 292 NOTICE(S) FOR 1,460,000  OZ OF SILVER

In gold, the total comex gold SURPRISINGLY ROSE BY A HUGE 9974 CONTRACTS DESPITE THE TINY RISE IN THE PRICE OF GOLD  ($3.40 with YESTERDAY’S TRADING). The total gold OI stands at 472,831 contracts.

we had 3 notice(s) filed upon for 300 oz of gold.

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

GLD:

We had a huge change in tonnes of gold at the GLD: a massive withdrawal of 5.32 tonnes and this was used in the paper raid today

Inventory rests tonight: 835.35 tonnes

.

SLV

Today: STRANGE:  DESPITE THE MASSIVE FALL IN SILVER TODAY, NO CHANGE IN INVENTORY/INVENTORY RESTS AT 341.731 MILLION OZ

Please note the difference between gold and silver with respect to the GLD and SLV inventory changes

end

.

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

1. Today, we had the open interest in silver  ROSE BY A TINY 344 contracts  UP TO 207,805 (AND now A LITTLE CLOSER FROM THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787), WITH THE SMALL RISE IN PRICE FOR SILVER WITH YESTERDAY’S TRADING  (UP 8 CENTS).We LOST NOBODY AS  EVERYBODY remains firm and determined. 

(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 THURSDAY night/FRIDAY morning: Shanghai closed UP 5.51 POINTS OR 0.17%   / /Hang Sang CLOSED DOWN 124.37 POINTS OR 0.49% The Nikkei closed DOWN 64.97 POINTS OR 0.32%/Australia’s all ordinaires CLOSED DOWN 0.93%/Chinese yuan (ONSHORE) closed UP at 6.7990/Oil DOWN to 44.13 dollars per barrel for WTI and 46.66 for Brent. Stocks in Europe OPENED ALL IN THE RED,,   Offshore yuan trades  6.80050 yuan to the dollar vs 6.7990 for onshore yuan. NOW THE OFFSHORE IS A TOUCH STRONGER  TO THE ONSHORE YUAN/ ONSHORE YUAN  STRONGER (TO THE DOLLAR)  AND THE OFFSHORE YUAN IS STRONGER TO THE DOLLAR AND THIS IS COUPLED WITH THE STRONGER DOLLAR. CHINA IS NOT  HAPPY TODAY

3a)THAILAND/SOUTH KOREA/NORTH KOREA

i)NORTH KOREA

b) REPORT ON JAPAN

Japan panicked last night when they saw their bond yields rising about .12%.  They then went into another bond buying bash by offering to buy unlimited 10 yr bonds at .11%.  That sent bond yields lower but also the message that central banks are nervous about yields rising and the message that it sends to the stock markets.

( zero hedge)

c) REPORT ON CHINA

4. EUROPEAN AFFAIRS

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

Syria/ISIS

i)The Syrian Army is now set to recapture the oil fields near Palmyra and the USA et al are ready to take Raqqa back

ISIS is basically finished

( Paraskova/OilPrice.com)

Russia/USAMeeting

ii)USA and Russia are cooperating and agree to a cease fire in southwest Syria:

( zerohedge)

iii)Highlights of the meeting between Trump  and Putin:

( zero hedge)

iv)Iran/Saudi Arabia

The following out to good for another 10 dollar rout in gold:  Iran arrests 4 Saudis in a vessel just inside its territorial waters:

( zero hedge)

6 .GLOBAL ISSUES

7. OIL ISSUES

i)Brent tumbles into the 46 dollar handle after witnessing that huge USA production surge

( zero hedge)

ii)After falling last week, this week the USA rig count rose considerably
( zero hedge)

8. EMERGING MARKET

9.   PHYSICAL MARKETS

( Times of India)

( Alasdair Macleod)

iii)This is not good for Tanzania’s mining sector as their government just about killed them if this critical gold nation

(courtesy Dave Forest)

10. USA Stories

i)The phony jobs official report:  222,000 which is a beat but the all important hourly earnings came in at .2% rise instead of .3%

the dollar falls with gold and silver rising/

( zero hedge)

ii)Initial trading after the phony jobs report:

( zerohedge)

iii)now the real story behind the jobs report:  huge increase in minimum wage earners and also a surge in non productive government hiring:

( zero hedge)

(courtesy Dave Kranzler/IRD)

v)Funny!! CNN ratings collapse as they are drawing less viewers than reruns of Yogi Bear

( zero hedge)

Let us head over to the comex:

The total gold comex open interest SURPRISINGLY ROSE BY  9,974 CONTRACTS up to an OI level of 472,831 WITH THE  RISE  IN THE PRICE OF GOLD ($3.40 with YESTERDAY’S trading). An open interest of around 390,000 to 400,000 is core and nothing will move these guys from their contracts.

We are now in the contract month of JULY and it is one of the POORER delivery months  of the year. .

The non active July contract LOST 19 contract(s) to stand at 56 contracts. We had only 19 notices filed YESTERDAY morning, so we GAINED 0 contracts or an additional NIL oz that will  stand in this non active month of July.  Thus 0 EFP notices were given which gives the long holder a fiat bonus plus a futures contract for delivery and most likely these are London based forwards.  The contracts are private so we do not get to see all the particulars. The next big active month is August and here the OI LOST 1505 contracts DOWN to 283,733, as the bankers trying to keep this month down to manageable size. The next non active contract month is September and here they picked up another 72 contracts to stand at 328. The next active delivery month is October and here we gained 264 contracts up to 18,441.  October is the poorest of the active gold delivery months as most players move right to December.

We had 3 notice(s) filed upon today for 300 oz

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And now for the wild silver comex results.  Total silver OI  ROSE BY 344 contracts FROM 207,461 UP TO 207,805 WITH YESTERDAY’S  8 CENT GAIN AND CONSTANT TORMENT THESE PAST FEW WEEKS. OUR BANKER FRIENDS ARE DESPERATELY TRYING TO COVER THEIR SHORTS IN SILVER BUT AS YOU CAN SEE  THEY HAVE NOT BEEN AS SUCCESSFUL AS THEY WOULD HAVE LIKED. THE BIG NEWS IS THE FACT THAT WE  ENTERED FIRST DAY NOTICE AND BEYOND AND  WE HARDLY HAD ANY OBLITERATION OF OPEN INTEREST. THIS IS THE FIRST TIME THIS HAS HAPPENED IN OVER 2 YEARS.

We are now in the next big active month will be July and here the OI LOST 362 contracts DOWN to 466. We had 369 notices served  yesterday so we  gained 7 notices or an additional  35,000 oz will stand at the comex, and 0 EFP contracts were issued which entitles them to receive a fiat bonus and a future delivery contract (which no doubt is a London based forward).

The month of August, a non active month gained 41 contracts to stand at 465.  The next big active delivery month for silver will be September and here the OI already jumped by another 123 contracts up to 158,741.

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.

As for the July contracts:

Initial amount that stood for silver for the July 2016 contract:  14.785 million  oz

Final standing JULY 2016:  12.370 million with the difference being EFP’s taking delivery in London.  Thus we are basically on par to what happened a year ago as to the total amount of silver ounces standing.

We had 292 notice(s) filed for 1,460,000 oz for the June 2017 contract

VOLUMES: for the gold comex

Today the estimated volume was 188,168 contracts which is good/

Yesterday’s confirmed volume was 214,227 contracts  which is GOOD

volumes on gold are STILL HIGHER THAN NORMAL!

Initial standings for JULY
 July 7/2017.
Gold Ounces
Withdrawals from Dealers Inventory in oz   nil
Withdrawals from Customer Inventory in oz  
3,279.402
OZ
hsbc
Deposits to the Dealer Inventory in oz NIL  oz
Deposits to the Customer Inventory, in oz 
NIL oz
No of oz served (contracts) today
 
3 notice(s)
300 OZ
No of oz to be served (notices)
53 contracts
5300 oz
Total monthly oz gold served (contracts) so far this month
61 notices
6100 oz
.1897 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   3,279.402oz
Today we HAD  0 kilobar transaction(s)/ 
We had 0 deposit into the dealer:
total dealer deposits: NIL oz
We had NIL dealer withdrawals:
total dealer withdrawals:  NIL oz
we had no dealer deposits:
total dealer deposits:  nil oz
we had 0  customer deposit(s):
total customer deposits; NIL  oz
We had 1 customer withdrawal(s)
 i) out of HSBC: 3,279.402 oz
total customer withdrawal: 3,279.402  oz
 we had 1 adjustment(s):
i) from the brinks vault: 5040.455 oz was adjusted out of the dealer and this landed into the customer account of Brinks
 
For JULY:

Today, 0 notice(s) were issued from JPMorgan dealer account and 3 notices were issued from their client or customer account. The total of all issuance by all participants equates to 19  contract(s)  of which 3 notices were stopped (received) by j.P. Morgan dealer and 0 notice(s) was (were) stopped/ Received) by j.P.Morgan customer account.

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To calculate the initial total number of gold ounces standing for the JULY. contract month, we take the total number of notices filed so far for the month (61) x 100 oz or 6,100 oz, to which we add the difference between the open interest for the front month of JUNE (56 contracts) minus the number of notices served upon today (3) x 100 oz per contract equals 11,400  oz, the number of ounces standing in this NON active month of JULY.
 
Thus the INITIAL standings for gold for the JULY contract month:
No of notices served so far (61) x 100 oz  or ounces + {(56)OI for the front month  minus the number of  notices served upon today (3) x 100 oz which equals 11,400 oz standing in this  active delivery month of JUNE  (0.3545 tonnes)
We GAINED 7 contracts or AN ADDITIONAL 35,000 oz will  stand and 0 EFP contracts were issued as described as above.
.
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Total dealer inventory 827,122.459 or 25.72 tonnes  (dealer gold continues to disappear)
Total gold inventory (dealer and customer) = 8,613,422.571 or 267.91 tonnes 
 
Over a year ago the comex had 303 tonnes of total gold. Today the total inventory rests at 267.91 tonnes for a  loss of 35  tonnes over that period.  Since August 8/2016 we have lost 86 tonnes leaving the comex. However I am including kilobar transactions and they are very suspect at best
I have a sneaky feeling that these withdrawals of gold in kilobars are being used in the hypothecating process  and are being used in the raiding of gold!

The gold comex is an absolute fraud.  The use of kilobars and exact weights makes the data totally absurd and fraudulent! To me, the only thing that makes sense is the fact that “kilobars: are entries of hypothecated gold sent to other jurisdictions so that they will not be short with their underwritten derivatives in that jurisdiction.  This would be similar to the rehypothecated gold used by Jon Corzine at MF Global.
 
