August 11/COT report shows bankers capitulating in silver/gold rises $4.10 and silver up 4 cents/gold and silver withstand another attack by bankers today/Rhetoric increases between North Korea and the uSA/China refuses to advance the idea of a regime change in North Korea: not what the USA wanted to hear/Consumer prices and wage inflation disappoint the Fed for the 5th consecutive month/Goldman Sachs lowers the chances for another rate hike/

GOLD: $1287.80  UP $4.10

Silver: $17.08  up 4 cent(s)

Closing access prices:

Gold $1289.50

silver: $17.11

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: $1288.86 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME:  $1284.30

PREMIUM FIRST FIX:  $4.56

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SECOND SHANGHAI GOLD FIX: $1291.86

NY GOLD PRICE AT THE EXACT SAME TIME: $1288.40

Premium of Shanghai 2nd fix/NY:$3.46

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LONDON FIRST GOLD FIX:  5:30 am est  $1288.30

NY PRICING AT THE EXACT SAME TIME: $1288.40 

LONDON SECOND GOLD FIX  10 AM: $1286.10

NY PRICING AT THE EXACT SAME TIME. $1287.10 

For comex gold:

AUGUST/

NOTICES FILINGS TODAY FOR APRIL CONTRACT MONTH: 19 NOTICE(S) FOR  1900  OZ.

TOTAL NOTICES SO FAR: 4487 FOR 448700 OZ (13.956 TONNES) 

For silver:

AUGUST

 88 NOTICES FILED TODAY FOR

44,000  OZ/

Total number of notices filed so far this month: 810 for 4,050,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

end

 

Today, the bankers tried to raid both gold and silver.  They like Friday’s especially once London officially closes because they do not have to worry about physical demand for another 48 hrs starting on Monday. Once again their attack was rebuffed.  Also extremely encouraging is the COT for silver which saw bankers start to unload their massive shortfall

Let us have a look at the data for today

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In silver, the total open interest SURPRISINGLY FELL BY  687 contracts from 195,132 DOWN TO 194,445 DESPITE THE HUGE RISE IN THE PRICE THAT SILVER TOOK WITH RESPECT TO YESTERDAY’S TRADING (UP 21 CENT(S). SIMPLE EXPLANATION: THE BANKERS HAVE CAPITULATED..THEY ARE TRYING TO COVER THEIR SHORTFALL AT HIGHER AND HIGHER PRICES. THE BANKERS ARE LOATHER TO SUPPLY ADDITIONAL SHORT PAPER AND LONGS ARE COMING IN LIKE GANG BUSTERS.

 In ounces, the OI is still represented by just UNDER 1 BILLION oz i.e.  0.972 BILLION TO BE EXACT or 139% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT MAY MONTH/ THEY FILED: 88 NOTICE(S) FOR 440,000  OZ OF SILVER

In gold, the open interest ROSE by A CONSIDERABLE 11,516 WITH the RISE in price of gold ($10.70 GAIN ON YESTERDAY.)  The new OI for the gold complex rests at 475,913.  IN COMPLETE CONTRAST TO SILVER, THE BANKERS SUPPLIED THE MASSIVE AMOUNT OF PAPER SHORT GOLD WHICH WAS GOBBLED UP BY THE LONGS.  THE NEWBIE SPEC SHORTS HAVE NO DOUBT COVERED THEIR POSITION. NO WONDER A RAID WAS CALLED UPON BY THE ELITE TO ROB THE NEWBIE LONGS.

we had: 19 notice(s) filed upon for 1900 oz of gold.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD:

Today, no changes in gold inventory:

Inventory rests tonight: 786.87 tonnes

 

(from Tuesday through Thursday we lost .17 tonnes which paid for fees)

IN THE LAST 21 TRADING DAYS: GLD SHEDS 50.1 TONNES YET GOLD IS HIGHER BY $48.95 . 

SLV

Today: : WE NO CHANGES IN SILVER INVENTORY TONIGHT:

INVENTORY RESTS AT 335.825 MILLION OZ BUT WE LOST 3.781 MILLION OZ FROM TUESDAY THROUGH TO THURSDAY.

end

.

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

1. Today, we had the open interest in silver FALL BY  687 contracts from 195,132 UP TO 194,445 (AND now A LITTLE FURTHER FROM THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787). THE FALL IN OPEN INTEREST WAS ACCOMPANIED BY A HUGE RISE IN PRICE AND FOR THE FIRST TIME WE ARE WITNESSING BANKER CAPITULATION.  BANKERS ARE LOATHE TO SUPPLY NEW SHORT PAPER AND THE LONGS CONTINUE TO ENTER THE ARENA PURCHASING WHATEVER SILVER THEY CAN. 

(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 DOWN 53.21 POINTS OR 1.63%   / /Hang Sang CLOSED DOWN 560.49 POINTS OR 2.04% The Nikkei closed DOWN 8.97 POINTS OR .05%/Australia’s all ordinaires CLOSED DOWN 1.15%/Chinese yuan (ONSHORE) closed UP at 6.6651/Oil DOWN to 48.36 dollars per barrel for WTI and 51.68 for Brent. Stocks in Europe OPENED DEEPLY IN THE RED , Offshore yuan trades  6.6784 yuan to the dollar vs 6.7201 for onshore yuan. NOW THE OFFSHORE IS WEAKER  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 SLIGHTLY STRONGER DOLLAR. CHINA IS  HAPPY TODAY

3a)THAILAND/SOUTH KOREA/NORTH KOREA

i)NORTH KOREA//USA

Tuesday:

Japan presents a paper suggesting that North Korea might be in possession of a miniature nuclear warhead and that would be deadly to the world.

( zerohedge)

ii)THURSDAY NIGHT

 

North Korea responds to Trump as he vows to mercilessly wipe out “provocateurs”. He also states that the USA will suffer its final doom.

I personally do not feel that they have the capability of reaching Guam or for that matter any part of the USA.  I may be wrong but all their equipment is from the 1970’s or 1960’s.

However, I agree that it is nerve-racking

 

 

( zerohedge)

iii)THURSDAY NIGHT

The Pentagon plan for a pre-emptive strike on North Korea: use non nuclear B1 bombers

(courtesy zerohedge)

iv)FRIDAY AFTERNOON

North Korea issues emergency standby orders to its civil defense units:

 

(courtesy zero hedge)

b) REPORT ON JAPAN

c) REPORT ON CHINA

THIS IS NOT WHAT THE WORLD WANTS TO HEAR:

China will resist regime change in North Korea

( zero hedge)

4. EUROPEAN AFFAIRS

SPAIN

First it was Greece, receiving a multitude of migrants through Turkey. Then it was Italy who this year has received the bulk of new migrants floating across the Med.  Now it is Spain..

( zero hedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

i)Russia/USA

Funny!!  The Press is love this:  Trump thanks Putin for kicking out 755 diplomats and the uSA will save a lot of money

( zero hedge)

ii)Russia and China’s plan to defuse the Korean crisis.  North Korea would suspend all new ballistic missile tests and the the USA South Korea would suspend large scale naval exercises. Not sure the USA would go for this as they could not trust the North Koreans

( zerohedge)

 

6 .GLOBAL ISSUES

7. OIL ISSUES

i)This is something that i have been worrying about:  China importing less imports as its SPDR oil is filled to the brim and cannot take on any more oil

( Paraskova/Oil Price.com)

ii)Rig counts rise by only but production will increases.  We have highlighted this to you in the past:  just because rig count increases fall to zero, it doesn’t stop USA production..it rise for about a year and then peters out.

( zerohedge)

8. EMERGING MARKET

 

9.   PHYSICAL MARKETS

i)This is a good commentary from Mike Norman.  I read this on Wednesday and it is worth repeating for those who did not see it.  He says correctly that continual sanctions by the uSA destroys the use of the USA dollar and by definition is the noose that kills off the uSA dollar

 

( Mike Norman/The Street.com/GATA)

ii)Ron Paul describes in detail how the uSA stabilization fund rigs the price of gold

 

( Ron Paul/GATA)

iii)Craig Hemke states that the bullion banks are still capping gold and silver prices.  This time I will have to disagree with him on silver.  Gold yes but silver is their Achilles heel

 

( Craig Hemke/TFMetals)

iv)The Wall Street Journal is now asking questions about the gold at the Federal Reserve Bank of NY. Interesting enough the uSA only has about 500 tonnes of official gold held there.  Most of the uSA gold is stored at Fort Knox Ky., some at West Point NY and the remainder at NORAD under the mountain in Colorado.

 

( Chris Powell/GATA)

v)John Embry correctly states that the cryptos are revealing inflation simply because the bankers have not figured out yet how to short them

 

( John Embry/GATA)

vi)If gold was not manipulated, this is what is should be trading around today: $3500.00

( zero hedge)

10. USA Stories

i)From Tuesday:  the Uber effect whacks Avis

( zero hedge)

ii)And  now UBER itself is in a mess as its largest shareholder has declared a state of emergency( Bloomberg)

iii)This is not what Janet wants to see:  consume prices disappoint for the 5th month in a row. But most importantly she needs to see a rise in wage inflation, and it is just not happening for her.  It will be difficult to raise rates

 

( zero  hedge)

iv)Now Mueller is going after Manafort’s family in the hope that the lower rung on the ladder will supply information to charge the higher levels on the ladder:

( zero hedge)

v)Then finally, the laid back Republicans strike back as they demand an open hearing with respect to the on goings of Mueller

( zerohedge)

vi)This is interesting:  the judge handling the freedom of information case against the state department has now ordered the said State Dept. to search for  Hillary’s Benghazi emails

( zero hedge)

vii a)This is not what Janet wants to see:  consume prices disappoint for the 5th month in a row. But most importantly she needs to see a rise in wage inflation, and it is just not happening for her.  It will be difficult to raise rates

( zero  hedge)

vii)  b  And with the 5th consecutive miss, Goldman Sachs cuts its odds for a rate hike. The uSA cannot get wage inflation(courtesy zerohedge)

Let us head over to the comex:

The total gold comex open interest ROSE BY A HUGE 11,516  CONTRACTS UP to an OI level of 475,913 WITH THE HUGE RISE IN THE PRICE OF GOLD ($10.70 with YESTERDAY’S trading). NEWBIE LONGS ENTERED THE ARENA WITH THE BANKERS SUPPLYING THE PAPER. NEWBIE SPEC SHORTS ARE NOW COMPLETELY OUT OF THEIR POSITIONS. THE HUGE RISE IN OPEN INTEREST WAS FODDER FOR THE CROOKS TO RAID TODAY.

We are now in the contract month of August and it is the 3rd best of the delivery months after December and June.

The active August contract LOST 12 contract(s) to stand at 1262 contracts. We had 106 notices filed upon YESTERDAY so we GAINED 94 contracts or an additional 9400 oz will stand at the comex and 0 EFP’s were issued which entitles the long holder to a fiat bonus plus a futures contract and most probably that would be a London based forward.

The non active September contract month saw it’s OI LOSE 178 contracts DOWN to 1522.

The next active contract month is Oct and here we saw a GAIN of 2535 contracts UP to 50,039.

The very big active December contract month saw it’s OI GAIN 9,239 contracts up to 371,145.

We had 19 notice(s) filed upon today for   1900 oz

For those keeping score: in the upcoming front delivery month of August:

LAST YEAR WE HAD A MONSTROUS 44.7 TONNES OF GOLD INITIALLY.  BY THE CONCLUSION OF THE AUGUST CONTRACT MONTH 44.358 TONNES STOOD FOR DELIVERY.

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And now for the wild silver comex results.  Total silver OI FELL BY 687 contracts FROM 195,132 DOWN TO 194,445 WITH YESTERDAY’S GOOD SIZED 21 CENT GAIN . THERE IS NO QUESTION THAT WE ARE HAVING BANKER CAPITULATION AS THE HUGE TOTAL SILVER COMEX OPEN INTEREST HAS FINALLY CHOKED THEM TO DEATH.  AS I HAVE WARNED YOU, THE NOOSE IS AROUND OUR BANKERS’ NECKS AND SOMETHING HAPPENED IN THE SILVER ARENA FORCING THEM TO COVER AS FAST AS THEIR FEET COULD CARRY THEM.  NEWBIE SPEC LONGS ENTERED THE SILVER COMPLEX AND ON THE SUPPLY SIDE: MANY WERE JUST PLAIN LOATHE TO SUPPLY THE NECESSARY PAPER.  THUS A SMALL DECLINE IN SILVER OI BUT A GOOD SIZED RISE IN PRICE.

We are now in the next big non active silver contract month of August and here the OI  ROSE BY 68 contracts UP TO 160. We had 77 notice(s) filed yesterday.  Thus we GAINED 134 contract(s) or an additional 725,000 oz will stand for delivery in this non active month of August and zero EFP’s were issued for the August contract month.

The next active contract month is September (and the last active month until December) saw it’s OI fall by 3838 contacts down to 112,506.  The next non active contract month for silver after September is October and here the OI gained 10  contacts up TO 83. After October, the big active contract month is December and here the OI GAINED by 2798 contracts UP to 71,174 contracts.

We had 88 notice(s) filed for 440,000 oz for the AUGUST 2017 contract

VOLUMES: for the gold comex

Today the estimated volume was 174,618 contracts which is FAIR/

FRIDAY’S confirmed volume was 284,321 contracts  which is EXCELLENT

volumes on gold are STILL HIGHER THAN NORMAL!

Initial standings for AUGUST

 August 11/2017.

Gold Ounces
Withdrawals from Dealers Inventory in oz   nil
Withdrawals from Customer Inventory in oz  
32.15 oz
BRINKS
1 KILOBAR
Deposits to the Dealer Inventory in oz   oz
Deposits to the Customer Inventory, in oz 
nil oz
No of oz served (contracts) today
 
19 notice(s)
1900 OZ
No of oz to be served (notices)
1243 contracts
(124,300 oz)
Total monthly oz gold served (contracts) so far this month
4487 notices
448.700 oz
13.596 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   17,714.65  oz
Today we HAD  1 kilobar transaction(s)/ 
total dealer deposits: nil oz
We had nil dealer withdrawals:
total dealer withdrawals:  0 oz
we had 0  customer deposit(s):
total customer deposits;nil  oz
We had 0 customer withdrawal(s)
total customer withdrawals;  nil oz
 we had 0 adjustment(s)
 
For AUGUST:

Today, 0 notice(s) were issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 19  contract(s)  of which 0 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 AUGUST. contract month, we take the total number of notices filed so far for the month (4487) x 100 oz or 448,700 oz, to which we add the difference between the open interest for the front month of AUGUST (1262 contracts) minus the number of notices served upon today (19) x 100 oz per contract equals 573,000  oz, the number of ounces standing in this active month of AUGUST.
 
Thus the INITIAL standings for gold for the AUGUST contract month:
No of notices served so far (4487) x 100 oz  or ounces + {(1262)OI for the front month  minus the number of  notices served upon today (19) x 100 oz which equals 573,000 oz standing in this  active delivery month of AUGUST  (17.822 tonnes)
 we GAINED 94 contracts or an additional 9400 oz will stand for delivery and 0 EFP’s for August were issued.
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Total dealer inventory 758,510.492 or 23.59 tonnes  (dealer gold continues to disappear)
Total gold inventory (dealer and customer) = 8,634,161.10 or 268.55 tonnes 
 
Over a year ago the comex had 303 tonnes of total gold. Today the total inventory rests at 268.55 tonnes for a  loss of 33  tonnes over that period.  Since August 8/2016 we have lost 84 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 12 MONTHS  84 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
AND NOW THE AUGUST DELIVERY MONTH
 
August initial standings
 August 11 2017
Silver Ounces
Withdrawals from Dealers Inventory  nil
Withdrawals from Customer Inventory
883,411.490 oz
Brinks
Delaware
Scotia
Deposits to the Dealer Inventory
nil  oz
Deposits to the Customer Inventory 
1,162,096.134
oz
CNT
Scotia
No of oz served today (contracts)
88 CONTRACT(S)
(440,000 OZ)
No of oz to be served (notices)
72 contracts
( 360,000 oz)
Total monthly oz silver served (contracts) 810 contracts (4,050,000 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 2,056,136.4 oz
today, we had  0 deposit(s) into the dealer account:
total dealer deposit: nil   oz
we had 0 dealer withdrawals:
total dealer withdrawals: NIL oz
we had 3 customer withdrawal(s):
ii) out of Brinks: 235,300.33 oz
ii) out of Delaware:  6020.21 oz
iii) out of Scotia: 642,090.955 oz
TOTAL CUSTOMER WITHDRAWALS:  883,411.490 oz
We had 2 Customer deposit(s):
 i) Into CNT:  600,445.094 oz
ii) Into JPMorgan:  561,651.04
***deposits into JPMorgan have 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: 1,162,096.134 oz
 
 we had 0 adjustment(s)
The total number of notices filed today for the AUGUST. contract month is represented by 88 contract(s) for 440,000 oz. To calculate the number of silver ounces that will stand for delivery in AUGUST., we take the total number of notices filed for the month so far at 810 x 5,000 oz  = 4,050,000 oz to which we add the difference between the open interest for the front month of AUGUST (160) and the number of notices served upon today (88) x 5000 oz equals the number of ounces standing
 

 

.
 
Thus the INITIAL standings for silver for the AUGUST contract month:  810 (notices served so far)x 5000 oz  + OI for front month of AUGUST(160 ) -number of notices served upon today (88)x 5000 oz  equals  4,410,000 oz  of silver standing for the AUGUST contract month. This is extremely high for a non active delivery month. Silver is being constantly demanded at the silver comex and we witness again the amount of silver increases daily right from the get go.
We GAINED ANOTHER 134 contracts or an additional 725,000 oz wishes to stand for delivery in this non active month of August and  0 EFP’s were issued for the silver August month.
 At this point in the delivery cycle last year on August 11/2016 we had 119,476 contracts standing vs this yr at 113,151.
Last yr on the first day notice for the Sept contract we had 17.070 million oz stand for delivery.
By month end:  16.075 million oz/
 
 
 
 
Volumes: for silver comex
Today the estimated volume was 65,877 which is EXCELLENT
FRIDAY’s  confirmed volume was 126,255 contracts which is OUT OF THIS WORLD
YESTERDAY’S CONFIRMED VOLUME OF 126,255 CONTRACTS WHICH EQUATES TO 632 MILLION OZ OF SILVER OR 90% 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:  38.348 million (close to record low inventory  
Total number of dealer and customer silver:   215.981 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 6.7 percent to NAV usa funds and Negative 6.9% to NAV for Cdn funds!!!! 
Percentage of fund in gold 62.5%
Percentage of fund in silver:37.5%
cash .+0.0%( August 11/2017) 
2. Sprott silver fund (PSLV): STOCK   NAV RISES TO +0.18% (August 11/2017) 
3. Sprott gold fund (PHYS): premium to NAV RISES TO -0.32% to NAV  (August 11/2017 )
Note: Sprott silver trust back  into POSITIVE territory at +0.18/Sprott physical gold trust is back into NEGATIVE/ territory at -0.32%/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

August 11/no change in gold inventory/Inventory rests at 786.87 tonnes

August 7/no changes in gold inventory at the GLD/Inventory rests at 787.14 tonnes

AUGUST 4/ANOTHER LOSS OF 4.48 TONNES OF GOLD FROM GLD INVENTORY/INVENTORY RESTS AT 787.14 TONNES.THIS IS A HUGE CRIME SCENE!!

