August 17/Terror in Spain: Van mows down and kills 13 pedestrians in another terrorist attack/gold rises by $13.45 and silver is up 11 cents/New China report from renowned author Chu claims China has a total debt of $35 trillion and non performing loans at $7.6 trillion or 22%

GOLD: $1286.50  UP $13.45

Silver: $17.06  UP 11 cent(s)

Closing access prices:

Gold $1288.60

silver: $17.04

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: $1291.94 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME:  $1288.50

PREMIUM FIRST FIX:  $3.44

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SECOND SHANGHAI GOLD FIX: $1291.49

NY GOLD PRICE AT THE EXACT SAME TIME: $1287.15

Premium of Shanghai 2nd fix/NY:$4.34

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LONDON FIRST GOLD FIX:  5:30 am est  $1285.90

NY PRICING AT THE EXACT SAME TIME: $1286.15 

LONDON SECOND GOLD FIX  10 AM: $1285.15

NY PRICING AT THE EXACT SAME TIME. $1285.95 

For comex gold:

AUGUST/

NOTICES FILINGS TODAY FOR APRIL CONTRACT MONTH: 2 NOTICE(S) FOR  200  OZ.

TOTAL NOTICES SO FAR: 4581 FOR 458,100 OZ  (14.248 TONNES) 

For silver:

AUGUST

 85 NOTICES FILED TODAY FOR

425,000  OZ/

Total number of notices filed so far this month: 1000 for 5,000,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

end

Today for the 6th consecutive day we had a raid on both gold and silver and again forces loyal to gold and silver rebuffed their attempts to discredit our precious metals.  I am witnessing banker capitulation in silver which seems to be their Achilles heal. The difference between gold and silver is simple:  there are always enough above ground gold to borrow against (central bank gold) but physical silver has already been spent in all of the extremely useful advances it has made in pharmaceuticals, photo-voltaic cells etc. The boys are having great difficulty borrowing against a declining inventory.

 

Let us have a look at the data for today

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In silver, the total open interest SURPRISINGLY ROSE BY ONLY  292 contracts from 187,955 UP TO 188,247 DESPITE THE HUGE RISE IN THE PRICE THAT SILVER UNDERTOOK WITH  YESTERDAY’S TRADING (UP 25 CENT(S) . THE BANKERS PROVIDED THE SHORT PAPER TO INITIATE ANOTHER RAID YESTERDAY (5TH CONSECUTIVE DAY OF TORMENT). THAT FAILED IMMEDIATELY AS SILVER STARTED TO ADVANCE IN PRICE.  NEWBIE SPEC LONGS REALIZING ANOTHER FAILED RAID, JUMPED ONTO THE BANDWAGON WITH PURCHASES.  HOWEVER THE COMMERCIALS WERE STILL LOATHE TO SUPPLY THE SHORT CONTRACTS. THUS A HUGE ADVANCE IN PRICE WITH A TINY GAIN IN OI. 

 In ounces, the OI is still represented by just UNDER 1 BILLION oz i.e.  0.941 BILLION TO BE EXACT or 134% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT MAY MONTH/ THEY FILED: 85 NOTICE(S) FOR 425,000  OZ OF SILVER

In gold, the open interest ROSE by A CONSIDERABLE 4,484 WITH THE SMALL RISE in price of gold ($3.85 GAIN YESTERDAY.) Most of gold’s gains came after the comex closed and we will see the resultant OI of those gains in tomorrow’s reading. The new OI for the gold complex rests at 482,405. A raid was called upon yesterday by the bankers and it failed. The bankers initiated the raid with short paper but newbie longs entered the arena with the lower price following silver’s lead. Thus the bankers were not successful in covering their shorts but they did supply the necessary paper to our newbie spec longs.  The result: increase in open interest with a higher price for gold.

we had: 2 notice(s) filed upon for 200 oz of gold.

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

GLD:

Today, a big change late last night in gold inventory: a deposit of 4.43 tonnes

Inventory rests tonight: 795.44 tonnes

IN THE LAST 24 TRADING DAYS: GLD SHEDS 41.53 TONNES YET GOLD IS HIGHER BY $53.45 . 

SLV

Today: THIS LOOKS SINISTER

 

WE HAD A HUGE CHANGES IN SILVER INVENTORY TONIGHT: A WITHDRAWAL OF 1.418 MILLION OZ  (WITH SILVER UP?)

INVENTORY RESTS AT 334.407 MILLION OZ

end

.

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

1. Today, we had the open interest in silver RISE BY ONLY 292 contracts from 187,955 UP TO 188,247 (AND now A LITTLE CLOSER TO THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) DESPITE THE HUGE RISE IN SILVER PRICE (25 CENTS). THE INITIAL RAID WEDNESDAY MORNING WAS REBUFFED IMMEDIATELY BY A HUGE INFLUX OF NEWBIE LONGS ENTERING THE SILVER COMEX CASINO.  THE BANKERS HAD A HARD TIME COVERING DUE TO THAT RISE IN PRICE AS YOU CAN VISUALIZE BANKER CAPITULATION. NEWBIE LONGS ENTERED ONCE THEY SAW THE FAILED RAID, WITH THE SUPPLY COMING FROM OLD SPECS EXITING FOR A PROFIT.  RESULT: HIGHER PRICE WITH A TINY OI GAIN.

(report Harvey)

.

2.a) The Shanghai and London gold fix report

(Harvey)

 

2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY:  Bloomberg

3. ASIAN AFFAIRS

i)Late WEDNESDAY night/THURSDAY morning: Shanghai closed UP 21.98 POINTS OR 0.68%   / /Hang Sang CLOSED DOWN 64.85 POINTS OR 0.24% The Nikkei closed DOWN 26.65 POINTS OR 0.41%/Australia’s all ordinaires CLOSED DOWN 0.06%/Chinese yuan (ONSHORE) closed UP at 6.6766/Oil DOWN to 46.66 dollars per barrel for WTI and 50.13 for Brent. Stocks in Europe OPENED DEEPLY IN THE GREEN , Offshore yuan trades  6.6855 yuan to the dollar vs 6.6766 for onshore yuan. NOW THE OFFSHORE IS WEAKER  TO THE ONSHORE YUAN/ ONSHORE YUAN STRONGER (TO THE DOLLAR)  AND THE OFFSHORE YUAN IS STRONG 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

b) REPORT ON JAPAN

c) REPORT ON CHINA

A very important commentary today as zero hedge remarks on the analysis of Charlene Chu formerly of Fitch who has made a career out of figuring out the true debt of China and then its non performing loans.  Her figure of $35 trillion is now well received by all pundits. Her figure of 7.6 trillion of non performing loans is scaring the living daylights out of Wall Street executives

( zero hedge/Charlene Chu/Hong Kong)

4. EUROPEAN AFFAIRS

i)The Euro dumps to below 1.17 when minutes reveal that the ECB will basically not tolerate a move to the 1.20 level.
( zerohedge)

ii)Spain is becoming the second largest destination  by sea after Greece for our Migrants

( Kern/Gatestone Institute)

 

iii)Massive crash in Barcelona after a van plows into a crowd at the Rambla  (City centre)

 

( zero hedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

6 .GLOBAL ISSUES

Despite the media proclaiming global growth, the total global negative yielding debt has now surged to its highest level in almost a year

 

( zero hedge)

 

7. OIL ISSUES

8. EMERGING MARKET

VENEZUELA

 

The faster they get this buffoon out of there, the better.  Average Venezuelans are suffering drastic weight loss due to lack of food.  Remember, this nation has the world’s highest oil reserves in the ground

 

( zerohedge)

9.   PHYSICAL MARKETS

i)Brian Lundin explains:  If government is trying to persuade you not to buy gold, then maybe you should buy it to protect yourself
( Brien Lundin/GATA)

ii)John Embry comments that the social fabric in the USA is breaking down and it is these people who are least interested in gold

( John Embry/Kingworld news)

This is interesting:  Assange in a 3 hour meeting with a Californian Congressman offered to prove that the Russians were not his source for the Democrat email hacking.  He wants a seat at the White House Press briefing and of course an absolute pardon

 

(courtesy zero hedge)

10. USA Stories

i)Hussman warns that the equity bubble will burst after the Fed warns that the markets are “vulnerable to elevated valuations”

( Hussman/zero hedge)

 

ii)Oh oH! this is a good indicator for problems in the uSA economy:  WalMart’s free cash flow falls and fails to cover its dividends and buybacks.  WalMart stock drops due to its guidance of lower earnings

 

( zerohedge)

 

iii)Soft data Philly Fed index slides to its weakest level since the Trump election with employment the killer

 

( Philly Index/zero hedge)

iv)USA industrial production rose by only .2% month/month in July missing expectations.  Last month’s data: .4% month/month and this is showing an economy that is slowing down.  Industrial production numbers are hard data

 

( zero hedge/Industrial production)

v)A new study shows what we have been telling you:  higher minimum wages are bringing job losses.  The hardesthit: females and minority workers

 

( zerohedge)

vi)This is a strange one!!  The FBI now reopens a Freedom of Information case on the Lynch Clinton Tarmac meeting after they got caught in a huge lie

( zero hedge)

vii)Bannon breaks his silence and gives his opinion on China, North Korea and what is happening internally . Correctly he admits that the USA is in an economic war with China and they must try and curtail their advances.

 

a must read..

 

( zero hedge)

viii)This is deadly and not good for Trump: Senator Corker, who is probably the wealthiest of all the senators has now called for a “radical change’ in the White House

(courtesy zerohedge)

Let us head over to the comex:

The total gold comex open interest ROSE BY A HUGE 4,484 CONTRACTS UP to an OI level of 482,405 WITH THE RISE IN THE PRICE OF GOLD ($3.85 with TUESDAY’S trading). NEWBIE LONGS ENTERED THE ARENA ESPECIALLY TACKLING THE LOWER PRICE DUE TO ANOTHER RAID IN YESTERDAY’S TRADING. THE BANKERS CONTINUE TO SUPPLY THE SHORT PAPER.  THE HIGH OPEN INTEREST IN THE GOLD COMPLEX WAS FODDER FOR OUR CROOKS AS THEY TRIED AGAIN  TO SHAKE MANY OF THE GOLD LEAVES FROM THE GOLD TREE. TODAY ANOTHER SMALL RAID (FLASH CRASH) FAILED MISERABLY.  YESTERDAY MOST OF THE GOLD PRICE GAINS CAME AFTER THE COMEX CLOSED SO WE WILL SEE ELEVATED OI IN GOLD IN TOMORROW’S READING.

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 71 contract(s) to stand at 899 contracts. We had 32 notices filed on YESTERDAY so we LOST 39 contracts or an additional 3900 oz will NOT stand at the comex and 39 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 GAIN 1 contract UP to 1383.

The next active contract month is Oct and here we saw a LOSS of 137 contracts DOWN to 49,553.

The very big active December contract month saw it’s OI GAIN 4515 contracts UP to 376,411.

We had 2 notice(s) filed upon today for   200 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 SURPRISINGLY ROSE BY ONLY 292 CONTRACTS FROM  187,955 UP TO 188,247 DESPITE YESTERDAY’S HUGE 25 CENT GAIN.  THERE IS NO QUESTION THAT WE ARE HAVING CONTINUAL BANKER CAPITULATION AS THEIR HUGE SHORTS IN SILVER ARE CHOKING THEM TO DEATH. THE BANKERS INITIATED THE RAID SUPPLYING A GOOD SIZED PAPER SHORTS WHICH INITIALLY DROVE THE PRICE OF SILVER DOWN. HOWEVER SILVER REBOUNDED ALMOST IMMEDIATELY CATCHING THE BANKERS TOTALLY OFFSIDE. THE BANKERS COULD NOT COVER ANY OF THEIR SHORTS WHICH WAS THE OBJECT OF THE EXERCISE. WHEN THE BANKERS WERE LOATHE TO SUPPLY NEW SHORT POSITIONS, SILVER SKYROCKETED NORTHBOUND. RESULT: A SMALL OPEN INTEREST GAIN WITH A HUGE PRICE RISE.

We are now in the next big non active silver contract month of August and here the OI ROSE 9 contracts UP TO 94. We had 15 notice(s) filed yesterday.  Thus we GAINED ANOTHER 24 contract(s) or an additional 120,000 oz will stand for delivery in this non active month of August and AGAIN zero EFP’s were issued for the August contract month. Please note that in gold we continually see EFP’s issued but not in silver!!

The next active contract month is September (and the last active month until December) saw it’s OI fall by 2,965 contacts down to 95,493.  The next non active contract month for silver after September is October and here the OI gained 114 contacts up TO 229. After October, the big active contract month is December and here the OI GAINED by 3014 contracts UP to 80,901 contracts.

We had 85 notice(s) filed for 425,000 oz for the AUGUST 2017 contract

VOLUMES: for the gold comex

YESTERDAY’S confirmed volume was 278,381 which is excellent

volumes on gold are STILL HIGHER THAN NORMAL!

Initial standings for AUGUST

 August 17/2017.