IN THE LAST 11 MONTHS  86 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
AND NOW THE June DELIVERY MONTH
 
JULY INITIAL standings
 July 7 2017
Silver Ounces
Withdrawals from Dealers Inventory  nil
Withdrawals from Customer Inventory
 310,542.300 oz
Scotia
Deposits to the Dealer Inventory
nil  oz
Deposits to the Customer Inventory 
629,799.500 oz
JPM
No of oz served today (contracts)
 292 CONTRACT(S)
(1,460,000 OZ)
No of oz to be served (notices)
174 contracts
( 870,000 oz)
Total monthly oz silver served (contracts) 2262 contracts (11,310,000 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 492,469.6 oz
today, we had  0 deposit(s) into the dealer account:
total dealer deposit: nil   oz
we had Nil dealer withdrawals:
total dealer withdrawals: nil oz
we had 1 customer withdrawal(s):
 i) Out of Scotia:  310,542.300 oz
TOTAL CUSTOMER WITHDRAWALS:   310,542.300 oz
We had 1 Customer deposit(s):
i) Into JPM: 629,799.500 oz
***deposits into JPMorgan have now resumed again
In the month of March and February, JPMorgan stopped (received) almost all of the comex silver contracts.
why is JPMorgan bringing in so much silver??? why is this not criminal in that they are also the massive short in silver
total customer deposits: 629,799.500 oz
 
 we had 1 adjustment(s)
i) Out of CNT:  15,273.140 oz was adjusted out of the dealer account and this landed into the customer account of CNT
The total number of notices filed today for the JULY. contract month is represented by 292 contract(s) for 1,460,000 oz. To calculate the number of silver ounces that will stand for delivery in JULY., we take the total number of notices filed for the month so far at 2262 x 5,000 oz  = 11,310,000 oz to which we add the difference between the open interest for the front month of JUNE (466) and the number of notices served upon today (292) x 5000 oz equals the number of ounces standing
 

 

.
 
Thus the INITIAL standings for silver for the JULY contract month:  2262 (notices served so far)x 5000 oz  + OI for front month of JUNE.(466 ) -number of notices served upon today (292)x 5000 oz  equals  12,180,000 oz  of silver standing for the JULY contract month.
We  gained 24 contracts for an additional 120,000 oz  that will stand at the comex and 0 EFP’s were issued.
 
 
 
 
Volumes: for silver comex
Today the estimated volume was 80,486 which is huge
Yesterday’s  confirmed volume was 70,256 contracts which is  HUGE
YESTERDAY’S CONFIRMED VOLUME OF 70,256 CONTRACTS EQUATES TO 351 MILLION OZ OF SILVER OR 50% OF ANNUAL GLOBAL PRODUCTION OF SILVER EX CHINA EX RUSSIA). IN OUR HEARINGS THE COMMISSIONERS STRESSED THAT THE OPEN INTEREST SHOULD BE AROUND 3% OF THE MARKET.
 
Total dealer silver:  38.503 million (close to record low inventory  
Total number of dealer and customer silver:   211.859 million oz
The record level of silver open interest is 234,787 contracts set on April 21./2017  with the price at that day at  $18.42
The previous record was 224,540 contracts with the price at that time of $20.44
end

NPV for Sprott and Central Fund of Canada

1. Central Fund of Canada: traded at Negative 7.7 percent to NAV usa funds and Negative 7.9% to NAV for Cdn funds!!!! 
Percentage of fund in gold 62.9%
Percentage of fund in silver:37.0%
cash .+0.1%( July 7/2017) 
 SPROTT DID NOT UPDATE AS OF PUBLISHING TIME
I WILL AMEND MY COMMENTARY
2. Sprott silver fund (PSLV): STOCK   NAV  RISES TO +.54% (July 6/2017) 
3. Sprott gold fund (PHYS): premium to NAV RISES TO -0.68% to NAV  (July 6/2017 )
Note: Sprott silver trust back  into POSITIVE territory at +0.54 /Sprott physical gold trust is back into NEGATIVE/ territory at -0.68%/Central fund of Canada’s is still in jail  but being rescued by Sprott.

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

(courtesy Sprott/GATA)

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

 Section: Daily Dispatches

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

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

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

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

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

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

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

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

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

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

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

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

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

end

And now the Gold inventory at the GLD

July 7/a massive withdrawal of 5.32 tonnes of paper gold were removed and this was used in the attack today/inventory rests at 835.35 tonnes

July 6/no changes in tonnage at the GLD/Inventory rests at 840.67 tonnes

July 5/A MASSIVE 5.62 TONNES OF GOLD LEFT THE GLD AND NO DOUBT WAS USED IN THE RAID THIS MORNING/INVENTORY REST

July 3/ A MASSIVE 7.37 TONNES OF GOLD LEAVE THE GLD/INVENTORY RESTS AT 846.29 TONNES

June 30/no change in gold inventory at the GLD/Inventory rests at 853.66 tonnes

June 29/no change in inventory at the GLD/inventory rests at 853.66 tonnes

June 28/no change in inventory at the GLD/Inventory rests at 853.66 tonnes

June 27.2017/a deposit of 2.64 tonnes into the GLD/inventory rests at 853.66 tonnes

June 26/a withdrawal of 2.66 tonnes from the GLD and this gold no doubt was part of the raid/Inventory rests at 851.02

June 23/no change in gold inventory at the GLD/Inventory rests at 853.68 tonnes

June 22/no change in gold inventory at the GLD/Inventory rests at 853.68 tonnes

June 21/no change in gold inventory at the GLD/Inventory rests at 853.68 tonnes

June 20/no  change in gold inventory at the GLD//Inventory rests at 853.68 tonnes

June 19/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 853.68 TONNES

June 16/no changes in gold inventory at the GLD/Inventory rests at 853.68 tonnes

June 15/ a monstrous “paper” withdrawal of 13.32 tonnes/Inventory rests at 853.68 tonnes

June 14./NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 867.00 TONNES

June 13. No change in gold inventory at the GLD/Inventory rests at 867.00 tonnes

June 12/No change in gold inventory at the GLD/Inventory rests at 867.00 tonnes

June 9/no change in inventory at the GLD/Inventory rests at 867.00 tonnes

June 8/AN ADDITION OF 3.07 TONNES OF GOLD ADDED TO THE GLD/INVENTORY RESTS AT 867.00 TONNES

June 7 a huge change in inventory/a deposit of 13.93 tonnes/inventory rests at 864.93 tonnes

June 6/ no changes in inventory at the GLD/Inventory remains at 851.00 tonnes

June 5.2017/no changes at the GLD/Inventory remain at 851.00 tonnes

June 2/2017/a huge deposit of 3.55 tonnes of gold into the GLD/Inventory rests at 851.00 tonnes

June 1/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 847.45 TONNES

May 31./ no change in gold inventory at the GLD/Inventory rests at 847.45 tonnes

May 30/no change in gold inventory at the GLD/Inventory rests at 847.45 tonnes

May 26./no change in inventory at the GLD/Inventory rests at 847.45 tonnes

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

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July 7 /2017/ Inventory rests tonight at 835.35 tonnes
*IN LAST 185 TRADING DAYS: 111.78 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 126 TRADING DAYS: A NET  15.65 TONNES HAVE NOW BEEN ADDED INTO GLD INVENTORY.
*FROM FEB 1/2017: A NET  28.77 TONNES HAVE BEEN ADDED.

end

Now the SLV Inventory

July 7/Strange: no change in inventory (compare that with gold) Inventory rests at 341.731 million oz

July 6/ANOTHER MASSIVE DEPOSIT OF 2.126 MILLION OZ INTO THE SLV INVENTORY/INVENTORY RESTS AT 341.731 MILLION OZ.

July 5/STRANGE! NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 339.605 MILLION OZ

July 3/strange! with the huge whacking of silver we got an increase of 379,000 oz into inventory.

June 30/no change in silver inventory at the SLV/Inventory rests at 339.226 million oz

June 29/no change in silver inventory at the SLV/Inventory rests at 339.226 million oz/

June 28/ a small withdrawal of 662,000 oz form the SLV/Inventory rests at 339.226 million oz/

June 27/no change in the silver inventory at the SLV/Inventory rests at 339.888 million oz/

June 26/no change in the silver inventory at the SLV/Inventory rests at 339.888 million oz/

June 23/no change in silver inventory at the SLV/Inventory rests at 339.888 million oz

June 22/ a big change; a huge deposit of 2.175 million oz into the SLV/Inventory rests at 339.888 million oz

June 21/no change in silver inventory at the SLV/inventory rests at 337.713 million oz

June 20/a deposit of 1.513 million oz/inventory rests at 337.713 million oz/.

June 19/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 336.200 MILLION OZ

June 16/no changes in inventory at the SLV/inventory rests at 336.200 million oz

June 15/ a massive “paper withdrawal” of 3.405 million oz of silver/Inventory rests at 336.200 million oz/

June 14/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 339.605 MILLION OZ/

June 13/no change in silver inventory at the SLV/Inventory rests at 339.605 million oz

June 12/no change in silver inventory at the SLV/Inventory rests at 339.605 million oz/

June 9/no change in silver inventory at the SLV/Inventory rests at 339.605 million oz/

June 8/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 339.605 MILLION OZ/

June 7/no change in inventory at the SLV/inventory rests at 339.605 million oz/

June 6/no change in inventory at the SLV/Inventory rests at 339.605 million oz.

June 5/a huge change at the SLV/a withdrawal of 1.371 million oz /inventory rests at 339.605 million oz/

June 2/no change in silver inventory at the SLV/Inventory rests at 340.976 million oz/

June 1/NO CHANGE IN INVENTORY AT THE SLV/INVENTORY RESTS AT 340.976 MILLION OZ

May 31./ no change in silver inventory at the SLV/inventory rests at 340.976 million oz/

May 30/no change in silver inventory at the SLV/inventory rests at 340.976 million oz

May 26/another paper withdrawal of 946,000 oz of silver from the SLV with silver rising/inventory rests at 340.976 million oz

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/

July 7.2017:
 Inventory 341.731  million oz
end
  • 6 Month MM GOFO

    Indicative gold forward offer rate for a 6 month duration

    + 1.11%
  • 12 Month MM GOFO
    + 1.43%
  • 30 day trend

end

Here is a review of the 3 latest comex waterfall (whacks) on gold and silver not including the current one we are undergoing.  I have taken the nadir of the gold price before it started to rise again and compared it to OI in both gold and silver with the OPEN INTEREST.  The OI readings are the following day but we are always one day behind so this compares exactly to the nadir price.
First waterfall ended Oct 6 2016/ Nadir price of gold at that date Oct 6 2016 : $1254.70 / OI for gold Oct 7/2016: 511,340//OI for silver/Oct 7.2016: 194,811
Second waterfall ended Dec 15.2016:Nadir Price of gold Dec 15.2016:      $1128.20              //OI for gold Dec 16/2016 401,798// OI for silver: Dec 16/16 161,570
Third waterfall ended May 10/2017: Nadir Price of gold May 10 2016:   $1220.95              //  OI for gold May 11: 425,252//  OI for silver May 11/17: 199,826
and for comparison while we are undergoing another waterfall these past several weeks
 Today’s price of gold $1211.0                                                                                                    OI for gold today: 472,831//Oi for silver  207,805
The first waterfall corresponds to a silver price of $17.30 on Oct 6
The second waterfall corresponds to a silver price of $15.90 on Dec 15
The third waterfall corresponds to a silver price of $17.37 on May 10
and today:  silver price of $15.63
Since the bottom of the second waterfall the price of gold at its nadir is about the same ($1220 and $1226), but the OI for gold is much higher along with silver OI also much higher. (425,252 and 472,831 OI for gold) accompanying  199,826 and 207,805 OI for silver)
It seems the data suggests power manipulation to control the price through paper!
end
At 3:30 pm we receive the COT report.  As I have stated in previous reports, I do not think we can glean much from this as longs can receive a paper EFP and move deliveries to outside jurisdictions like London.  However for the sake of completeness here is your report anyway:
Gold COT Report – Futures
Large Speculators Commercial Total
Long Short Spreading Long Short Long Short
221,681 127,882 56,968 131,190 238,416 409,839 423,266
Change from Prior Reporting Period
-14,905 22,968 5,310 13,693 -28,944 4,098 -666
Traders
152 103 81 54 50 243 201
 
Small Speculators  
Long Short Open Interest  
47,362 33,935 457,201  
-41 4,723 4,057  
non reportable positions Change from the previous reporting period
COT Gold Report – Positions as of Monday, July 03, 2017

Our large speculators

those large specs that have been long in gold pitched a huge 14,905 contracts from their long side

those large specs that have been short in gold added a whopping 22,968 contracts to their short side

Our commercials

those commercials who are criminals and are long in gold added 13,693 contracts to their long side

those commercials who are criminals and are short in gold covered a monstrous 28944 contracts

Our small specs

those small specs who are long in gold pitched a tiny 41 contracts from their long side

those small specs who are short in gold added 4723 contracts.