August 3/no change in gold inventory at the GLD/Inventory rests at 791.88 tonnes

August 2/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 791.88 TONNES

Aug 1/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 791.88 TONNES

July 31/NO CHANGES AT THE GLD/INVENTORY RESTS AT 791.88 TONNES

July 28/ANOTHER MASSIVE WITHDRAWAL OF 3.54 TONNES OF GOLD WITH GOLD UP $9.15/INVENTORY RESTS AT 791.88 TONNES

July 27/LATE LAST NIGHT, A HUGE WITHDRAWAL OF 5.03 TONNES WITH GOLD UP $10.45 ON THE DAY/INVENTORY RESTS AT 795.42 TONNES

July 26/NO CHANGE IN GLD INVENTORY WITH GOLD DOWN $2.55/INVENTORY RESTS AT 800.45 TONNES

July 25/A MASSIVE 9.17 TONNES OF GOLD WITHDRAWN FROM THE GLD/INVENTORY RESTS AT 800.45 TONNES

July 24/A massive 9.62 tonnes withdrawal and yet the price remains constant (down only 25 cents)..inventory drops to 809.62 tonnes

July 21/with gold up $8.75 again, we had no changes in gold inventory at the GLD/inventory rests at 816.13 tonnes

July 20/WITH GOLD UP AGAIN TODAY ($3.50) WE HAD NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 816.13 TONNES

jULY 19/STRANGE!! AGAIN WITH GOLD UP $0.50 WE HAD ANOTHER HUGE 5.32 TONNES WITHDRAWAL FROM THE GLD/INVENTORY RESTS AT 816.13 TONNES  THIS GOLD IS HEADING TO SHANGHAI

July 18/STRANGE AGAIN/WITH GOLD UP $7.50 WE HAD ANOTHER HUGE 5.62 TONNES WITHDRAWAL FROM THE GLD/INVENTORY RESTS AT 821.45 TONNES

July 17/strange again! with gold up $4.20 we had another huge withdrawal of 1.77 tonnes/inventory rests at 827.07 tonnes

July 14/strange@!!with gold up $12.00 today, we had a huge withdrawal of 3.55 tonnes/inventory rests at 828.84 tonnes

July 13/no change in gold inventory at the GLD/inventory rests at 832.39 tonnes

JULY 12/no change in gold inventory at the GLD/inventory rests at 832.39 tonnes

July 11/strange!@! we had a big withdrawal of 2.96 tonnes despite gold’s advance today/inventory rests tonight at 832.39 tonnes

July 10/no changes in gold inventory at the GLD/inventory rests at 835.35 tonnes

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

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August 11 /2017/ Inventory rests tonight at 786.87 tonnes
*IN LAST 211 TRADING DAYS: 163.01 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 149 TRADING DAYS: A NET  5.58 TONNES HAVE NOW BEEN WITHDRAWN FROM  GLD INVENTORY.
*FROM FEB 1/2017: A NET  22.39 TONNES HAVE BEEN WITHDRAWN.

end

Now the SLV Inventory

August 11/no change in silver inventory tonight.  However we lost 3,781 million oz from Tuesday through Thursday. Inventory rests at 335.825 million oz/

August 7/no change in silver inventory at the SLV/Inventory rests at 339.606 million oz

AUGUST 4/A WITHDRAWAL OF 945,000 OZ/INVENTORY RESTS AT 339.606 MILLION OZ

August 3/A WITHDRAWAL OF 1,181,000 OZ FROM THE SLV/INVENTOR RESTS AT 340.551 MILLION OZ/

August 2/NO CHANGES IN SILVER INVENTORY AT THE SLV

INVENTORY RESTS AT 341.732 MILLION OZ/

August 1/A HUGE WITHDRAWAL OF 945,000 OZ/INVENTORY RESTS AT 341.732 MILLION OZ/

July 31/no change in silver inventory at the SLV/inventory rests at 342.677 million oz

July 28/ A HUGE WITHDRAWAL OF 1.15 MILLION OZ OF SILVER LEAVES THE SLV DESPITE SILVER BEING UP 11 CENTS TODAY/INVENTORY RESTS AT  342.677 MILLION OZ

July 27/NO CHANGE IN SILVER INVENTORY/INVENTORY RESTS AT 343.812 MILLION OZ WITH SILVER UP 13 CENTS TODAY.

July 26/NO CHANGE IN SILVER INVENTORY/INVENTORY RESTS AT 343.812 MILLION OZ

July 25/A MASSIVE 3.309 MILLION OZ OF INVENTORY WITHDRAWN FROM THE SLV DESPITE SILVER’S 10 CENT RISE TODAY.

July 24/no change in silver inventory despite its 4 cent drop/inventory remains at 347.121 million oz

July 21/STRANGE! WITH SILVER UP AGAIN TODAY (11 CENTS), NO CHANGE IN SILVER INVENTORY AT THE SLV/inventory 347.121 million oz/

July 20/STRANGE! WITH SILVER UP AGAIN TODAY, THE SLV INVENTORY LOWERS BY 945,000 OZ/INVENTORY RESTS AT 347.121 MILLION OZ/

July 19/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 348.066 MILLION OZ

July 18/a huge 946,000 oz withdrawal from the SLV despite silver’s 16 cent gain!

Inventory rests at 348.066 million oz

July 17/no change in silver inventory at the SLV/Inventory rests at 349.012 million oz

July 14/no change in silver inventory/inventory rests at 349.012 million oz/

July 13/no change in silver inventory/inventory at the SLV rests at 349.012 million oz/

JULY 12/another massive 1.986 million oz of silver added into the SLV/inventory rests at 349.012 million oz/the last 3 days saw 7.281 million oz added into the SV

July 11/ANOTHER MASSIVE INCREASE OF 2.364 MILLION OZ into the SLV inventory/inventory rests at 347.026 million oz

July 10/ A HUGE INCREASE OF 2.931 MILLION OZ OF SILVER DESPITE THE EARLY HIT ON SILVER THIS MORNING/INVENTORY RESTS AT 344.662 MILLION OZ.

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.

August 11.2017:

 Inventory 335.825  million oz
end
  • 6 Month MM GOFO

    Indicative gold forward offer rate for a 6 month duration

    + 1.33%
  • 12 Month MM GOFO
    + 1.48%
  • 30 day trend

end

At 3:30 we receive the COT report which gives up position levels of our major players.  This report gives levels as of August 8.  You will recall last week that the commercials went deeply short.  let us see what these crooks did this week:

 

Gold COT Report – Futures
Large Speculators Commercial Total
Long Short Spreading Long Short Long Short
246,377 97,540 36,408 125,168 284,679 407,953 418,627
Change from Prior Reporting Period
6,611 -12,554 -3,589 -1,723 14,403 1,299 -1,740
Traders
152 94 79 57 56 241 201
 
Small Speculators  
Long Short Open Interest  
40,774 30,100 448,727  
-1,281 1,758 18  
non reportable positions Change from the previous reporting period
COT Gold Report – Positions as of Tuesday, August 8, 2017

LARGE SPECULATORS

Our large speculators that have been long in gold added a large 6611 contracts to their long side

Our large specs that have been short in gold covered a huge 12,554  contracts from their short side (something which I highlighted to you on Monday and Tuesday)

Specs go net long by 19,000 contracts.

COMMERCIALS

Our crooked commercials who are long in gold pitched 1723 contracts from their long side

the commercials who are short in gold added a whopping 14,403 contracts to their short side  (while gold was rising and we indicated this to you throughout the week)

commercials go net short by 16000 contracts

 

SMALL SPECULATORS

 Our small specs who have been long in gold pitched 1281 contracts from their long side
Our small specs who have been short in gold added 1758 contracts to their short side.
Conclusions: recipe for a raid as the commercials go net short by 16,000 contracts.  they tried today but failed.

END

 

AND NOW FOR OUR SILVER COT

I got this one right.

you will recall that I told you the bankers despite being net short last week, that they were having trouble covering.  I told you that this week’s COT would be important to see if the bankers would start to capitulate.  They did!!

LARGE SPECULATORS

those large specs  that have been long in silver pitched 914 contracts from their long side (at higher prices)

those large specs that have been short in silver covered 4019 contracts from their short side.

large specs go net long by 3100  contracts.

 

 

 

COMMERCIALS

those commercials that have been long in silver pitched 1320 contracts from their long side

those commercials that have been short capitulated and covered 1426 contracts.  The covering started in earnest last Wednesday so you will witness in flashing lights that the next COT report will show increased capitulation

commercials go net long by 100 contracts.

 

SMALL SPECULATORS

 

Our small specs that have been long in silver pitched 443 contracts from their long side  (at higher prices)

Our small specs that have been short in silver  added 2765 contract to their short side and these guys got buried. They probably covered yesterday and today.

Conclusions: bullish/banker capitulation commenced.

Major gold/silver trading/commentaries for FRIDAY

GOLDCORE/BLOG/MARK O’BYRNE.

GOLD/SILVER

Gold Up 2%, Silver 5% In Week – Gundlach, Gartman and Dalio Positive On Gold

Gold Up 2.3%, Silver 5.3% In Week – Gundlach, Gartman and Dalio Positive On Gold

– Gold is up 2.3% this week and silver has surged nearly 5.3% as stocks sell off on geopolitical risk
– Billionaire fund managers and commodities experts increasingly positive on gold
– Risks are rising, and everybody should put 5% to 10% of their assets in gold – Dalio
– Dalio’s Bridgewater, world’s largest hedge fund, warned clients that geopolitical risks are rising
– ‘Gold is about break out on the upside strongly’ – commodities expert Gartman
– Gartman believes right now investors should have 10% to 15% allocation to gold
– “The stock market looks a little vulnerable. The geopolitical circumstances are getting worse and worse” – Gartman
– Run up in gold prices is far from over due to economic risks – Gartman
– Gold’s chart has ‘one of the most bullish’ patterns – Billionaire bond guru Gundlach
– Gold up 6.3% and silver 8.2% in 30 days and look on verge of major move higher

Market Performance – One Week (Finviz)



Gold in USD – 30 Days

Gold in USD – 30 Days


See below for Business Insider UK article on Gundlach, CNBC article on Gartman and Business Insider on Dalio’s views on gold

News and Commentary

Gold ends at 2-month high: Risk aversion is back on (MarketWatch.com)

Stocks Drop Most Since May, Bonds Rally on Tension (Bloomberg.com)

GUNDLACH: Gold’s chart has ‘one of the most bullish’ patterns around (BusinessInsider.com)

Dalio Recommends Gold as Hedge Against Rising Political Risk (Bloomberg.com)

‘Gold is about break out on the upside strongly,’ Dennis Gartman says (CNBC.com)

 Source: Bloomberg.com

Everybody Needs To Put 5% to 10% of Their Money In Gold (BusinessInsider.com)

These 7 billionaires are worried about a stock-market correction (MarketWatch.com)

Sanctions will destroy the dollar (TheStreet.com)

Bitcoin Debate between Keiser and Schiff (Youtube.com)

Decade after financial crisis, World is still hooked on debt that caused it (Telegraph.co.uk)

Related Content
“Do You Own Gold?” Ray Dalio at CFR: “Oh Yeah, I Do”
Gold Selling “Malevolent Force”? – Dennis Gartman
Gold Is Undervalued – Leading Money Managers

Gold Prices (LBMA AM)

11 Aug: USD 1,288.30, GBP 993.67 & EUR 1,096.47 per ounce
10 Aug: USD 1,278.90, GBP 985.39 & EUR 1,091.67 per ounce
09 Aug: USD 1,267.95, GBP 974.80 & EUR 1,079.79 per ounce
08 Aug: USD 1,261.45, GBP 967.78 & EUR 1,068.20 per ounce
07 Aug: USD 1,257.55, GBP 963.41 & EUR 1,065.90 per ounce
04 Aug: USD 1,269.30, GBP 964.92 & EUR 1,068.37 per ounce
03 Aug: USD 1,261.80, GBP 952.41 & EUR 1,064.96 per ounce

Silver Prices (LBMA)

10 Aug: USD 17.08, GBP 13.14 & EUR 14.57 per ounce
09 Aug: USD 16.59, GBP 12.76 & EUR 14.14 per ounce
08 Aug: USD 16.39, GBP 12.57 & EUR 13.87 per ounce
07 Aug: USD 16.13, GBP 12.35 & EUR 13.67 per ounce
04 Aug: USD 16.70, GBP 12.71 & EUR 14.07 per ounce
03 Aug: USD 16.47, GBP 12.50 & EUR 13.91 per ounce
02 Aug: USD 16.67, GBP 12.60 & EUR 14.09 per ounce


Recent Market Updates

– Great Disaster Looms as Technology Disrupts White Collar Workers
– Gold Sees Safe Haven Gains On Trump “Fire and Fury” Threat
– Silver Mining Production Plummets 27% At Top Four Silver Miners
– Gold Consolidates On 2.5% Gain In July After Dollar Has 5th Monthly Decline
– Gold Coins and Bars See Demand Rise of 11% in H2, 2017
– Greenspan Warns Stagflation Like 1970s “Not Good For Asset Prices”
– What Investors Can Learn From the Japanese Art of Kintsukuroi
– Bitcoin, ICO Risk Versus Immutable Gold and Silver
– This Is Why Shrinkflation Is Making You Poor
– Gold A Good Store Of Value – Protect From $217 Trillion Global Debt Bubble
– Why Surging UK Household Debt Will Cause The Next Crisis
– Gold Seasonal Sweet Spot – August and September – Coming
– Commercial Property Market In Dublin Is Inflated and May Burst Again

end

 

 

This is a good commentary from Mike Norman.  I read this on Wednesday and it is worth repeating for those who did not see it.  He says correctly that continual sanctions by the uSA destroys the use of the USA dollar and by definition is the noose that kills off the uSA dollar

 

(courtesy Mike Norman/The Street.com)

 

Mike Norman: Sanctions will destroy the dollar

 Section: 

By Mike Norman
TheStreet.com, New York
Tuesday, August 8, 2017

The United States has been on a sanctions spree.

Sanctions on Russia. Sanctions on North Korea. Sanctions on Iran. Sanctions on Syria. Sanctions on Venezuela. Sanctions proposed against China. Sanctions even obliquely placed on our allies in Europe as a result of sanctions on Russia.

Sanctions, sanctions, sanctions.

Our leaders are stupid. They cannot see beyond their ill-conceived sanctions, which in most cases are illegal and violate the norms and rules of international trade.

The United States is increasingly using sanctions as a form of warfare. When we can’t attack militarily, we use sanctions. In many cases the result is the same as bombing supply lines only without the bombs. It’s a form of soft warfare that targets a country’s economy and its ability to transact business and safeguard its financial wealth in today’s dollar-based economy.

Do you know what the result of these sanctions will be? The dollar will get crushed.

Something like 80 percent of all international transactions take place in dollars. The global financial system rests on a dollar architecture. That includes funds transfer, clearing, payments, etc. There’s a special unit set up in the Treasury Department that is the war room where such measures are designed and meted out — just like any war room where military tactics and strategies are implemented to defeat an enemy.

How long do you think the rest of the world will operate under such a risk — a risk that at any moment if you fall out of favor with the fools in Washington, your entire economy and lifeline to the world’s financial system can be shut down? …

… For the remainder of the commentary:

http://realmoney.thestreet.com/articles/08/08/2017/sanctions-will-destro…

end

 

Ron Paul describes in detail how the uSA stabilization fund rigs the price of gold

 

(courtesy Ron Paul)

U.S. Exchange Stabilization Fund rigs gold price, ex-U.S. Rep. Ron Paul says

 Section: 

1:10p ET Wednesday, August 9, 2017

Dear Friend of GATA and Gold:

Former U.S. Rep. Ron Paul, R-Texas, this week tells Wall Street for Main Street’s Jason Burack that the United States uses its Treasury Department’s Exchange Stabilization Fund to manipulate currency markets and suppress the price of gold. Central banking, Paul says, can’t afford to let free markets set the gold price. The interview is 25 minutes long and can be heard at YouTube here:

https://www.youtube.com/watch?v=3SPiHhuLdFY&feature=youtu.be

The discussion about gold price suppression begins at the 13:50 mark.

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

END

 

Craig Hemke states that the bullion banks are still capping gold and silver prices.  This time I will have to disagree with him on silver.  Gold yes but silver is their Achilles heel

 

(courtesy Craig Hemke/TFMetals)

 

TF Metals Report: Bullion banks still sell as much paper as needed to cap prices

 Section: 

8:55a ET Thursday, August 10, 2017

Dear Friend of GATA and Gold:

Bullion banks continue to sell any many gold and silver futures contracts as necessary to keep monetary metals prices under control, the TF Metals Report concludes today after reviewing recent trader positioning reports. The banks, the report says, seem not to be afraid of anything in the monetary metals markets and nothing seems to have changed. The report is headlined “Same As It Ever Was” and it’s posted here:

https://www.tfmetalsreport.com/blog/8494/same-it-ever-was

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

 

END

 

The Wall Street Journal is now asking questions about the gold at the Federal Reserve Bank of NY. Interesting enough the uSA only has about 500 tonnes of official gold held there.  Most of the uSA gold is stored at Fort Knox Ky., some at West Point NY and the remainder at NORAD under the mountain in Colorado.

 

(courtesy Chris Powell/GATA)

FLASH: Wall Street Journal acknowledges gold leasing and swaps question …

 Section: 

… but never actually puts it comprehensively to any Federal Reserve or Treasury Department official.