Gold Ounces
Withdrawals from Dealers Inventory in oz   nil
Withdrawals from Customer Inventory in oz  
3009.62 oz
Scotia
Deposits to the Dealer Inventory in oz   oz
Deposits to the Customer Inventory, in oz 
nil oz
No of oz served (contracts) today
 
2 notice(s)
200 OZ
No of oz to be served (notices)
897 contracts
(89,700 oz)
Total monthly oz gold served (contracts) so far this month
4581 notices
458,100 oz
14.248 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   26,778.6  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 1 customer withdrawal(s)
i) Out of Scotia:  3009.620 oz
total customer withdrawals;  3009.62 oz
 we had 1 adjustment(s)
 i) Out of Brinks:  96.45 oz was adjusted out of the customer and this landed into the dealer account of Brinks (3 kilobars)
 
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 2  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 (4581) x 100 oz or 458,100 oz, to which we add the difference between the open interest for the front month of AUGUST (899 contracts) minus the number of notices served upon today (2) x 100 oz per contract equals 547,800  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 (4581) x 100 oz  or ounces + {(899)OI for the front month  minus the number of  notices served upon today (2) x 100 oz which equals 547,800 oz standing in this  active delivery month of AUGUST  (17.038 tonnes)
 we lost 39 contracts or an additional 3900 oz will not stand for delivery and 39 EFP’s for August were issued.(FOR FIAT BONUS PLUS ANOTHER DELIVERABLE CONTRACT WHICH MOST LIKELY IS A LONDON BASED FORWARD)
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Total dealer inventory 758,311.027 or 23.58 tonnes  (dealer gold continues to disappear)
Total gold inventory (dealer and customer) = 8,625,139.302 or 268.27 tonnes 
 
Over a year ago the comex had 303 tonnes of total gold. Today the total inventory rests at 268.27 tonnes for a  loss of 34  tonnes over that period.  Since August 8/2016 we have lost 85 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  85 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
AND NOW THE AUGUST DELIVERY MONTH
 
August initial standings
 August 17  2017
Silver Ounces
Withdrawals from Dealers Inventory  nil
Withdrawals from Customer Inventory
151,204.08 oz
 Scotia
Brinks
Deposits to the Dealer Inventory
nil  oz
Deposits to the Customer Inventory 
41,065.080
oz
CNT
No of oz served today (contracts)
85 CONTRACT(S)
(425,000 OZ)
No of oz to be served (notices)
9 contracts
( 45,000 oz)
Total monthly oz silver served (contracts) 1000 contracts (5,000,000 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 2,585,984.9 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 2 customer withdrawal(s):
i) out of  brinks: 40,380.29 oz
ii) out of Scotia: 110,823.790 oz
TOTAL CUSTOMER WITHDRAWALS:  151,204.08 oz
We had 1 Customer deposit(s):
 i) Into CNT:  41,065.080 oz
***deposits into JPMorgan have stopped  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: 41,065.080 oz
 
 we had 2 adjustment(s)
i) Out of Brinks: 5265.610 oz was adjusted out of the customer and this landed into the dealer account of Brinks
ii) Out of CNT: 30,337.334 oz was adjusted out of the dealer and this landed into the customer account of CNT
The total number of notices filed today for the AUGUST. contract month is represented by 85 contract(s) for 425,000 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 1000 x 5,000 oz  = 5,000,000 oz to which we add the difference between the open interest for the front month of AUGUST (94) and the number of notices served upon today (85) x 5000 oz equals the number of ounces standing
 

 

.
 
Thus the INITIAL standings for silver for the AUGUST contract month:  1000 (notices served so far)x 5000 oz  + OI for front month of AUGUST(94 ) -number of notices served upon today (85)x 5000 oz  equals  5,045,000 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 24 contracts or an additional 120,000 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 16/2016 we had 104,058 contracts standing vs this yr at 95,753.
Last yr on the first day notice for the Sept silver contract we had 17.070 million oz stand for delivery.
By month end:  16.075 million oz/
 
 
 
 
Volumes: for silver comex
YESTERDAY’s  confirmed volume was 111,656 contracts which is OUT OF THIS WORLD
FRIDAY’S CONFIRMED VOLUME OF 111,645 CONTRACTS WHICH EQUATES TO 558 MILLION OZ OF SILVER OR 80% 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:  38.323 million (close to record low inventory  
Total number of dealer and customer silver:   215.627 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 6.5 percent to NAV usa funds and Negative 6.3% to NAV for Cdn funds!!!! 
Percentage of fund in gold 62.5%
Percentage of fund in silver:37.5%
cash .+0.0%( August 17/2017) 
2. Sprott silver fund (PSLV): STOCK   NAV RISES TO +0.21% (August 17/2017) 
3. Sprott gold fund (PHYS): premium to NAV RISES TO -0.54% to NAV  (August 17/2017 )
Note: Sprott silver trust back  into POSITIVE territory at +0.21/Sprott physical gold trust is back into NEGATIVE/ territory at -0.54%/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 17/late last night, a deposit of 4.43 tonnes of gold at the GLD/inventory rests at 795.44 tonnes/the bleeding of gold has stopped.

August 16/no change in gold inventory at the GLD. Inventory rests at 791.01 tonnes

August 15/no change in gold inventory at the GLD/inventory rests at 791.01 tonnes

August 14/this is good!!: a gain of 4.14 tonnes of gold into the GLD inventory/the removal of GLD gone to the east has now stopped probably because there is no physical to send/inventory rests at 791.01 tonnes

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

 

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August 17 /2017/ Inventory rests tonight at 795.44 tonnes
*IN LAST 214 TRADING DAYS: 154.44 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 152 TRADING DAYS: A NET  2.99 TONNES HAVE NOW BEEN ADDED INTO  GLD INVENTORY.
*FROM FEB 1/2017: A NET  13.82 TONNES HAVE BEEN WITHDRAWN.

end

Now the SLV Inventory

August 17/A WITHDRAWAL OF 1.418 MILLION OZ LEAVES THE VAULTS OF THE SLV (WITH SILVER UP 25 CENTS YESTERDAY?)/INVENTORY RESTS AT 334.407 MILLION OZ

August 16/no change in silver inventory at the SLV/Inventory rests at 335.825 million oz/

August 15/no change in silver inventory at the SLV/Inventory rests at 335.825 million oz.

August 14./no change in silver inventory/inventory rests at 335.825 million/

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

 

August 17.2017:

 Inventory 334.407  million oz
end
  • 6 Month MM GOFO

    Indicative gold forward offer rate for a 6 month duration

    + 1.31%
  • 12 Month MM GOFO
    + 1.49%
  • 30 day trend

end

Major gold/silver trading/commentaries for THURSDAY

GOLDCORE/BLOG/MARK O’BYRNE.

GOLD/SILVER

Must See Charts – Gold Hedges USD Devaluation, Rise in Oil, Food and Cost of Living Since Nixon Ended Gold Standard

– Gold hedges massive ongoing devaluation of U.S. Dollar
– 46th anniversary of ‘Tricky Dicky’ ending Gold Standard (see video)
– Savings destroyed by currency creation and now negative interest rates
– Long-term inflation figures show gold a hedge against rising cost of fuel, food and cost of living
– $20 food and beverages basket of 1971 cost $120.17 in 2017
– Household items increased by average of 2000% and oil by 5,373% since 1913
– Gold gained 5,669% since 1913; by nearly 3,000% since 1971
– Dollar has been reserve currency of world in the period and most other currencies have seen greater devaluation
– Evidence of gold’s role as inflation and currency devaluation hedge

 Editor: Mark O’Byrne

US dollar Purchasing Power As measured By Gold’
Source: Goldchartsrus

You don’t need ‘Tricky Trump’ to devalue the dollar, it’s been doing that since 1913 and ‘Tricky Dicky’ in 1971

In 2015 President Donald Trump made headlines when he told a town hall event in Atkinson, New Hampshire about how his father had once given him a ‘small loan of a million dollars.’

Outcry swept around the media who asked how much the future President was really in touch with the common voter.

Whilst Trump’s reference to ‘small’ was in relation to the (apparent) size of the empire he subsequently built he may as well have been referring to the value of a million dollars now and how small it is compared to in 1975 when he was lent the money.

$1 million dollars was a lot of currency in 1975. Today it will barely buy you a nice house in a nice city.

Using today’s CPI data Trump Sr’s $1 million loan would today be equivalent to $4.4 million. The purchasing power of a 1975 US dollar has fallen by over 400%. It has fallen a lot more since 1971.

In this week 46 years ago on August 15 1971, President Nixon announced the U.S. Dollar would completely cut ties with sound money gold (see video below).

Without gold backing and gold as a monetary anchor, we can now see just how much the purchasing power of the consumer dollar has declined since 1971.

You can see an even better example of the dollar’s collapse in purchasing power when measured in gold ounces (see charts above).

Prices climb by over 2000% since 1913 and creation of the Fed

‘[Since 1913] the general public and policymakers have focused almost constantly on inflation; they have feared it, bemoaned it, sought it, and even tried to whip it.’ Bureau of Labour Statistics 

In 1970, after many decades of dollar devaluation, Herbert W. Armstrong quoted the Labor Department’s figures for how much $5 would have purchased in 1913:

“15 pounds of potatoes, 10 pounds of flour, 5 pounds of sugar, 5 pounds of chuck roast, 3 pounds of round steak, 3 pounds of rice, 2 pounds each of cheese and bacon, and a pound each of butter and coffee; that money would also get you two loaves of bread, 4 quarts of milk and a dozen eggs. This would leave you with 2 cents for candy.”

Percent (%) change in US prices (1913 – 2017)

What changed in 1913? The US adopted the Federal Reserve Banking System and the journey towards dismantling the gold standard and currency debasement began.

In the same year the United States government started tracking prices. This was thanks to President William Howard Taft who signed a bill promoting the Department of Labor to a Cabinet-level Department. Following this move the Consumer Price Index (CPI) was created in 1921 and backdated to 1913.

Many things have changed since 1913, the most obvious is that the US Dollar is no longer backed by gold and that inflation has been slowly destroying wealth. Despite government efforts to track prices, little has been done about the impact of inflation and our loss of purchasing power.

This is best illustrated not just with gold but through day-to-day items that we can all relate to. Below it is clear to see that since before the beginning of the World War I prices of everyday items have climbed by over 2,000%, on average.

We can also appreciate how much the U.S. Dollar has depreciated in value when we consider that a $100 bill at the end of the First World War has the equivalent purchasing power of $1,196, today.

This is in significant contrast to the price and purchasing power of store of value gold.

We often talk about the role of gold during times of war and upheaval. This seems particularly relevant today as Trump and North Korea engage in saber-rattling.

The table above shows just how important gold was during war time for the millions of people who were uprooted in the run up to and in 1914 and found themselves refugees, without a country to call home and in need of a borderless currency which would serve them wherever they found themselves.

The children or grandchildren of those who escaped with gold would own as asset which has protected and grown their wealth and is today worth over 5,000% more than it was in 1913.

CPI measure, questionable but available

When we complain that food and other household items are becoming more expensive what we are usually experiencing is the devaluation in the US dollar and impact on inflation.

To give you an idea of how much the dollar has fallen in value since the removal of the gold standard in 1971, the purchasing power of $100 then would be equivalent to $616.65 today.

By comparison, $100 worth of gold in 1971 is now worth nearly $3,700.

Today the CPI is the fiat-centric world’s way of tracking consumer prices and, therefore, inflation. We rarely hear about the depreciation of our currencies, instead we are bamboozled with odd figures which rarely translate into our every day life.

Despite this, we are still able to use CPI as real evidence of the rising cost of living over time. This is particularly interesting when you look at the change in food prices using 1971 as a base year.

We use 1971 as since then the US currency has not been tied to or associated with gold. In the period since then we have seen a slow but damaging impact on the value of people’s wealth and the purchasing power of their earnings.

As with our piece on British food prices, British inflation and rising cost of living, we would have preferred to have used actual price information in order to look at the depreciation of the U.S. Dollar. Unfortunately individual price information isn’t readily available for the periods of most interest.

Below you can see how much the CPI numbers have increased for items which are considered key in an household’s food basket. When you consider 1971 = 100 as the base year and price, you can see the dramatic changes in prices.

The CPI can be misleading and confusing. When looking at the CPI data for the last 46 years it was interesting to note that halfway through the years the BLS decided to change the base year, thus making it appear as though inflation had not increased at quite the rate it had been. The numbers above have been adjusted to the best of our ability.

One thing we also noticed when gathering the data was the climb in price of unprocessed foods, look at potatoes, carrots and apples as an example of freshly grown produce.

As we looked deeper into data between 1971 and 2017 the list of foods included in the CPI basket grew, thanks to the advent of processed and unhealthy food all of which appear to be more affordable and suffering less from price climbs.

As our currency has been debased so has our food.

For those who are interested in actual prices, rather than the CPI data, we were only able to gather certain figures from the earliest point of 1980. Here you can see that on average the price of food has risen sharply.

% change in (US) prices 1980 – 2017

This is quite a powerful indication of how gold has acted as a hedge against inflation. Even for those who bought gold, nine years into the bull market and near the top in 1980, gold protected their purchasing power.

Not just about food

As we mentioned when we looked at the depreciation of the British pound, the price of food is not the only thing to hurt the average consumer.

Fuel is the backbone of any economy, it affects the price of living both directly and indirectly. It affects the price of your food through to the cost of the journey from the farm to the fork.

The price of oil, fuel and energy related items have increased massively since 1971. The graph above, courtesy of the St Louis FRED database, shows just how much the price of fuel items have increased since 1971.

The depreciation of the dollar, just a myth?

A couple of years ago Business Insider ‘Stalwart’ Joe Weisenthal, now Bloomberg presenter and host wrote about how the depreciation of the US Dollar was a ‘myth’.

He based this on the logic that hardly anyone keeps their cash in a box or ‘under the mattress’ anymore, but (he conceded):

‘Yes, if someone had a bunch of cash in 1959 and literally put it in a shoebox, they’d have lost a lot of money over the last several decades”

But what happens when you don’t keep your money to yourself?

You have to put it in a bank account or invest it in stocks, bonds, IRAs etc. All of those things come with counterparty risk. For some of us, it makes sense to hold a percentage of our wealth outside of the banking and financial system.