Conclusions:

other than fraud, the specs who massively net short and the commercials go net long

that is bullish despite the fraud.

end

Silver COT Report: Futures
Large Speculators Commercial
Long Short Spreading Long Short
91,996 65,721 20,600 61,561 100,789
-1,873 7,384 -1,467 1,841 -9,139
Traders
104 56 47 38 35
Small Speculators Open Interest Total
Long Short 203,541 Long Short
29,384 16,431 174,157 187,110
403 2,126 -1,096 -1,499 -3,222
non reportable positions Positions as of: 162 122
Monday, July 03, 2017

Our large speculators

those large specs who have been long in silver pitched a huge 1873 contracts from their long side

those large specs who have been short in silver added 7384 contracts to their short side

Our commercials

those commercials who are criminals and have been long in silver added 1841 contracts to their long side

those commercials who are criminals have been short in silver pitched 9139 contracts to their short side

Our small specs

those small specs who have been long in silver added 403 contracts to their long side

those small specs who have been short in silver added 2126 contracts.

Conclusions:

the specs go massively net short and the commercials go massively net long

two things:

  1. are the specs that stupid
  2. this COT report is of Monday. You can bet the farm that  the same modus operandi continued throughout the week. When the specs go net short they always get annihilated. Expect gold and silver  (paper) to advance hugely crushing the spec shorts.

Major gold/silver trading/commentaries for FRIDAY

GOLDCORE/BLOG/MARK O’BYRNE.

GOLD/SILVER

Silver Prices Bounce Higher After Futures Manipulated 7% Lower In Minute

GoldCore's picture

Silver Prices Bounce Higher After Futures Manipulated 7% Lower In Minute

  Silver prices ‘flash crash’ before rebound
– Silver hammered 7% lower in less than minute in Asian trading
– Silver fell from $16 to $14.82, before recovering to $15.89
– Silver plunge blamed on another ‘trading error’
– Gold similar ‘flash crash’ last week and similar recovery
– Hallmarks of market manipulation as $450 million worth of silver futures sold in minute

– Trading ‘errors’ always push gold and silver lower. Why never higher?
– ‘Flash crashes’ increasingly frequent in precious metals, yet rarely happen in stocks and bonds
– Rapid recovery from frequent raids bodes well for precious metals
Silver coins and bars accumulated on dips by ‘stackers’

Silver prices got a bit of a jolt this morning  when spot silver had yet another so called ‘flash crash’ and fell by between 7% and 10% before recovering and bouncing sharply higher to not far below where the attack on the price began.

In a repeat of what happened to gold last week, a bout of massive selling hammered silver prices lower momentarily. Having hit an early session high of $16.18/oz, the spot silver price fell from $16 to as $14.82 in less than a minute. The price recovered as quickly as it crashed, rebounding to $15.89/oz.

Source: Thomson Reuters via Business Insider

This isn’t the first so called ‘flash crash’ silver has seen in the last month. It fell in tandem with gold’s 1% ‘crash’ on June 26th, by 1.3%. Prices did not rebound as quickly, silver has declined by nearly 3.7% between then and July 6th.

Yesterday silver appeared to be on the road to recovery having climbed 0.5%.

Many analysts are calling the flash crash a ‘trading error’ or fat finger.’ However, this is somewhat lazy and ignores a few pertinent facts and context.

The aggressive selling had all the hallmarks of market manipulation as $450 million worth of silver futures were sold in a minute. An entity appears to have wanted silver lower and the massive sell order achieved that goal.

This could be due to a hedge fund or institution having a short position. By manipulating prices lower they can liquidate their short positions at much lower prices, making sizable profits.

The profit motive is a powerful one for hedge funds, banks etc and it would be naive in the extreme to discount this possibility. Especially, as regulators and the CFTC have been seen to be very “light touch” in recent years.

We think it notable and worthy of further inquiry as to why ‘fat finger’ trades never appear to be in favour of gold and silver prices and never result in gold and silver prices surging in value.

It is also worth noting that such fat finger trades rarely result in massive selling of stocks or bonds that result in sharp declines in a minute or two.

Finally, banks have been found to have been manipulating silver markets in recent years and this was proven in the evidence seen in the silver manipulation lawsuit.

Deutsche Bank agreed to settle a class action lawsuit filed in July 2014 accusing a consortium of banks of manipulating gold and silver. Among the charges that Deutsche Bank effectively refused to contest were:

  • bid-rigging, and unjust enrichment.
  • price fixing and unlawful restraint
  • price manipulation claims

Deutsche Bank agreed to pay $38 million to settle the U.S. litigation over allegations it illegally conspired with other banks to fix silver prices at the expense of investors.

Might other institutions and banks not have been doing the same thing overnight in the silver market?

.

Since 2003, we have believed and written about how the silver and gold markets are manipulated. Even then there was circumstantial evidence to suggest this was the case.

Since then, there has emerged much evidence that bullion banks were coordinating the manipulation of gold and silver and suppressing prices as alleged by the Gold Anti Trust Action Commitee (GATA).

Physical silver buyers are again taking advantage of this latest artificial price decline and are continuing to accumulate silver coins and bars. Gold and particularly silver stackers accumulate physical silver on an ongoing basis and many use these price declines to acquire silver for the long term at short term discounted prices.

.

News and Commentary

Silver swoons and snaps back again in latest flash crash (TheAustralian.com)

Gold prices dip ahead of U.S. non-farm payrolls data (Reuters.com)

Asia hit by Wall St. stumble, debt yields spike after ECB minutes (Reuters.com)

Bond Rout Deepens as Asia Stocks Join Global Drop (Bloomberg.com)

Trader bets nearly $1.5 million on major gold rally in the second half (CNBC.com)

Silver Flash-Crashes As Japan Opens (ZeroHedge.com)

Silver just had a flash crash (BusinessInsider.com)

Gold may supplant “outdated global financial architecture” (Gold.org)

Real cryptocurrency money is here in Asia (StansBerryChurcHouse.com)

We’re all ten years older and deeper in debt (MoneyWeek.com)

Gold Prices (LBMA AM)

07 Jul: USD 1,220.40, GBP 944.47 & EUR 1,068.95 per ounce
06 Jul: USD 1,224.30, GBP 946.14 & EUR 1,077.51 per ounce
05 Jul: USD 1,221.90, GBP 945.87 & EUR 1,078.45 per ounce
04 Jul: USD 1,224.25, GBP 947.32 & EUR 1,078.81 per ounce
03 Jul: USD 1,235.20, GBP 952.09 & EUR 1,085.00 per ounce
30 Jun: USD 1,243.25, GBP 957.43 & EUR 1,090.83 per ounce
29 Jun: USD 1,246.60, GBP 959.88 & EUR 1,093.14 per ounce

Silver Prices (LBMA)

07 Jul: USD 15.84, GBP 12.29 & EUR 13.88 per ounce
06 Jul: USD 16.01, GBP 12.36 & EUR 14.09 per ounce
05 Jul: USD 15.95, GBP 12.36 & EUR 14.09 per ounce
04 Jul: USD 16.15, GBP 12.48 & EUR 14.23 per ounce
03 Jul: USD 16.48, GBP 12.72 & EUR 14.49 per ounce
30 Jun: USD 16.47, GBP 12.69 & EUR 14.44 per ounce
29 Jun: USD 16.83, GBP 12.98 & EUR 14.76 per ounce


Recent Market Updates

– Precious Metals Are “Best Defence” Against Bail-ins In Economic Crisis
– Buy Gold Near $1,200 “As Insurance” – UBS Wealth
– UK House Prices ‘On Brink’ Of Massive 40% Collapse
– Gold Up 8% In First Half 2017; Builds On 8.5% Gain In 2016
– Pensions Timebomb In America – “National Crisis” Cometh
– London Property Bubble Bursting? UK In Unchartered Territory On Brexit and Election Mess
– Shrinkflation – Real Inflation Much Higher Than Reported
– Goldman, Citi Turn Positive On Gold – Despite “Mysterious” Flash Crash
– Worst Crash In Our Lifetime Coming – Jim Rogers
– Go for Gold – Win a beautiful Gold Sovereign coin
– Only Gold Lasts Forever
– Your Future Wealth Depends on what You Decide to Keep and Invest in Now
– Inflation is no longer in stealth mode

end

last night:

Silver Flash-Crashes As Japan Opens

First it was gold last week, then it was half of Nasdaq on July 4th, and now it’s silver that is taking it’s turn in the ‘glitch’ camp. As Japanese markets opened tonight, spot silver prices crashed around 6% in a few seconds only to instantly rip back higher

It appears someone was in a hurry to dump over $450 million worth of silver futures…

Silver Tests Overnight Flash-Crash Lows

Spot silver prices have slipped lower since the payrolls data this morning and are now testing (and rebounding) the overnight flash-crash lows as Japan opened…

The futures volume is considerably lower in this drop than the $475mm dump last night.

Gold is also falling…

DR JANDA’S LETTER TO THE CHAIRMAN OF THE CFTC

Dear Mr. McDonald,

In addition to my role as an Orthopedic Surgeon, I have an economics degree from Bucknell University and I am a “dissector” of financial markets. What occurred in the silver after market tonight can ONLY be categorized as a CRIMINAL act! 10,000 contracts dumped in less than minute representing 50 MILLION ounces causing a 10% drop in price can only occur when a criminal enterprise is intent on wiping out stops in order to create an illegal advantageous position.

The CFTC in the past has determined that the silver market was not manipulated only to be proven wrong by the disclosure by Deutche Bank and other banks in admitting criminal manipulation of the fix. In addition, as you well know, a trader for the same bank has plead guilty to criminally manipulating the silver market and as we ALL know a lone trader at DB is NOT alone in this criminal activity.

Sir, it is time! Enough! The public is aware and it is time for you to step up and re-establish Free and Functional markets.The public is tired of “regulators” taking on the role of co-conspirators … it is time to enforce the rule of law.

We are watching and tired of waiting!

David H Janda M.D

(courtesy Times of India)

(courtesy Alasdair Macleod)

Alasdair Macleod: Time for a new gold standard for Asia

 Section: 

1:21p ET Thursday, July 6, 2017

Dear Friend of GATA and Gold:

GoldMoney research director Alasdair Macleod writes today that China and Russia are leading Eurasia away from the U.S. dollar and toward a new gold standard, recognizing that the United States has used the dollar’s reserve currency status and the shorting of gold for the purposes of world domination. Macleod’s commentary is headlined “Time for a New Gold Standard for Asia” and it’s posted at GoldMoney here:

https://www.goldmoney.com/research/goldmoney-insights/time-for-a-new-gol…

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

END

This is not good for Tanzania’s mining sector as their government just about killed them if this critical gold nation

(courtesy Dave Forest)

The government just killed the mining sector in this critical gold nation

 Section: 

By Dave Forest
OilPrice.com, London
Wednesday, July 6, 2017

The Philippines government said this week it is trying to repair its damaged mining sector, with officials stating they will review all policies implemented by former environment secretary Regina Lopez, who took a hard-line stance against operations around the country.