* * *

In the report appended here the newspaper gets a Fed official to say that the Fed does not lease the gold of other nations. Well, of course not. But do those other nations lease or swap gold, or did they? And does the U.S. government lease or swap gold, or did it? If so, why?

The president of the Federal Reserve Bank of New York, William Dudley, was asked that question in public last year and ran away from it as fast as he could. It’s on video:

http://www.gata.org/node/16341

Over the last year and a half GATA gave The Wall Street Journal introductions to everyone quoted in the article below except for U.S. Sen. Rand Paul and his father, former U.S. Rep. Ron Paul. GATA also provided the newspaper with enormous documentation about surreptitious intervention in the gold market by central banks and governments. Yet somehow GATA itself isn’t mentioned here.

In any case maybe this is at least a start with mainstream financial news organizations, considering that all such major organizations have been given the same documentation by GATA over the years and ours remains a planet where gratitude will always remain rarer than gold. After all, as Gandhi is supposed to have said — or was it Alfred E. Neuman? — “First they ignore you, then they laugh at you, then they fight you, and then they go back to ignoring you, snickering that everybody really knew all along what you were trying to tell them.”

* * *

The Fed Has 6,200 Tons of Gold in a Manhattan Basement — Or Does It?

The Central Bank Provides Limited Inventory Information and Won’t Let Outsiders Count the Bars, Prompting Skeptics to Pounce

By Katy Burne
The Wall Street Journal
Thursday, August 10, 2017

https://www.wsj.com/articles/the-fed-has-6-200-tons-of-gold-in-a-manhatt…

Eighty feet below the streets of lower Manhattan, a Federal Reserve vault protected by armed guards contains about 6,200 tons of gold.

Or doesn’t.

The Fed tells visitors its basement vault holds the world’s biggest official gold stash and values it at $240 billion to $260 billion.

But “no one at all can be sure the gold is really there except Fed employees with access,” said Ronan Manly, a precious-metals analyst at gold dealer BullionStar in Singapore. If it is all there, he said, the central bank has “never in its history provided any proof.”

Mr. Manly is among gold aficionados who wonder if the bank is hiding something about what it’s hiding.

Other theorists suspect the gold beneath the New York Fed’s headquarters at 33 Liberty St. may be gold-plated fakes. Some conspiracy-minded investors think the Fed has been secretly leasing out the gold to manipulate prices.

“There has to have been a central bank spewing their gold into the market,” said John Embry, an investment strategist for Sprott Asset Management in Toronto until 2014 who once managed its gold fund.

“The gold price didn’t act right” during the time he was watching it and the likely explanation for the movement was Fed action, said Mr. Embry.

Fed officials have heard theories about their gold holdings for many years and don’t think much of them. After this article was published, a Fed spokeswoman said the Fed doesn’t own any of the gold housed at the New York Fed, which “does not use it in any way for any purposes including loaning or leasing it out.”

The Fed has been selective in giving details about the contents of the vault and in the past has said it can’t comment on individual customer accounts due to confidentiality agreements.

Former Fed Chairman Alan Greenspan said in a July interview: “When you deposit your funds in a bank, should that bank make your account balances available to whoever asks?”

Seeking a better glimpse inside the vault and at Fed procedures and records, The Wall Street Journal filed Freedom-of-Information requests with the New York Fed. Among the Journal’s findings, from a heavily redacted tour-guide manual provided by the Fed: Tour guides are informed that “visitors are excitable” and should be asked to “please keep their voices down.”

Three Fed staffers must be present when gold is moved or a compartment opened, even to change a lightbulb, and no attempts have been made to break in, documents state.

New York Fed President William Dudley told a March gathering in Queens, N.Y., that the fictional raid by drilling through from a subway tunnel in the 1995 movie “Die Hard With a Vengeance” was far-fetched.

The Fed gives some information about the vault on a website and offers tours. A guide on one tour gave some details: Inside is enough oxygen for a person to survive 72 hours, should someone get trapped; custodians wear magnesium shoe covers to help prevent injuries, should they drop 27-pound bars; the Fed charges $1.75 a bar to move gold but nothing to store it; most of the gold is owned by foreign governments.

Along with the foreign gold, the Fed’s Manhattan vault holds about 5% of America’s roughly $11 billion in gold reserves and coin, valued at the statutory rate of $42.22 per fine troy ounce, according to the U.S. Mint. The U.S. government keeps the rest in Denver, Fort Knox, Ky., and West Point, N.Y.

Elaborate theories build on what the Fed doesn’t say about goings-on in its vault’s 122 compartments.

It doesn’t report when bars enter or leave and doesn’t let in outsiders—other than auditors and account holders—to count the bars or review records.

Visitors on vault tours see only a display sample and can’t verify bars up close.

“All you see is the front row of gold bars,” said James Turk, co-founder of Goldmoney, a gold custodian. “There’s no way of knowing how deep the chamber is or how many rows there are.”

Mr. Turk, based in London, believes much of the gold has been “hypothecated,” or lent out to other parties, and then rehypothecated, or lent to multiple parties at once. In doing so, he says, “central banks actually own less gold than people believe.”

Some gold bugs—investors bullish on the yellow metal—think the Fed secretly lends it out to suppress prices, partly to protect the dollar’s value. In theory, the Fed can feed gold into the market through swaps with other countries.

James McShirley, who owns Sulphur Lumber in Sulphur Springs, Ind., and has traded gold, believes investment banks, probably as agents for the Fed, act to lower prices when gold futures gain 1%. “It’s totally logical that in addition to maintaining artificially low interest rates,” he said, “it would be imperative to keep gold suppressed as an inflationary barometer.”

Then there’s the purity question. Mr. Turk said there are “questions in gold circles as to what’s in an actual bar.” One theory, he said: They could be gold-plated tungsten, which would weigh almost the same.

“I think the gold they have there is real gold,” he said, “but until you do random sampling you don’t know for certain.”

In a 2012 audit of U.S. gold at the Fed’s vault, the U.S. Mint and the Treasury’s Office of Inspector General sent 367 samples to an independent lab for testing. All but three samples came back within 0.13% of the purity recorded by the government, within standard industry tolerance, according to the Mint and Treasury.

Since then, annual government audits of the Fed’s vault have inspected only the locks and joint seals on the compartments to check they haven’t been tampered with, a Mint spokesman said.

That isn’t enough, said Peter Boehringer, founder of the German Precious Metals Society. The problem, he said, is the “complete lack of a transparent, full, independent, external audit in the Fed´s vaults by a sworn-in auditor.”

New legislation, nicknamed the “Audit the Fed” bill, could allow the Government Accountability Office to audit the Fed’s vault, said a spokesman for the bill’s Senate sponsor, Rand Paul (R., Ky.). GAO lawyers wouldn’t speculate on the bill’s reach. Mr. Paul’s spokesman said the Senator has arranged a personal visit to Fort Knox this fall.

Former U.S. Rep. Ron Paul, the senator’s father, has been outspoken about what he says is taxpayers’ need for more transparency about gold from the Fed. “Even if you could walk into that vault and see a lot of gold, you wouldn’t know … whether it’s been loaned out or sold,” he said. “They haven’t convinced me that we have total control of it.”

 

 

END

 

John Embry correctly states that the cryptos are revealing inflation simply because the bankers have not figured out yet how to short them

 

(courtesy John Embry/GATA)

 

Cryptos succeed in revealing inflation because governments can’t short them, Embry says

 Section: 

10:27p ET Thursday, August 10, 2015

Dear Friend of GATA and Gold:

The explosion in crypto-currency prices, Sprott Asset Management’s John Embry tells King World News story, reveals the monetary inflation loose in the world because there is as yet no good way for governments to short them as governments short the monetary metals in the futures markets. But, he adds, the day of gold and silver will come. An excerpt from Embry’s interview is posted at KWN here:

http://kingworldnews.com/john-embry-silver-set-to-soar-as-world-markets-…

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

 

 

END

If gold was not manipulated, this is what is should be trading around today: $3500.00

(courtesy zero hedge)

Bitcoin Spikes To New Record High Over $3500 – Best Week Since Brexit Amid “Netscape Moment”

Bitcoin is now up almost 35% since the August 1st fork, and up over 90% from the mid-July fork-fears panic low. Buying was heavy in the overnight Asian session but surged once again this morning, seemingly after US CPI data disappointed, lifting the price to a new record high of $3547.

As we noted earlier, “The real demand for bitcoin will not be known until a global financial crisis guts confidence in central banks and politicized capital controls. “

 

This is Bitcoin’s best week since pre-Brexit anxiety sent the virtual currency surging in June 2016…

Coinbase CEO Brian Armstrong noted: “Digital currencies are having their ‘Netscape’ moment…The pace of innovation has been accelerating and we are now seeing exciting projects and companies being built on top of digital currencies.”

As CoinTelegraph also notes, recent tension between the US and North Korea has played its part on the global market, rattling some of the major asset classes. However, not being pegged, or controlled by any centralized force, Bitcoin was totally unaffected by the news.

Cryptocurrencies are famous for their volatility, but the non-correlation between the global market slipping and cryptocurrencies mostly staying up shows that these decentralized forms of currency won’t be affected like traditional assets.

 


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 6.6651(REVALUATION NORTHBOUND   /OFFSHORE YUAN MOVES WEAKER TO ONSHORE AT   6.6784/ Shanghai bourse CLOSED DOWN 53.21 POINTS OR 1.63%  / HANG SANG CLOSED DOWN 560.49 POINTS OR 2.04% 

2. Nikkei closed DOWN 8.97 POINTS OR .052%    /USA: YEN RISES TO 109.17

3. Europe stocks OPENED DEEPLY IN THE RED     ( /USA dollar index RISES TO  93.45/Euro DOWN to 1.1764

3b Japan 10 year bond yield: FALLS  TO  +.063%/ GOVERNMENT INTERVENTION    !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 114.34/ 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::  48.36 and Brent: 51.68

3f Gold UP/Yen DOWN

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund FALLS TO  +.389%/Italian 10 yr bond yield UP  to 2.043%    

3j Greek 10 year bond yield RISES to  : 5.572???  

3k Gold at $1287.70  silver at:17.12 (8:15 am est)   SILVER BELOW  RESISTANCE AT $18.50 

3l USA vs Russian rouble; (Russian rouble UP 5/100 in  roubles/dollar) 60.07-

3m oil into the 48 dollar handle for WTI and 51 handle for Brent/

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

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 109.17 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  0.9620 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1318 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 FALLING to  +0.389%

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 2.196% early this morning. Thirty year rate  at 2.781% /POLICY ERROR)GETTING DANGEROUSLY HIGH

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

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

Global Market Rout Spreads: VIX Marches Higher As China Stocks, Currency Plunge

The global rout resulting from tensions over the North Korean nuclear standoff continued on Friday as world stocks tumbled for the fourth day, on course for their worst week since November following a third day of escalating verbal exchanges between Trump and Kim, as European and Asian shares tumlbed, volatility spiked, and the selloff in US futures continued albeit at a more modest pace as the escalating war of words over North Korea drove investors on Friday to safe havens such as the yen, Swiss franc and gold. In addition to North Korea, attention will be closely focused on today’s US CPI print, which could result in even more currency volatility, should it surprise significantly in either direction.

“What has changed this time is that the scary threats and war of words between the U.S. and North Korea have intensified to the point that markets can’t ignore it,” said Shane Oliver, head of investment strategy at AMP Capital in Sydney. “Of course, it’s all come at a time when share markets are due for a correction, so North Korea has provided a perfect trigger.”

All eyes remained on the sharp short squeeze in the VIX, which exploded more than 50% above 16 on Thursday from single digits the day before – the highest print since Trump’s election victory – and extended gains on Friday rising nearly 5% to 16.80, after briefly topping 17, a potential “margin calling” nightmare for countless vol sellers over the past year. Thursday also saw the highest VIX volume day on record as 937K VIX futures traded across the curve. The Global Financial Stress Indicator surged positive after trading in negative territory since April.

The global rout that sent the Nasdaq lower by 2% on Thursday, spread to China which saw the Shanghai Composite tumble by 1.6% to 3,208, its biggest drop this year, led by mining and resource stocks, with nearly 20 names halted limit down, after Chinese metals prices tumbled by 5%. The Chinese volatility index jumped by the most since January 2016 to its highest level in more than seven months.

While there wasn’t a specific catalyst for the rout, a driver for the sharp commodity selling was the announcement by the China Steel Industry Association which said the recent surge in steel futures was not due to market demand but misunderstanding by some institutions. Adding fuel to the fire was a Reuters report that the Shanghai Futures Exchange told its members it may raise margins on steel rebar contracts if market trade volume is too large. As a result, metals also led declines on the mainland CSI 300 Index: Xiamen Tungsten slides as much as 9.3%, most intraday since September; Jiangxi Copper falls as much as 8.3%; China Molybdenum slips as much as 7.7%; the Bloomberg China Steel Producers Valuation Peers Index tumbled 5.9%, with Nanjing Iron & Steel, Maanshan Iron & Steel, Angang Steel dropping at least 6.9%.

“Chinese investors locked in profits on commodity shares following strong gains which had been driven by bets that capacity cuts would boost prices”, said Helen Lau, Hong Kong-based analyst with Argonaut Securities. “Stock markets are in a risk-off mode due to escalating geopolitical risks, so recent outperformers would be the first to take a hit amid a selloff.”  In HK trading Aluminum Corp. of China tumbles as much as 7.4%, the biggest intraday drop since February 2016, while China Shenhua Energy dropped as much as 4.8%, among the worst performers on Hang Seng Index.

Also hurting Chinese sentiment was the plunge in Tencent, with the Chinese tech giant dropping as much as 5% in Hong Kong, its biggest intraday decline in more than a month, following news of a Chinese probe into Tencent, Sina and Baidu for cyber-security law violations.  Stocks of related tech companies were all lower with Sina down 3%, Weibo down 4.5%, and Baidu down 2.5%.

Earlier in the session, the onshore Chinese yuan dropped as much as 0.43% vs USD to 6.7080, its biggest drop since Jan. 19, after the PBOC set the fixing at a weaker level than expected. As Bloomberg reported overnight, the PBOC strengthened fixing by 0.19% to 6.66420, compared with forecasts of 6.6477 from Commerzbank, 6.6552 from Mizuho Bank, 6.6559 from Scotiabank and 6.6549 from Nomura. At the same time, the offshore yuan dropped as much as 0.28% to 6.6853, most since June 26, although putting the drop in context, just one day earlier, the CNY rose to its strongest level since August 2016 on Thursday, prompting Bloomberg to call the Yuan the new “safe haven” currency.

Elsewhere in Asia, MSCI’s broadest index of Asia-Pacific shares outside Japan had skidded 1.55 percent, its biggest one-day loss since mid-December, to leave it down 2.5 percent for the week. Australia’s S&P/ASX 200 Index fell 1.2 percent at the close in Sydney. The Hang Seng Index in Hong Kong tumbled 2 percent and China’s Shanghai Composite Index was down 1.6 percent. The Japanese yen rose 0.2 percent to 108.96 per dollar, the strongest in more than 15 weeks. Japanese markets are closed for the Mountain Day public holiday.

South Korea’s KOSPI fell 1.8 percent to an 11-1/2-week low, but its losses for the week are a relatively modest 3.2 percent; volatility on the Kospi 200 surged as much as 27 percent. “Pretty remarkable, perhaps even extraordinary, considering,” said fund manager BlueBay strategist Tim Ash. The Korean won also continued to skid, down 0.45 percent to 1,147.2, falling below its 200-day moving average for the first time in a month.

European markets continued sliding into risk-off mode although at a slower pace; even so Europe’s where regional indices were set for the worst week of losses this year as sentiment on ongoing fears about escalation between the US and North Korea. Euro zone volatility jumped to the highest since April, when France’s election was rattling the region.  Weakness has been seen across the board (Eurostoxx 600 -1.0%), however mining names have notably underperforming amid Chinese metal prices slumping by some 5% overnight. The iTraxx Crossover extended its recent widening, leading sentiment as hedges are placed into the weekend. European equity markets opened lower led by mining sector, as base metals sell off heavily in Asia after a report saying the Shanghai exchange may raise margins on steel rebar contracts, which was later confirmed. DAX futures dip to approach 200-DMA, financials under pressure after HSBC warns low-vol environment could hit 2H revenues.

CHF and JPY marginally outperform in G-10, EMFX weaker against USD across the board. Core fixed income extends rally and bund curve flattens further, yet UST/bund spread widens 3bps as USTs lag amid focus on U.S. CPI data which may add to the recent dollar pains should inflation come in weaker than expected.

U.S. treasury yields fell to their lowest in more than six weeks ahead of inflation data expected to show a pickup in price growth, which could boost the chances of a further rate hike this year, while the Fed’s Kaplan and Kashkari are due to speak. The dollar declined against the Japanese yen for a fourth day as North Korea tensions remained elevated. The yield on 10-year Treasuries fell one basis point to 2.19 percent, the lowest in more than six weeks. Germany’s 10-year yield decreased three basis points to 0.38 percent, the lowest in more than six weeks.

Oil was modestly higher even though the IEA cuts its OPEC demand estimates for this year and next year by by 400bpd after revising down its demand estimates going back to 2015, rejecting OPEC’s own assessment of rising demand growth for the near future.

Aside from North Korea, inflation data is where the market is most sensitive to a surprise at the moment, even if yesterday’s weak US PPI doesn’t suggest an imminent rise. For the US CPI today, consensus expected core CPI inflation to rise +0.2%, and should finally snap its streak of four consecutive monthly misses which could be important. As recent Fed statements have emphasized, policymakers will be monitoring near-term inflation trends closely. Hence, an in line print would provide tentative evidence that the recent downshift in core inflation may be behind us.

New York Fed President William Dudley cautioned that it will “take some time” for inflation to reach the central bank’s 2 percent target, the latest official warning that price pressures remain muted. The Federal Reserve Bank Dallas President Fred Kaplan speaks this afternoon. Also today, Moody’s may publish a review of South Africa’s credit rating, two months after reducing its foreign- and local-currency assessments to one level above junk.  JC Penney, Magna International and Telus are due to release results. July consumer price data is also due later.