However we cannot do this with paper bank notes as, as Mr Weisenthal reminds us, it just loses its value over time.

This is why we recommend clients hold some of their savings in gold and silver.  You are not keeping it in the banking system, you do not need to ‘fear’ the impact of inflation and you certainly do not need to worry about counterparties either devaluing it or trying to confiscate it – if owned in safer jurisdictions such as Singapore and Switzerland.

Gold has acted as hedge against inflation and a financial insurance against the tyranny of central bank policies, throughout history but no more so than in the last century.

No matter banking system, measure of inflation or government your country has, one ounce of gold remains one ounce of gold. It is the same and is recognised everywhere which confers vitally important liquidity.

It is clear to see from the charts above that the fiat currency system works against the long-term desire to protect and grow our wealth.

This is thanks to both the fractional reserve banking system but also thanks to the confiscatory practices of governments and powerful the financial industry and the currency debasement of central banks.

As former Federal Reserve Chairman Alan Greenspan said himself

“In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value.”

We are no longer on a gold standard, nor are we likely to be on one for the foreseeable future. But this does not mean savers cannot implement their own version in their portfolios.

We all need to eat and we all need to use fuel, but we must learn to protect ourselves from the ongoing devaluation of the dollar and all fiat currencies in order to ensure we can keep doing what we need to do before our savings are destroyed by the fiat monetary system.

News and Commentary

Gold, silver soar after US Fed minutes; palladium hits over 16-year high (IndiaTimes.com)

Gold ends higher as Trump disbands 2 White House advisory groups (MarketWatch.com)

Gold edges up after gaining on softer dollar (Reuters.com)

Unlike Bitcoin – “Gold has demonstrated ability to preserve value under all circumstances ” – Morgan Stanley (Bloomberg.com)

Bitcoin Is Literally Soaring Into Space After Rocket-Like Surge (Bloomberg.com)

Source: David Stockman via Daily Reckoning

5 Charts Prove Market A Bubble (DailyReckoning.com)

Bitcoin is a bubble – but bubbles change the world (MoneyWeek.com)

Corporate Employers Flee Pensions With Gap Topping $375 Billion (Bloomberg.com)

This is what every ETF investor needs to know today (StansBerryChurcHouse.com)

What’s so special about gold? – Lundin (PeakProsperity.com)

Gold Prices (LBMA AM)

17 Aug: USD 1,285.90, GBP 998.12 & EUR 1,096.74 per ounce
16 Aug: USD 1,270.15, GBP 985.13 & EUR 1,082.29 per ounce
15 Aug: USD 1,274.60, GBP 986.92 & EUR 1,084.05 per ounce
14 Aug: USD 1,281.10, GBP 987.34 & EUR 1,085.48 per ounce
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

Silver Prices (LBMA)

17 Aug: USD 17.02, GBP 13.23 & EUR 14.55 per ounce
16 Aug: USD 16.68, GBP 12.96 & EUR 14.25 per ounce
15 Aug: USD 16.89, GBP 13.12 & EUR 14.38 per ounce
14 Aug: USD 16.97, GBP 13.09 & EUR 14.39 per ounce
11 Aug: USD 17.09, GBP 13.18 & EUR 14.53 per ounce
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


Recent Market Updates

– World’s Largest Hedge Fund Bridgewater Buys $68 Million of Gold ETF In Q2
– Diversify Into Gold Urges Dalio on Linkedin – “Militaristic Leaders Playing Chicken Risks Hellacious War”
– Gold Has Yet Another Purpose – Help Fight Cancer
– Gold Up 2%, Silver 5% In Week – Gundlach, Gartman and Dalio Positive On Gold
– 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

END
Brian Lundin explains:  If government is trying to persuade you not to buy gold, then maybe you should buy it to protect yourself
(courtesy Brien Lundin/GATA)

Brien Lundin: If government doesn’t want you to own gold, you probably should

 Section: 

10:07a Wednesday, August 16, 2017

Dear Friend of GATA and Gold:

Manipulation of the gold market by central banks figures heavily in an interview this week with Gold Newsletter editor and New Orleans Investment Conference organizer Brien Lundin by Peak Prosperity’s Chris Martenson.

Martenson comes closer than ever to joining the supposed tin-foil hat crowd with a remark that may sound familiar to GATA supporters: “It’s easier to find plans for a nuclear bomb online than it is to find out the actual state of the gold market.”

Lundin offers this advice: “What’s so special about gold? If what they tell us — that it’s a barbaric relic and it has no use in society — is true, then why be so secretive about it? Why be so reluctant to have your citizens own it? That alone tells you all you really need to know. If they don’t want you to know about it, if they don’t want you to own it, you probably should.”

Audio of the interview and a transcript are posted at Peak Prosperity here:

https://www.peakprosperity.com/podcast/110158/brien-lundin-if-dont-want-…

GATA Chairman Bill Murphy and your secretary/treasurer will be speaking at the New Orleans conference, which will be held Wednesday through Saturday, October 25-28, and information about it is posted here:

http://neworleansconference.com/wp-content/uploads/2017/07/NOIC2017_powe…

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

 END
John Embry comments that the social fabric in the USA is breaking down and it is these people who are least interested in gold
(courtesy John Embry/Kingworld news)

Those who most need monetary metals are least interested, Embry says

 Section: 

3:35p ET Wednesday, August 16, 2017

Dear Friend of GATA and Gold:

Interviewed today by King World News, Sprott Asset Management’s John Embry marvels at the lack of interest of Americans in the monetary metals, since he thinks they will need the metals most.

“Social cohesion appears to be breaking down” in the United States, Embry says. “This is occurring before the real economic and financial problems that will cripple America have unfolded. I am extremely uncomfortable with what might occur in the face of real economic hardship, with a heavily armed and angry populace reacting badly to a sharply lower standard of living.”

Embry’s comments are excerpted at KWN here:

http://kingworldnews.com/john-embry-deep-state-operatives-becoming-despe…

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

END

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

 
 

1 Chinese yuan vs USA dollar/yuan STRONGER 6.6766 (REVALUATION NORTHBOUND   /OFFSHORE YUAN MOVES WEAKER TO ONSHORE AT   6.6855/ Shanghai bourse CLOSED UP 21.98 POINTS OR 0.68%  / HANG SANG CLOSED DOWN 64.85 POINTS OR 0.24% 

2. Nikkei closed DOWN 26.65 POINTS OR 0.41%    /USA: YEN RISES TO 110.18

3. Europe stocks OPENED DEEPLY IN THE RED     ( /USA dollar index RISES TO  93.91/Euro DOWN to 1.1697

3b Japan 10 year bond yield: RISES  TO  +.0540%/ 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::  46.66 and Brent: 50.13

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  +.440%/Italian 10 yr bond yield DOWN  to 2.029%    

3j Greek 10 year bond yield RISES to  : 5.564???  

3k Gold at $1286.00  silver at:17.07 (8:15 am est)   SILVER BELOW  RESISTANCE AT $18.50 

3l USA vs Russian rouble; (Russian rouble DOWN 2/100 in  roubles/dollar) 59.41-

3m oil into the 46 dollar handle for WTI and 50 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 110.18 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  0.9679 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1322 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  +0.440%

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 2.2395% early this morning. Thirty year rate  at 2.8198% /POLICY ERROR)GETTING DANGEROUSLY HIGH

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

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

S&P Futures, Euro, Stocks Fall After Fed’s Low Inflation Warning

S&P futures, European stocks and bond yields all fell in early trade alongside oil and the euro after the latest Fed minutes expressed concern over weak U.S. inflation, while Asian equities rose overnight ahead of WalMart earnings and the latest ECB minutes. Gold rose as high as $1,290 before fading most gains as the USDJPY rebounded. Fund futures are now pricing in about a 40% chance the Fed will raise rates by December, compared to 50% before the Fed’s minutes.

Last week’s market turmoil and resultant near record jump in volatility in the wake of heightened tensions between the U.S. and North Korea has continued to ease, bringing down gauges of equity and bond volatility and repairing most of the damage done to stock markets, in fact as Bank of America showed, the retracement in the VIX on Monday was among the fastest on record.

But political angst isn’t over; investors continue to watch the political trainwreck in Washington where President Trump disbanded two high-profile business advisory councils amid the fallout from his response to the weekend violence in Virginia.

 

“Trump dissolving his major business groups makes the investment community even more pessimistic because this sets the stage for even more failure for him,” Naeem Aslam, chief market analyst at Think Markets in London, wrote in a note.

Lost in the political noise was the July FOMC minutes, where the most notable takeaway was the reference to “most participants expected inflation to pick up over the next couple of years….and to stabilize around the 2% objective over the medium term”. However, many participants “saw some likelihood that inflation might remain below 2% for longer than they currently expected, and several indicated that the risks to the inflation outlook could be tilted to the downside.” The debate on inflation echoed recent comments made public by various Fed presidents, while some members noted the “committee could afford to be patient….in deciding when to increase the rates further and argued against additional adjustments until incoming information confirmed that the recent low inflation were not likely to persist”. However, those comments were balanced by the observation that “…some other participants were more worried about risks arising from a labour market that had already reached full employment and was projected to tighten further from the easing in financial conditions”. Elsewhere, on the balance sheet unwind topic, “several” members favoured an announcement in the July meeting, but most preferred to defer that decision to the next meeting in September.

With concerns about weak inflation in the air, the Stoxx 600 Index was down 0.1%, with declines in banking shares offsetting advances in healthcare stocks. Germany’s DAX, France’s CAC 40 and the UK’s FTSE 100 all fell 0.1%. Yesterday’s Reuters’ trial balloon, according to which Mario Draghi would not say anything of note next week during the Jackson Hole conference, weakened the euro, which traded as low at 1.1700 this morning and gave support to fixed income assets with European government bond yields dropping, and the 10Y Bund yield down nearly 2 bps to 0.42%, down from Wednesday’s high of 0.47%. Most other euro zone yields fell 1-2 basis points.

In currencies, in addition to the euro sliding before the ECB minutes release, most Asian currencies rose overnight, with the Korean won up 0.3% after tensions over North Korea continued to ease. Overnight, the yen gained for a second day as the dollar decline on declining US rate hike expectations. The Australian dollar rose a second day against the U.S. dollar to reach the highest in nearly 2 weeks after July employment data beat estimates while prior month data was revised higher and iron ore prices erase week-to-date losses. In Europe, the pound rose against the euro after strong U.K. retail sales data.

In commodities, London copper, aluminum and zinc hit multi-year highs on expectation China’s reform of its metals industry will curb supply against a backdrop of robust demand. Gold and tin were among the best performing metals, and zinc traded near a 10-year high.  Oil prices edged higher after new data showed U.S. crude stocks have fallen by 13 percent from a peak in March. Brent crude futures were at $50.36 per barrel, up 0.2 percent from their last close.

Today’s data include jobless claims, Philadelphia Fed Business Outlook and industrial production. Wal-Mart, Gap, Ross Stores and Madison Square Garden are among companies reporting earnings.

Bulletin Headline Summary from RanSquawk

  • Choppy GBP reaction to UK retail sales
  • Financial leading the declines in Europe post last night’s FOMC minutes
  • Looking ahead, highlights include ECB minutes, US Philly Fed and jobless claims

Market Snapshot

  • S&P 500 futures down 0.1% to 2,465
  • STOXX Europe 600 down 0.1% to 378.62
  • MSCI Asia up 0.5% to 159.86
  • MSCI Asia ex Japan up 0.5% to 526.58
  • Nikkei down 0.1% to 19,702.63
  • Topix down 0.07% to 1,614.82
  • Hang Seng Index down 0.2% to 27,344.22
  • Shanghai Composite up 0.7% to 3,268.43
  • Sensex up 0.4% to 31,888.42
  • Australia S&P/ASX 200 down 0.1% to 5,779.21
  • Kospi up 0.6% to 2,361.67
  • German 10Y yield fell 1.0 bps to 0.435%
  • Euro down 0.3% to $1.1738
  • Italian 10Y yield unchanged at 1.755%
  • Spanish 10Y yield fell 1.0 bps to 1.454%
  • Brent futures down 0.2% to $50.17/bbl
  • Gold spot up 0.3% to $1,287.08
  • U.S. Dollar Index up 0.2% to 93.70

Top Overnight News

  • Alibaba, Wal-Mart Report Earnings; ECB Minutes Watched for Taper Clues
  • The U.S.’s top general declined to comment on South Korean leader Moon Jae-in’s assertion that he needed to sign off on a war against North Korea, saying President Donald Trump had the final say on a unilateral military strike
  • Trump’s pro-business image tarnished as CEOs abandon president
  • China believes the Korean Peninsula issue can only be solved via dialogue and negotiations, Fan Changlong, Vice Chairman of Central Military Commission said
  • Saudi Arabia shipped the least oil in almost three years in June, just as domestic stockpiles are dwindling.
  • U.K. retail sales rose 0.3% m/m in July, exceeding the median estimate of +0.2%, driven by the biggest jump in purchases of food in almost two years
  • President Donald Trump waded into a longstanding scrap between online retailers and their brick- and-mortar rivals with a Twitter posting Wednesday about Amazon.com Inc. and taxes
  • Fed officials are looking under the hood of their most basic inflation models and starting to ask if something is wrong
  • Investors are about to get their first look at Bill Ackman’s plans for improving the performance of Automatic Data Processing Inc., which the activist investor contends is losing ground to smaller rivals
  • Credit Suisse, JPMorgan and Citigroup have struck the first deals on a new structured debt platform amid a boom in repackaged note transactions
  • Most industrial metals eased back after a rally that took zinc to the highest level in almost 10 years on signs of supply curbs and faster economic growth around the world
  • U.K. consumers are flagging, stripping the economy of its most consistent and important support over the past two years.
  • Air Berlin Plc’s insolvency could open the way for Deutsche Lufthansa AG to add new hubs for inter-continental flights while allowing short-haul discount specialist EasyJet Plc to boost its presence in the German capital
  • South Korea’s Moon says will be no war again on the peninsula
  • Japan July trade 418.8b yen vs 327.1b est; exports 13.4% vs 13.2% est
  • Australia July jobs 27.9k vs 20.0k est; unempl rate 5.6% vs 5.6% est
  • New Zealand Aug ANZ consumer confidence 126.2 vs 125.4; +0.6% m/m
  • Elliott Is Said to Buy Debt in Move to Block Berkshire Oncor Bid
  • For Bull Market in U.S. Stocks, You’re Only as Young as You Feel
  • Credit Suisse’s London Sublease to WeWork Said to Be Blocked
  • Trump’s Pro-Business Image Tarnished as CEOs Abandon President
  • Republican Leaders Duck for Cover After Trump’s Race Remarks