But as that mining nation swings to the better, another key metals country has gone the other way. With the government implementing a raft of policies that may well decimate the entire sector here: Tanzania.

Tanzania’s government has gone to war with miners in recent months, accusing companies like Acacia Mining of cheating on export duties, resulting in a complete ban on concentrate exports earlier this year.

And this week officials took the fight to another level, passing several new laws that will make mining much more challenging in the country. …

… For the remainder of the report:

http://oilprice.com/Metals/Gold/The-Government-Just-Killed-The-Mining-Se…

END


Your early FRIDAY 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  STRONGER 6.7990(REVALUATION NORTHBOUND   /OFFSHORE YUAN MOVES  STRONGER TO ONSHORE AT   6.7990/ Shanghai bourse CLOSED UP 5.51 POINTS OR 0.17%  / HANG SANG CLOSED DOWN 124.37 POINTS OR 0.49% 

2. Nikkei closed DOWN 64.97 POINTS OR 0.32%   /USA: YEN RISES TO 113.71

3. Europe stocks OPENED ALL IN THE RED      ( /USA dollar index RISES TO  95.99/Euro DOWN to 1.1412

3b Japan 10 year bond yield: FALLS  TO  +.087%/ GOVERNMENT INTERVENTION    !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 110.06/ 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::  44.13 and Brent: 46.66

3f Gold DOWN/Yen DOWN

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund RISES TO  +.575%/Italian 10 yr bond yield UP  to 2.292%    

3j Greek 10 year bond yield RISES to  : 5.426???  

3k Gold at $1223.35  silver at:15.88 (8:15 am est)   SILVER BELOW  RESISTANCE AT $18.50 

3l USA vs Russian rouble; (Russian rouble DOWN 25/100 in  roubles/dollar) 60.39-

3m oil into the 44 dollar handle for WTI and 46 handle for Brent/

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

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 113.71 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  0.9629 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0987 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 RISING to  +0.575%

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 2.3802% early this morning. Thirty year rate  at 2.9102% /POLICY ERROR)GETTING DANGEROUSLY HIGH

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

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

Bond Rout Fades With Futures Flat Ahead Of Payrolls; Pound, Yen, Oil Tumble

S&P futures are little changed following yesterday’s rout even as Asian and European markets continued selling; the pound slid on poor factory data, the yen tumbled after the BOJ intervened to stabilize the JGB bond market, precious metals flash crashed early in the session, while the selloff in oil accelerated despite yesterday’s massive inventory draw, although at least yesterday’s sharp bond tantrum has stabilized.

MSCI’s gauge of global stocks was at its lowest since late May’s record highs and down 0.6% for the week. Global stocks are poised to end the week at six-week lows in the face of oil weakness, a spike in bond yields and anticipation of tighter monetary policy, particularly in the United States. Concerns that the world’s central banks are moving closer to unwinding ultra-loose monetary policies have roiled markets and ECB minutes released on Wednesday indicate its policymakers are open to further steps. This sent German government bond yields to 18-month highs, lifted the euro and weighed on stocks.  “Once again, bond markets are ruling FX and having an increasing impact on equity markets,” strategists at Morgan Stanley, led by Hans Redeker, said, drawing parallels with moves seen in 2013 during the so-called “taper tantrum,” when Fed signals about withdrawing liquidity hit markets.

The dollar rose against a basket of major currencies and hit a seven-week high against the yen after the Bank of Japan increased its government bond buying, expanding monetary policy when other central banks are moving towards tightening. Despite Thursday’s massive DOE inventory draw, oil was unable to sustain gains and Brent dropped to $47.26.

S&P futures held steady as investors await the June jobs report and the first official meeting between Donald Trump and Vladimir Putin.  S&P futures traded at 2,410 after the cash index dropped to a a six-week low on Thursday, when real estate stocks had their biggest daily drop in 2017. Both Dow Jones and Nasdaq 100 futures are also little changed.

Looking at Asia, the yen fell sharply and JGB yields pulled back from five-month highs after the BOJ announced its first unlimited fixed-rate bond purchases since February. As discussed last night, this morning the BoJ offered to buy unlimited fixed-rate purchases for the first time since February to cap the move, offering specifically to buy 10y bonds at 0.110%. While no bids were subsequently tendered, the offer has resulted in yields dropping as low as 0.081%. It’s worth noting that this is the third time that the BoJ has flexed its muscles in controlling the yield curve since introducing the policy in September.

The JGB 10s30s re-approaches steepest levels YTD in reaction. Despite the BOJ intervention, Australian sovereign bonds were under heavy selling pressure with the 10-year yield jumping as much as ten basis points to 2.736%; shares in Sydney 1% lower. In China the 7-day repo rate fell seven basis points despite PBOC skipping liquidity operations for eleventh session and draining a whopping CNY 750 billion over the same period; the onshore yuan little was changed. Overnight, China reported that its FX reserves rose for the 5th month in a row, rising another $3bn in June to $3.057TN, however the increase was driven mostly by non-USD currency appreciation.

European stocks fell even as the Utilities sector supported risk with Centrica up 4.4% following reported M&A interest. German 10-year Bund yields climbing to an 18-month high as Treasuries also slipped modestly, both rising by 1bp. Italian BTPs underperform due to bond exchange operation increasing duration.

The Euro continued its upward move while sterling dropped sharply below 1.29 after U.K. May industrial and construction outputs both dropped, missing an expected increase; core bonds opened steady after yesterday’s sharp technical driven sell-off

A quick preview of today’s payrolls report courtesy of Deutsche Bank (a detailed breakdown can be found here):

Looking ahead to payrolls then, following the low 138k print in May the consensus for June is currently sitting at 178k. Our US economists expect a slightly more meaningful rebound to 210k which would be likely sufficient to keep the unemployment rate steady at 4.3% assuming a slight nudge up in the participation rate. Yesterday’s ADP print (158k vs. 188k expected) was a little less than what the market had expected (and included 33k of downward revisions) however it’s worth noting that the employment components in both of the ISM’s this week have been overall fairly solid (57.2 for the  manufacturing sector and 55.8 for the services sector) and also that the ADP hasn’t necessarily been the best predictor of payrolls in recent months. As always also keep an eye on other elements of the  report including average hourly earnings (+0.3% mom expected).

In Rates, German 10-year yields climbed one basis point to 0.57 percent as of 10:50 a.m. in London after rising 9 basis points on Thursday. The yield on 10-year Treasuries added one basis point to 2.38 percent, after climbing four basis points on Thursday. Yields in the Bloomberg USD Emerging Market Sovereign Bond Index advanced 17 basis points to 4.81 percent this week, the most since the week ending Nov. 18. EM sovereign dollar bonds posted their worst week since November.

In commodity markets, Brent crude futures, the international benchmark for oil prices, were trading down 1.2 percent, at $47.55 per barrel. Oil prices are down more than 16 percent this year, muddying the outlook for inflation expectations globally.  WTI crude slips below $45 on rising output: West Texas Intermediate tumbled 2.5% to $44.38 a barrel, more than erasing Thursday’s 0.9 percent gain. Oil is down 3.6 percent for the week as a decline in U.S. stockpiles failed to convince investors that global markets are rebalancing. Gold slipped 0.3% to 1,221.62 an ounce. The precious metal is down 1.6 percent for the week, its worst performance since early May. Dalian iron ore erases early loss to trade 1.1% stronger

The yen dropped 0.4 percent to 113.70 per dollar, reversing an earlier gain of 0.1 percent. The currency is down 1.1 percent for the week, heading for the biggest drop since the end of April. The Bloomberg Dollar Spot Index rose less than 0.1 percent after dropping 0.3 percent on Thursday. The euro was little changed at $1.1420 after jumping 0.6 percent in the previous session, while the pound slipped 0.4% to $1.2918.

The main economic event is the June non-farm payroll data is expected later, there are no major earnings. All eyes will be on the G-20 meeting in Hamburg.

Bulletin headline summary from RanSquawk

  • USD-index was contained below 96.00. Precious metals pressured by a flash crash in silver
  • Poor UK Data weighs on GBP
  • Looking ahead, highlights include US and Canadian job reports

Market Snapshot

  • S&P 500 futures up 0.05% at 2,409.50
  • STOXX Europe 600 down 0.2% to 379.54
  • MXAP down 0.6% to 152.84
  • MXAPJ down 0.4% to 500.36
  • Nikkei down 0.3% to 19,929.09
  • Topix down 0.5% to 1,607.06
  • Hang Seng Index down 0.5% to 25,340.85
  • Shanghai Composite up 0.2% to 3,217.96
  • Sensex up 0.1% to 31,400.50
  • Australia S&P/ASX 200 down 1% to 5,703.57
  • Kospi down 0.3% to 2,379.87
  • German 10Y yield fell 0.2 bps to 0.56%
  • Euro down 0.06% to 1.1416 per US$
  • Brent Futures down 1.8% to $47.26/bbl
  • WTI Futures down to $44.38/bbl
  • Italian 10Y yield rose 10.7 bps to 1.973%
  • Spanish 10Y yield fell 1.4 bps to 1.664%
  • Gold spot down 0.3% to $1,221.55
  • U.S. Dollar Index up 0.2% to 95.96

Top Overnight News

  • Chinese President Xi Jinping took a swipe at the U.S. for retreating from globalization, exposing the tensions before a meeting of world leaders divided over everything from trade and climate change to handling North Korea’s provocations
  • Hedge-fund investor Ray Dalio called time on the era of central bank stimulus, saying the global economy is heading toward a new stage where markets won’t get the same level of support from monetary policy makers
  • The BOJ asserted control over the nation’s bond yields, sending borrowing costs lower with its first fixed-rate purchase operation since February after a global debt selloff
  • Wal-Mart Stores sold yen bonds for the first time in seven years, taking advantage of falling fundraising costs and Japanese demand for securities issued by well-known U.S. firms
  • Apple fires back at supplier Imagination in contract dispute
    European May Industrial Production m/m: Germany 1.2% vs 0.2% est; France 1.9% vs 0.6% est; Spain 1.2% vs 0.5% est.
  • ECB’s Coeure: underlying inflation pressure still weak; fears regarding side of effects of negative rates not justified at present
  • ECB’s Knot: policy decisions will always be dictated by the economic circumstances and not instrument availability
  • U.K. May Industrial Production m/m: -0.1% vs +0.4% est; motor vehicle production -4.4%, most since Feb. 2016
  • BOJ: announces first unlimited fixed-rate bond purchase operation since February; receives no tendered bids
  • China June FX Reserves rise $3.2b from May to $3.056t; fifth consecutive monthly rise
  • Merkel Girds for G-20 Discord as Trump-Putin Meeting Looms
  • Trump Says Had ’Great Meeting’ With Merkel, Abe, Moon
  • Russians Are Said to Be Suspects in Nuclear Site Hackings
  • Russia ready to weigh any market proposal at July 24 summit
  • China teapot refinery runs fall to lowest in two months: SCI99
  • Icahn’s Tropicana Purchases Chelsea Hotel in Atlantic City

Asia stock markets traded negative across the board amid spill-over selling after global central banks continued strike a hawkish tone. ASX 200 (-1.8%) and Nikkei 225 (-0.3%) were pressured from the open with energy among the laggards after oil prices failed to maintain post-DoE gains, while miners were also spooked following a flash crash in silver, and to a much lesser extent gold, which was speculated to have been caused by a fat finger early in the session. Shanghai Comp. (-0.2%) and Hang Seng (-0.5%) conformed to the downbeat tone after the PBoC refrained from OMOs for the 11th consecutive day which resulted to a net liquidity drain of CNY 250bn for the week and was shortly followed by surges in money market rates, with the CNH overnight HIBOR up by over 70bps and at a 1-month high. 10yr JGBs were supported following the Rinban operation in which the BoJ increased its purchases in the 5yr-10yr by JPY 50bIn and offered to buy an unlimited amount at a fixed yield of 0.11%. This measure was in response to an increase in 10yr yields which initially rose to their highest since February, alongside gains across global yields. However, upside in 10yr JGBs then petered out as the BoJ’s fixed rate operation received no bids, considering that market prices were above the BoJ’s offer. BoJ offered to buy unlimited amount of 10yr JGBs at yield of 0.110%.