Bulletin Headline Summary From RanSquawk

  • Geopolitical tensions continue to act as a driving force for markets amid the latest exchange between the US and NK
  • This has seen downside in EU equities (Eurostoxx 50 -1.0%) and a FTQ in other assets
  • Looking ahead, highlights include US CPI, Fed’s Kashkari and Kaplan

Market Snapshot

  • S&P 500 futures down 0.1% to 2,434.25
  • STOXX Europe 600 down 1.0% to 372.26
  • DAX down 0.3% to 11,980
  • MSCI ASIA down 0.8% to 158.49
  • MSCI ASIA ex JAPAN down 1.5% to 515.81
  • Nikkei down 0.05% to 19,729.74
  • Topix down 0.04% to 1,617.25
  • Hang Seng Index down 2% to 26,883.51
  • Shanghai Composite down 1.6% to 3,208.54
  • Sensex down 1.1% to 31,193.00
  • Australia S&P/ASX 200 down 1.2% to 5,693.14
  • Kospi down 1.7% to 2,319.71
  • German 10Y yield fell 3.5 bps to 0.38%
  • Euro down 0.1% to 1.1759 per US$
  • Brent Futures down 0.9% to $51.45/bbl
  • US 10Y yields unchanged at  2.19%
  • Italian 10Y yield rose 2.1 bps to 1.743%
  • Spanish 10Y yield fell 0.6 bps to 1.452%
  • Brent Futures down 0.4% to $51.70/bbl
  • Gold spot up 0.1% to $1,287.31
  • U.S. Dollar Index up 0.04% to 93.44

Top Overnight News

  • China Urges Restraint as Futures Slide; FOMC Voters to Speak After CPI Data; Snap Slammed Amid Facebook Pressure
  • The escalating war of words between Trump and North Korean leader Kim Jong-Un sent Asian markets tumbling as the region braced for more provocations from his regime next week
  • President Donald Trump stepped up his campaign of pressure on North Korea, warning the regime not to follow through with a missile test near Guam and promising massive response to any strike against the U.S. or its allies
  • Treasury yields may climb from a six-week low if Friday’s U.S. consumer- price data merely meet expectations, as the market is on high- alert for evidence that inflation is heating up and supporting the Fed’s case for higher interest rates
  • For all the talk that Chair Janet Yellen’s plan to shrink the Fed’s balance sheet will hurt Treasuries, U.S. mortgage bonds face a bigger test
  • The International Energy Agency cut estimates for the amount of crude needed from OPEC this year and in 2018, after lowering its historical assessments of consumption in emerging nations including China and India
  • All that stands between German Chancellor Angela Merkel and a fourth term is six weeks of campaigning
  • Morgan Stanley added its voice to a growing chorus of skepticism surrounding debt valuations, with Pacific Investment Management Co. writing in a report released Wednesday that investors should pare relatively expensive assets like corporate bonds in favor of safer investments like Treasuries
  • Credit Suisse Group AG is barring its traders from buying or selling certain Venezuelan securities and business as the political and economic crisis in the South American country intensifies
  • Gold advanced to the highest in two months as the spike in tensions between the U.S. and North Korea fanned demand, with hedge fund billionaire Ray Dalio flagging rising risks, including “two confrontational, nationalistic, and militaristic leaders playing chicken with each other”
  • President Donald Trump laid out a path for Senate Majority Leader Mitch McConnell to get back in his good graces: replace Obamacare, overhaul the U.S. tax code and find a way to pay for big infrastructure improvements
  • RBA’s Lowe says next interest rate move likely up, but could be some time away; RBA prepared to intervene in A$ in ’extreme’ situations
  • Snap, Blue Apron Fall Flat as the Incumbents Smash the Upstarts
  • IEA Cuts Estimates for Crude Needed From OPEC This Year and Next
  • Chinese Regulator Starts Probe Into Tencent, Weibo and Baidu
  • Stolen 1MDB Funds Are Focus of U.S. Criminal Investigation
  • Health Insurers Face Long Odds to Win Reprieve of Obamacare Tax
  • U.S. Stocks Gain, Hong Kong Loses Weight in MSCI Indexes: SocGen
  • FBI Says ISIS Used EBay to Send Cash to U.S.: WSJ
  • Anbang Ownership Secrets Subject of U.S. Workers’ Complaint
  • Hollywood Heads For Its Worst Summer Box Office in a Decade

Asia stock markets were heavily pressured amid continued geopolitical tensions after further fighting talk between US and North Korea, which also saw US indices close negative for a 3rd consecutive day. The fresh goading came from both sides as US President Trump suggested his fire and fury comments maybe was not tough enough and warned North Korea to get its act together or it will be in trouble like few nations have ever been. This evoked a response from North Korea which vowed to mercilessly wipe out the provocateurs and stated the US will suffer a shameful defeat. As such, ASX 200 (-1.2%), KOSPI (-1.7%) Hang Seng (-2.0%) and Shanghai Comp (-1.7%) all traded with firm losses, while Nikkei 225 was shut due to public holiday. PBoC injected CNY 70bln in 7-day reverse repos and CNY 60bln in 14-day reverse repos, for a net weekly drain of CNY 30bln vs. CNY 40bln drain last week.

Top Asian News

  • War of Words Between Trump and Kim Has Asia Bracing for Conflict
  • South Korean Banks Follow Won Lower Amid Rising Trump Rhetoric
  • China Data Dump and Alternative Gauges Both Signal Steady Output
  • Maker of India’s Aircraft Carrier Surges 22% on Trading Debut
  • Biggest India Lender Slumps as Bad-Loan Surprise Hits Profit
  • KKR Completes 26 Investments in China as of Aug. 1
  • Freeport Urged to Reinstate Workers to End Indonesian Strike
  • India July Local Passenger Vehicle Sales Gain 15% Y/y to 298,997
  • BlackRock’s James Lenton Joins Fidelity as Trader in Hong Kong

European indices are set for the worst week of losses this year as sentiment is weighed by the war of words between the US and North Korea. Weakness has been seen across the board (Eurostoxx 50 -1.0%), however mining names have notably underperforming amid Chinese metal prices slumping by some 5% overnight. EGBs supported by flight to quality with Bunds printing fresh session highs, while there had been reports of 5k lots tripping stops at 164.50. Peripherals underperform this morning, led by BTPs, subsequently the GER-ITA spread has widened to 162bps

Top European News

  • Morgan Stanley Makes ‘Multi-Year Call’ For Strong Euro on Reform
  • Europe Miners Slump as Metals Fall on China Steel Body’s Warning
  • Tullow Oil, Genel Energy Drop; GMP Cuts Both Stocks to Reduce
  • Old Mutual First-Half Profit Climbs as Insurer’s Split Looms
  • Merkel’s Bloc Holds All the Coalition Options in Latest Poll
  • Buy BNP Paribas, Credit Suisse; Sell Barclays, Goldman Says
  • Nordea Chairman Hints HQ Review Isn’t Limited to the Nordics

In currencies, safe-haven support for the currency has continued as USD/JPY made a brief break below 109.00 overnight. Although, with the war of words showing no signs of stopping, JPY could make a push back to the April low at 108.11. So far, the pair have traded in a narrow range with investor focus for the USD shifting to the US inflation figures due out later in the session. AUD softened in Asian trade as commodities prices slipped. Crude prices fell over 0.5%, despite Saudi Arabia and Iraq’s announcement to ensure that all major producers comply to the OPEC production cut, while Saudi also left the door open to deeper cuts. Additionally, Chinese iron ore prices fell some 5%, further weighed on the currency, subsequently pushing AUD to the mid 0.78.

In commodities, China state run newspaper editorial comments state China will remain neutral if North Korea launches an attack on US, but if US strikes first and tries to overthrow North Korean government, China will stop them. Saudi Arabia Energy Minister Al-Falih stated the possibility for continuation of output cuts is on the table and if the size of cuts need to be adjusted, this will be examined and subject to approval by 24 countries. North Korea vows to mercilessly wipe out the provocateurs, says US will suffer a shameful defeat, according to North Korean state media. IEA raises 2017 global oil demand forecast to 1.5mln bpd vs. 1.4mln bpd, global oil supply rose by 520k, while OPEC compliance fell to 75%.

Looking at the day ahead, the main focus will be its inflation stats for July, with expectations at 0.2% mom (for core) and 1.7% yoy. Onto other events, the Fed’s Kaplan and Fed’s Kashkari will also speak today.

US Event calendar

  • 8:30am: US CPI MoM, est. 0.2%, prior 0.0%; CPI Ex Food and Energy MoM, est. 0.2%, prior 0.1%
    • US CPI YoY, est. 1.8%, prior 1.6%; CPI Ex Food and Energy YoY, est. 1.7%, prior 1.7%
    • Real Avg Weekly Earnings YoY, prior 1.09%; Real Avg Hourly Earning YoY, prior 0.8%

DB’s Jim Reid concludes the overnight wrap

I’m hoping I’ll be on this planet for as close to 36,525 days as I can get and I’m also hoping tomorrow will be the only day of that stint that I’m stupid enough to be picking up a brand new car with no miles on it. So in some ways it’s exciting and in some way it’s very annoying as I vowed never to waste money on a new car. The twins have forced the issue and I’ll be figuratively setting light to wads of bank notes as I roll out the forecourt. I’m driving 80 miles to Poole to collect it and I’m setting off very early as I have to get back to make sure everything is ready at home for the new arrival. The excitement is building, I’m very nervous and hopes and dreams come in abundance with such a fresh start. Yes Liverpool kick off their season at lunchtime tomorrow and I need to make sure I’m back in time to watch it. Wish me luck.

The markets and more importantly the world is wishing for a bit of luck at the moment and a peaceful solution to the North Korean spat. The nuclear fallout from this week’s high stakes geopolitical jaw boning couldn’t completely unsettle markets on Wednesday but Thursday was a different story. We finally broke the 15 day run of sub 0.3% closes in either direction with the S&P 500 -1.45% after a day where the news we covered yesterday morning concerning North Korea’s threat to attack Guam by mid-August increasingly spooked global investors as the day progressed.

Mr Trump then raised the temperature another notch late in the US session last night, saying his ‘fire and fury” comment earlier in the week “wasn’t tough enough” and that “things will happen to them (NK) like they never thought possible..” and has “declined” to rule out a pre-emptive strike on NK, noting “we’ll see what happens”, all of which helped the US close at the lows for the session and shatter the recent low vol environment. Given the previous record low vol run was 10 days in 1966, if I do live to be 100 I’m statistically unlikely to witness anything like what we saw in the 15 days before yesterday.

The S&P 500 had its worse day since mid-May this year when it fell 1.8%. Over at the Vix, the fear gauge broadly traded up most of the day and surged 44% higher to close at 16.04, which is actually the first day the index closed above 16 in CY2017. Across the pond, the Vstoxx was up 26% to 18.9, the highest level since April when Europe had heightened political risks in the run up to the French elections.

Investors pushed safe haven assets higher again, with gold up 0.7% to a 9 week high, the Swiss franc up 0.1% (was +1.1% the day before) and JPY/USD +0.8% higher. Over in European government bonds, changes in core yields were more tempered following the ~5bp fall the day before. Bunds fell 1bp (2Y: unch; 10Y: -1bps), with Gilts down 3bps (2Y: +0.3bp; 10Y: -3bps) at the long end of the curve, while French OATs were broadly flat (2Y: unch; 10Y: -0.5bp). Peripheral bond yields were up slightly across the curve, with Italian BTPs (2Y: +1bp; 10Y: +2bps) and Portuguese yields (2Y: -0.5bp; 10Y: +2bps) not sure whether they  were a flight to quality instrument or a high beta asset. Across the pond, the UST10Y fell 5bps yesterday (2Y -1bp) but is fairly flat this morning.

In Asia, markets have continued to fall. The Kospi recovered a little to be 1.6% down as we type, the Won/USD dipping another 0.2%. The Hang Seng fell for the 3rd consecutive day (-1.9%), with Chinese bourses down 1.1% to 1.6%. We also got a glimpse of what China might be thinking, with the Global times (English paper under the People’s Daily) writing that China should make clear that: i) it will stay neutral if the US retaliates after NK launches missile that threaten American soil, but ii) if countries try to overthrow the NK regime, China will prevent them from doing so.

Moving on, if we can pull out attention away from the nuclear threat, inflation data is probably where the market is most sensitive to a surprise at the moment, even if yesterday’s weak US PPI doesn’t suggest an imminent rise. For the US CPI today, our economists expect core CPI inflation (+0.2% vs. +0.1%) should finally snap its streak of four consecutive monthly misses which could be important. They also remind us that as recent Fed statements have emphasized, policymakers will be monitoring near-term inflation trends closely. Hence, an in line print would provide tentative evidence that the recent downshift in core inflation may be behind us.

Following on the theme of inflation, DB’s Luzzetti examined the impact of recent US dollar depreciation on the inflation outlook. Based on their own inflation models and analysis cited by Fed officials, they think that recent dollar weakness – assuming that it does not reverse – could lift year-over-year core PCE inflation by about 0.2pps by mid-2018 and 0.1pps by mid-2019. More details here.

Turning to Europe, the flip-side of recent currency moves is discussed by DB’s Mark Wall who has written on how euro appreciation will be balanced against growth momentum in determining the ECB’s exit from QE. He argue that all else unchanged the euro’s appreciation since June could reduce the ECB staff core inflation forecast for 2019 from 1.7% yoy to 1.5% yoy. More details here Returning to the equity market sell-off in a little more depth, US bourses all weakened yesterday, with the S&P (-1.5%), the Dow (-0.9%) and the Nasdaq (-2.1%) sharply lower. Within the S&P, only the utilities sector was up (+0.3%) versus larger losses elsewhere (IT -2.2%; Financials -1.8%). European markets also fell across the board, the Stoxx 600 was down 1% to the lowest level since March with all sectors in the red. Across the region the FTSE 100 (-1.4%),  the DAX (-1.2%), Italian FTSE MIB (-0.8%) and CAC (-0.6%) were all lower.

Currencies were mixed but little changed, the USD dollar index dipped 0.2% post the lower than expected PPI data. The Euro continued to edge ahead against the USD and Sterling, up 0.1% and 0.3% respectively, while the Sterling/USD was down 0.2%. In commodities, WTI oil fell 2%, despite OPEC raising its demand forecast for oil and two of the largest OPEC producers (Saudi Arabia & Iraq) agreeing to strengthen their commitments to production cuts. Notably, Iraq’s recent compliance to production targets is not exactly great (29% in July).

Elsewhere, precious metals were modestly up (Gold +0.7%; Silver +1%) and aluminium continues to gain (Copper -0.3%; Aluminium +0.9%). Agricultural commodities were broadly lower, with corn, wheat and cotton all down ~4%, while soybeans, coffee and sugar were down ~3%. This follows a USDA report which suggest US farmers will produce more corn and soybeans than analyst forecasts.

Away from the markets, Trump has made his disappointment with Senate majority leader McConnell well known, tweeting “can you believe that McConnell, who has screamed repeal & replace (Obamacare) for 7 years, couldn’t get it done…” and “…Mitch, get back to work…”. However, Trump was more conciliatory on special counsel Mueller, saying he “hasn’t given it any thought about firing Mueller” and that “I’m not dismissing anybody”. Elsewhere, NY Fed president Dudley cautioned that it will “take some time” for inflation to reach the Fed’s 2% target, which is consistent with comments made by his colleagues earlier in the week.

Before we take a look at today’s calendar, we wrap up with other data releases from yesterday. In the US, the July PPI report was softer than expected. The core measure (ex-food & energy aggregate) was -0.1% mom (vs. 0.2% expected) and 1.8% yoy (vs. 2.1% expected). The PPI for healthcare services, which is closely correlated with that within the PCE deflator, rose a steady 1.4% yoy. Elsewhere, claims data were mixed, with initial jobless claims up 3k to 244k (vs. 240k expected) and continuing claims at 1,951k (vs. 1,960k expected). In Europe,France’s June industrial production (IP) was modestly lower than expectations at -1.1% mom (vs. -0.6% expected, 1.9% previous) and 2.6% yoy (vs. 3.1% expected), while manufacturing production was slightly better at -0.9% mom (vs. -1% expected) and 3.3% yoy (vs. 3.2% expected), which is just a bit weaker than Markit PMI readings had foreshadowed. Over in UK, IP for June was higher than expectations at 0.5% mom (vs. 0.1% expected) and 0.3% yoy (vs. -0.1% expected), while June manufacturing production was flat and in line, at 0% mom and 0.6% yoy. The UK’s trade deficit also unexpectedly widened in June as exports fell but imports rose.

Looking at the day ahead, the final CPI figures for Germany (1.5% yoy expected), France (0.8% yoy expected) and Italy (1.2% yoy expected) will be released. Over in the US, the main focus will be its inflation stats for July, with expectations at 0.2% mom (for core) and 1.7% yoy. Onto other events, the Fed’s Kaplan and Fed’s Kashkari will also speak today.

 END

3. ASIAN AFFAIRS

i)Late THURSDAY night/FRIDAY morning: Shanghai closed DOWN 53.21 POINTS OR 1.63%   / /Hang Sang CLOSED DOWN 560.49 POINTS OR 2.04% The Nikkei closed DOWN 8.97 POINTS OR .05%/Australia’s all ordinaires CLOSED DOWN 1.15%/Chinese yuan (ONSHORE) closed UP at 6.6651/Oil DOWN to 48.36 dollars per barrel for WTI and 51.68 for Brent. Stocks in Europe OPENED DEEPLY IN THE RED , Offshore yuan trades  6.6784 yuan to the dollar vs 6.7201 for onshore yuan. NOW THE OFFSHORE IS WEAKER  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 SLIGHTLY STRONGER DOLLAR. CHINA IS  HAPPY TODAY 

3a)THAILAND/SOUTH KOREA/NORTH KOREA

NORTH KOREA/USA

Tuesday:

Japan presents a paper suggesting that North Korea might be in possession of a miniature nuclear warhead and that would be deadly to the world.

(courtesy zerohedge)

North Korea May Be In Possession Of A Miniature Nuclear Warhead, Japan Warns

One day after Kim Jong Un’s regime balked at this weekend’s UN sanctions, promising retaliation and threatening to attack the US with a nuclear weapon, Japan’s government has released a new 500-page report in which it warns that the threat from North Korean nuclear weapons has reached a “new stage” and that Pyongyang’s weapons program had “advanced considerably,” to the point where it was possible that the regime had acquired the ability to miniaturize nuclear warheads.

The white paper, approved by Japan’s cabinet on Tuesday morning, was published less than two weeks after North Korea test-fired its second ICBM, which US experts have said may be able to reach most of the continental United States.

According to the Guardian, “Japan’s defence ministry said that security threats had reached a new stage after the North conducted two nuclear tests and more than 20 ballistic missile launches last year.”