Asia equity markets traded indecisive following a relatively tepid close in the US where basic materials outperformed as zinc rose above USD 3000/ton to a decade high, while energy and financials declined on oil weakness and after US yields were pressured post¬FOMC minutes. ASX 200 (-0.10%) was choppy with miners underpinned by strength across the metals complex and as a slew of earnings releases also drove individual stocks, while Nikkei 225 (-0.14%)was subdued by a firmer currency. Shanghai Comp (+0.68%) and Hang Seng (-0.24%) were both initially higher, although the latter then pared gains on profit taking and amid an increase in money market rates. 10yr JGBs traded flat amid an indecisive risk tone in Japan, while the 5yr auction also failed to spur price action as the results were mixed. PBoC injected CNY 60bln in 7-day reverse repos and CNY 40bln in 14-day reverse repos. (Newswires) PBoC set CNY mid-point at 6.6709 (Prey. 6.6779). Japanese Trade Balance (Jul) JPY 418.8bln vs. Exp. JPY 327.1b1n (Prey. JPY 439.9b1n); Exports (Jul) Y/Y 13.4% vs. Exp. 13.2% (Prey. 9.7%);Imports (Jul) Y/Y 16.3% vs. Exp. 17.0% (Prey. 15.5%)

Top Asian News

  • Economic Growth in the Philippines Exceeds 6% for Eighth Quarter
  • Casino Giants Look for Clarity as Japan Begins Public Debate
  • Series of Gaffes Taint Unicom’s $11.7 Billion Sale Announcement
  • Gemadept Seeks $125M From Stake Sales in 2 Units: CEO Minh
  • Tokyo Stocks Slip as Yen Strengthens After Dovish Fed Minutes
  • Taiwan Blackout Seen Pressuring Tsai to Reconsider Energy Policy
  • BOJ Seen Trimming Bond Purchases Further If Yields Extend Slide
  • China Kickstarts Privatization Push With Unicom Share Sale
  • Tencent’s Appetite for AI Sends Sector Stocks Surging in China

European equities trade modestly lower (Eurostoxx 50 -0.2%) with financials underperforming in the wake of yesterday’s FOMC minutes which received a somewhat dovish response given concerns at the Fed regarding inflation. To the upside, material names outperform in response to the gains seen overnight in the metals complex with Dalian iron ore prices up over 6% during Asia-Pac trade. In fixed income markets, prices were originally supported by the softness seen in European equities and the fallout of yesterday’s FOMC minutes with the 10yr Bund approaching 164.00 to the upside. Looking ahead, investors will likely turn towards today’s ECB minutes release for any views on concerns surrounding scarcity of core paper and any potential biases the central bank could have in purchasing paper from across the continent.

Top European News

  • U.K. Said to Plan Visa-Free Travel for Europeans After Brexit
  • U.K. July Retail Sales Rise, Led by Surge in Demand for Food
  • Nets CEO Opens Door to European Expansion Amid Deals Speculation
  • Axa, NN Are Said to Near Deal for Billionaire March’s Encampus
  • Seadrill Shields Seadrill Partners From Impact of Chapter 11
  • Novo’s Diabetes Drug Bests Lilly’s in Aiding on Weight Loss
  • Vestas Maintains Outlook, Begins $706 Million Share Buy Back
  • Lufthansa Swoop for Air Berlin Would Add Lower-Cost U.S. Routes

In currencies, sterling was once again a key focus for FX markets amid further tier 1 data from the region, this time with retail sales on the data slate. Upon the release, GBP/USD saw a spike higher after 3/4 headline metrics exceeded expectations before prices were dragged lower to pre-announced levels with all 4 components revised lower. USD has regained some ground against its major counterparts following the losses seen last night in the wake of the FOMC minutes. USD has particularly out-muscled EUR with participants looking for further insight via the ECB minutes into the current train of thought at the central bank given yesterday’s source reports. AUD has regained some ground amid firmer metals prices, subsequently shrugging off the domestic jobs data overnight.

In commodities, the metals complex traded higher overnight with gold prices extending on gains seen following the FOMC minutes. Elsewhere, Copper traded higher alongside broad strength across basic materials with Dalian iron ore prices up nearly 6%, while WTI traded quiet overnight and failed to make any significant recovery from yesterday’s post-DoE declines. Saudi Arabia June output rose 190K bpd M/M to
10.07mln bpd, while Saudi Arabia June crude exports fell 40K bpd M/M to 6.889mn bpd, according to JODI data. Libya’s NOC said that the Sharara oil field is “working normally and the situation is currently stable” following recent security breaches.

Looking at the day ahead, we’ve got a fair bit of data due today including July IP (0.3% mom expected), capacity utilisation, conference board US leading index (0.3% expected), the Philadelphia Fed business outlook survey (19 expected), initial jobless claims and continuing claims stats. Away from the data, the ECB will publish the account of its July policy meeting and the Fed’ Kaplan will also speak. Further, Wal-Mart will report its results today.

US Event Calendar

  • 8:30am: Initial Jobless Claims, est. 240,000, prior 244,000; Continuing Claims, est. 1.96m, prior 1.95m
  • 8:30am: Philadelphia Fed Business Outlook, est. 18, prior 19.5
  • 9:15am: Industrial Production MoM, est. 0.3%, prior 0.4%; Capacity Utilization, est. 76.7%, prior 76.6%
  • 9:45am: Bloomberg Consumer Comfort, prior 51.4, Bloomberg Economic Expectations, prior 47
  • 10am: Leading Index, est. 0.3%, prior 0.6%
  • 1pm: Fed’s Kaplan Speaks in Lubbock, Texas

DB’s Jim Reid – or in this case not – concludes the overnight wrap

Don’t panic. Jim’s absence today isn’t because his twins have arrived early. Although we’re not totally sure which of the following shocks he’s getting over this morning. The fact that it’s 25 years today since his A-Level results, his 4th wedding anniversary today or being told last night by the consultant that the twins will be coming a little earlier than planned and to expect to be called in anytime in the next 10 days. Luckily we haven’t had to alert him to any super important market related news this morning although things did get a bit more interesting towards the end of the US session last night. Initially the news that one of President Trump’s business advisory groups was disbanding in reaction to events in Virginia over the weekend saw risk assets initially pare some gains. Then after that we got the release of the FOMC minutes which showed a relatively healthy debate amongst policy makers about inflation and which the market appeared to take slightly dovishly given the decent rally for Treasuries into the close. We’ll jump into both of events those shortly.

Prior to that the lack of any more updates or news on the North Korea/US front seemed to be helping keep things fairly calm overall and in fact after all the excitement of last week the S&P 500 and Stoxx 600 have clawed back nearly three-quarters of last week’s moves lower after ticking up another +0.14% and +0.69% yesterday. The VIX is also back down to 11.74 after nudging down another -2.5% yesterday and having peaked at just over 16 last week. We’ve been saying for a while that we are likely in for a quiet spell although after Amazon’s $16bn bond deal attracted orders equivalent to the GDP of Belarus ($47bn) it seems that markets are still some way from a taking a full holiday just yet.

Back to the FOMC minutes, the most notable takeaway was the reference to “most participants expected inflation to pick up over the next couple of years….and to stabilize around the 2% objective over the medium term”. However, many participants “saw some likelihood that inflation might remain below 2% for longer than they currently expected, and several indicated that the risks to the inflation outlook could be tilted to the downside.” The debate on inflation echoed recent comments made public by various Fed presidents, while some members noted the “committee could afford to be patient….in deciding when to increase the rates further and argued against additional adjustments until incoming information confirmed that the recent low inflation were not likely to persist”. However, those comments were balanced by the observation that “…some other participants were more worried about risks arising from a labour market that had already reached full employment and was projected to tighten further from the easing in financial conditions”. Elsewhere, on the balance sheet unwind topic, “several” members favoured an announcement in the July meeting, but most preferred to defer that decision to the next meeting in September.

So while the tone of the minutes was actually fairly balanced much of the focus was on the inflation references and particularly the dovish elements. Treasuries were a bit stronger heading into the minutes although yields nosedived a bit further after the text was digested and we saw 10y yields end 5bps lower at 2.223%. 2y yields were also a couple of basis points lower, while the USD (-0.33%) ended weaker for the first time this week. Gold also rallied +0.90% along with the wider precious metals space while EM currencies also benefited from the weaker Greenback (South African Rand +1.08%, Mexican Peso +0.85%, Ruble  +0.58%). That was interestingly also in the context of a weaker day for Oil with WTI falling -1.62% following the latest US crude production data.

Staying with the US, President Trump’s political agenda appeared to take another blow yesterday, as he was effectively forced to disband two of his business advisory councils pre-emptively, given reports (per Bloomberg) that one of the groups, led by the Blackstone CEO is planning to quit. The story is taking up plenty of column space in the papers this morning and while the impact on markets wasn’t huge the S&P 500 did end up paring a gain of closer to +0.50% just before the headlines broke with some suggestion that this might make fiscal progress more difficult. It feels like one to keep an eye on.

Closer to home yesterday, European govies had a very very brief moment of excitement too at the open when a Reuters report hit the wires suggesting that President Draghi won’t deliver any new messages at the Jackson Hole conference next week on 25th. Instead the article quoted an ECB spokesman as saying that the focus will be on the “theme of the symposium, fostering a dynamic global economy”. That sounds about as vague as you can get which probably fits the bill that he’s looking for. There had been a fairly decent buzz building around the event although in fairness the ECB did suggest that the debate over tapering was more likely to take place at the September council meeting so it probably would have been a big surprise to hear anything prior to this of any substance. In terms of the moves for rates, as we noted it was very brief with Bunds at best 2bps stronger in a short period of time, only then to completely reverse and edge a little higher in the mid-morning which is roughly where they held into the close to finish up 1.2bps at 0.439%. The Euro also mostly recovered a temporary dip lower to end just +0.3% on the day.

Jumping over to the latest in Asia this morning, markets are broadly speaking flat to slightly firmer. The Nikkei is back to unchanged following a weak start, while the ASX and Hang Seng are also little changed. China bourses are up around +0.35% and the Kospi is +0.6%. US equity futures are slightly in the red however. Away from markets, Sky news reported late last night that the next phrase of Brexit talks are likely to be delayed until December (from October), in part driven by the challenge and timing of getting a more formal engagement from a new German government as federal elections will occur in September. However, it does mean leaving less than a year for talks on the future trading relationship between the UK and the EU, and another two months of the two-year Article 50 timetable being used up. The reaction for Sterling has been fairly subdued however and if anything it’s a little stronger this morning.

Moving on. In terms of data yesterday most of the focus was on GDP numbers in Europe. The eurozone print of +0.6% qoq was in line while the annual rate pushed up one-tenth to +2.2% yoy, which is the highest since March 2011. The Netherlands (+3.3% yoy vs. +2.3% expected) and Italy (+1.5% yoy vs. +1.4% expected) in particular stood in some of the details after coming in stronger than expected. This follows decent GDP data in Germany on Tuesday too.

In the US yesterday the July housing data were a tad lower than expected, with housing starts falling 4.8% mom to 1.16m (vs. 1.22m expected), largely due to a 15.3% mom decline in the multi-unit sector. Building permits fell 4.1% in July to 1.22m (vs. 1.25m expected), but this follows an upward revision to the prior month, leaving a still solid annual growth of 4.1%. Elsewhere, MBA mortgage applications dipped 0.1%.

Looking at the day ahead, the Eurozone’s July CPI came in as expected (-0.5% mom) while UK July retail sales ex fuel printed at 0.5%, above the 0.2% expected. In the US we’ve got a fair bit of data due today including July IP (0.3% mom expected), capacity utilisation, conference board US leading index (0.3% expected), the Philadelphia Fed business outlook survey (19 expected), initial jobless claims and continuing claims stats. Away from the data, the ECB will publish the account of its July policy meeting and the Fed’ Kaplan will also speak. Further, Wal-Mart will report its results today.

 END

3. ASIAN AFFAIRS

i)Late WEDNESDAY night/THURSDAY morning: Shanghai closed UP 21.98 POINTS OR 0.68%   / /Hang Sang CLOSED DOWN 64.85 POINTS OR 0.24% The Nikkei closed DOWN 26.65 POINTS OR 0.41%/Australia’s all ordinaires CLOSED DOWN 0.06%/Chinese yuan (ONSHORE) closed UP at 6.6766/Oil DOWN to 46.66 dollars per barrel for WTI and 50.13 for Brent. Stocks in Europe OPENED DEEPLY IN THE GREEN , Offshore yuan trades  6.6855 yuan to the dollar vs 6.6766 for onshore yuan. NOW THE OFFSHORE IS WEAKER  TO THE ONSHORE YUAN/ ONSHORE YUAN STRONGER (TO THE DOLLAR)  AND THE OFFSHORE YUAN IS STRONG 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

b) REPORT ON JAPAN

end

c) REPORT ON CHINA

A very important commentary today as zero hedge remarks on the analysis of Charlene Chu formerly of Fitch who has made a career out of figuring out the true debt of China and then its non performing loans.  Her figure of $35 trillion is now well received by all pundits. Her figure of 7.6 trillion of non performing loans is scaring the living daylights out of Wall Street executives

(courtesy zero hedge/Charlene Chu/Hong Kong)

(courtesy zero hedge)

(courtesy Wolf Richter/WolfStreet)

So When Will China’s Debt Bubble Finally Blow Up?