  • Top Asian News
  • Hong Kong Braces for Higher Rates as Currency Losses Quicken
  • World’s Biggest Pension Fund Has Best Performance in Two Years
  • Japanese Yields Retreat After BOJ Offer While Aussie Bonds Slide
  • China Foreign Reserves Rise for a Fifth Month as Yuan Stabilizes
  • Bank Indonesia Sees 2017 Budget Deficit at 2.6% of GDP at Most
  • Citi Is Said to Start Shutting Down Branches in S. Korea: Yonhap

EUR bourses have not taken any real direction; trading marginally lower for the session, as Energy names lag following the evening bearish pressure seen in oil markets. A miss from the UK proved to add no real concern in equity markets, as the FTSE shrugged off concerns, possibly trading solitude in the figures potentially delaying the BoE. European fixed income markets have taken small direction from the bid seen in the Asian session, following the BoJ’s offer to buy unlimited about of lOy JGBs. The German bund still trades above 0.50%, however, the yield does underperform across the curve; with the global 10 years lagging against the rest of the maturities. Gilts took much of the morning attention, as the poor UK figures resulted support for buying in the UK 10y. BTPs are slipping however, many have touted this to expected ahead of today’s exchange tapping the 2.33 to lift front end paper. The 10 years remain in focus due to the aforementioned BoJ comments; with the BTP/Bunds spread now at 1.6bps and BTP/Bonos 1bps cheaper.

Top European News

  • German Industry Output Rises for Fifth Month Amid Solid Upswing
  • U.K. Factories, Builders Cut Output, Clouding Growth Outlook
  • U.K. Says Enormously Disappointed at Failure of Cyprus Talks
  • U.K. House Prices Increase at Slowest Pace in Four Years
  • Scale Into Long Positions in Bunds Around 0.62%, Citigroup Says
  • Inflation ‘Shock’ Gives Bank of Russia Food for Thought on Rates
  • Activist Fund Elliott Is Said to Build Stada Stake Amid Bids

In currencies, the headline number coming into US jobs data was UK Manufacturing and Industrial Production taking the morning spotlight with the UK missing across the board. The concern is interesting, as the BoE has taken a more hawkish tone of late, leaving focus now on the BoE, if they will continue to indicate that the UK economy is ready for a 25bps move. The NFP report will take the vast focus today, alongside CAD watchers looking out for the Canadian employment figures. Price action across FX markets has followed the usual pre-NFP tone, seeing subdued trade as participants await. EUR has continued to gain and will be likely the main focus into the NFP report, optimism for EUR is clear with United Overseas Bank the latest to follow Deutsche and Morgan Stanley in taking EUR/USD long positions. The CAD recovery has slowed, largely due to the increased oil production out of the US, as 1.3202 behaves as the next key resistance level in USD/CAD. Loony watchers will await the Canadian employment figures, with the BoC very much taking centre court on men’s quarter finals day. The headline employment change is expected at 10K and unemployment 6.6%, any drastic change here could potentially hinder the BoCs plans.

In commodities, precious metals garnered much of the attention overnight — stemmed by a Silver flash crash, with many accounting this to a fat Finger’, a mistake that is seemingly becoming more and more common. Silver fell from 16.140, printing a low of 14.328, however, a huge bounce was evident and the metal trades near pre-crash levels. The silver move weighed on the other precious metals, with Gold and Platinum seeing selling pressure off the back of the overnight fat finger. Oil has continued to reside near session lows through today’s trade, as increased output continues to overshadow the DoE report. Production being ramped-up by the USA, alongside rebel problems lowering in Syria and Nigeria a further lmin BPD is being pumped. The increased production from these countries have put a huge dent in the agreed combined 1.8min BPD cut across the OPEC nations and Russia.

Looking at the day ahead, this morning in Europe we are due get May industrial production reports from Germany, France and the UK as well as trade data from the latter two countries. Over in the US it’s all about the June employment report due out at 8.30am. It’s also worth keeping an eye on the Fed’s July 2017 monetary policy report due to be delivered to Congress at 11am. This will form the basis for Yellen’s testimony in front of Congress and the Senate next week which is almost always a closely watched event. Finally the other potentially significant event for markets is the G-20 leaders gathering in Hamburg. The gathering kicks off today and continues into the weekend with Merkel, Trump and Putin amongst the leaders attending.

US Event Calendar

  • 8:30am: Change in Nonfarm Payrolls, est. 178,000, prior 138,000
    • Unemployment Rate, est. 4.3%, prior 4.3%
    • Average Hourly Earnings MoM, est. 0.3%, prior 0.2%; YoY, est. 2.6%, prior 2.5%
    • Average Weekly Hours All Employees, est. 34.4, prior 34.4
    • Labor Force Participation Rate, est. 62.71%, prior 62.7%
    • Underemployment Rate, prior 8.4%

DB’s Jim Reid concludes the overnight wrap

Payrolls Friday comes today at an intriguing time for markets. If you’d chosen these last two weeks to have been on your compulsory time away then you’d be coming back to a very different atmosphere to the one you’d left. It was only last Tuesday morning that we were casually waiting for Draghi to speak in Sintra. Innocent days indeed. Yesterday saw another sharp sell-off in bonds and we again recap the 10 year moves yesterday alongside the moves since the open on Tuesday 27th June – aka Draghi Day. The first number in brackets refers to yesterday’s move while the second number is since the open on Draghi Day. The moves are as follows: Germany (+9.1bps and +31.7bps), US (+4.3bps +22.9bps), France (+9.9bps and +32.0bps), Italy (+10.9bps and +36.9bps), Spain (+10.4bps and +30.1bps) and UK (+5.5bps and +30.5bps).

Although the moves in Japan have been far less extreme, this morning 10y JGBs touched a high of 0.103% and crucially edged above 0.10% and what is seen as the upper limit of the BoJ’s target range. By comparison on the start of Draghi Day yields were hovering around 0.049%. However, early this morning the BoJ offered to buy unlimited fixed-rate purchases for the first time since February to cap the move, offering specifically to buy 10y bonds at 0.110%. While no bids were subsequently tendered, the offer has resulted in yields dropping to 0.081% as we go to print. It’s worth noting that this is the third  time that the BoJ has flexed its muscles in controlling the yield curve since introducing the policy in September.

Putting Japan to one side, there’s no doubt that there has been a significant repricing in the last week and a half across global bond markets. 10y Bunds cleared 0.500% with some ease yesterday before closing at 0.562% and to the highest since January 2016. Unsurprisingly some of the longer duration assets stand out with this rate move. Argentina’s 100y bond issued last month is down over 4pts during the rout. The longest dated Gilt (July 2068 maturity) is off 13pts. The longest dated OAT (May 2066 maturity) is off 9pts and the longest dated BTP (March 2067 maturity) is off 6pts.

Looking ahead to payrolls then, following the low 138k print in May the consensus for June is currently sitting at 178k. Our US economists expect a slightly more meaningful rebound to 210k which would be likely sufficient to keep the unemployment rate steady at 4.3% assuming a slight nudge up in the participation rate. Yesterday’s ADP print (158k vs. 188k expected) was a little less than what the market had expected (and included 33k of downward revisions) however it’s worth noting that the employment components in both of the ISM’s this week have been overall fairly solid (57.2 for the manufacturing sector and 55.8 for the services sector) and also that the ADP hasn’t necessarily been the best predictor of payrolls in recent months. As always also keep an eye on other elements of the report including average hourly earnings (+0.3% mom expected).

Back to the bond moves yesterday, the initial selloff appeared to be sparked by a weak 30y auction in France which attracted a bid to cover ratio of just 1.53x compared to 1.93x at the previous sale last month. Not long after that we got the ECB minutes which appeared to suggest some debate amongst policy members about removing the reference to the easing bias around QE. While it was subsequently left in, with the minutes also cautioning to the fact that “even small and incremental changes in the communication could be misperceived as signalling a more fundamental change in policy direction”, the  discussion did appear to add more fuel to the fire around the normalization debate. The ECB’s Praet also spoke although his comments didn’t seem to garner much interest (mostly referencing the need to adopt a steady hand with policy). The Bundesbank’s Weidmann spoke after the European close however and said that “the continued economic recovery is opening the perspective of a monetary policy normalization” and that “it is decisive that the expansionary monetary policy is ended when it becomes necessary from a price stability perspective”. The BoE’s Ian McCafferty (hawkish) also said that we could see a couple of “modest rate rises” at the BoE over the next couple of years if the economy evolves along the lines of the forecasts put out in May.

The end result of another 24-hour bond rout has also been a similarly weak session for equities. The S&P 500 closed -0.94% yesterday after rate-sensitive sectors took a hit and that move means that the index is now down -1.80% from the all-time high recorded intraday back on June 19th. The Dow and Nasdaq also finished -0.74% and -1.00% respectively while the Stoxx 600 closed -0.67% prior to this. European Banks did however rise another +0.65% and have now gained in 7 of the last 9 sessions. Commodities took a breather yesterday with Gold ending -0.15% and WTI Oil rebounding a modest +0.86%.  This morning in Asia the Nikkei (-0.14%), Hang Seng (-0.38%), Shanghai Com (-0.24%), Kospi (-0.19%) and ASX (-1.15%) are all in the red while outside of JGBs yields across Asia Pac are also sharply higher.

With regards to the remaining data in the US yesterday, the other notable release was the ISM non-manufacturing print for June which came in half a point higher relative to May at 57.4 (vs. 56.5 expected). In the details the new orders component rose 2.8pts to 60.5 while, as noted earlier, the employment component dipped 2pts to 55.8 albeit to a still relatively solid level. The final services PMI also surprised to the upside after being revised up 1.2pts from the initial flash reading to 54.2 which leaves it 0.6pts above the May reading. The rest of the data included a largely in line trade deficit for May ($46.5bn) and a  248k initial jobless claims reading (which was up 4k on the week prior). The latest batch of data has seen the Atlanta Fed revise down their Q2 GDP print to 2.7% (versus the 3.0% estimate a few days prior).

Looking at the day ahead, this morning in Europe we are due get May industrial production reports from Germany, France and the UK as well as trade data from the latter two countries. Over in the US this  afternoon it’s all about the aforementioned June employment report due out at 1.30pm BST. It’s also worth keeping an eye on the Fed’s July 2017 monetary policy report due to be delivered to Congress. This will form the basis for Yellen’s testimony in front of Congress and the Senate next week which is almost always a closely watched event. Finally the other potentially significant event for markets is the G-20 leaders gathering in Hamburg. The gathering kicks off today and continues into the weekend with Merkel, Trump and Putin amongst the leaders attending. So we’ll see if there are any interesting headlines to emerge from that. It’s worth also noting that the ECB’s Coeure is scheduled to take part in an annual economics forum on Sunday.