The report went on to speculate that North Korea had improved its technological expertise to the point where it could theoretically marry a nuclear warhead with a missile.

“It is conceivable that North Korea’s nuclear weapons programme has already considerably advanced and it is possible that North Korea has already achieved the miniaturisation of nuclear bombs into warheads and has acquired nuclear warheads,” the ministry said.

“North Korea’s development of ballistic missiles and its nuclear programme are becoming increasingly real and imminent problems for the Asia-Pacific region including Japan, as well as the rest of the world,” said the report.

While it has yet to be confirmed, some experts believe the North has already miniaturised its nuclear capability, even as others believe the regime is still several years away from being able to do so.

Scott LaFoy, a Washington-based imagery analyst focusing on ballistic missile and space technologies, said the report reflected “an increasing belief that North Korea either has or is very close to having a nuclear warhead”. Based on data and projections by experts at the Middlebury Institute of International Studies, LaFoy told the Guardian: “I lean towards believing North Korea is either in possession of a device, or the potential sixth nuclear test will be the practical test of said device.

“The Japanese defence white paper doesn’t add much to this due to its expected government vagueness, but it is consistent with what I’m seeing.”

To be sure, Japan – which would be first in the line of attack – has reasons to stir the pot and escalate the situation, hoping for pre-emptive military intervention from the US. “North Korea’s missiles represent a deepening threat. That, along with China’s continued threatening behavior in the East China Sea and South China Sea, is a major concern for Japan,” the country’s defense minister, Itsunori Onodera, told reporters in Tokyo.

Japan has held several evacuation drills in recent months in preparation for a North Korean missile attack, while Onodera is among those who have called for the country to acquire the ability to strike North Korean bases if it is attacked.

 

That would require a drastic change in Japan’s defence posture to allow it to use offensive weapons, such as bombers and cruise missiles capable of striking targets overseas – a move that would inevitably prompt a debate on whether the country was honouring the defensive posture required by its “pacifist” constitution.

Japan’s self-defense forces have dramatically increased their involvement in joint exercises with the US, and the defense ministry already plans to upgrade its ship-to-air and mobile missile defence capabilities, the Guardian adds.

And now that Trump has a military veteran advising him, Japan may get its wish. The wildcard remains China, which has promised to enforce UN sanctions against North Korea agreed at the weekend, even though it claims it has the most to lose from weakening its close trade links with Pyongyang. Beijing has been criticised for failing to enforce previous sanctions packages, but China’s foreign minister, Wang Yi, said the measures were necessary to demonstrate international opposition to North Korea’s missile and nuclear weapons programs.

“Owing to China’s traditional economic ties with North Korea, it will mainly be China paying the price for implementing the resolution,” a Chinese foreign ministry statement quoted Wang as saying at a regional security forum in Manila on Monday.

If NKorea indeed is in possession of the technology, it is very likely that Kim’s next provocative move will not be an ICBM launch but rather another nuclear test.

end

THURSDAY NIGHT

 

North Korea responds to Trump as he vows to mercilessly wipe out “provocateurs”. He also states that the USA will suffer its final doom.

I personally do not feel that they have the capability of reaching Guam or for that matter any part of the USA.  I may be wrong but all their equipment is from the 1970’s or 1960’s.

However, I agree that it is nerve-racking

 

 

(courtesy zerohedge)

 

North Korea Responds: Vows To “Mercilessly Wipe Out Provocateurs”, Blasts “US Will Suffer Final Doom”

The ping pong war of words between Trump and Kim has continued for a third straight day.

Earlier today, Trump said that “if anything” his statement on fire and fury  “was not tough enough”, and proceeded to warn North Korea that “things will happen to them like they never thought possible” and concluded that “people of North Korea should be careful, or they’re going to be in trouble like they’ve never been before.”

“Frankly, the people questioning that statement, was it too tough, maybe it wasn’t tough enough. They’ve been doing this to our country a long time, for many years. And it’s about time that somebody stuck up for the people of this country and the people of other countries. So if anything, maybe that statement wasn’t tough enough and we’re backed by 100 percent by our military, we’re backed by everybody. And we’re backed by many other leaders. I noticed that many senators and others came out today very much in favor of what I said. But if anything that statement may not be tough enough.”

 

“The people of our country are safe. Our allies are safe. And I will tell you this, North Korea better get their act together or they are going to be in trouble like few nations ever have been in trouble in this world.”

Shortly after, following a national security meeting Trump hada some more comments: “He has disrespected our country greatly,” Trump said of Kim Jong Un.

“He has said things that are horrific. And with me he’s not getting away with it. He got away with it for a long time, between him and his family. Hes not getting away with it. This is a whole new ballgame. Hes not going to be saying those things and hes certainly not going to be doing those things. I read about were in Guam by Aug. 15. Lets see what he does with Guam. He does something in Guam, it will be an event the likes of which nobody’s seen before, what will happen in North Korea.”

At that moment the countdown to the KCNA-carried response by North Korea started, and we didn’t have long to wait.

Moments ago, North Korea’s state-run KCNA news agency responded to the latest iteration of mutually-assured threats of destruction, blasting that it will “mercilessly wipe out the provocateurs making desperate attempts to stifle socialist country” and adds that “the U.S. will suffer a shameful defeat and final doom if it persists in extreme military adventure, sanctions and pressure.”

NEW: North Korea releases statement vowing to “mercilessly wipe out the provocateurs” and say the US would suffer “a shameful defeat”

Developing, although readers can probably figure out where this goes from here.

end

THURSDAY NIGHT

The Pentagon plan for a pre-emptive strike on North Korea: use non nuclear B1 bombers

(courtesy zerohedge)

 

 

Pentagon Unveils Plan For “Pre-Emptive Strike” On North Korea

Just hours after Trump made his famously heated vow to unleash “fire and fury” on North Korea if provocations by the Kim regime continued, the US Air Force issued a very clear statement in which it explicitly said that it was “ready to fight tonight”, launching an attack of B-1 bombers if so ordered:

“How we train is how we fight and the more we interface with our allies, the better prepared we are to fight tonight,” said a 37th EBS B-1 pilot. “The B-1 is a long-range bomber that is well-suited for the maritime domain and can meet the unique challenges of the Pacific.”

Now, according to an NBC report, it appears that the B-1 pilot was dead serious, as the Pentagon has unveiled a plan for a preemptive strike on North Korean missile sites with bombers stationed in Guam, once Donald Trump gives the order to strike. Echoing what we said yesterday that war “under any analysis, is insanity“, the preemptive strike plan is viewed as the “best option available” out of all the bad ones:

“There is no good option,” a senior intelligence official involved in North Korean planning told NBC News, but a unilateral American bomber strike not supported by any assets in the South constitutes “the best of a lot of bad options.”

The attack would consist of B-1 Lancer heavy bombers located on Andersen Air Force Base in Guam, a senior acting and retired military officials told NBC news.

Of all the military options … [President Donald Trump] could consider, this would be one of the two or three that would at least have the possibility of not escalating the situation,” retired Admiral James Stavridis, former Supreme Allied Commander Europe and an NBC News analyst, said.

Why the B-1?

Military sources told NBC News that the internal justification for centering a strike on the B-1 is both practical and intricate. The B-1 has the largest internal payload of any current bomber in the U.S. arsenal. A pair of bombers can carry a mix of weapons in three separate bomb bays — as many as 168 500-pound bombs — or more likely, according to military sources, the new Joint Air-to-Surface Standoff Missile — Extended Range (JASSM-ER), a highly accurate missile with a range of 500 nautical miles, allowing the missile to be fired from well outside North Korean territory.

There is another important consideration: according to one senior military officer, “the B-1 has also been selected because it has the added benefit of not being able to carry nuclear weapons. Military planners think that will signal China, Russia, and Pyongyang that the U.S. is not trying to escalate an already bad situation any further.

The plan explains why in recent weeks pairs of B-1s have conducted 11 practice runs of a similar mission since the end of May, the last taking place on Monday, around the time Trump and Kim were exchanging unpleasantries in the media, with the training has accelerated since May, according to officials. In an actual mission, NBC notes that the non-nuclear bombers would be supported by satellites and drones and surrounded by fighter jets as well as aerial refueling and electronic warfare planes.

There are currently at least six B-1 bombers on Andersen Air Force base, which is located some 3,200km from North Korea. If given the command, these strategic bombers would target around two dozen North Korean “missile-launch sites, testing grounds and support facilities” according to sources cited by NBC.

Asked about the B-1 bomber plan, two U.S. officials told NBC News that the bombers were among the options under consideration but not the only option. NBC points out that “action would come from air, land and sea — and cyber.”

Of course, as we elaborated yesterday, striking North Korea is certain to prompt an immediate and deadly response that could involve targets as near as Seoul, just 40 miles from the border, or as far away as Andersen AFB, according to Adm. Stavridis.

The use of the B-1 bombers to actually drop bombs and destroy Korean infrastructure and kill North Koreans would cause an escalation,” said Stavridis. “Kim Jong Un would be compelled to respond. He would lash out militarily, at a minimum against South Korea, and potentially at long-range targets, perhaps including Guam. … That’s a bad set of outcomes from where we sit now.”

“Diplomacy remains the lead,” said Gen. Terrence J. O’Shaughnessy, the U.S. Pacific Air Forces commander, after the B-1 bombers’ late May training run. “However, we have a responsibility to our allies and our nation to showcase our unwavering commitment while planning for the worst-case scenario. If called upon, we are ready to respond with rapid, lethal, and overwhelming force at a time and place of our choosing.”

Separately, Defense Secretary James Mattis said military strategists at the Pentagon have a military solution in place to address the growing threat emanating from North Korea, but they are holding their fire in favor of ongoing diplomatic efforts. The Pentagon chief said any military option would be a multilateral one involving a number of regional powers in the Pacific.

“Do I have military options? Of course, I do. That’s my responsibility, to have those. And we work very closely with allies to ensure that this is not unilateral either … and of course there’s a military solution,” Mr. Mattis told reporters en route to meet with senior leaders in the technology sector in Seattle and California.

However, as the Washington Times reports, Mattis reiterated that the administration’s diplomatic efforts to quell tensions on the peninsula remained the top priority for the White House.

“We want to use diplomacy. That’s where we’ve been, that’s where we are right now. and that’s where we hope to remain. But at the same time, our defenses are robust” and ready to take on any threat posed by the North Korean regime, Mattis said.

* * *

Finally, should the worst-case scenario be put in play, and conventional war is launched, here is what Capital Economics predicted would be the drastic economic consequences from even a contained, non-nuclear war.

  • North Korea’s conventional forces, which include 700,000 men under arms and tens of thousands of artillery pieces, would be able to cause immense damage to the South Korean economy. If the North was able to set off a nuclear bomb in South Korea, the consequences would be even greater. Many of the main targets in South Korea are located close to the border with the North. The capital, Seoul, which accounts for roughly a fifth of the country’s population and economy, is located just 35 miles from the North Korean border, and would be a prime target.
  • The experience of past military conflicts shows how big an impact wars can have on the economy. The war in Syria has led to a 60% fall in the country’s GDP. The most devastating military conflict since World War Two, however, has been the Korean War (1950-53), which led to 1.2m South Korean deaths, and saw the value of its GDP fall by over 80%.
  • South Korea accounts for around 2% of global economic output. A 50% fall in South Korean GDP would directly knock 1% off global GDP. But there would also be indirect effects to consider. The main one is the disruption it would cause to global supply chains, which have been made more vulnerable by the introduction of just-in-time delivery systems. Months after the Thai floods had receded in 2011 electronics and automotive factories across the world were still reporting shortages.
  • The impact of a war in Korea would be much bigger. South Korea exports three times as many intermediate products as Thailand. In particular, South Korea is the biggest producer of liquid crystal displays in the world (40% of the global total) and the second biggest of semiconductors (17% market share). It is also a key automotive manufacturer and home to the world’s three biggest shipbuilders. If South Korean production was badly damaged by a war there would be shortages across the world. The disruption would last for some time – it takes around two years to build a semi-conductor factory from scratch.
  • The impact of the war on the US economy would likely be significant. At its peak in 1952, the US government was spending the equivalent of 4.2% of its GDP fighting the Korean War. The total cost of the second Gulf War (2003) and its aftermath has been estimated at US$1trn (5% of one year’s US GDP). A prolonged war in Korea would significantly push up US federal debt, which at 75% of GDP is already uncomfortably high.
  • Reconstruction after the war would be costly. Infrastructure, including electricity, water, buildings, roads and ports, would need to be rebuilt. Massive spare capacity in China’s steel, aluminium and cement industries mean reconstruction would unlikely be inflationary, and should instead provide a boost to global demand. The US, a key ally of South Korea, would likely shoulder a large share of the costs. The US spent around US$170bn on reconstruction after the most recent wars in Afghanistan and Iraq. South Korea’s economy is roughly 30 times larger than these two economies combined. If the US were to spend proportionally the same amount on reconstruction in Korea as it did in Iraq and Afghanistan, it would add another 30% of GDP to its national debt.

Naturally, should North Korea manage to successfully launch a nuke, the devastation, economic and otherwise, would be orders of magnitude greater.

 

 

end

 

 

FRIDAY MORNING

The war of words continue for the 4th day in a row.  Trump: military solutions are fully locked in placed and loaded..

(courtesy zero hedge)

Trump: “Military Solutions Are Now Fully In Place, Locked And Loaded”

Confirming yesterday’s report that the Pentagon is now prepared for a “preemptive strike”, or response to any provocative action by North Korea, moments ago president Trump took the verbal war of words with Kim Jong-Un into the fourth day when he tweeted that “military solutions are now fully in place,locked and loaded,should North Korea act unwisely.  Hopefully Kim Jong Un will find another path!”

Military solutions are now fully in place,locked and loaded,should North Korea act unwisely. Hopefully Kim Jong Un will find another path!

Earlier on Friday, the North Korean government’s official newspaper said that the US mainland could be “reduced to ashes at any moment” as tensions between the two countries continue to mount. The Rodong Sinmun, an official mouthpiece of Kim Jong-un’s ruling Workers’ Party, said the “reckless and hysteric” behavior of Donald Trump would be to blame if the US is attacked.

The Trump administration has been “seized with anxiety and terror” following North Korea’s successful testing of a long-range missile, the newspaper claimed, saying “US military warmongers are running amok”.

“It is a tragedy that the reckless and hysteric behaviors may reduce the US mainland to ashes [at] any moment,” it continued, according to KCNAWatch.

Ominously, the newspaper also said that it was the “steadfast will” of North Korea to “put an end to the hostile moves of the US” and vowed that the communist state will “win the final victory in the stand-off with imperialism and the US”. “The US and its vassal forces will dearly pay for the harshest sanctions and pressure and reckless military provocations against the DPRK,” it added.

As a reminder, on Thursday NBC reported the Pentagon yesterday unveiled a plan for a preemptive strike on North Korean missile sites with bombers stationed in Guam, once Donald Trump gives the order to strike. Echoing what we said yesterday that war “under any analysis, is insanity”, the preemptive strike plan is viewed as the “best option available” out of all the bad ones: “There is no good option,” a senior intelligence official involved in North Korean planning told NBC News, but a unilateral American bomber strike not supported by any assets in the South constitutes “the best of a lot of bad options.”

The attack would consist of B-1 Lancer heavy bombers located on Andersen Air Force Base in Guam, a senior acting and retired military officials told NBC news.

“Of all the military options … [President Donald Trump] could consider, this would be one of the two or three that would at least have the possibility of not escalating the situation,” retired Admiral James Stavridis, former Supreme Allied Commander Europe and an NBC News analyst, said.

Separately, Defense Secretary James Mattis said military strategists at the Pentagon have a military solution in place to address the growing threat emanating from North Korea, but they are holding their fire in favor of ongoing diplomatic efforts. The Pentagon chief said any military option would be a multilateral one involving a number of regional powers in the Pacific. “Do I have military options? Of course, I do. That’s my responsibility, to have those. And we work very closely with allies to ensure that this is not unilateral either … and of course there’s a military solution,” Mattis told reporters en route to meet with senior leaders in the technology sector in Seattle and California.

However, as the Washington Times reports, Mattis reiterated that the administration’s diplomatic efforts to quell tensions on the peninsula remained the top priority for the White House.

“We want to use diplomacy. That’s where we’ve been, that’s where we are right now. and that’s where we hope to remain. But at the same time, our defenses are robust” and ready to take on any threat posed by the North Korean regime, Mattis said.

Unfortunately with every passing day that see rising verbal escalation – and now that China has explicitly warned the US not to strike first – the possibility of a diplomatic resolution grows increasingly more unlikely.

end

FRIDAY AFTERNOON

North Korea issues emergency standby orders to its civil defense units:

 

(courtesy zero hedge)

North Korea Issues “Emergency Standby Orders” To Civil Defense Units: Report

With markets about to close for the next 2 days, the question on every trader’s mind is: “should i carry risk over the weekend, or should I dump it all in case North Korea fires another test, or non-test, ICBM launch which may be just the provocation Trump needs to give the green light to a squadron of B-1 bombers to begin a bombing campaign.” After all, Trump himself tweeted this morning that “military solutions are now fully in place, locked and loaded, should North Korea act unwisely. Hopefully Kim Jong Un will find another path!” 

While we don’t know if Kim will “find another path”, late on Friday KBS World Radio, the official international broadcasting station of South Korea (which is owned by the Korean Broadcasting System), reports that according to Radio Free Asia (RFA), in a potential warning that Pyongyang may be preparing yet another imminent escalation, “North Korean authorities have dispatched emergency standby orders to the leaders of the ruling Workers’ Party committees and civil defense units.”

More details

Friday’s RFA report quotes a source in Yanggang Province as saying that the Central Military Commission of the party delivered the orders via e-mail.

 

The e-mail apparently arrived even before the North publicly threatened to retaliate against the U.S. “hundreds of thousands of times” over newly approved U.N. sanctions.

A separate source in the North has reportedly told RFA that the state-run Rodong Sinmun newspaper carrying the North’s statement was distributed by military helicopters in Jagang Province on Tuesday. The source said it was the first time military helicopters have been used to deliver the newspaper except when the paper carried new year’s messages by North Korean leader Kim Jong-un.