The upside is fake stability. The downside is too ugly to contemplate.

Corporate debt in China has soared to $18 trillion, or 169% of GDP, the largest pile of corporate debt in the world, according to the worried Bank for International Settlements. The OECD has warned about it earlier this year. The New York Fed warned about this debt boom in February and that it could lead to a “financial crisis,” but that authorities have many tools to control it.

The IMF regularly warns about China’s corporate debt, broken-record-like, and did so again a few days ago, lambasting the authorities for their reluctance to tamp down on the growth of debt. The “current trajectory,” it said, “could eventually lead to a sharp adjustment.”

The Chinese authorities – the government and the central bank, supported by the state-owned megabanks – have allowed some bonds to default, rather than bail them out, to make some kind of theoretical point, and they have been working furiously on a balancing act, tamping down on the credit growth that fuels the economy and simultaneously stimulating the economy with more credit to keep the debt bubble from imploding. A misstep could create a global mess.

“Everyone knows there’s a credit problem in China, but I find that people often forget about the scale; it’s important in global terms,” Charlene Chu told the Financial Times. Back in 2011, when she was still a China banking analyst at Fitch Ratings, she went out on a limb with her radical estimates that there was much more debt than disclosed by the central bank, particularly in the shadow banking system, that banks were concealing risky loans in off-balance-sheet vehicles, and that this soaring opaque debt could have nasty consequences. Her outlandish views at the time have since then become the consensus.

And this pile of debt is in much worse shape than officially acknowledged, she says in her latest report, cited by the FT. She’s now with Autonomous Research. She figured that by the end of 2017, bad debt in China could hit 51 trillion yuan, or $7.6 trillion.

Or about 68% of GDP! It would take the bad-debt ratio to an astronomical 34% of all loans, and way above the 5.3% that the authorities are proffering.

And the authorities – the government, the central bank, supported by the state-owned banks – are now pulling all levers to keep this under control.

“What I’ve gotten a greater appreciation for is how everything is so orchestrated by the authorities,” she said. “The upside is that it creates stability. The downside is that it can create a problem of proportions that people would think is never possible. We’re moving into that territory.”

 

By orchestrating this superficial appearance of stability of the bad-debt problem, the authorities have over the years allowed and encouraged this problem to get much worse.

Chu’s methodology, as the FT pointed out, is not without critics:

In particular, her estimate of Rmb51tn in bad debt is based on average credit losses across 11 other economies that previously experienced rapid debt increases comparable to China, including Japan in 1985-97 and the US in 2000-07.

But Chen Long, China economist at Gavekal Dragonomics in Beijing, said this methodology implicitly assumes that an economic crash will eventually occur in China.

But if that economic crash doesn’t occur, and if the economy continues to grow, credit will perform better, and loans won’t go bad to that extent, he argues.

The government understands this too. Hence the mantra that growth must be maintained no matter what the costs. But since that growth is debt-fueled, and since it is now taking more and more debt to obtain diminishing growth rates, the math gets a little tricky.

So an acute crisis does not appear imminent, Chu told the FT. The authorities – combination of central bank and government – control the state-owned megabanks and can tell them to lend more even to zombie companies, many of them state-owned, to refinance nonperforming debts, to lend to smaller banks that rely on interbank funding, and to support the debt bubble in other ways. This keeps the money flowing. It has kept a credit crisis from toppling the system. And as long as the megabanks have the total support of the authorities, they won’t topple either.

So where does that leave China short sellers, like Kyle Bass, who bet very publicly against the monstrous credit bubble in China and against the yuan?

Publicly shorting China, hoping for an implosion, is like daring the Chinese authorities – the government, the central bank, the state-owned megabanks, and their whole apparatus – to come out and crush you. And they do that just to make a point. The yuan, after declining relentlessly from the beginning of 2014 through the end of 2016, is up over 3% against the dollar so far this year.

And so far, the authorities still have this credit bubble under control. They have special tools since they control not only the monetary printing press but also the lenders and the borrowers. This is why Chu conceded that, since her bold pronouncements years ago, she has “gotten a greater appreciation” for “how everything is so orchestrated by the authorities.” The upside is the current fake stability. The downside is too ugly to contemplate.

China’s efforts to keep the debt bubble under control already impacted in the US, where the last big enthusiastic buyer, China, is leaving the party. Read…  This Hits the Wheezing Commercial Real Estate Bubble at Worst Possible Time

 

4. EUROPEAN AFFAIRS

 The Euro dumps to below 1.17 when minutes reveal that the ECB will basically not tolerate a move to the 1.20 level.
(courtesy zerohedge)

Euro Dumps To Session Lows After ECB Minutes Reveal Concerns About “Euro Overshooting”

While hardly a surprise after yesterday’s Reuters trial balloon, which killed any speculation that Draghi would use the Jackson Hole podium to announce ECB balance sheet tapering, sending the EUR sliding, moments ago the EUR dumped to fresh session lows after the highly anticipated ECB minutes were released and confirmed that “concerns were expressed about the risk of the exchange rate overshooting in the future,” confirming what we speculated last week, namely that for all the pseudo-hawkish rhetoric from Draghi since Sintra (and before), the ECB simply will not tolerate a Euro which approaches 1.20 and threatens to dent European corporate earnings.

The immediate kneejerk result:

Among the other highlights from the minutes, which were initially read as dovish across most Wall Street desks, were the following observations:

  • The appreciation of the euro to date could be seen in part as reflecting changes in relative fundamentals in the euro area vis-a-vis the rest of the world” but “concerns were expressed about the risk of the exchange rate overshooting in the future”
  • “Looking ahead, the Governing Council needed to gain more policy space and flexibility to to adjust policy and the degree of monetary policy accommodation, if and when needed, in either direction.”
  • “The overall degree of accommodation was determined by the combination of all the monetary-policy measures”
  • “The asset purchase program would continue to be a key instrument if the Governing Council assessed the sustained adjustment of inflation at risk”

And perhaps the key quote, confirming what we have said since 2012, namely that it is the flow, not stock, that matteers:

  • “In this context, it was also suggested that the stock versus flow effects of the asset purchases be considered.”

This suggests that Draghi is well aware that stocks will tumble once the ECB stops buying various bonds, or simply reduces the monthly purchases, even if it ultimately keeps its balance sheet constant.

And yet, the ECB itself admits it is trapped, because the longer it waits, the more it will have to do in the future to reverse the current dovish path, especially once the ECB hits the red line where it runs out of (German) bonds to buy:

  • “A suggestions was made that some consideration be given to an incremental adjustment in the language on forward guidance, because postponing an adjustment for too long could give rise to a misalignment between the Governing Council’s communication and its assessment of the state of the economy, which could trigger more pronounced volatility in financial markets when communication eventually had to shift”

In kneejerk reaction to this latest slide in the Euro, European shares have reversed losses, with the Stoxx 600 rising as much as 0.1% after the minutes, paring an earlier loss of as much as 0.5%, while Germany’s DAX rose up as much as 0.2% before trading little changed. Meanwhile in bond markets, Bund futures spiked higher in kneejerk reaction to the ECB minutes release fueled by the Euro slump to session lows. However, this jump too was quickly retraced, after a read of the the rest of the ECB’s July meeting was deemed to be “more balanced”, with “incremental” changes to forward guidance discussed, and some concern over potential financial market volatility if policy adjustments are postponed for too long.

As a reminder, when Draghi meets the press after the governing council’s next vote on September 7 he will have to explain why the bank is holding discussions on slowing down the pace of its bond buying in 2018, while at the same time presenting forecasts for weaker inflation. As the FT notes, a decision on tapering is expected at the council’s October meeting. Further recall that it is none other than Draghi to blame for the recent surge in the Euro, and the near record number of spec shorts in the currency: the EUR rose sharply after Draghi’s Sintra speech in late June in which the ECB president mentioned “reflationary” forces were emerging in the eurozone economy, and again after his press conference following the July vote.

Today’s minutes put the currency’s rise down to two factors: the removal, following the election of Emmanuel Macron as France’s president, of the political uncertainty that erupted in the wake of the Brexit vote and market expectations over US interest rates. “These two factors were now largely priced out, leaving the euro back around the levels prevailing before the UK referendum.”

Of course, the real reason why the market has been so convinced that the ECB will have to accept a higher Euro – and launch balance sheet tapering 0 is because over the next 3-6 months the amount of bonds the ECB can monetize at the current purchase pace will collapse to virtually nil.

Amazing:  this bankrupt nation sees its bond yields plunge to record lows as the so called analysts claim their ‘economy’ is improving. Yet their youth unemployment is 44.4%

Spanish Bond Yields Plunge To Record Lows As ‘Economy Improves’ (Just Don’t Tell The Nation’s Youth)

Spain’s two-year bond yields have collapsed to a record low -35bps this week and Portugal‘s followed suit, plunging near record low levels as Draghi’s “whatever it takes” has benefitted all those front-running bondholders but left youth unemployment hovering still near record-high levels.

As a strong euro weighs on the region’s inflation outlook, it makes it harder for the European Central Bank to end quantitative easing and negative interest rates, said Peter Chatwell, head of European rates strategy at Mizuho International Plc in London, and sure enough today’s reports that Draghi’s Jackson Hole appearance will be a nothing burger has sparked more anticipation that QE isn’t ending anytime soon, despite better-late-than-never complaints from the Germans.

“Whatever it takes” to keep asset prices high!

 

 

END

 

 

Spain is becoming the second largest destination  by sea after Greece for our Migrants

(courtesy Kern/Gatestone Institute)

 

Europe: Migrant Crisis Reaches Spain

Authored by Soeren Kern via The Gatestone Institute,

  • “The biggest migration movements are still ahead: Africa’s population will double in the next decades. A country like Egypt will grow to 100 million people, Nigeria to 400 million. In our digital age with the internet and mobile phones, everyone knows about our prosperity and lifestyle.” — German Development Minister Gerd Müller.
  • “Young people all have cellphones and they can see what’s happening in other parts of the world, and that acts as a magnet.” — Michael Møller, Director of the United Nations office in Geneva.
  • “If we do not manage to solve the central problems in African countries, ten, 20 or even 30 million immigrants will arrive in the European Union within the next ten years.” — Antonio Tajani, President of the European Parliament.

Spain is on track to overtake Greece as the second-biggest gateway for migrants entering Europe by sea. The sudden surge in migration to Spain comes amid a crackdown on human smuggling along the Libya-Italy sea route, currently the main migrant point of entry to Europe.

The westward shift in migration routes from Greece and Italy implies that Spain, situated only ten miles from Africa by sea, may soon find itself at the center of Europe’s migration crisis.

More than 8,300 illegal migrants have reached Spanish shores during the first seven months of 2017 — three times as many as in all of 2016, according to the International Organization for Migration (IOM).

Infographic: Refugee Arrivals in the Mediterranean in Perspective | Statista

You will find more statistics at Statista

Thousands more migrants have entered Spain by land, primarily at the Spanish enclaves of Ceuta and Melilla on the north coast of Morocco, the European Union’s only land borders with Africa. Once there, migrants are housed in temporary shelters and then moved to the Spanish mainland, from where many continue on to other parts of Europe.

In all, some 12,000 migrants have arrived in Spain so far this year, compared to 13,246 for all of 2016. By comparison, 14,156 migrants have arrived in Greece so far in 2017.

Italy remains the main migrant gateway to Europe, with around 97,000 arrivals so far this year, compared to 181,436 for all of 2016. Italy has been the main point of entry to Europe since the EU-Turkey migrant deal, signed in March 2016, shut off the route from Turkey to Greece, at one time the preferred point of entry to Europe for migrants from Asia and the Middle East. Almost 600,000 migrants have arrived in Italy during the past four years.

Migrants wait to be rescued by crewmembers from the Migrant Offshore Aid Station (MOAS) Phoenix vessel on June 10, 2017 off Lampedusa, Italy. (Photo by Chris McGrath/Getty Images)

In May, Italy signed a deal with Libya, Chad and Niger to stem the flow of migrants across the Mediterranean through improved border controls. In July, Italy also reached a deal with France and Germany to tighten the regulation of charities operating boats in the Mediterranean and to increase funds to the Libyan coast guard.

Since then, the Libyan coast guard has prevented thousands of migrants from leaving the Libyan coast for Italy. The crackdown, however, has sent would-be migrants scrambling for an alternative route to cross the Mediterranean. This appears to explain the increase in migrants arriving in Spain.

On August 14, Frontex, the European Union’s border agency, reportedthat the number of African migrants arriving in Italy from Libya had dropped by more than half in July compared to the month before. During this period, the number of migrants arriving in Spain rose sharply.

Frontex said that 10,160 migrants had arrived in Italy by sea in July — 57% fewer than in June and the lowest level of arrivals for a July since 2014. According to Frontex, 2,300 migrants made it to Spain in July, more than four times as many as the year before. Most of the migrants arriving in Italy and Spain are believed to be economic migrants seeking a better life in Europe, not refugees fleeing war zones.