 END

3. ASIAN AFFAIRS

i)Late THURSDAY night/FRIDAY morning: Shanghai closed UP 5.51 POINTS OR 0.17%   / /Hang Sang CLOSED DOWN 124.37 POINTS OR 0.49% The Nikkei closed DOWN 64.97 POINTS OR 0.32%/Australia’s all ordinaires CLOSED DOWN 0.93%/Chinese yuan (ONSHORE) closed UP at 6.7990/Oil DOWN to 44.13 dollars per barrel for WTI and 46.66 for Brent. Stocks in Europe OPENED ALL IN THE RED,,   Offshore yuan trades  6.80050 yuan to the dollar vs 6.7990 for onshore yuan. NOW THE OFFSHORE IS A TOUCH STRONGER  TO THE ONSHORE YUAN/ ONSHORE YUAN  STRONGER (TO THE DOLLAR)  AND THE OFFSHORE YUAN IS STRONGER TO THE DOLLAR AND THIS IS COUPLED WITH THE STRONGER DOLLAR. CHINA IS NOT  HAPPY TODAY

3a)THAILAND/SOUTH KOREA/NORTH KOREA

NORTH KOREA

b) REPORT ON JAPAN

Japan panicked last night when they saw their bond yields rising about .12%.  They then went into another bond buying bash by offering to buy unlimited 10 yr bonds at .11%.  That sent bond yields lower but also the message that central banks are nervous about yields rising and the message that it sends to the stock markets.

(courtesy zero hedge)

Panicked BOJ Unleashes Bond Buying Bazooka: Offers To Buy Unlimited 10Y JGBs At 0.11%

During this morning’s bond rout when a poor French auction sparked a high-volume selloff in German Bunds which also hit Japanese JGBs before slamming US TSYs, Goldman said that “with 10Y JGBs closing at 0.095 and getting hit at 10bp intraday, focus will be on how the BOJ will react tomorrow [i.e. now]. Opinions seem pretty split with some expecting an increase in purchase size in the 5-10 bucket, while others feel that the BOJ will let the 10Y run loose given the current sell off is more fundamental than event driven. With BOJ behind buying pace for 80tn reference anyway, personally I feel it doesn’t hurt the BOJ to remind market of their presence.”

Goldman was right: the BOJ, panicking after the overnight bond rout, not only reminded markets of its presence, but did so in dramatic fashion when it first boosted the amount of JGBs bought in the 5-10 year bucket from JPY 450BN to JPY 500 BN, and then for good measure unleashed the QQEWYC bazooka, announcing it would purchase an unlimited amount of 10Y JGBs at 0.11%, just a fraction above the BOJ’s 0.10% line in the sand, only the second time it has done so in 2017 since February.

In immediate reaction, the benchmark Japanese TSY, which was trading north of 0.105% and flirting with 0.11%, promptly slid back to 0.095% now that it has become clear that all the hawkish posturing by central banks was just that.

Japanese market were relieved with the Topix paring losses to 0.3%, or 1,611.52 as of 10:23am in Tokyo, down from a drop as big as 0.7%, same as the Nikkei, which had dropped 0.7% earlier, then trimming losses by more than half, while the Yen, after trading at 113.250, immediately weakened by 25 pips to 113.50.

And so, when push had again come to shove, the BOJ – the central bank which owns 100% of Japan’s GDP in bond terms and can’t afford any sharp, or not so sharp, moves higher in yields – admitted that all the recent warnings and talk about higher rates was nothing but.

end

c) REPORT ON CHINA

4. EUROPEAN AFFAIRS

END

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

The Syrian Army is now set to recapture the oil fields near Palmyra and the USA et al are ready to take Raqqa back

ISIS is basically finished

(courtesy Paraskova/OilPrice.com)

US-Russia Reportedly Ready For Cease-Fire In Syria

While the Trump-Putin meeting continues to stretch on way beyond its 30 minutes scheduled time, prompting media types to speculate endlessly, AP reports that sources are saying the United States and Russia are prepared to announce a cease-fire in Syria very soon…

As AP reports,  U.S. officials say the United States and Russia have reached an agreement for a cease-fire in southwest Syria.

The cease-fire is set to take effect July 9 at noon Damascus time. Word of the cease-fire has emerged as President Donald Trump is meeting with Russian President Vladimir Putin.

The officials weren’t authorized to discuss the cease-fire publicly and spoke on condition of anonymity.

The deal marks a new level of involvement for the U.S. in trying to resolve Syria’s civil war.

A separate deal to create “de-escalation zones” was brokered between Russia, Turkey and Iran, but not the U.S., but follow-up talks this week in Kazakhstan to finalize a cease-fire in those zones failed to reach a deal.

The U.S. and Russia have been backing opposing sides in Syria’s war.

This is a positive sign that there is some rapprochement between the two nations… but John McCain won’t like it.

And here’s CNN worrying about the length of the meeting..

end

Highlights of the meeting between Trump  and Putin:

(courtesy zero hedge)

Putin Reveals What He Discussed With Trump In Two-Hour Long First Meeting

Following their first ever, 2+ hour meeting which was originally supposed to last only 30-40 minutes, the question on everyone’s mind was what did the two discuss.

So, in addition to the previously discussed ceasefire agreement in Southwest Syria unexpectedly announced by the two nations, speaking at the beginning of his meeting with Japanese Prime Minister Shinzo Abe, Vladimir Putin said that during his first meeting with US President Donald Trump, the two discussed Syria, Ukraine, counterterrorism, and drumroll, the “fight against cyber crime.

“I had a very lengthy conversation with the President of the United States, there were a lot of issues such as Ukraine, Syria, other problems, some bilateral issues”, according to Interfax news agency. “We again returned to the issues of fighting terrorism and cybersecurity,” Putin added.

Elaborating after the meeting, Secretary of State Rex Tillerson said Trump repeatedly pressed Putin on the matter over the course of their meeting (see below for details).

Putin denied Russia’s involvement, and according to a parallel comment from Russia’s Sergey Lavrov, “Trump accepted Putin’s assurance of no election hacking.”

Or as Interfax put it:

  • TRUMP ACKNOWLEDGES ANTI-RUSSIAN CAMPAIGN IN U.S. ALREADY LOOKING ODD, THAT HE ACCEPTS PUTIN’S STATEMENTS ON THIS MATTER – LAVROV: IFX

However, it appears Lavrov may have taken some artistic liberty, because according to NBC’s chief White House correspondent, one administration official has said Lavrov’s comment is “not accurate

Pushback already from Trump administration: one official tells @NBCNews Lavrov’s “not accurate” w/this comment –> https://twitter.com/AP/status/883381310173179905 

Additionally, Tillerson also discussed the ceasefire deal in Syria:

“A cease-fire has been entered into,” U.S. Secretary of State Rex Tillerson told reporters. This is the “first indication of the U.S. and Russia being able to work together in Syria,” he said.

Until now, Putin and Trump had only spoken on the phone. They were not alone: Russian Foreign Minister Sergey Lavrov and US Secretary of State Rex Tillerson were also present at the talks.

* * *

Earlier, during the press photo session, Trump told the media that “President Putin and I have been discussing various things, and I think it’s going very well.”

“We’ve had some very, very good talks, we are going to have a talk now and obviously that will continue,” Trump added, saying there are hopes of “a lot of very positive things happening.”

“It’s an honor to be with you, thank you,” Trump concluded, offering his hand to Putin.

“I’m delighted to be able to meet you personally Mr. President,” Putin countered. “And I hope, as you have said, our meeting will yield positive result.”

“Spasibo [thank you],” the US leader added in Russian.

Addressing Trump, Putin then said that although the two leaders have “several times talked over the phone, including on some very important bilateral and international issues,” phone talks were “obviously not enough.” Meetings in person are “necessary” if the two countries want to resolve the “most pressing issues,” Putin added.

* * *

Finally, some additional details first from Rex Tillerson, courtesy of Bloomberg:

  • TILLERSON: U.S., RUSSIA, JORDAN REACHED CEASEFIRE IN SW SYRIA
  • RUSSIA HAS SAME INTEREST IN STABLE SYRIA AS U.S.: TILLERSON
  • TRUMP NOTED SANCTIONS BILL ONGOING IN PUTIN TALKS: TILLERSON
  • NO LONG-TERM ROLE FOR ASSAD, HIS FAMILY, IN SYRIA: TILLERSON
  • RUSSIA-U.S. DIFFERENCES IN TACTICS, PACE, ON N.KOREA: TILLERSON
  • TILLERSON SAYS TRUMP & PUTIN HAD A GOOD EXCHANGE ON #NORTHKOREA; RUSSIANS SEE IT DIFFERENTLY THAN THE U.S. DOES: RTRS
  • TILLERSON SAYS IT IS NOT CLEAR U.S. OR RUSSIA WILL EVER COME TO A RESOLUTION ON THE QUESTION ABOUT ELECTION INTERFERENCE: RTRS

About the bromance between the two:

  • TRUMP, PUTIN CONNECTED QUICKLY, `POSITIVE CHEMISTRY’: TILLERSON
  • TILLERSON SAYS NEITHER LEADER WANTED TO STOP MEETING, U.S. FIRST LADY CAME IN AT ONE POINT TO TRY TO GET THEM TO CONCLUDE: RTRS

And the punchline:

  • TRUMP RAISED ELECTION MEDDLING, PUTIN DENIED ROLE: TILLERSON
  • TRUMP ACCEPTED PUTIN’S ASSURANCE OF NO ELECTION HACKING: LAVROV

And here is the conversation from the Russian side, in this case Sergey Lavrov, as reported by Interfax:

  • PUTIN, TRUMP HAD VERY CONCRETE CONVERSATION – LAVROV
  • LAVROV SAYS HE AND TILLERSON ASKED TO CONTINUE DIALOGUE ON ALL INT’L ISSUES, INCLUDING N. KOREA
  • LAVROV: THERE IS UNDERSTANDING ON THREE DE-ESCALATION ZONES IN SYRIA, DIALOGUE CONTINUING ON NORTHERN ZONE
  • LAVROV: U.S. AIMS AT IMPLEMENTATION OF MINSK AGREEMENTS – LAVROV
  • LAVROV: CONTACTS WITH TRUMP, TILLERSON SHOWED NO SIGN OF U.S. DEPARTING FROM MINSK ACCORDS
  • LAVROV: PUTIN, TRUMP AGREE ON CREATION OF BILATERAL WORKING GROUP FOR DEVELOPMENT OF INTERACTION ON BROAD RANGE OF ISSUES, INCLUDING CYBER SECURITY
  • LAVROV: WE WILL CONTINUE SEEKING SOLUTION TO PROBLEM OF RUSSIAN DIPLOMATIC PROPERTY IN U.S
  • RUSSIA, U.S. AGREE TO SPEED UP THEIR AMBASSADOR APPOINTMENT PROCEDURES – LAVROV
  • LAVROV: STATE SOVEREIGNTY TO BE ENSURED IN CREATION OF DE-ESCALATION ZONE IN SOUTHERN SYRIA
  • LAVROV: WE HOPE U.S. ENVOY FOR UKRAINE WILL ARRIVE IN MOSCOW FOR CONSULTATIONS SOON
  • LAVROV: AGREEMENT REACHED TO CREATE RUSSIAN-U.S. CHANNEL FOR UKRAINIAN SETTLEMENT
  • LAVROV: SECURITY IN DE-ESCALATION ZONE IN SOUTHERN SYRIA WILL BE ENSURED USING RUSSIAN POLICE, U.S. AND JORDANIAN FORCES
  • LAVROV: RUSSIAN, U.S. EXPERTS IN JORDAN ON FRIDAY FINISHED WORK OF AGREEING ON DE-ESCALATION AREAS IN SOUTHWEST SYRIA
  • LAVROV: PUTIN AND TRUMP ARE DRIVEN BY NATIONAL INTERESTS, AIM AT MUTUAL AGREEMENTS
  • TRUCE IN SOUTHERN SYRIA TO BE EFFECTIVE FROM MIDNIGHT JULY 9 – LAVROV
  • LAVROV: PUTIN, TRUMP DEMONSTRATED THAT THEY HAVE NO INTENTION OF CREATING PROBLEMS OUT OF NOTHING FOR TWO COUNTRIES