And while the report has yet to be confirmed by other news outlets, traders are furiously hitting refresh on the website of 38North.org for the daily satellite image update of North Korea’s missile launch preparedness, which has yet to hit and which could mean the difference between another sleepy, boring open on Monday and a VIX surging above 20, 30 or more depending on what “path” Kim Jong-Un picks over the next 48 hours.

b) REPORT ON JAPAN

end

c) REPORT ON CHINA

THIS IS NOT WHAT THE WORLD WANTS TO HEAR:

China will resist regime change in North Korea

(courtesy zero hedge)

China Warns Trump: “We Will Prevent A North Korea Regime Change”

In a troubling repudiation of President Donald Trump’s demands that Beijing do more to rein in its bellicose neighbor, Beijing, through the state-owned media, cautioned the US president on Friday that it would intervene (militarily) on North Korea’s behalf if the US and South Korea launch a preemptive strike to “overthrow the North Korean regime,” according to a statement in the influential state-run newspaper Global Times.

“If the U.S. and South Korea carry out strikes and try to overthrow the North Korean regime and change the political pattern of the Korean Peninsula, China will prevent them from doing so,” it said.

At the same time, the Chinese regime  made it clear that its preferred outcome would be a continuation of the status quo, warning Kim Jong Un that it would “remain neutral if North Korea were to strike first.”The article, cited by Rueters,  reiterated calls for a diplomatic solution. However, the possibility of talks between the two sides was looking increasingly remote as both Trump and Kim continued to exchange threats of nuclear annihilation, with Trump clarifying Thursday that his earlier promise to respond with “fire and fury” should the North continue to threaten the US may not have gone far enough.

China – North Korea’s most important ally and trading partner –  has reiterated calls for calm during the current crisis. Beijing has expressed frustration with both Pyongyang’s repeated nuclear and missile tests and with behavior from South Korea and the United States, such as military drills, that it sees as escalating tensions.

“China should also make clear that if North Korea launches missiles that threaten U.S. soil first and the U.S. retaliates, China will stay neutral,” the Global Times, which is widely read but does not represent government policy, said in an editorial.

Meanwhile, as the North may be planning its next ICBM launch, the US is stepping up military exercises with Japan and South Korea.

“On Thursday, U.S. and Japanese troops began an 18-day live fire exercise on the northern Japanese island of Hokkaido, which was to include rocket artillery drills and involve 3,500 troops. The Northern Viper drills are one of the scheduled exercises that Japan’s Self Defense Forces conducts regularly with their U.S. counterparts and are not a response to the latest tensions. South Korean and U.S. troops are also gearing up for an annual joint drill from Aug. 21, called the Ulchi Freedom Guardian, in which up to 30,000 U.S. troops will take part.”

US officials were also discussing coordinated contingency plans on Friday to formulate exactly how the allies would respond to an attack.

“South Korea’s national security adviser Chung Eui-yong and his U.S. counterpart H.R. McMaster spoke on the phone for 40 minutes early on Friday, a spokesman for the presidential Blue House in Seoul said. The two discussed responses to North Korean provocations and the security situation on the Korean peninsula, he said.”

Not surprisingly, analysts have compared the standoff between the two nuclear powers (the North is a recent, if untested, member of this club) to a modern day Cuban Missile crisis.  “This situation is beginning to develop into this generation’s Cuban Missile crisis moment,” ING’s chief Asia economist Robert Carnell said in a research note. “While the U.S. president insists on ramping up the war of words, there is a decreasing chance of any diplomatic solution.”

Judging by the markets’ reaction in the past 48 hours, this troubling reality has finally filtering through to risk assets.

4. EUROPEAN AFFAIRS

SPAIN

First it was Greece, receiving a multitude of migrants through Turkey. Then it was Italy who this year has received the bulk of new migrants floating across the Med.  Now it is Spain..

(courtesy zero hedge)

Spanish Sunbathers Shocked As Raft Full Of Migrants Paddle Up And Run Ashore

Families at a popular Spanish beach were shocked yesterday when an inflatable raft carrying dozens of migrants from Northern Africa suddenly washed ashore.  As can be seen in the following onlooker’s video, the migrants fled the boat before it reached dry land and ran inland in an effort to evade authorities.

According to the Daily Mail, the migrants arrived in Cadiz in Southern Spain and managed to disperse before being captured by police.

Footage shows the migrants leaping out of a black inflatable dinghy and dashing across the sand on beaches at Cadiz in southern Spain, after crossing the Strait of Gibraltar.

 

Carlos Sanz, who shot the video while on vacation in Cadiz, said the group quickly vanished and police only arrived some time later.

Local newspaper Diario De Cadiz reported that many of those on board quickly changed their clothing to evade the police, who carried out searches to apprehend the suspected illegal migrants.  Many of the group were collected in vehicles after landing, according to the paper which could mean that those driving the vehicles could potentially face human trafficking charges if caught.

 

The incident comes as the International Organization for Migration warned on Thursday that Spain could overtake Greece this year in the number of migrants arriving by sea, using boats and even jet-skis.

According to the IOM’s latest figures, until August 6, close to 8,200 migrants had arrived in Spain so far this year.

 

That is more than triple the number who reached Spain at the same time last year, according to Joel Millman, a senior IOM spokesman, and already more than the total arrivals in 2016.

 

While the figure pales in comparison with arrivals in Italy – where more than 96,400 have landed so far this year – Spain is catching up with Greece where 11,713 have arrived by sea in the same timeframe.

 

‘It’s possible that Spain will outperform Greece this year,’ Millman told AFP.

 

‘If so, that’s a big change.’

The southern shores of Spain are roughly 20 miles from the north African coast.

Spains

5. RUSSIA AND MIDDLE EASTERN AFFAIRS

Russia/USA

Funny!!  The Press is love this:  Trump thanks Putin for kicking out 755 diplomats and the uSA will save a lot of money

(courtesy zero hedge)

Trump Thanks Putin For Kicking Out 755 Diplomats: “We’ll Save A Lot Of Money”

In a statement that has been buried by the rest of Trump’s barrage of soundbites today, including the ongoing back on forth verbal war on North Korea, as well as Mueller, Manafort and McConnell, during his second meeting with reporters at his golf complex in Bedminster, President Trump said something which could push his war with the intel community and the “deep state” into uncharted territory.

In his first public comment on the recent decision by the Kremlin to seize two US compounds and kick out 755 US diplomats in retaliation for a similar move by Obama in December, Trump said “I want to thank” Russian President Vladimir Putin for ousting hundreds of US embassy employees “because we’re trying to cut down our payroll.”

Q: Thoughts on Putin expelling US diplomats?

Trump: “I greatly appreciate the fact that they’ve been able to cut our payroll.” (via ABC)

The president said the move would “cut payroll.” And even as many have received the comments in jest, we are confident that hundreds of humorless spooks will use this as a green light to leak even more NSA intercepts. Trump has so far been quiet on the expulsion of US workers from Russia.

“I greatly appreciate the fact that we’ve been able to cut our payroll of the United States,” Trump said, adding “we’re going to save a lot of money… there’s no real reason for them to go back.”

Hardly a glowing endorsement of the US “intelligence” apparatus.

Trump did not stop here, and noting of Putin’s decision, said “I’m very thankful that he let go of a large number of people because now we have a smaller payroll.”

“I want to thank him because we’re trying to cut down on payroll and as far as I’m concerned I’m very thankful that he let go of a large number of people because now we have a smaller payroll.”

 

“There’s no real reason for them to go back. I greatly appreciate the fact that we’ve been able to cut our payroll of the United States. We’re going to save a lot of money.”

Following the latest sanctions targeting Russia, North Korea, and Iran, Moscow moved to reduce the number of US diplomatic personnel by 755 people, bringing parity to the size of diplomatic staffs in each country. Previously, US State Department spokeswoman Heather Nauert had said “the expulsions of our US diplomats and other citizens who are working over there at our embassy, we consider that to be a regrettable step.”

Russia and China’s plan to defuse the Korean crisis.  North Korea would suspend all new ballistic missile tests and the the USA South Korea would suspend large scale naval exercises. Not sure the USA would go for this as they could not trust the North Koreans
(courtesy zerohedge)

Lavrov: “There Is A Russian-Chinese Plan To Defuse Korea Crisis”

In a glimmer of hope that a military conclusion to the North Korean crisis may yet be averted, Russia’s foreign minister Sergey Lavrov said that “Russia does not accept a North Korea that possesses nuclear weapons”, cautioned that there is an “overwhelming amount of over-the-top belligerent rhetoric on North Korea’s nuclear and rocket programs from Washington and Pyongyang”, but most importantly said that there is a joint Russian-Chinese plan to defuse the North Korean crisis, according to which North Korea would freeze its missile tests, while the US and South Korea would stop large scale exercises.

“Russia together with China developed a plan which proposes ‘double freezing’: Kim Jong-un should freeze nuclear tests and stop launching any types of ballistic missiles, while US and South Korea should freeze large-scale drills which are used as a pretext for the North’s tests.”

It was not clear if Russia or China, had floated this plan with the US or S. Korea prior; the most likely answer is no.

Hoping that “common sense will ultimately prevail“, Lavrov said that North Korea had once signed the Non-Proliferation Treaty (NPT) but then withdrew from it. The result is a nuclear-armed N.Korea which Russia refuses to accept: “Now North Korea claims that it has legal rights to make nuclear weapons and has already done so,” he said. “But you know our position: we don’t accept the fact that North Korea could possess nuclear weapons.”

He added that both Russia and China have a “range of proposals” aimed at preventing what could become “one of the deepest conflicts” and a “crisis with a big number of casualties.”

Still, Lavrov said that Moscow is worried about Washington’s remarks on a preemptive strike on North Korea, and said that Russia is doing its best to prevent this from happening.

“There are direct threats of deploying military power,” he stated adding that “Russia is doing its best to prevent this from happening”

Earlier on Friday, China’s Global Times government-owned tabloid said that “China would not allow” the US to implement a regime change in Pyongyang.

Finally, in terms of next steps, Lavrov said that Washington should take the first step to reconciliation in the escalating crisis:

“The side that is stronger and cleverer” should take the first step to defuse tensions, he said speaking live on state television.

Lavrov echoed German Chancellor Angela Merkel, who earlier on Friday said Berlin would support “any non-military solutions” regarding North Korea but deemed an escalation of rhetoric “the wrong answer.”

“I don’t see a military solution to this conflict,” Merkel told reporters in Berlin. “I see the need for enduring work at the UN Security Council … as well as tight cooperation between the countries involved, especially the US and China.”

6 .GLOBAL ISSUES

7. OIL ISSUES

This is something that i have been worrying about:  China importing less imports as its SPDR oil is filled to the brim and cannot take on any more oil

(courtesy Paraskova/Oil Price.com)

Another Red Flag For Oil? China’s Crude Imports Slump To 7-Month Low

Authored by Tsvetana Paraskova via OilPrice.com,

Chinese crude oil imports in July dropped to their lowest level in seven months, although they rose 12 percent on an annual basis, according to calculations made by Reuters on the basis of China’s customs data.

Last month China imported some 34.66 million tons of crude oil, or around 8.16 million bpd, which—according to Reuters calculations based on China’s General Administration of Customs data—was the lowest level since January.

Crude oil imports in the first seven months of this year increased by 13.6 percent at 247 million tons.

In the first half of the year, Chinese crude oil imports averaged 8.55 million bpd, or 212 million tons in total – a 13.8-percent annual increase.

The total trade data for July had analysts worried that China’s economy may have started to show signs of slowdown. Both exports and imports increased less than expected, making analysts wonder if global demand growth has started to slow down, or if China’s July trade figures should be attributed solely to one-off or seasonal factors.

In total imports, China’s imports increased by 11 percent last month, missing forecasts for a 16.6-percent rise, and slowing down from June’s 17.2-percent jump, to the slowest growth since December last year.

Last month, a senior manager at Sinopec said that lower domestic production and continued low oil prices will lead to China’s demand for crude oil imports rising by around 400,000 bpd in 2017. Chinese crude oil imports are expected to exceed 400 million tons this year, and to further rise next year, Zhang Haichao, vice president of Sinopec Group, told Reuters. The estimate provided by Zhang means that Chinese demand for foreign crude would rise by 400,000 bpd, and for the first time ever, rising imports could make China the world’s top crude oil importer on an annual basis, according to Reuters

 end
Rig counts rise by only but production will increases.  We have highlighted this to you in the past:  just because rig count increases fall to zero, it doesn’t stop USA production..it rise for about a year and then peters out.
(courtesy zerohedge)

8. EMERGING MARKET

VENEZUELA

end

 

Your humour for the day:  true story!!

 

special thanks to Daliah Organ and Gita Kellar for providing this for us:

The Canadian Revenue Agency actually commented on this one.
The importance of accuracy in your tax return.
The CRA has returned the Tax Return to a man in Canada, after he apparently answered one of the questions.   
In response to the question, “Do you have anyone dependent on you?”
The man wrote: “2.1 million illegal immigrants, 1.1 million crackheads, 4.4 million unemployable scroungers, 80,000 criminals in over 85 prisons plus 450 idiots in Parliament, thousands of ‘politicians’ and an entire group that call themselves ‘Senators’   
The CRA stated that the response he gave was unacceptable.
The man’s response back to CRA was, “Who did I leave out?”

 

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   1.1764 DOWN .0006/REACTING TO  + huge Deutsche bank problems + USA election:/TRUMP HEALTH CARE DEFEAT//ITALIAN REFERENDUM DEFEAT/AND NOW ECB TAPERING BOND PURCHASES/ /USA FALLING INTEREST RATES AGAIN/EUROPE BOURSES ALL DEEPLY IN THE RED 

USA/JAPAN YEN 109.17 UP 0.083(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/   HELICOPTER MONEY  ON THE TABLE AND DECISION ON SEPT 21 DISAPPOINTS WITH STIMULUS/OPERATION REVERSE TWIST/LABOUR PARTY LOSES IN LOCAL ELECTIONS

GBP/USA 1.2976 UP .0006 (Brexit  March 29/ 2017/ARTICLE 50 SIGNED

THERESA MAY FORMS A NEW GOVERNMENT/STARTS BREXIT TALKS

USA/CAN 1.2719 DOWN .0017 (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 ROSE by 34 basis points, trading now ABOVE the important 1.08 level  RISING to 1.1803; 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  DOWN 53.21 POINTS OR 1.63%     / Hang Sang  CLOSED DOWN 560.49 POINTS OR 2.04% /AUSTRALIA  CLOSED DOWN 1.15% / EUROPEAN BOURSES OPENED  DEEPLY 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 8.97 POINTS OR .05%

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

2/ CHINESE BOURSES / : Hang Sang CLOSED DOWN 560.49 POINTS OR 2.04%  / SHANGHAI CLOSED DOWN 51.21 POINTS OR 1.63%   /Australia BOURSE CLOSED DOWN 1.15% /Nikkei (Japan)CLOSED DOWN 8.97  POINTS OR 0.05%   / INDIA’S SENSEX IN THE RED

Gold very early morning trading: 1286.80

silver:$17.09

Early FRIDAY morning USA 10 year bond yield: 2.196% !!!  DOWN 6   IN POINTS from TUESDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%.

 The 30 yr bond yield  2.781, DOWN 5  IN BASIS POINTS  from TUESDAY night.

USA dollar index early FRIDAY morning: 93.45 UP 5  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: 2.853% DOWN 1 in basis point(s) yield from THURSDAY 

JAPANESE BOND YIELD: +.063%  DOWN 1   in   basis point yield from THURSDAY/JAPAN losing control of its yield curve

SPANISH 10 YR BOND YIELD: 1.458% FLAT   IN basis point yield from THURSDAY 

ITALIAN 10 YR BOND YIELD: 2.031 UP 4 POINTS  in basis point yield from THURSDAY 

the Italian 10 yr bond yield is trading 58 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: +.382% DOWN 7  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/5:00 PM 

Euro/USA 1.1784 UP .0051 (Euro UP 51 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 108.98 DOWN 0.116(Yen UP 12 basis points/ 

Great Britain/USA 1.3006 UP  0.0030( POUND UP 30 BASIS POINTS)

 

USA/Canada 1.2682 DOWN .0054 (Canadian dollar UP 54 basis points AS OIL FELL TO $48.45

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This afternoon, the Euro was UP  by 51 basis points to trade at 1.1822

The Yen ROSE to 108.98 for a GAIN of 12  Basis points as NIRP is STILL a big failure for the Japanese central bank/HELICOPTER MONEY IS NOW DELAYED/BANK OF JAPAN NOW WORRIED AS AS THEY ARE RUNNING OUT OF BONDS TO BUY AS BOND YIELDS RISE  /OPERATION REVERSE TWIST ANNOUNCED SEPT 21.2016

The POUND ROSE BY 30  basis points, trading at 1.3006/ 

The Canadian dollar ROSE by 54 basis points to 1.2682,  WITH WTI OIL FALLING TO :  $48.45

The USA/Yuan closed at 6.6630/
the 10 yr Japanese bond yield closed at +.063%  DOWN 1 IN  BASIS POINTS / yield/ 

Your closing 10 yr USA bond yield DOWN 6  IN basis points from TUESDAY at 2.183% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic  USA 30 yr bond yield: 2.786 DOWN  5 in basis points on the day /

Your closing USA dollar index, 93.12  DOWN 29 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 DOWN 79.98 POINTS OR 1.08%
German Dax :CLOSED UP 0.24 POINTS OR 0.00%
Paris Cac  CLOSED DOWN 54.31 POINTS OR 1.06% 
Spain IBEX CLOSED DOWN  167.10 POINTS OR 1.60%

Italian MIB: CLOSED DOWN 327.59 POINTS/OR 1.51%

The Dow closed UP 14.31 OR 0.07%

NASDAQ WAS closed UP 39.68  POINTS OR 0.64%  4.00 PM EST

WTI Oil price;  48.45 at 1:00 pm; 

Brent Oil: 51.72 1:00 EST

USA /RUSSIAN ROUBLE CROSS:  59.85 DOWN 29/100 ROUBLES/DOLLAR (ROUBLE HIGHER BY 29 BASIS PTS)

TODAY THE GERMAN YIELD FALLS TO  +0.382%  FOR THE 10 YR BOND  4.PM EST EST

END

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

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

WTI CRUDE OIL PRICE 5:00 PM:$48.77

BRENT: $51.97

USA 10 YR BOND YIELD: 2.191%  (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)

USA 30 YR BOND YIELD: 2.7855%

EURO/USA DOLLAR CROSS:  1.1821 UP .0052

USA/JAPANESE YEN:109.14  UP  0.043

USA DOLLAR INDEX: 93.08  DOWN 32  cent(s) 

The British pound at 5 pm: Great Britain Pound/USA: 1.3009 : UP 33 POINTS FROM LAST NIGHT  

Canadian dollar: 1.2677 UP 60 BASIS pts 

German 10 yr bond yield at 5 pm: +0.382%

END

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

TRADING IN GRAPH FORM FOR THE DAY

Small Cap Stocks Suffer Worst Week In 18 Months As Retailer Rout Returns, Credit Crashes

Blame The Russians, The Chinese, The North Koreans, and The Welsh… but not The Fed…

 

 

Overnight saw more China turmoil.. (MSCI China ETF saw its biggest drop since Brexit)

 

With China ‘VIX’ spiking to 2017 highs…

 

Then Europe followed through with Corporate credit markets crashing by the most in 18 months…

The cost of insuring against non-payment jumped the most this week since February 2016, when the oil price slump heightened default risks of energy companies and their bankers.