“The vast majority of migrants crossing to Italy from Libya come from Senegal, Gambia, Guinea and other west African countries,” said Joel Millman, an IOM spokesman, in an interview with the Financial Times. “Given the crackdown on migration from Libya, it seems natural that many would forsake the dangerous dessert [sic] crossing to Libya and choose to cross from Morocco.”

Julio Andrade, a city councilor in Málaga, a port city in southern Spain, called it “the balloon effect.” In an interview with the Irish Times, he said: “If you squeeze one area, the air goes elsewhere. If there is a lot of police pressure and arrests of mafias around the Mediterranean routes via Greece and Italy, for example, then the mafias will look for other routes.”

Spanish authorities have reported that there is a surge in African migrants attempting to cross the land border at Ceuta by scaling fences that are up to six meters (20 feet) tall and topped by razor wire. Spanish Interior Minister Juan Ignacio Zoido said there were 2,266 attempts to jump the perimeter at Ceuta during the first seven months of 2017, compared to a total of 3,472 attempts in all of 2016.

On August 7, more than 300 mostly sub-Saharan Africans ambushed Spanish and Moroccan security forces and stormed the border crossing at El Tarajal; 186 migrants made it onto Spanish territory. On August 8, more than a thousand migrants armed with spears and rocks attempted to breach the same crossing. On August 9, Spanish authorities closed the border for a week. On August 10, around 700 migrants stormed the border; 200 migrants were arrested.

Meanwhile, on August 9, a video showed a rubber boat carrying dozens of migrants arrive at a beach full of sunbathers in Cádiz. José Maraver, the head of a rescue center in nearby Tarifa, told the Telegraph that a second boat had landed on another beach in the area and that this scene was now a regular occurrence. “Every day there are boats, every day there is migration,” he said. “The situation is getting very complicated.”

Migrants are also using other means to reach Spain. On August 6, for example, four Moroccans reached the coast of Málaga on jet skis. During July and August, police intercepted at least two dozen migrants using jet skis to cross over to Spain. On August 10, police using motion detectors and thermal imaging sensors found 56 migrants, including 14 children, hiding inside trucks en route from Ceuta to the mainland ferry port in Algeciras.

In an August 9 editorial, Spain’s El País newspaper said that it was “obvious that migratory pressure has moved to the western Mediterranean and there is no indication that this situation will change in the near future.” It added:

“The migratory pressure Spain has experienced during the past several weeks is an increase of such dimensions that it exceeds all measures of surveillance and control. The massive entry of sub-Saharan people across the border of Ceuta, whether by jumping the fence or crossing the El Tarajal border, reveals the enormous difficulties in stopping the entry of those fleeing war, famine or economic hardship….

 

“The management of migratory flows requires a strong European policy and sufficient economic resources. Spain cannot stand alone as the guardian of southern Europe.”

German Development Minister Gerd Müller recently warned that Europe must prepare for the arrival of millions more migrants from Africa:

“The biggest migration movements are still ahead: Africa’s population will double in the next decades. A country like Egypt will grow to 100 million people, Nigeria to 400 million. In our digital age with the internet and mobile phones, everyone knows about our prosperity and lifestyle.”

The director of the United Nations Office in Geneva, Michael Møller, has echoed those concerns:

“What we have been seeing is one of the biggest human migrations in history. And it’s just going to accelerate. Young people all have cellphones and they can see what’s happening in other parts of the world, and that acts as a magnet.”

The President of the European Parliament, Antonio Tajani, said that in order to staunch the flow of migrants from Africa, the European Union would need to invest billions and develop a long-term strategy to stabilize the continent: “If we do not manage to solve the central problems in African countries, ten, 20 or even 30 million immigrants will arrive in the European Union within the next ten years.”

end

 

 

Massive crash in Barcelona after a van plows into a crowd at the Rambla  (City centre). Now at least 13 killed

 

(courtesy zero hedge)

Live Feed: At Least 13 Killed After Van Plows Into Barcelona Crowd; One Attacker Dead

Summary of the latest:

  • Here’s the latest:
    • A terror attack took place in Barcelona when a van plowed into a crowd in Las Ramblas, killing at least 12 and injuring 80.
    • The driver was arrested after escaping on foot; a second suspect has also been arrested.
    • A third attacker has died after being shot dead by the police.
    • The Islamic State has claimed responsibility.
    • The Spanish passport of a person of Moroccan origin was found at the scene of the attack, TV3 reports. 
    • Driss Oukabir Soprano was named in connection to the attack although he has since denied involvement
    • This would be the deadliest terrorist attack in Spain since 2004 bombing, when Islamist militants placed bombs on commuter trains in Madrid, killing 191 people and wounding more than 1,800.

    * * *

Update 9: Local media reports that one of the attackers has died. It is unclear if this is the same assailant who previously was reported to have been arrested.

* * *

Update 8: The Catalan Police says that in response to reports, there is nobody held up in a bar in Barcelona. Meanwhile, Fox reports that someone has opened fire on police in a second possible attack:

Report: Somebody has opened fire on police in second possible attack. 

* * *

Update 7: The Spanish passport of a person of Moroccan origin was found at the scene of the attack, TV3 reports.  At the same time, Spanish public broadcaster RTVE says that one suspect in the Barcelona van attack has been arrested.

* * *

Update 6: Trump and Melania tweet:

The United States condemns the terror attack in Barcelona, Spain, and will do whatever is necessary to help. Be tough & strong, we love you!

Thoughts and prayers to 

 

* * *

Update 5: Attack witness Lourdes Porcar has told Spain’s TV3 television station that she saw the van running people over. “It was going very fast, without caring about who was in its way.”  

Additionally, Police have set up roadblocks around the city amid reports that a second van was involved in the attack and fled the scene.

As reported earlier, there are also reports that at least on attacker is holed up in a Turkish restaurant on Carrer Hospital, which leads off from the spot in which the van appears to have come to a halt. Television pictures show that a van came to a halt on top of a Joan Miro mosaic, half-way down Las Ramblas – meaning that it would have covered more than 500 metres, mowing dow anyone in its path.

* * *

Update 4: According to a leading terrorism analyst, there is “growing confidence” the Islamic State may be behind the Barcelona attack as message to Spain popping up on key IS-linked Telegram channels.

Indicator of growing confidence Islamic State may be behind  attack: Msgs to Spain popping up on key IS-linked Telegram channels

Update 3: According to El Mundo the number of dead increased to 13, while over 50 have been injured. Additionally, as the Telegraph adds, Police stationed at the cordon a block away from Plaza Catalunya, on Passeig de Gracia, say they have no information what is happening inside. Confused tourists, shoppers and business owners gathered at its edges, awaiting some word or direction as to what to do.  

The Catalan police say they are treating the crash as a suspected terrorist attack but cannot yet confirm the motive.  According to media reports, the attack vehicle was a rented van.  That would suggest, if this is confirmed as a terrorist attack, that terrorists are imitating the perpetrators of the London Bridge attack, where a rented van was also used.

Sky News reports that police are now looking for a second van that may have been involved in the attack.

* * *

Update 2: Daksha Dixit, a 28 year old tourist visiting from Mumbai with family, told the Telegraph they had been on a tourist bus which had just dropped them off one block from Plaza Cataluña when they heard the news.  “We got off and people were panicking, no one knew what was going on. There was panic everywhere.”  The family arrived just yesterday for a one week trip and their hotel is on the Ramblas inside the cordon. They were unclear as to what exactly was unfolding, with Miss Dixit adding: “I don’t know what to do”.

* * *

Update 1: According to Reuters, two armed men have holed up inside a Turkish restaurant after the crash and have taken hostages, while El Periodico tweets that there was an active shootout in the area, in what the Barclona police now say is considered a “terrorist attack.”

🔴 Atentado en Barcelona: La CIA avisó a los Mossos hace dos meses de que Barcelona y la Rambla podía ser un objetivo http://elPeriodi.co/ifgou8  pic.twitter.com/aGOKNpk0Ho

The location of the terrorist attack:

Reuters also adds that at least two have been killed in the van crash while El Mundo adds that more than 20 people have been injured. Pictures from the scene of the crash show emergency services and civilians attending to at least two people on the ground. One twitter video post shows bodies strewn across the pavement for at least 100 metres of the famous street.

According to El Pais the driver of the van attack ran on foot and is still on the run.

Spanish newspaper El Periodico said two armed men were holed up in a bar in Barcelona’s city center, and reported gunfire in the area, although it did not cite the source of the information. It was not immediately clear whether the incidents were connected.

A source familiar with the initial U.S. government assessment said the incident appeared to be terrorism, and a White House spokeswoman said President Donald Trump was being kept abreast of the situation.

Media reports said the van had zigzagged at speed down the famous Las Ramblas avenue, a magnet for tourists.

“I heard screams and a bit of a crash and then I just saw the crowd parting and this van going full pelt down the middle of the Ramblas and I immediately knew that it was a terrorist attack or something like that,” eyewitness Tom Gueller told the BBC.

“It wasn’t slowing down at all. It was just going straight through the middle of the crowds in the middle of the Ramblas.”

Mobile phone footage posted on Twitter showed several bodies strewn along the Ramblas, some motionless. Paramedics and bystanders bent over them, treating them and trying to comfort those still conscious. Around them, the boulevard was deserted, covered in rubbish and abandoned objects including hats, bags and a pram.

“We saw a white van collide with people. We saw people going flying because of the collision, we also saw three cyclists go flying,” Ellen Vercamm, on holiday in Barcelona, told El Pais newspaper. Vehicles have been used to ram into crowds in a series of militant attacks across Europe since July 2016, killing well over 100 people in Nice, Berlin, London and Stockholm.

Witness Ethan Spibey told Britain’s Sky News: “All of sudden it was real chaos. People just started running screaming, there were loud bangs. People just started running into shops, there was a kind of mini-stampede where we were, down one of the alleyways.”

He said he had taken refuge with dozens of other people in a nearby church. “They’ve locked the doors because I’m not sure whether the person who may have done it has actually been caught, so they’ve locked the doors and told people just to wait in here.”

* * *

A “massive crash” has taken place in Barcelona, where a white van has ploughed into a crowd of “dozens of people” in the city’s center, at the main Rambla de Catalunya promenade, one of the most well-known and popular parts of the city, visited by tourists and locals alike. Catalan emergency services said people should not go to the area around Placa Catalunya.

El Pais newspaper said the driver of the vehicle had fled on foot after mowing down dozens of people. While full details of the incident were not immediately clear, since July 2016 vehicles have been used to ram into crowds in a series of militant attacks across Europe, killing well over 100 people in Nice, Berlin, London and Stockholm. In recent weeks, threatening graffiti against tourists has appeared in Barcelona, which draws at least 11 million visitors a year.

In one video released under the slogan “tourism kills neighbourhoods”, several hooded individuals stopped a tourist bus in Barcelona, slashed the tyres and spray-painted the windscreen.

Fresh footage shows suspected ‘terrorist attack’ in Barcelona

From Reuters:

As Vanguardia adds citing several sources, the driver appears to have run over a dozen people. The local police reported that there are “several injured”, without giving further details. Local emergency services say that police forces have evacuated the area, while several ambulances are attending to the injured.

Local media reports a van has crashed into a crowd of people in Barcelona’s city centre

Police in Barcelona say there has been a “massive crash” involving a van in the city centre and say several people have been injured

Vídeos de las ramblas

BREAKING: Truck plows into pedestrians in Ramblas, Barcelona. Many injured, unconfirmed deaths.

Estampida ahora mismo en El Corte Inglés de Plaza Catalunya en Barcelona

View image on Twitter

Una furgoneta atropella a una multitud de personas en las Ramblas de Barcelona. En desarrollo

 

⚠⚠⚠⚠⚠⚠
IMPORTANT x incident zona Plaça Catalunya evitin sortir al carrer
Eviten salir a la calle zona plaza Catalunya por incidente grave

Developing

5. RUSSIA AND MIDDLE EASTERN AFFAIRS

6 .GLOBAL ISSUES

Despite the media proclaiming global growth, the total global negative yielding debt has now surged to its highest level in almost a year

 

(courtesy zero hedge)

Despite ‘Growth Promise’, Global Negative-Yielding Debt Surges To Highest Since October

The market value of bonds yielding less than zero percent has jumped by a quarter over the past month to $8.68 trillion, the highest since October... which is odd given the mainstream narrative that everything is awesome and global growth is heading for escape velocity?

“probably nothing”

 

As Bloomberg notes, slower-than-forecast inflation data and haven demand on geopolitical risk have revived bond bulls around the world.

With global borrowing costs already so low, central banks should be prepared to cut interest rates deep into negative territory in the next economic downturn, warn economists including Harvard professor Kenneth Rogoff.

7. OIL ISSUES

8. EMERGING MARKET

VENEZUELA

The faster they get this buffoon out of there, the better.  Average Venezuelans are suffering drastic weight loss due to lack of food.  Remember, this nation has the world’s highest oil reserves in the ground

 

(courtesy zerohedge)

“The Maduro Diet” – Venezuelans Suffer Drastic Weight Loss As Hunger Crisis Strikes

Shortages are becoming ever more severe in Venezuela. As Deutsche Welle reports, according to the World Health Organization, hospitals lack 95% of necessary medicines. Many people are undernourished and they receive no help from the government.

“An estimated 75% of Venezuelans lost at least 10 kilos last year because there is not enough food to go around… people here call it ‘The Maduro Diet’

 

“When we say people are eating from the garbage, we are not joing, it’s our reality… people don’t have enough to eat.”

Furthermore, a lack of food and basic services is also creating an education crisis with more than 1 million children no longer attending school due to a lack of food, running water and/or electricity.