And the only line that matters on this side:

  • TRUMP ACKNOWLEDGES ANTI-RUSSIAN CAMPAIGN IN U.S. ALREADY LOOKING ODD, THAT HE ACCEPTS PUTIN’S STATEMENTS ON THIS MATTER – LAVROV

In summary: Putin denied hacking the US election, and “Trump accepted Putin’s assurance” at least according to the Russian side. We now await the howls of outrage from the US media.

end

The following out to good for another 10 dollar rout in gold:  Iran arrests 4 Saudis in a vessel just inside its territorial waters:

(courtesy zero hedge)

Iran Arrests 4 Saudis On A Vessel Inside Its Territorial Waters

On June 19, just around the time it emerged that Israel had been secretly funding Syrian rebel groups and was explicitly aligned with Saudi Arabia in the Syrian conflict, Saudi media reported that the kingdom had captured three members of Iran’s Revolutionary Guard Corps from a boat as it approached the kingdom’s offshore Marjan oilfield. The Saudi Center for International Communications added that the boat carried explosives, and the Iranians aboard “intended to carry out terrorist act in Saudi territorial waters” with the Marjan Saudi offshore oilfield allegedly targeted.  In other words, Saudi paraded that it had caught what appeared to be three Iranian terrorists belonging to IRGC, suggesting this was an operation ordered from the very top.

Of course, Iran’s take on things was different: Iran’s Tasnim news agency said that Saudi border guards had opened fire on an Iranian fishing boat in the Gulf on Friday, killing a fisherman. It said the boat was one of two Iranian boats fishing in the Gulf that had been pushed off course by waves. So on one side terrorists, on the other fishermen: about par.

Three weeks later, there has been no resolution to this alleged hostage crisis, however in a new development, on Friday Iran’s Fars news agency reported that Iran has returned the favor.

According to the Iranian news agency, Iran’s Revolutionary Guards – this time on the offensive – intercepted a Saudis boat for violating Iran’s territorial waters, and arrested the four passengers on board.

According to the Fars report, the boat came from the Saudi port of Darien and violated Iranian naval water borders where it was stopped by the Revolutionary Guards in the waters of the Bushehr province in southern Iran.

The Iran source told Fars that the IRGC had started an investigation regarding the four passengers on board the boat.

So far there has been no official statement on any Saudi news agency either confirming or denying the report, which likely means that a “behind the scenes” transfer of hostages on both sides is already in place.

6 .GLOBAL ISSUES

7. OIL ISSUES

Brent tumbles into the 46 dollar handle after witnessing that huge USA production surge

(courtesy zero hedge)

Brent Tumbles To $46 Handle After US Crude Production Surge

Yesterday’s “bullish” slump in inventories (and record demand) was offset by a resurgence in US crude production and along with Russia’s lack of enthusiasm for more production cuts, is weighing heavily on oil prices this morning

Today’s rig count data will be a key catalyst for signals that US shale production growth may be topping.

“The market’s trying to pin it on the production increase but that seems overstated,” says Warren Patterson, commodity strategist at ING. “There was some strong [Brent] resistance at $50 and since the failure there it seems to have been one way”

The market did get a bit ahead of itself before the numbers so we are seeing some correction as a result of that”

As Bloomberg Intelligence’s Philipp Chladek notes, Russia and Kazakhstan’s rejection of further oil production cuts that could be proposed by OPEC will hurt crude prices in 2H.

Russia, with the lion’s share, is leading a group of 11 non-OPEC nations committed to reduce output by 558,000 barrels per day. But Russian compliance has been weak thus far. That’s also true of Kazakhstan, which started its multi-billion dollar 370,000 barrel Kashagan field. Non-OPEC cuts are voluntary and OPEC doesn’t have a mechanism in place to prevent any breach.

Additionally WSJ is now reporting that OPEC is mulling production caps for Libya and Nigeria, the market is unimpressed for now.

end
After falling last week, this week the USA rig count rose considerably
(courtesy zero hedge)

US Oil Rig Count Rises But “Must Drop 150 For Oil Markets To Balance”

After falling for the first time this year last week, Baker Hughes reports US oil rig count rose once again (as perhaps Cindy impacted drilling last week) for the 23rd week in the last 24.

  • *U.S. TOTAL RIG COUNT UP 12 TO 952 , BAKER HUGHES SAYS :BHI US
  • *U.S. OIL RIG COUNT UP 7 TO 763 , BAKER HUGHES SAYS :BHI US
  • *U.S. GAS RIG COUNT UP 5 TO 189 , BAKER HUGHES SAYS :BHI US

This week saw a resurgence in US crude production (as Cindy’s effects wear off)…This is the highest Lower 48 production since Aug 2015…

And it is that production spike that poured coled water on the short-lived rally after DOE showed inventories dropping. However, as OilPrice.com’s Tsvetana Paraskova notes,the rig count needs to drop drastically further if any equilibrium in the global oil market is possible…

Analysts and investors have been growing increasingly concerned that the OPEC-led production cuts would not be enough to bring the oil market back to balance, and now one investment bank, Morgan Stanley, is saying that if the market stands any chance of rebalancing next year, U.S. shale possibly needs to drop around 150 rigs.

“If OPEC doesn’t balance the market, the oil price will have to force it somewhere else, most likely in U.S. shale. For a chance of a balanced market in 2018, the U.S. rig count can no longer grow and possibly needs to contract ~150 rigs. Given current break-evens, this requires WTI between $46-50,” Morgan Stanley analysts said in a research report on Thursday, as quoted by MarketWatch.

According to Morgan Stanley, despite OPEC’s cuts, global inventory levels are currently around the same high as they were last year.

“To support prices in the mid-$50s, OPEC-12 would probably need to lower production by another 200,000-300,000 barrels a day and extend the output agreement to end-2018. We find this unlikely,” the bank’s analysts said.

“The combination of little impact on physical balances, but a strong signal to invest has meant that the OPEC cuts have had a perverse effect: on current trends, the oil market would be oversupplied again in 2018,” Morgan Stanley warned. And they see U.S. rig count in need of dropping between 120 and 180 rigs to keep oil output from flooding the market.

Last week, the number of active oil and gas rigs in the United States fell by a single rig, ending the US shale patch’s impressive run of 23 weeks of steady gains, but oil and gas rigs in the United States are still 509 rigs up from this time last year.

Morgan Stanley not only warned that the glut will be here to stay next year, but it also slashed its oil price forecasts for Q3 and Q4 2017 for both WTI and Brent. The analysts cut their forecast for WTI price for the rest of this year to US$48 per barrel from the previous forecast of US$55. Brent forecast was lowered to US$50.50 from US$57.50.

end

8. EMERGING MARKET

end

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

Euro/USA   1.1412 DOWN .0009/REACTING TO  + huge Deutsche bank problems + USA election:/TRUMP HEALTH CARE DEFEAT//ITALIAN REFERENDUM DEFEAT/AND NOW ECB TAPERING BOND PURCHASES/ /USA RISING INTEREST RATES AGAIN/EUROPE BOURSES ALL IN THE RED

USA/JAPAN YEN 113.71 UP 0.566(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/LABOUR PARTY LOSES IN LOCAL ELECTIONS

GBP/USA 1.2895 DOWN .0073 (Brexit  March 29/ 2017/ARTICLE 50 SIGNED

THERESA MAY FORMS A NEW GOVERNMENT/STARTS BREXIT TALKS

USA/CAN 1.2982 UP .0003 (CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/TRUMP INITIATES LUMBER TARIFFS ON CANADA)

Early THIS FRIDAY morning in Europe, the Euro FELL by 9 basis points, trading now ABOVE the important 1.08 level  FALLING to 1.1412; 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 5.51 POINTS OR 0.17%     / Hang Sang  CLOSED DOWN 124.37 POINTS OR 0.49% /AUSTRALIA  CLOSED DOWN 0.93% / EUROPEAN BOURSES OPENED ALL  IN THE RED 

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

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

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

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

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

The NIKKEI: this FRIDAY morning CLOSED DOWN 64.97 POINTS OR 0.32%

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

2/ CHINESE BOURSES / : Hang Sang CLOSED DOWN 124.37 POINTS OR 0.49%  / SHANGHAI CLOSED UP 5.51 POINTS OR 0.17%   /Australia BOURSE CLOSED DOWN 0.93% /Nikkei (Japan)CLOSED DOWN 64/97 POINTS OR 0.32%    / INDIA’S SENSEX IN THE RED

Gold very early morning trading: 1221.95

silver:$15.86

Early FRIDAY morning USA 10 year bond yield: 2.3802% !!! UP 2 IN POINTS from THURSDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%.

 The 30 yr bond yield  2.9102, UP 1  IN BASIS POINTS  from THURSDAY night.

USA dollar index early FRIDAY morning: 95.99 UP 19  CENT(S) from THURSDAY’s close.

This ends early morning numbers FRIDAY MORNING

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And now your closing FRIDAY NUMBERS

Portuguese 10 year bond yield: 3.161%  up 10 in basis point(s) yield from THURSDAY 

JAPANESE BOND YIELD: +.087%  DOWN 2  in   basis point yield from THURSDAY/JAPAN losing control of its yield curve

SPANISH 10 YR BOND YIELD: 1.735% UP 5  IN basis point yield from THURSDAY 

ITALIAN 10 YR BOND YIELD: 2.343 UP 8 POINTS  in basis point yield from THURSDAY 

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

GERMAN 10 YR BOND YIELD: +.573% UP 1 IN  BASIS POINTS ON THE DAY

END

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IMPORTANT CURRENCY CLOSES FOR FRIDAY

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

Euro/USA 1.1400 DOWN .0021 (Euro DOWN 21 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 114.08 UP  0.924 (Yen DOWN 92 basis points/ 

Great Britain/USA 1.2877 DOWN  0.0091( POUND DOWN 91 basis points) 

USA/Canada 1.2869 DOWN .0109 (Canadian dollar UP 109 basis points AS OIL FELL TO $44.40

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This afternoon, the Euro was DOWN  by 21 basis points to trade at 1.1400

The Yen FELL to 114.08 for a LOSS of 92  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 91  basis points, trading at 1.2877/ 

The Canadian dollar ROSE by 109 basis points to 1.2869,  WITH WTI OIL FALLING TO :  $44.40

The USA/Yuan closed at 6.8057/
the 10 yr Japanese bond yield closed at +.087%  DOWN 2 IN  BASIS POINTS / yield/ 

Your closing 10 yr USA bond yield UP 1 IN basis points from THURSDAY at 2.387% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic  USA 30 yr bond yield: 2.932  UP 3 in basis points on the day /

Your closing USA dollar index, 96.01  UP  21 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 FRIDAY: 1:00 PM EST

London:  CLOSED UP 13.64 POINTS OR 0.19%
German Dax :CLOSED UP 7.43 POINTS OR 0.06%
Paris Cac  CLOSED DOWN 7.24 POINTS OR 0.14% 
Spain IBEX CLOSED DOWN 9.60 POINTS OR 0.09%

Italian MIB: CLOSED  DOWN 69.09 POINTS/OR 0.33%

The Dow closed UP 93.21 OR 0.44%

NASDAQ WAS closed UP 63.61 POINTS OR 1.04%  4.00 PM EST
WTI Oil price;  44.40 at 1:00 pm; 

Brent Oil: 46.84 1:00 EST

USA /RUSSIAN ROUBLE CROSS:  60.43 UP 30/100 ROUBLES/DOLLAR (ROUBLE LOWER BY 30 BASIS PTS)

TODAY THE GERMAN YIELD RISES TO  +0.573%  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:$44.35

BRENT: $46.73

USA 10 YR BOND YIELD: 2.3856%  (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)

USA 30 YR BOND YIELD: 2.9265%

EURO/USA DOLLAR CROSS:  1.1399 down .0021

USA/JAPANESE YEN:113.91  up 0.765

USA DOLLAR INDEX: 96.02  up 22  cent(s) 

The British pound at 5 pm: Great Britain Pound/USA: 1.28880 : down 88 POINTS FROM last NIGHT  

Canadian dollar: 1.2875 up 101 BASIS pts 

German 10 yr bond yield at 5 pm: +0.573%

END

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

TRADING IN GRAPH FORM FOR THE DAY

Roller-Coaster Week Ends Strong As Quant Strategies Suffer Biggest Losses Since 2003

 

Quant trading strategies extended their notable losses this week with CTAs suffering their worst 2-week drop since June 2003…

These drawdowns are marginally worse than the 2007 Quant crisis drops.