And while stocks bounced today in US, the week was not pretty.

Summary:

  • Dow’s worst week in 5 months (Mar ’17)
  • S&P’s worst week since pre-election (Nov ’16)
  • Russell 2000 worst week since Feb ’16
  • Financials worst week in 5 months
  • VIX biggest percentage spike since Aug ’15 (China Deval)
  • HY Credit Risk biggest jump since election (Nov ’16)
  • Silver’s biggest week since Jul ’16
  • Gold’s biggest week since Apr ’16
  • Ofshore Yuan’s best week in 7 months (Jan ’17)

Russell 2000 was the week’s biggest loser (worst week for Small Caps since Feb 2016); Nasdaq is down 3 weeks in a row (worst week in last 7)

 

As Small Caps outperformance since the election has been erased…

 

Nasdaq was unable to break back above its 50DMA…

 

But it is the S&P 500 that is most worying to technical anlysts as this is the longest its held under the 50DMA since April…

 

Today’s modest bounce was very weak as Buy-The-Fucking-All-Out-Nuclear-War-Dip’ers did not show up en masse…

 

Retailers were ugly bnut Energy and Financials suffered this week…

 

FANG Stocks suffered their 3rd losing week in a row, dropping to one month lows…

 

Retailer Rout returned this week…

 

For the worst week since Dec 2016…

 

VIX reached as high as 17.28 today – its highest since the election…

 

The VIX term structure inverted for the firs time since May…

 

Market Breadth (by any measure) remains dismal…

 

Credit markets were really ugly this week – as we noted above, Europe was a bloodbath – but US HY Corporate bond risk spiked 30bps – its biggest jump since the election…

 

Treasury yields tumbled on the week – pushing towards YTD low yields and entirely erasing any payrolls losses…

 

And at the very short-end, T-Bills are signaling early October debt ceiling deadline…

 

But while VIX shot up at the short-end this week, it remains relative ignorant of any debt ceiling concerns…

 

The Dollar Index closed lower for the 4th week of the last 5, erasing last Friday’s post-payrolls ramp…

 

JPY has strengthened for 5 straight weeks against the USD, Yuan also surged this week (best wek in 7 months) with commodity currencies weakest…

 

And as the dollar sank, Bitcoin had its best week since pre-Brexit anxiety sent the virtual currency surging in June 2016… to a new record hiugh at $3550

 

WTI found resistance at $50 and support at $48 this week but ended lower…

 

Gold surged on the week as safe-haven buying sent the precious metal to $1298…

 

The last few weeks have seen gold and Bitcoin moving together…

 

Finally, we note that last week it was FX risk that spiked, this week it was equity’s turn. What snaps next week?

 

Bonus Chart: “Probably nothing”

 

Bonus Bonus Chart: Maybe Gundlach’s favorite indicator is wrong this time…

end

 

From Tuesday:  the Uber effect whacks Avis

(courtesy zero hedge)

 

The Uber Effect: Avis Plunges On Huge Miss, Margin Collapse, Guidance Cut, “Over-Fleeting”

While the growing woes facing the auto sector are well-known by now (see “Carmageddon: Ford & GM Sales Tank Despite Record July Incentive Spending“) and boil down to excess capacity, insufficient demand and just a tiny – if one listens to the experts – subprime lending bubble, one key culprit has emerged as the biggest catalyst behind the chronic weakness among US carmakers: a moribund fleet, or rental, industry which has been devastated in recent years from Uber’s juggernaut of disruption.

A painful reminder of that was presented moments ago when Avis Budget reported its Q2 earnings. The company reported Q2 revenue of $2.24 billion, just barely making the low end of the consensus range, while earnings were slashed in half, tumbling from $0.63 a year ago, to just $0.30 in Q2, a huge miss to the $0.52 expected. Also, that was non-GAAP: the company’s GAAP EPS was barely positive at $0.04.

Making matters worse, while CAR reported a modest 2% decline in revenue in the Americas, adjusted EBITDA in the same region crashed by 41% to $96MM from $163MM a year ago, leading to a 31% drop in overall company EBITDA, from $204MM to $140MM.

In the company’s discussion of Q2 results, the CEO did everything he could to sound upbeat, but he didn’t quite get there. In a nutshell, everything that could go wrong for CAR did, excess capacity or “industry over-fleeting”, surging costs i.e., “higher per-unit fleet costs”, and a plunge in used-vehicle prices.

“Our second quarter results in the Americas reflected both a 4% reduction in pricing resulting from industry over-fleeting and higher per-unit fleet costs due to lower used-vehicle values. Consequently, we have identified $25 million of additional savings opportunities globally, bringing our total expected savings this year to $75 million, and have lowered our full-year earnings guidance to reflect the difficult first half,” said Larry De Shon, Avis Budget Group President and Chief Executive Officer. “Industry fleet levels in the Americas normalized to demand towards the end of the second quarter. This enabled us to transition to improved pricing, with revenue per day up more than 1% in July. Looking forward, I am now more optimistic that the industry issues we’ve been contending with should be behind us.”

 

Reported revenue of $2.2 billion was unchanged compared to the prior year, with an increase in overall rental days being offset by a decrease in pricing. Strong International revenue growth offset lower revenue in the Americas. The pricing environment together with higher per-unit fleet costs in the Americas, net of early benefits from the cost reduction initiatives, resulted in a $33 million decrease in net income to $3 million (or $0.04 per share). Adjusted EBITDA was $140 million compared to $204 million in the prior year, and adjusted net income was $25 million ($0.30 per diluted share) in the quarter.

 

“Our recently announced partnerships with both Waymo and RocketSpace are providing opportunities to pilot scalable new business models as we start to execute on our strategy to leverage our fleet management and logistics capabilities in the rapidly developing mobility space,” said Mr. De Shon.  “I’m also excited about all of the innovative growth initiatives we’ve announced this year, including enabling Avis customers to transact with us through Amazon Alexa and Google Home.”

If that’s what Larry is excited about we would hate to ask him what he thinks about Uber, which has led to a dramatic collapse in Avis (and Hertz’) pricing power as he himself admits. As much is evident from the company’s downward revised guidance, which sees FY adjusted EPS $2.40 to $2.85, sharply down from $2.85 to $3.50, and below the consensus estimate of $2.78, despite keeping its revenue guidance flat at $8.80 billion – $8.95 billion, and above the consensus estimate of $8.78 billion.

Needless to say none of the above bodes well for the US OEM sector as the fleet segment will be focusing on “rationalizing”, i.e., hacking and slashing, existing business for months if not years to come, removing virtually all fleet demand from US automakers for the foreseeable future.

And as the market digests the combination of collapsing margins, lack of pricing power, “over-fleeting”, higher per-unit fleet costs, and tumbling used-vehicle values, it is not happy as the plunge in both CAR and HTZ stocks demonstrates.

(courtesy Bloomberg)

Uber Investor Declares a State of Emergency

Benchmark’s lawsuit against Travis Kalanick effectively hits the pause button on major decisions.
August 11, 2017, 7:00 AM EDT

At a crucial time when Uber Technologies Inc. is looking to fill a leadership void, repair a foul corporate culture, salvage morale, fend off rivals worldwide, prove it didn’t benefit from stolen trade secrets and deal with a host of other issues, the ride-hailing company is forced to hit the pause button.

Benchmark, a major shareholder, declared what is essentially a state of emergency at Uber on Thursday. The venture capital firm filed a lawsuit against Travis Kalanick, the recently ousted chief executive officer, seeking to remove him from the board, while eliminating two additional board positions. Boardroom schisms have become standard operating procedure at Uber this year, but the decision to bring a case to court is a remarkable twist.

The suit is likely to paralyze the company, which already has a long list of essential tasks piling up. (Fortunately, they solved the problem of what to call a controversial conference room known as the War Room. It’s now the Peace Room.) Even if Uber directors manage to decide on a CEO everyone likes, who would want to report to a board in disrepair? “It puts the company in limbo and prevents them from moving forward,” said Arun Sundararajan, a New York University professor and author of The Sharing Economy. “This kind of fight is going to hurt Uber significantly in the short term.”

Benchmark argues that such a drastic move was necessary. Although the firm helped orchestrate Kalanick’s resignation as chief in June, it believes the gesture didn’t go far enough. Kalanick still holds great sway over the board, a position he acquired by defrauding board members, according to the complaint. Benchmark claims Kalanick breached his contract and violated his fiduciary responsibilities by withholding information from Uber’s board before it voted last year to allow him to add three directors of his choosing. A spokesman for Kalanick called the lawsuit “completely without merit and riddled with lies and false allegations.”

Time is a big factor. Benchmark may have recognized this and asked for a preliminary injunction to remove Kalanick from the board while the matter is decided in Delaware Chancery Court. Delaware law mandates that challenges to directors’ elections or appointments be heard in an expedited fashion to ensure companies can have properly functioning boards, said Larry Hamermesh, a Widener University professor who specializes in Delaware corporate law. In legal speak, “expedited fashion” means a few months or longer.

Uber investors should look to Viacom Inc. as a cautionary tale. Sumner Redstone’s attempts to remove board members landed him and the company in a multi-month courtroom saga over control of his $40 billion media empire. The fight exposed details about the billionaire’s personal life and mental health, and pitted him against his granddaughter and old friends.

The ride-hailing business was far more reliant on Kalanick for guidance than Viacom was on the 94-year-old media mogul in recent years. Uber is more vulnerable, too. That’s why executives hoped to quickly hire a new chief, whose many duties will include preparation for an initial public offering. But the infighting has already cost Uber at least one viable candidate. Meg Whitman, the Hewlett Packard Enterprise Co. chief who was on Uber’s short list, took herself out of the running last month, backing away from a messy process.

Just a couple weeks ago, Uber’s head of human resources forecast a CEO appointment by early September. With the lawsuit acting as a hazard notice to all on the outside, the timing is now anyone’s guess.

Sign up to receive the Fully Charged newsletter in your inbox, and follow Bloomberg Technology on Twitter and  for more.

And here’s what you need to know in global technology news

Snap investors freaked out. Shares dropped as much as 18 percent in late trading after the social-media company reported growth that fell short of analyst estimates.

Jeff Bezos dropped another spot on the billionaire rankings. The Amazon.com chief, who was briefly the world’s richest man last month, is down to No. 3 after a market selloff erased $2 billion from his fortune. Poor Jeff.

The Uber of Brazil is going on a hiring spree. 99, a Latin America ride-hailing company backed by SoftBank, is looking to quintuple its workforcethis year. Meanwhile, Uber is battling for market share in the region as it discusses a potential deal with SoftBank.

— With assistance by Jef Feeley

 

end

 

This is not what Janet wants to see:  consume prices disappoint for the 5th month in a row. But most importantly she needs to see a rise in wage inflation, and it is just not happening for her.  It will be difficult to raise rates

 

(courtesy zero  hedge)

Dollar Nosedives After Inflation Disappoints For 5th Month In A Row

Following ‘disappointing’ (to some) producer price data, consumer prices missed expectations for the 5th month in a row with a mere 0.1% rise MoM (0.2% exp). Year-over-year growth in core consumer prices also slowed for the 7th straight month dropping to just 1.7% – the slowest since Jan 2015. Amid this dismal report, there is a silver lining for Americans, the cost of shelter rose just 0.1% – the smallest rise since March.

 

The breakdown by components


Source: @SmithEconomics

The index for all items less food and energy increased 0.1 percent in July. The shelter index rose 0.1 percent in July, its smallest increase since March. The rent index increased 0.2 percent, while the index for owners’ equivalent rent rose 0.3 percent. However, the AriBNB effect keeps crushing hotels – the index for lodging away from home fell sharply, declining 4.2 percent.

The medical care index rose 0.4 percent in July, the same increase as in June. The index for prescription drugs continued to rise, increasing 1.3 percent in July after rising 1.0 percent in June. The index for hospital services rose 0.5 percent, and the physicians’ services index advanced 0.1 percent.

The recreation index rose 0.3 percent in July, its largest increase since February. The index for apparel rose 0.3 percent after declining in each of the past four months. The index for airline fares also turned up in July, rising 0.7 percent following 3 months of declines. The index for motor vehicle insurance continued to increase, rising 0.3 percent.

The dollar is disappointed:

In his preview of a potential 5th consecutive CPI miss, RBC’s Charlie McElligott has this to day:

US CPI (core) was always going to be the headliner of the week, as the 2.5 year global macro focus has continued to center on the debate around ‘disinflation / reflation’ range-trading around it.   Last week’s excitement around ISM Prices Paid and AHE’s beats (and 5y breakevens crossing north of 1.70 cleanly) however has been tempered by the disappointing PPI print yesterday (shouldn’t really fixate on that, as Tom Porcelli laid-out yday).

 

In light of the recent market wobble though, I can now see this going two very different routes.  An ‘inline to better’ number (.2) could definitely arrest the ‘sentiment drain’ in global risk markets right now, with long-awaited signs of US inflation and data being ‘back on track’ as a catalyst for higher Dollar & rates (real yields having collapsed recently).  That said however, with regards to the current US exporter / mega-cap Tech / FAANG ‘boon’ that has been the Dollar coming unglued, it might actually add further pressure to these areas which are obviously being ‘stressed’ (on account of positioning) ‘as is’ IF we were to see a strong counter-trend rally in Dollar kick-off.

 

Conversely, another miss in core CPI would REALLY muck-up the picture for the Fed and rates, with the potential for the market to try and price a Dec Fed hike out entirely, along with increased expectations for the Fed to drop their ‘dot plot.’  This would likely be the next driver of leg-lower in USD and with it, open up the potential for rates to revisit 2.0% level, especially with the potential scope for $/Y to travel to 105 and what that would do for Japanese ‘mechanical’ buying (and similar Yuan / Chinese FX reserve manager flows too).  In that case, you are likely to see a return to the ‘slow-flation’ positioning narrative—long secular growth, long low risk (‘duration sensitives’) against short cyclicals…sigh And I also think that if this were to occur and the Euro strengthened significantly again, you are going to see folks girded to short the EU exporter-centric DAX further.

 

Longer-term, that will probably be a ‘fade,’ but we’ll cross that bridge when we get there.

 

 

end

And with the 5th consecutive miss, Goldman Sachs cuts its odds for a rate hike. The uSA cannot get wage inflation

(courtesy zerohedge)

Goldman Cuts Rate Hike Odds After 5th Consecutive Inflation Miss

The Fed is becoming increasingly trapped: despite the FOMC’s “best intentions” to telegraph that the economy is improving with the unemployment rate at a paltry 4.3% – because otherwise it clearly wouldn’t be hiking, right – CPI has now missed consensus estimates for 5 consecutive months, and what worse, the biggest historical driver of inflation in recent years, shelter and rent inflation, appears to have peaked and is now declining. Worse, wage inflation is nowhere to be found, much as one would expect from a bartender and waiter-led “recovery.”

Of course, never one to miss a scapegoat, earlier today Dallas Fed president Robert Kaplan blamed the lack of inflation on technology, saying at an event in Texas that technological disruption is “a new and powerful structural factor that is influencing inflation” and finally noticing that “technology is increasingly replacing people in the jobs market” while “allowing consumers to change shopping habits, and is limiting the pricing power of businesses. That – in addition to global factors – has an impact on inflation.”

Predictably there was no discussion of how it is the Fed’s trillions in excess liquidity that has allowed VCs to invest tens if not hundreds of billions in money-losing ventures, which have made this tech-driven deflation possible.

As an aside, while the BLS-reproted CPI continues to deteriorate, the Atlanta Fed reported that its own sticky-price consumer price index —a weighted basket of items that change price relatively slowly—rose 2.6% annualized in July, following a 2.2% increase in June. The 12-month percent change in the index remained at 2.1%. Then again, the Fed is known to avoid any indicator that defies the prevailing groupthink, which now seems to be that inflation is lower than the Fed would like it to be.

So while the Fed ponders how to escape this trap it has created for itself, in which zombie companies refuse to die and where cash burning tech companies push inflation ever lower, at least until rates rise enough to crush the VC party once and for all, here is Goldman which moments ago once again cut its forecast for a rate hike possibility in 2017.

The consumer price index rose 0.11% in July in both the headline and the core, missing expectations for the fifth consecutive month. The primary sources of weakness were lodging away from home and new vehicle prices, and we suspect the former will rebound in coming months. Nonetheless, we now estimate that the core PCE price index rose just 0.08% month-over-month in July, or 1.40% from a year earlier, down from +1.5% in June. Accordingly, we now place the subjective odds of a third hike this year at 55% (vs. 60% previously).

The details:

  1. The consumer price index (CPI) rose 0.11% month-over-month in both the headline and the core (excluding food and energy), below expectations for the fifth consecutive month. Food prices rebounded (+0.2%) but energy prices edged down (-0.1%), providing offsetting impacts for the headline CPI, where the year-over-year rate moved up a tenth to +1.7% (vs. consensus of +1.8%). Relative to our expectations, the sources of weakness in core inflation this month were lodging away from home (-4.2% mom) and new car (-0.5%) prices, which together reduced month-over-month core inflation by -0.07pp. The lodging decline was the largest on record (back to the 1960s) and appears at odds with continued firmness in the PPI and industry measures. Despite the overall weakness, month-over-month inflation was generally firm in the large and persistent housing and medical care categories, with increases in medical services (+0.3%), medical commodities (+1.0%), and owners’ equivalent rent (+0.27% vs. +0.28% in June) prices, despite the sequential deceleration in rent of primary residence (+0.24% from +0.35% in June).
  2. Based on details in the PPI and CPI reports, we estimate that the core PCE price index rose just 0.08% month-over-month in July, or 1.398% from a year earlier (vs. +1.505% in June). Additionally, we expect that the headline PCE price index rose 0.08% in July, or +1.392% from a year earlier.
  3. Despite encouraging component detail, the overall CPI report was clearly disappointing. We lowered our Fed probabilities accordingly, with subjective odds for a third hike this year at 55% (vs. 60% previously). In terms of timing, we place the odds of the next hike at less than 5% for September (vs. 5% previously), less than 5% for November (vs. 5% previously), and 55% cumulatively by December (vs. 60% previously).