About 30 percent of students who now stay home do not attend school because of water problems at home or on campus, 22 percent do not attend because of electricity blackouts and 15 percent do not attend due to school strikes, the survey found.

 

About 10 percent said a lack of food at home or in school was the reason for their absence. The survey said those in that category are considered among the poorest who previously never skipped school because they did not have food at home.

Of course, the failure of Venezuela’s socialist utopia likely means that civil war is all but inevitable at some point in the future absent a quick doubling of crude prices…

end

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

Euro/USA   1.1697 DOWN .0076/REACTING TO  + huge Deutsche bank problems + USA election:/TRUMP HEALTH CARE DEFEAT//ITALIAN REFERENDUM DEFEAT/AND NOW ECB TAPERING BOND PURCHASES/ /USA RISING INTEREST RATES AGAIN/EUROPE BOURSES ALL IN THE RED 

USA/JAPAN YEN 110.18 UP 0.194(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 1.2867 DOWN .0022 (Brexit  March 29/ 2017/ARTICLE 50 SIGNED

THERESA MAY FORMS A NEW GOVERNMENT/STARTS BREXIT TALKS

USA/CAN 1.2640 UP .0016 (CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/TRUMP INITIATES LUMBER TARIFFS ON CANADA)

Early THIS THURSDAY morning in Europe, the Euro FELL by 76 basis points, trading now ABOVE the important 1.08 level  FALLING to 1.1697; Europe is still reacting to Gr Britain HARD BREXIT,deflation, announcements of massive stimulation (QE), a proxy middle east war, and the ramifications of a default at the Austrian Hypo bank, an imminent default of Greece, Glencore, Nysmark and the Ukraine, along with rising peripheral bond yield further stimulation as the EU is moving more into NIRP, and now the Italian referendum defeat AND NOW THE ECB TAPERING OF ITS PURCHASES/ THE USA’S NON tightening by FAILING TO RAISE THEIR INTEREST RATE AND NOW THE HUGE PROBLEMS FACING TOO BIG TO FAIL DEUTSCHE BANK + THE ELECTION OF TRUMP IN THE USA+ TRUMP HEALTH CARE BILL DEFEAT AND MONTE DEI PASCHI NATIONALIZATION / Last night the Shanghai composite CLOSED  UP 21,98 POINTS OR 0.68%     / Hang Sang  CLOSED DOWN 64.85 POINTS OR 0.24% /AUSTRALIA  CLOSED DOWN 0.06% / 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 THURSDAY morning CLOSED DOWN 26.65 POINTS OR 0.41%

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

2/ CHINESE BOURSES / : Hang Sang CLOSED DOWN 64.85 POINTS OR 0.24%  / SHANGHAI CLOSED UP 21.98 POINTS OR 0.68%   /Australia BOURSE CLOSED DOWN 0.06% /Nikkei (Japan)CLOSED DOWN 26,65  POINTS OR 0.41%   / INDIA’S SENSEX IN THE GREEN

Gold very early morning trading: 1285.10

silver:$17.05

Early THURSDAY morning USA 10 year bond yield:  2.2395% !!! UP 1   IN POINTS from WEDNESDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%.

The 30 yr bond yield  2.8198, UP 1  IN BASIS POINTS  from WEDNESDAY night.

USA dollar index early THURSDAY morning: 93.91 UP 37  CENT(S) from WEDNESDAY’s close.

This ends early morning numbers  THURSDAY MORNING

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And now your closing THURSDAY NUMBERS

Portuguese 10 year bond yield: 2.774% DOWN 5 in basis point(s) yield from WEDNESDAY 

JAPANESE BOND YIELD: +.054%  UP 1   in   basis point yield from WEDNESDAY/JAPAN losing control of its yield curve

SPANISH 10 YR BOND YIELD: 1.439% DOWN 3   IN basis point yield from WEDNESDAY 

ITALIAN 10 YR BOND YIELD: 2.029 DOWN 1 POINTS  in basis point yield from WEDNESDAY 

the Italian 10 yr bond yield is trading 60 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: +.426% DOWN 1  IN  BASIS POINTS ON THE DAY

END

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IMPORTANT CURRENCY CLOSES FOR THURSDAY

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

Euro/USA 1.1738 DOWN .0036 (Euro DOWN 36 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 109.87 DOWN 0.122(Yen DOWN 12 basis points/ 

Great Britain/USA 1.2885 DOWN  0.0004( POUND DOWN 14 BASIS POINTS)

USA/Canada 1.2648 UP .0025 (Canadian dollar DOWN  25 basis points AS OIL ROSE TO $46.95

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This afternoon, the Euro was DOWN  by 36 basis points to trade at 1.1738

The Yen FELL to 109.87 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 FELL BY 4  basis points, trading at 1.2885/ 

The Canadian dollar FELL by 25 basis points to 1.2707,  WITH WTI OIL RISING TO :  $46.95

The USA/Yuan closed at 6.6755/
the 10 yr Japanese bond yield closed at +.054%  UP 1 IN  BASIS POINTS / yield/ 

Your closing 10 yr USA bond yield DOWN 6  IN basis points from WEDNESDAY at 2.209% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic  USA 30 yr bond yield: 2.794 DOWN 4 in basis points on the day /

Your closing USA dollar index, 93.66  UP 12 CENT(S)  ON THE DAY/1.00 PM 

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

London:  CLOSED DOWN 45.16 POINTS OR 0.61%
German Dax :CLOSED DOWN 60.40 POINTS OR 0.49%
Paris Cac  CLOSED DOWN 29.76 POINTS OR 0.57% 
Spain IBEX CLOSED DOWN  100.50 POINTS OR 0.95%

Italian MIB: CLOSED DOWN 195.99 POINTS OR 0.89% 

The Dow closed DOWN 274.14 OR 1.24%

NASDAQ WAS closed DOWN 123.19  POINTS OR 1.94%  4.00 PM EST

WTI Oil price;  46.95 at 1:00 pm; 

Brent Oil: 50.69 1:00 EST

USA /RUSSIAN ROUBLE CROSS:  59.09 DOWN 29/100 ROUBLES/DOLLAR (ROUBLE HIGHER BY 29 BASIS PTS)

TODAY THE GERMAN YIELD FALLS TO  +0.426%  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:$47.01

BRENT: $50.84

USA 10 YR BOND YIELD: 2.183%  (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)

USA 30 YR BOND YIELD: 2.7723%

EURO/USA DOLLAR CROSS:  1.1719 DOWN .0055

USA/JAPANESE YEN:109.58  DOWN  0.412

USA DOLLAR INDEX: 93.72  UP 18  cent(s) 

The British pound at 5 pm: Great Britain Pound/USA: 1.2867 : UP 50 POINTS FROM LAST NIGHT  

Canadian dollar: 1.2674 DOWN 50 BASIS pts 

German 10 yr bond yield at 5 pm: +0.426%

END

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

TRADING IN GRAPH FORM FOR THE DAY

Stocks Slammed Amid ‘Cohn Of Uncertainty’ As Hindenburg Omen Cluster Nears Record

“Pause that refreshes?”, “Fleshwound?”, or “beginning of the end?”

 

Between Bannon’s China trade war threats and fears over Cohn leaving, risk was off today, not helped by dismal Industrial Production data and the utter horror in Barcelona… Trannies were worst but this was an ugly say all around and losses accelerate into the close ahead of tomorrow’s OPEX…

NOT OFF THE LOWS>>>

 

Small Caps are now back to unchanged year-to-date…

 

S&P closed at critical support around 2430…

 

From “Fire & Fury”, Nasdaq is leading the drop…

 

In order, from worst to first, retailers, energy, financials, and tech have tumbled since “fire and fury” with Utes holding gains…

 

Cohn Uncertainty crushed Goldman…

 

S&P VIX surged back to 15 and Russell/Nasdaq back over 18… Thursday Spike, Monday Plunge, Thursday Spike… this is the quickest reversal in VIX since Sept 2016

 

Over the last few weeks, a cluster of Hindenburg Omens have been erupting across the major equity indices…

 

In fact, as @AlpePinnazzo notes, the size of the cluster is flashing a major warning…

 

The S&P dropped back below its 50DMA… (this is the biggest drop below the 50DMA since before the election) to its lowest in 5 weeks…

 

Tech stocks gave up the week’s gains…

 

AAPL was down today but FANG stocks were worse…

 

HY Credit tumbled to stop exactly at its 200DMA ($87.36 HYG)… plunging thru its 50DMA…

 

And stocks catching down to credit…

 

Treasury yields slid further today (again the AMZN rate lock pressure lifted and safe haven demand) with 30Y yields now lower on the week… (10Y ended with a 2.18% handle)

 

With 30Y yields back at one-week lows…

 

 

The dollar pumped higher overnight (seemingly bid after Bannon’s comments) but tumbled after ECB Minutes, Industrial Production, and Cohn rumors…

 

The biggest driver of USD swings today was EURUSD which shifted on ECB Minutes…

 

The drop in the dollar during the day session managed to lift WTI Crude modestly back above $47…

 

Gold jumped again today, pushed higher overnight by Bannon’s China trade war threats…

Hussman warns that the equity bubble will burst after the Fed warns that the markets are “vulnerable to elevated valuations”

(courtesy Hussman/zero hedge)

Hussman Predicts Massive Losses As Cycle Completes After Fed Warns Markets “Vulnerable To Elevated Valuations”

Buried deep in today’s FOMC Minutes was a warning to the equity markets that few noticed…

This overall assessment incorporated the staff’s judgment that, since the April assessment, vulnerabilities associated with asset valuation pressures had edged up from notable to elevated, as asset prices remained high or climbed further, risk spreads narrowed, and expected and actual volatility remained muted in a range of financial markets…

 

According to another view, recent rises in equity prices might be part of a broad-based adjustment of asset prices to changes in longer-term financial conditions,importantly including a lower neutral real interest rate, and, therefore, the recent equity price increases might not provide much additional impetus to aggregate spending on goods and services.

 

According to one view, the easing of financial conditions meant that the economic effects of the Committee’s actions in gradually removing policy accommodation had been largely offset by other factors influencing financial markets, and that a tighter monetary policy than otherwise was warranted.

Roughly translated means – higher equity prices are driving financial conditions to extreme ‘easiness’ and The Fed needs to slow stock prices to regain any effective control over monetary conditions.

And with that ‘explicit bubble warning’, it appears the ‘other’ side of the cycle, that Hussman Funds’ John Hussman has been so vehemently explaining to investors, is about to begin…

Nothing in history leads me to expect that current extremes will end in something other than profound disappointment for investors. In my view, the S&P 500 will likely complete the current cycle at an index level that has only 3-digits. Indeed, a market decline of -63% would presently be required to take the most historically reliable valuation measures we identify to the same norms that they have revisited or breached during the completion of nearly every market cycle in history.

The notion that elevated valuations are “justified” by low interest rates requires the assumption that future cash flows and growth rates are held constant. But any investor familiar with discounted cash flow valuation should recognize that if interest rates are lower because expected growth is also lower, the prospective return on the investment falls without any need for a valuation premium.

At present, however, we observe not only the most obscene level of valuation in history aside from the single week of the March 24, 2000 market peak; not only the most extreme median valuations across individual S&P 500 component stocks in history; not only the most extreme overvalued, overbought, overbullish syndromes we define; but also interest rates that are off the zero-bound, and a key feature that has historically been the hinge between overvalued markets that continue higher and overvalued markets that collapse: widening divergences in internal market action across a broad range of stocks and security types, signaling growing risk-aversion among investors, at valuation levels that provide no cushion against severe losses.

We extract signals about the preferences of investors toward speculation or risk-aversion based on the joint and sometimes subtle behavior of numerous markets and securities, so our inferences don’t map to any short list of indicators. Still, internal dispersion is becoming apparent in measures that are increasingly obvious. For example, a growing proportion of individual stocks falling below their respective 200-day moving averages; widening divergences in leadership (as measured by the proportion of individual issues setting both new highs and new lows); widening dispersion across industry groups and sectors, for example, transportation versus industrial stocks, small-cap stocks versus large-cap stocks; and fresh divergences in the behavior of credit-sensitive junk debt versus debt securities of higher quality. All of this dispersion suggests that risk-aversion is rising, no longer subtly. Across history, this sort of shift in investor preferences, coupled with extreme overvalued, overbought, overbullish conditions, has been the hallmark of major peaks and subsequent market collapses.

..

The chart below shows the percentage of U.S. stocks above their respective 200-day moving averages, along with the S&P 500 Index.The deterioration and widening dispersion in market internals is no longer subtle.

Market internals suggest that risk-aversion is now accelerating. The most extreme variants of “overvalued, overbought, overbullish” conditions we identify are already in place.

A market loss of [1/2.70-1 =] -63% over the completion of this cycle would be a rather run-of-the-mill outcome from these valuations. All of our key measures of expected market return/risk prospects are unfavorable here. Market conditions will change, and as they do, the prospective market return/risk profile will change as well. Examine all of your investment exposures, and ensure that they are consistent with your actual investment horizon and tolerance for risk.

 

END

Oh oH! this is a good indicator for problems in the uSA economy:  WalMart’s free cash flow falls and fails to cover its dividends and buybacks.  WalMart stock drops due to its guidance of lower earnings

 

(courtesy zerohedge)

 

 

Wal-Mart Slides, Free Cash Flow Fails To Cover Dividends And Buybacks

Despite reporting strong earnings which beat on both the top and bottom line in today’s most anticipated earnings report, Walmart stock is down 3%, sliding to the lowest level since late July after it provided full year EPS guidance whose midpoint was below Wall Street expectations.

First, here are WMT’s otherwise respectable historical results.