And Risk-Parity, plunging…

As Bloomberg’s Dani Burger writes, it’s far from clear risk-parity and CTA funds react to the same set of inputs. While both invest in multiple asset classes and employ leverage, risk parity tends to be a slower and more passive strategy, aiming to engineer a smoother ride by giving smaller weightings to higher-volatility assets. CTAs, a type of managed futures strategy, follows short-term trends and tends to be more volatile and less correlated to the market.

Brean Capital’s Peter Tchir fears there is more to come…

“I don’t think this move has caused much of an unwind from true risk parity funds, but much more from the homebrew or risk parity lite crowd — making the real fun just beginning.

Risk parity selling should kick in when expected volatility of the strategy exceeds target volatility of the strategy.”

And with bond vol picking up, perhaps we are getting a glimpse this week

For sure it was a tough week for both bonds and stocks…

Payrolls managed an automatic bid under stocks today to rescue some of the major indices (Trannies to new record highs) but Small Caps scrambled back to unch for the week…

VIX tumbled today, almost back to a 10 handle…

FANG Stocks managed their best day since May today to run them into the green for the week

Banks were a mixed bag on the week – all higher but WFC stumbled and the last two days saw early ramps faded…Notably all closing below the highs on Monday’s short day on Month-Start inflows…

The bond bloodbath continued with the long-end getting hit for 10bps and short-end holding in…

Steepening the curve back to pre-Fed rate-hike levels…

As 30Y remains well below 3.00% for now..

The Dollar Index had its best week in 3 months…

With CAD strength offsetting JPY weakness on the week…

Commodites were all lower led by a tumble in Silver (after last night’s flash-crash)

Tough week for oil as Russian comments and US production trumped the drop in US inventories and spoiled the brief party (with WTI sagging back to a $43 handle)

Silver’s worst week since Oct 2016…

And Gold suffered again, dropping back to March rate-hike lows…

end

The phony jobs official report:  222,000 which is a beat but the all important hourly earnings came in at .2% rise instead of .3%

the dollar falls with gold and silver rising/

(courtesy zero hedge)

June Payrolls Rise 222K, Beat Expectations, But Hourly Earnings Disappoint

While today’s payrolls report will hardly have much of an impact on Fed policy as explained previously, moments ago the BLS reported that in June the US added 222K jobs (making a mockery of the ADP print again), beating expectations of 179K, with the May payrolls number revised from 138K to 152K and April revised from 174K to 207K, for a combined revision of the past two months of +47,000 more than previously reported.

Meanwhile, the unemployment rate rose from 4.3% to 4.4%, and above the expectation of an unchanged print.

However, the fly in the ointment is that despite the better than expected job growth, wage growth once again disappointed, with average hourly earnings rising only 0.2%, missing expectations of a 0.3% increase, while the May earnings number  was revised lower from 0.2% to 0.1%.

Developing

end

Initial trading after the phony jobs report:

(courtesy zerohedge)

Stocks, Dollar, & Bond Yields Pop, Gold Drops After Payrolls ‘Positivity’

Bonds and Bullion are down.. but following the better than expected payrolls print, stocks and the dollar (JPY and EUR weakness) are jumping higher as markets celebrate The Fed’s ability to tighten financial conditions further (and ignore The Fed’s fears over bubbles)…

Stocks are up…

The Dollar Index dipped on the report then ripped back higher…

But Bonds are extending their losses…

And Gold is getting hit…

As a reminder…

Where The June Jobs Were: More Minimum Wage, Surge In Government Hiring

Another month, another rise in minimum wage jobs such as healthcare and education, which is hardly a surprise but this time an unexpected source of hiring emerged: the government.

First a quick recap of the key sectors that added jobs in June: healthcare added a total of 59,000. Of this, social assistance employment increased by 23,000 in June, and has added 115,000 jobs over the last 12 months. Employment in financial activities rose by 17,000 in June and has grown by 169,000 over the year. Securities, commodity contracts, and investments added 5,000 jobs over the month. Mining employment grew by 8,000,  (Harvey ?)with most of the growth in support activities for mining (+7,000). Since a recent employment low in October 2016, mining has added 56,000 jobs.

So how did June payrolls surprise so strongly to the upside? Courtesy of local government hiring, which added 35,000 jobs in June (more below).

One sector that remains a bright light is professional and business services, where employment continued to trend up in June (+35,000) and has grown by 624,000 over the last 12 months. Offsetting this, however, employment in food services and drinking places also continued on an upward trend in June (+29,000). The industry has added 277,000 jobs over the year, and has been on a historic tear, with 88 consecutive months of job gains since March 2010.

Below, courtesy of Southbay Research, are some of the highlights:

Notable Trends

  • Half of Private Payroll hiring is Healthcare (+59K) and Restaurants (+29K)
  • House flipping more important than production: Real Estate Hiring (+10K) vs Manufacturing (+1K)

Local Government Hiring: +35K: June 30th is end of fiscal year for most States: Use-it-or-lose-it budgets bump up hiring.

Healthcare: At +59, this was Stronger than we modeled (+59K)

  • Healthcare surged higher as Obamacare repeal looks unlikely
  • Headline number masks generally soft payrolls

As usual, the strong headline number masks generally soft payrolls:

  • Supply Chain (Manufacturing + Transportation):  +3K
    • Manufacturing: +1K
    • Transportation: +2K
  • White Collar Hiring (Professional Technical + Information + Financial): +32K
    • Pro technical: 19K
    • Information: -4K
    • Financial: +17K
  • Consumer Spending (Retail + Leisure/Hospitality): +44K
    • Retail: +8K
    • Leisure/Hospitality: +36K
  • Business Expansion Still Mild
    • Temp hiring: +14K (average run-rate ttm 11K)

A visual summary of where all the jobs were in June.

One surprise: despite the ongoing bloodbath in the retail sector, somehow in June there was an addition over over 8 thousand retail workers.  (Harvey:??)

Finally, our favorite chart: the number of food service and drinking places workers (i.e. waiters and bartenders), hasn’t had a down month in over 7 years.

(courtesy Dave Kranzler/IRD)

Non-Farm Payroll Propaganda – Aka Fake News

“If you tell a lie big enough and keep repeating it, people will eventually come to believe it.” Joseph Goebbels

I dislike giving the employment report any acknowledgment because the report is constructed for the purposes of political expedience. But I can’t help posting a few comments because, once again, the non-farm payroll report for June showed significant growth in sectors of the economy for which real world business economic reports showed economic contraction. The headline number purports that the 222k new jobs were created in June. This wailed on the consensus estimate of 170k.

The Government attributes 16k in new jobs to the construction industry. How can this possibly have been the case when construction spending declined 4.4% on a quarterly basis for April and May? Moreover, housing starts have been declining for the past few months, including June. Unless there’s a new model for running a business, contracting economic activity is accompanied by payroll cost-cutting. The number is just not credible. Same with retail, for which the Government wants us to believe that 8100 jobs miraculously were created despite the fact that retail stores are being closed at one of the fast rates in history.

Then there’s the nefarious “birth/death” model, which guesstimates the number of jobs created by new companies started in June net of jobs lost from new businesses closed in June. I have news for the Bureau of Labor Statistics: new business formation, according to Gallop, is at a 40-yr low. Furthermore, potential business owners are less likely to risk borrowing money for a new business when the cost of borrowing is increasing. Maybe the BLS statisticians forgot about the Fed interest rate hikes and forgot to plug the higher cost of capital in to their new business formations blender. The B/D model attributes 102,000 new jobs from new businesses net of business deaths. To convolute their reporting Hmmm…23k of those came from construction…need I say more?

end

Funny!! CNN ratings collapse as they are drawing less viewers than reruns of Yogi Bear

(courtesy zero hedge)

CNN’s Ratings Collapse As Primetime Shows Draw Less Viewers Than Re-Runs Of “Yogi Bear”

A series of fake news articles (see herehere and here), black mail of anonymous Reddit users who had the audacity to poke fun at them and a couple of undercover videos from Project Veritas revealing CNN producers admitting their own news is “mostly bullshit,” seems to be taking a toll on CNN’s ratings.

As The Federalist notes in the table below, for the week of June 26th – July 2nd, CNN’s primetime shows (Anderson Cooper and Don Lemon) managed to draw about 6% fewer viewers than multi-decade old re-runs of “Yogi Bear,” “Full House,” and “Friends” which air in the same time slots on Nick-At-Nite.

CNN

Sometimes it’s difficult to know for sure, but we think this is a bad trend…

CNN

(Source: AdWeek.com)

end

Let us close out the week with this wrap up courtesy of Greg Hunter of USAWatchdog

(courtesy Greg Hunter/USAWatchdog)

North Korea ICBM Danger, Economic Update, DNC Server Still Hidden

By Greg Hunter On July 7, 2017 In Weekly News Wrap-Ups

North Korea celebrated the Fourth of July with a bang by successfully launching a brand new ICBM. An emergency meeting was called at the UN, and the President said it was “dangerous” and would have to be “dealt with.”

The Illinois legislature has overridden the Republican Governor’s veto in that state to pass a spending bill and give its citizens a 32% tax increase. Lawmakers will not cut anything and will only raise taxes. The one thing that might get cut is the bond ratings for Illinois state debt. The ratings agencies are threatening to cut the debt from the Land of Lincoln to junk.

The DNC servers, where Russia allegedly hacked, are still not in control of the government’s special prosecutor on Russia interference with the 2016 election. The question is why is the DNC server being withheld? It has the most critical evidence and proof of Russian hacking. What does the DNC have to hide?

Join Greg Hunter as he talks about these stories and more in the Weekly News Wrap-Up.

Video Link

http://usawatchdog.com/north-korea-icbm-danger- economic-update-dnc-server-still-hidden/

end

We will see you MONDAY night

.

Harvey.

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One comment

  1. […] JULY 7/RAID!! […]

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