At the current rate of economic disappointments, that 55% will hit zero in about 4-6 weeks.

end

 

Now Mueller is going after Manafort’s family in the hope that the lower rung on the ladder will supply information to charge the higher levels on the ladder:

(courtesy zero hedge)

Mueller Goes After Manafort’s Family; Sought Cooperation From Son-In-Law Jeffrey Yohai

Just one day after we found out that FBI agents ‘raided’ former Trump campaign chairman Paul Manafort’s Alexandria home on July 26th, we learn that Special Counsel Mueller has also been going after Manafort’s family in order gather dirt on a person they clearly view as a material witness.  According to Politico’s anonymous sources (and you know what that means), Manafort’s son-in-law, Jeffrey Yohai, was approached earlier this summer regarding his “business deals” with Manafort.

Federal investigators sought cooperation from Paul Manafort’s son-in-law in an effort to increase pressure on President Donald Trump’s former campaign chairman, according to three people familiar with the probe.

 

Investigators approached Jeffrey Yohai, who has partnered in business deals with Manafort, earlier this summer, setting off “real waves” in Manafort’s orbit, one of these people said. Another of these people said investigators are trying to get “into Manafort’s head.”

 

Manafort, who is a focus of the broad federal and congressional investigations into Russian meddling in the 2016 presidential campaign, is also under investigation for his business and real estate transactions, including some that involve Yohai.

Yohai

 

As Politico notes, Mueller’s targeting of both Manafort and his son-in-law over potential criminal wrongdoing is a common tactic employed in white-collar cases, commonly called “climbing the ladder.”  The strategy, more or less, entails digging up whatever dirt can be found on those in Trump’s orbit and then using that dirt to coerce potential witnesses into cooperation.

“Manafort is — on many levels — a key subject of the investigation and someone who might be leveraged to share information about others,” said one Washington-based white-collar attorney with a client involved in the Russia probe.

 

The approach involves finding a suspected crime — false statements on tax returns or loan applications, for example — and then offering leniency on prosecution in exchange for cooperation. “They always start with the people on the low end of the ladder and try to get information on someone high up on the ladder,” said William Jeffress, a white-collar attorney who represented Vice President Dick Cheney’s chief of staff, I. Lewis “Scooter” Libby, in the President George W. Bush-era Valerie Plame leak investigation.

 

Mueller would clearly have jurisdiction over any real estate dealings between Yohai, Manafort and Russians, Jeffress said. In addition, he could press Yohai for details on what he knows about Manafort’s role in the campaign.

Of course, these new revelations come just one day after WaPo reported that FBI agentsraided the Alexandria home of President Trump’s former campaign chairman late last month, using a search warrant to seize documents and other materials.”  Federal agents reportedly appeared at
Manafort’s home without advance warning two weeks ago, in the predawn hours on Wednesday, July 26, the day after he met voluntarily with the staff for the Senate Intelligence Committee. The WaPo reported that the served search warrant was “wide-ranging and FBI agents working with special counsel Robert S. Mueller III departed the home with various records.”

The raid came as Manafort has been voluntarily producing documents to congressional committees investigating Russia’s interference in the 2016 presidential election. The search warrant indicates investigators may have argued to a federal judge they had reason to believe Manafort could not be trusted to turn over all records in response to a grand jury subpoena.

 

It could also have been intended to send a message to President Trump’s former campaign chairman that he should not expect gentle treatment or legal courtesies from Mueller’s team.

Meanwhile, in case Yohai’s name sounds familiar, it might be because he was recently sued by actor Dustin Hoffman after an LA real estate JV between the two went sour.  Here’s more from the LA Times:

It is the most famous street in one of Los Angeles’ most coveted neighborhoods.

 

High up in the hills above the Sunset Strip, Blue Jay Way is home to several A-list celebrities who enjoy panoramic views from glassy estates that can cost $10 million or more.

 

But a property on Blue Jay Way is now at the center of legal proceedings involving actor Dustin Hoffman and Jeffrey Yohai, a real estate developer who is the son-in-law of Paul Manafort, the former chairman of Donald Trump’s presidential campaign.

 

“The Graduate” actor and his son Jacob Hoffman invested $3 million with Yohai, who planned to raze a modest home on the street and build a $30-million mansion in its place, according to real estate records and Bankruptcy Court documents.

 

The deal has foundered as companies owning four of Yohai’s L.A.-area residential properties each went into foreclosure and then bankruptcy last year, including the Blue Jay Way parcel in the Bird Streets neighborhood. He’s also fighting a lawsuit in New York from an investor who alleges that he operated a Ponzi scheme. Yohai, 35, said in a filing that the allegations are fabrications.

 

All of which finally confirms our long-held suspicions that Dustin Hoffman is an undercover Russian spy.  Nice try going ‘full retard’ with Rain Man in ’88, but we’re on to you Dusty…

And Mueller going after Trump’s Secretary: Rhona Graff
(courtesy zerohedge)

Russiagate: Congress Sets Its Sights On Trump’s Longtime Secretary Rhona Graff

After almost a year of intense investigations and entertaining Congressional hearings, the most damning piece of evidence the Left has uncovered in its ‘Russigate Probe’ is an email exchange between Donald Trump Jr. and a British publicist which resulted in a meeting that basically turned out to be a hoax to promote a Russian political propaganda movie.

So, what do you do when you desire a specific outcome in an investigation but the facts just don’t support it?  Well, you cast a wider net and just keep digging, of course.

Just yesterday we noted that Special Counsel Mueller is apparently going after Paul Manafort’s son-in-law (see: Mueller Goes After Manafort’s Family; Sought Cooperation From Son-In-Law Jeffrey Yohai) and today we learn that Congress is ready to go after Trump’s longtime secretary, Rhonna Graff.  Here’s more from ABC:

Congressional investigators want to question President Donald Trump’s longtime personal secretary as part of their ongoing probe into a controversial meeting between Trump campaign officials and a Russian lawyer promising dirt on Hillary Clinton, ABC News has learned.

 

Rhona Graff, a senior vice president at the Trump Organization who has worked at Trump Tower for nearly 30 years, has acted as a gatekeeper to Trump. She remains a point of contact for the sprawling universe of Trump associates, politicians, reporters and others seeking Trump’s time and attention, even now that he’s in the White House.

 

Graff’s position in Trump’s orbit recently gained attention after Donald Trump Jr. released a June 2016 email exchange with British publicist Rob Goldstone leading up to the meeting with Russian attorney Natalia Veselnitskaya at Trump Tower.

 

“I can also send this info to your father via Rhona,” Goldstone wrote Donald Jr. in the email, “but it is ultra sensitive so wanted to send to you first.”

 

Graff was not on the email chain and it’s unclear if Goldstone ever made direct contact with her.

 

“Since her name is in the email, people will want her to answer questions,” said Rep. Peter King, R-New York, a member of the House Intelligence Committee who knows Graff. “If you go into Trump Tower, you’re going to mention her name.”

Graff

 

Attorney Alan Futerfas, who serves as outside counsel representing the Trump Organization and its employees, says Graff has not yet been contacted by congressional investigators but we suspect it’s only a matter of time.

“We have yet to receive such an inquiry but will, of course, continue to cooperate with any Committee seeking information,” Futerfas told ABC News when asked about the possibility of Graff being questioned or asked for records by investigators looking into the Russia matter.

 

Graff has not been accused of wrongdoing.

So, how long will this go on?  Well, if Adam Schiff has his way, the Congressional hearings will persist until (i) they finally find something or (ii) they’ve managed to interview everyone even remotely connected to Trump including the lawn maintenance folks at Mar-A-Lago.

“We’re going to want to hear from everyone connected to this,” Rep. Adam Schiff, D-California, the committee’s top Democrat, said on July 11. “We’re also going to want to see, as referenced in that email, whether the president’s assistant received any communications from the Russians as well. That was another channel alluded to in those emails.”

 

The Trump Tower meeting continues to be a focus in the three congressional investigations into Russian election interference.

 

“I think we should hear from every individual who is mentioned in the Don Jr. email chain to understand what was happening,” said Rep. Eric Swalwell, D-California, a member of the House Intelligence Committee.

Can we just dispense with the formalities and run and ancestry report on Graff?  She looks a little Russian…

end

Then finally, the laid back Republicans strike back as they demand an open hearing with respect to the on goings of Mueller

(courtesy zerohedge)

Republicans Strike Back: Congressman Circulates Letter Demanding Mueller Open Hearing

According to an exclusive report from the Daily Caller, Representative Brian Babin (R-TX) has apparently circulated a letter in DC asking for congressmen to sign onto an effort to force special counsel Robert Mueller to testify publicly in an open congressional hearing.  Among other things, Babin says that Congress has a right to question the independence of Mueller’s investigative staff and the scope of his investigation.

Babin’s letter, which was obtained by TheDC, was sent out to congressmen Thursday and asks for members to cosign a letter he plans to send to House Judiciary chairman Bob Goodlatte and Senate Judiciary chairman Chuck Grassley.

 

“Every nominee for United States Attorney must be confirmed by the Senate, a process that brings to the forefront any concerns regarding the nominee’s ability to hold their position in a decent and impartial manner. However, as Special Counsel Robert S. Mueller III and his team of lawyers investigate our very own president, we as a nation wait in the dark with very little information about those given this great authority,” Babin wrote in the letter to his fellow representatives.

 

Babin writes in the letter that there are “serious concerns” about conflicts of interest with regard to members of Mueller’s counsel who donated “generously” to Democrats or even represented Clinton herself.

 

“In addition, this investigation has the potential to drag on for months, or even years, and cost millions in taxpayer dollars,” Babin added.

 

Babin’s goal is to have one or both of the judiciary committees “bring Mr. Mueller and his team out of the shadows” to answer questions about the “potential expenses incurred by Mr. Mueller, the scope of his investigation and the selection of his special council team.”

Mueller

 

Of course, this request from Babin comes as people have continued to question the impartiality of several of Mueller’s early, notable hires, many of whom have been contributors to Hillary’s and/or Obama’s previous campaigns, with one, Jeannie Rhee, actually represented the Clinton Foundation.

Michael Dreeben, who serves as the Justice Department’s deputy solicitor general, is working on a part-time basis for Mueller, The Washington Post reported Friday.

 

Dreeben donated $1,000 dollars to Hillary Clinton’s Senate political action committee (PAC), Friends of Hillary, while she ran for public office in New York. Dreeben did so while he served as the deputy solicitor general at the Justice Department.

 

Jeannie Rhee, another member of Mueller’s team, donated $5,400 to Hillary Clinton’s presidential campaign PAC Hillary for America.

 

Andrew Weissmann, who serves in a top post within the Justice Department’s fraud practice, is the most senior lawyer on the special counsel team, Bloomberg reported. He served as the FBI’s general counsel and the assistant director to Mueller when the special counsel was FBI director.

 

Before he worked at the FBI or Justice Department, Weissman worked at the law firm Jenner & Block LLP, during which he donated six times to political action committees for Obama in 2008 for a total of $4,700.

 

James Quarles, who served as an assistant special prosecutor on the Watergate Special Prosecution Force, has donated to over a dozen Democratic PACs since the late 1980s. He was also identified by the Washington Post as a member of Mueller’s team.

 

Starting in 1987, Quarles donated to Democratic candidate Michael Dukakis’s presidential PAC, Dukakis for President. Since then, he has also contributed in 1999 toSen. Al Gore’s run for the presidency, then-Sen. John Kerry’s (D-Mass.) presidential bid in 2005Obama’s presidential PAC in 2008 and 2012, and Clinton’s presidential pac Hillary for America in 2016.

Meanwhile, as we pointed out yesterday, Mueller has also started to go after the family members of anyone surrounding the Trump campaign with Paul Manafort’s son-in-law, Jeffrey Yohai, being the latest target. The strategy, more or less, entails digging up whatever dirt can be found on those in Trump’s orbit and then using that dirt to coerce potential witnesses into cooperation.  That said, the aggressive tactics have left many questioning whether the scope of Mueller’s investigation is becoming far too wide-ranging.

“Manafort is — on many levels — a key subject of the investigation and someone who might be leveraged to share information about others,” said one Washington-based white-collar attorney with a client involved in the Russia probe.

 

The approach involves finding a suspected crime — false statements on tax returns or loan applications, for example — and then offering leniency on prosecution in exchange for cooperation. “They always start with the people on the low end of the ladder and try to get information on someone high up on the ladder,” said William Jeffress, a white-collar attorney who represented Vice President Dick Cheney’s chief of staff, I. Lewis “Scooter” Libby, in the President George W. Bush-era Valerie Plame leak investigation.

 

Mueller would clearly have jurisdiction over any real estate dealings between Yohai, Manafort and Russians, Jeffress said. In addition, he could press Yohai for details on what he knows about Manafort’s role in the campaign.

Of course, we’re sure that the mere suggestion that Republicans stand up against an investigation that has clearly morphed into an all out “witch hunt,” and one which is backed by the full capabilities and support of the intelligence community, will just be way too controversial for some mainstreamers to support.

This is interesting:  the judge handling the freedom of information case against the state department has now ordered the said State Dept. to search for  Hillary’s Benghazi emails
(courtesy zero hedge)

Judge Orders New Search Of State Department Servers For Hillary’s Benghazi Emails

In March 2015, Judicial Watch filed a FOIA lawsuit seeking the following:

“Any and all e-mails of former Secretary of State Hillary Rodham Secretary Clinton concerning, regarding, or relating to the September 11, 2012 attack on the U.S. Consulate in Benghazi, Libya.”

Ironically, State Department officials at the time decided to search records voluntarily turned over by Hillary and some of her former aides from private servers, as well as records collected by the FBI during their investigations, but figured it wasn’t necessary to search the one place where all official communications on such a topic should have been housed from the beginning: State Department servers.

For whatever reason, State has continually refused to conduct the search of its taxpayer funded servers going on two and a half years now.  Luckily, some small bit of rational thought prevailed yesterday when a U.S. District Judge filed an order demanding a search of State Department records for any and all Benghazi-related emails be completed by September 22, 2017.  Here is more from Politico:

“To date, State has searched only data compilations originating from outside sources — Secretary Clinton, her former aides, and the FBI. … It has not, however, searched the one records system over which it has always had control and that is almost certain to contain some responsive records: the state.gov e-mail server,” Mehta wrote.

 

“If Secretary Clinton sent an e-mail about Benghazi to Abedin, Mills, or Sullivan at his or her state.gov e-mail address, or if one of them sent an e-mail to Secretary Clinton using his or her state.gov account, then State’s server presumably would have captured and stored such an e-mail. Therefore, State has an obligation to search its own server for responsive records.”

 

Justice Department lawyers representing State argued that making them search other employees’ accounts for Clinton’s emails would set a bad precedent that would belabor other FOIA searches.

 

But Mehta said the circumstances surrounding Clinton’s email represented “a specific fact pattern unlikely to arise in the future.”

Hillary

 

Of course, this all feels eerily similar to another FOIA request we wrote about recently (see: FOIA Dump Reveals Collusion Between Lynch, FBI And Media To Bury Bill Clinton Meeting), in which the Obama administration told the American Center for Law and Justice there were no records of communications between the FBI and DOJ related to Loretta Lynch’s now infamous tarmac meeting with former President Bill Clinton.  That said, Jeff Sessions’ DOJ ran the same search on behalf of the ACLJ and found dozens of FBI/DOJ exchanges on the topic…so weird, right?

But, according to a new DOJ FOIA dump just released by the American Center for Law and Justice
(ACLJ), it looks increasingly as if nothing reported about this “social meeting” between Lynch and Clinton was grounded in fact…shocking, we know.

 

First, the new FOIA documents seemingly confirm that the FBI and DOJ simply lied in response to the ACLJ’s initial FOIA request filed back in July 2016.  Here is what the ACLJ was told at the time after sending requests to both the Comey FBI and the Lynch DOJ asking for any documents related to the Clinton-Lynch plane meeting:

 

 

 

That said, documents released today by the ACLJ reveal several emails between FBI and DOJ officials concerning the Lynch/Clinton meeting primarily related to how they should go about explaining the train wreck that had just been unwittingly played out on live television courtesy of a local Phoenix affiliate station.

Given that, what are the chances that Tillerson’s State Department is suddenly able to ‘find’ records that Hillary’s folks searched and searched for but were just never able to track down?  We would say pretty good…unless Hillary managed to wipe them…you know, ‘like with a cloth’.

 

The full court order can be read here:

end

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

(courtesy Greg Hunter)

North Korea Hot Head, Hillary DOJ Trouble, Economy Chaos ComingBy Greg Hunter On August 11, 2017 In Weekly News Wrap-Ups

The threats are going both ways between the U.S. and North Korea, especially after the U.N. Security Council voted 15 to 0 to sanction Kim Jung Un over his nuclear program and threats to use the nukes against his enemies. President Trump promised “fire and fury” if North Korea used their nukes.

Best-selling author of books exposing the Clintons, Ed Klein, says the Jeff Sessions Justice Department is reopening the Hillary Clinton email investigation. Klein’s sources are saying the DOJ is thinking about offering a plea deal to Hillary that he also says she will not take. That is the tip of the iceberg as there are still allegations of taking treasonous bribes in the form of donations to the Clinton Foundation that many say is a global charity fraud.

Don’t believe the things you hear about the U.S. economy getting better—it’s not. John Williams of ShadowStats.com says jobs are collapsing, and the true unemployment rate is still at 22%. Billionaire Ray Dalio, who manages $160 billion at his hedge fund, says things are dicey with North Korea and the debt ceiling, and you should buy physical gold for protection.

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

Video Link

http://usawatchdog.com/north-korea-hot-head-hillary-doj- trouble-economy-chaos-coming/

(To Donate to USAWatchdog.com Click Here)

end

 

 

WELL THAT ABOUT DOES IT FOR TONIGHT

 

I will see you Monday night

Harvey.

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2 comments

  1. Adam Ingwall · · Reply

    Was hoping u would mentioned the days 8,9,10 also. skipped a few days… 😦
    Anyway good job, thx

    Like

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