  • Q2 adj. EPS $1.08, beating est. $1.07on the top end of the $1.00- $1.08 range
  • Q2 revenue $123.4BN, beating est. $123.05b
  • Total U.S. comps. ex-fuel up 1.7%, in line with consensus est. of 1.7%
  • Wal-Mart U.S. comps. up 1.8%, est. up 1.8%; forecast up 1.5%-2.0% in Feb.
  • Wal-Mart U.S. traffic up 1.3% y/y, avg ticket up 0.5%
  • Wal-Mart U.S. E- commerce sales up 70 bps y/y, GMV up 67%

Sam’s Club results were a little weaker, with comps of 1.2% missing expectations of 1.4% increase, as a result of the average ticket down 0.9% despite a 2.1% increase in traffic.

  • Sam’s Club comps. ex- fuel up 1.2%, est. up 1.4% (Consensus Metrix); co. saw up 1%-1.5%
  • Sam’s Club traffic up 2.1%, avg ticket down 0.9%

Meanwhile, as Bloomberg notes, Costco, Sam’s Club main competitor, reported monthly comp. sales ahead of estimates in each of May, June, and July

And while WMT’s historical data was solid across the board, traders were concerned with the company’s guidance:

  • Sees 3Q EPS 90c-98c vs est. 98c (range 90c-$1.05)
  • Sees 3Q Wal- Mart U.S. comp. sales ex-fuel up +1.5%-2%
  • Sees 3Q Sam’s Club ex- fuel comps. up 1%-1.5%

But the biggest red flag was the full year adjusted EPS forecast, which at $4.30-$4.40 (vs the previous $4.20-$4.40), the midpoint of which trailed the consensus estimate of $4.39.

Finally, in terms of cash flow, Wal-Mart reported a sharp drop in YTD operating cash flow, which declined by $3.6 billion, and with CapEx largely unchanged, YTD Free Cash Flow of $6.9 billion was $3.4 billion worse than the year ago period. This is troubling because as the table below shows, WMT used up more than 100% of its YTD free cash flow to fund dividends of $3.1 billion and stock buybacks $4.4 billion for the first 6 months of the year. Should the FCF decline acceleate, how long until WMT’s sacrosanct dividend (or buyback) is in jeopardy?

As a result, the stock was down as much as 3.0% in the pre-market, sliding to three week lows.

Full earnings presentation here.

end

 

Soft data Philly Fed index slides to its weakest level since the Trump election with employment the killer

 

(courtesy Philly Index/zero hedge)

Philly Fed Slides To Weakest Since Election As Employment Sinks

Following Empire Fed’s exuberant six-sigma beat and surge to three year highs, Philly Fed failed to live up to its neighbor’s promise, dropping from 19.5 to 18.9 in August (a small beat of 18.0 expectations).

This is the weakest print since Nov 2016, despite a surge in new orders and average workweek as inventories tumbledand employment slipped.

Hope remains alive and well though.

The diffusion index for future general activity increased from a reading of 36.9 in July to 42.3 this month, its highest reading in four months. Over the next six months, nearly 49 percent of the firms expect increases in activity, and only 7 percent expect decreases.

Notably 7 of the 9 subindices improved… but the headline still declined.

end

 

USA industrial production rose by only .2% month/month in July missing expectations.  Last month’s data: .4% month/month and this is showing an economy that is slowing down.  Industrial production numbers are hard data

 

(courtesy zero hedge/Industrial production)

 

 

US Manufacturing Drops In July As Auto Production Slumps

Industrial Production, leaked early, rose just 0.2% MoM in July, missing expectations and slowing from last month’s 0.4% gain. Manufacturing production actually shrank (-0.1%)…

 

The biggest driver of the decline was a 3.6% slump in motor vehicle production…

 

Still, none of that matters…

 

A new study shows what we have been telling you:  higher minimum wages are bringing job losses.  The hardesthit: females and minority workers

 

(courtesy zerohedge)

 

 

Study Finds Higher Min. Wages Bring Crushing Job Losses For Female And Minority Workers

Anyone who has a basic understanding of elementary-level arithmetic and some common sense can easily explain why raising the minimum wage is bad for employment levels.  In a nutshell, higher labor costs simply improve the payback profile of capital investments in technology thus accelerating job losses.

We recently shared the following example regarding California’s minimum wage hike from $10 per hour to $15.  At $10 per hour and a 10-year payback, employers may be reluctant to invest in new technology.  But, at $15 per hour and a 6-years payback, that investment become a no-brainer.

Payback Example

Unfortunately, while these concepts are somewhat simplistic for most us, they have confounded left-leaning economists and politicians pretty much since the beginning of time.

And while no amount of empirical evidence will change their minds, here is yet another study, this time from Grace Lordan of the London School of Economics and David Neumark of UC Irvine, offering up evidence that raising minimum wages only serves to increase unemployment and disproportionately crushes female and minority low-income workers.

Entitled “People Versus Machines: The Impact of Minimum Wages on Automatable Jobs,” the study found that each $1 increase in the minimum wage decreased the “share of lowskilled automatable jobs by 0.43 percentage point.”  Here’s a summary of Lordan’s findings:

Overall, we find that increasing the minimum wage decreases significantly the share of automatable employment held by low-skilled workers. Our estimates suggest that an increase of the minimum wage by $1 (based on 2015 dollars) decreases the share of lowskilled automatable jobs by 0.43 percentage point (an elasticity of ?0.11). However, these average effects mask significant heterogeneity by industry and by demographic group. In particular, there are large effects on the shares of automatable employment in manufacturing, where we estimate that a $1 increase in the minimum wage decreases the share of automatable employment among low-skilled workers by 0.99 percentage point (elasticity of ?0.17). Within manufacturing, the share of older workers in automatable employment declines most sharply, and the share of workers in automatable employment also declines sharply for women and blacks.

Min Wage

 

Meanwhile, the results are even worse for workers over 40, females and minorities…

For example, a higher minimum wage significantly reduces the shares of both younger (? 25) and older (> 40) workers in jobs that are automatable, by a larger magnitude compared to those aged 26-39. For the younger and older groups, the estimates imply that a $1 increase in the minimum wage reduces the shares in automatable work by 0.94 and 0.72 percentage points respectively (the corresponding elasticities are ?0.20 and ?0.17. Looking by both age and industry, for older workers (? 40 years old) the negative effect mainly arises in the manufacturing and public administration sectors (a decrease of 1.68 and 3.50 percentage points for a $1 minimum wage increase respectively), while for younger workers (< 25 years old) the effects are large in many sectors but the estimate is close to zero for manufacturing. The middle age group, also, exhibits a decline in the share of workers in automatable jobs in manufacturing when the minimum wage increases – a 1.21 percentage point decline for a $1 increase. Thus, older workers appear more vulnerable to substitution away from automatable jobs when the minimum wage increases.

 

On average, females are affected more adversely than males: in the aggregate estimates in column (1), the negative estimate is significant only for females, and is almost ten times larger, indicating that, for females, a minimum wage increase of $1 causes a decrease of 1.01 percentage points in the share of automatable jobs (the elasticity is ?0.14). Across industries, these negative effects for females are concentrated in manufacturing, services, and public administration; for example, a $1 minimum wage increase reduces the share of automatable jobs in public administration by 3.67 percentage points – an elasticity of ?0.41). For males, only the estimate for manufacturing is statistically significant; the estimated effect implies that a $1 increase in the minimum wage causes a decrease of 0.62 percentage point (an elasticity of ?0.13).

 

Table 3 also points to similar overall effects by race, with a $1 increase in the minimum wage reducing the share in automatable jobs by 0.57 percentage point for whites and 0.72 percentage point for blacks. However, the effects are heterogeneous across industries. There are large estimated effects in manufacturing (1.19 percentage points) and public administration (1.53 percentage points) for whites, although only the first estimate is statistically significant. For blacks, there are large and statistically significant decreases in automatable shares in manufacturing and transport (declines of about 4.5 percentage point in both).

Min Wage

 

But, as usual, we’re sure this extra data will have no impact on Bernie’s “Fight for $15.”  Amazing how some politicians will embrace math and science when arguing climate change but completely reject it when discussing minimum wage…wonder why?

$15

end

The FBI agent who botched the Hillary investigation into her emails suddenly departs from Mueller.  I guess Mueller does not want another botched case??
(courtesy zero hedge)

FBI Investigator Who Led Hillary Email Case Suddenly Resigns From Mueller’s Team

After being appointed to Special Counsel Mueller’s team just over a month ago, ABC is now reporting that Peter Strzok, the FBI agent who oversaw the botched investigation of Hillary Clinton’s email case, has now decided to step down.  ABC reports that their anonymous sources have yet to discover the reasons for Strzok’s sudden departure.

One of the FBI’s top investigators, tapped by special counsel Robert Mueller just weeks ago to help lead the probe of Russian meddling in last year’s presidential election, has left Mueller’s team, sources tell ABC News.

 

The recent departure of FBI veteran Peter Strzok is the first known hitch in a secretive probe that by all public accounts is charging full-steam ahead.

 

It’s unclear why Strzok stepped away from Mueller’s team of nearly two dozen lawyers, investigators and administrative staff. Strzok, who has spent much of his law enforcement career working counterintelligence cases and has been unanimously praised by government officials who spoke with ABC News, is now working for the FBI’s human resources division.

Mueller

 

As The Daily Caller noted when Strzok was hired by Mueller last month, he is the same FBI agent who had the distinguished honor of interviewing Hillary Clinton just 3 days before she was cleared of all charged by former FBI Director James Comey.

Special counsel Robert Mueller has picked the FBI official who oversaw the Hillary Clinton email investigation to manage the investigation into any illegal connections between the Trump campaign and Russian government.

 

Strzok was one of two U.S. officials who interviewed Clinton on July 2 as part of the federal investigation into classified information found on her private email server.

 

Strzok interviewed Clinton along with Justice Department official David Laufman.

 

Three days later, then-FBI Director James Comey announced that charges would not be filed against Clinton for mishandling classified information found on her server.

Perhaps Mueller decided that one massively botched investigation was enough for Strzok?

 

 

END

 

This is a strange one!!  The FBI now reopens a Freedom of Information case on the Lynch Clinton Tarmac meeting after they got caught in a huge lie

(courtesy zero hedge)

FBI ‘Reopens’ FOIA Case On Lynch-Clinton Tarmac Meeting After Getting Caught In Lie

Last October Jay Sekulow of the American Center for Law and Justice (ACLJ) received the following letter from the FBI regarding his FOIA request for any documents related to the now-infamous Clinton-Lynch tarmac meeting in June 2016.  The letter quite simply stated there were“no records responsive to your request.”

 

Of course, since the DOJ has subsequently provided numerous documents which include email traffic with various FBI officials (see: FOIA Dump Reveals Collusion Between Lynch, FBI And Media To Bury Bill Clinton Meeting), we now know that the FBI’s original response was either (i) just a simple reflection of their complete incompetence (best case) or (ii) an outright lie (worst case).

Alas, it seems as though the FBI has finally admitted in a new letter sent to Sekulow that maybe, just maybe, there are “records potentially responsive to your request” and, as such, they’ve ‘reopened’ the case to search for those records. 

“…your request has been reopened under the FOIPA number listed above as the FBI has determined records potentially responsive to your request may exist.  We are currently in the process of searching for any responsive material.”

FBI Letter

 

 

Meanwhile, and for obvious reasons, the FBI’s continued refusal to acknowledge basic facts about a FOIA case that have been proven beyond a shadow of a doubt by DOJ records prompted a scathing retort from Sekulow who posted the following to the ACLJ website earlier:

After being caught hiding the truth from the American people, the FBI has just “reopened” our FOIA case.

 

The ACLJ just received a letter from the FBI bureaucracy informing us that it has “reopened” our Freedom of Information Act (FOIA) request into the clandestine meeting between former Obama Attorney General Lynch and former President Clinton while the Department of Justice (DOJ) and FBI were conducting a criminal investigation of Hillary Clinton.

 

The FBI’s letter – dated one week after we publicly excoriated the FBI for lying to us when the Comey-led FBI told us last October that it had “no” records responsive to our request – now states that “records potentially responsive to your request may exist.”

 

It is unbelievable that the FBI bureaucracy still only admits that some documents “may exist.”

 

We know they exist.

 

What else was the FBI hiding?

 

While we appreciate that the FBI has “reopened” the case file and is now “searching” for documents responsive to our duly submitted FOIA request from more than a year ago, it stretches the bounds of credulity to suggest that the FBI bureaucracy just discovered that “potentially responsive” records “may exist” on its own accord.

Sekulow also appeared on Fox News this morning to discuss the ‘reopened’ case:

 

Perhaps it’s time to refile all of those FOIA requests related to the various Hillary Clinton investigations that were submitted under the Obama administration…who knows what treasures may have been ‘overlooked’ in the initial FBI/DOJ responses…

 

 

END

 

This is interesting:  Assange in a 3 hour meeting with a Californian Congressman offered to prove that the Russians were not his source for the Democrat email hacking.  He wants a seat at the White House Press briefing and of course an absolute pardon

 

(courtesy zero hedge)

Assange Vows To Prove That Russia Was Not His Source In 3-Hour Meeting With Congressman

In a three hour meeting with Representative Dana Rohrabacher (R-CA) at the Ecuadorian embassy in London, Julian Assange vowed to provide proof that Russia was not the source of his leaks last year and promised more ‘helpful’ information in the near future.  Rohrabacher recounted the details of the meeting with Assange to The Hill:

“Our three-hour meeting covered a wide array of issues, including the WikiLeaks exposure of the DNC emails during last year’s presidential election,” Rohrabacher said,  “Julian emphatically stated that the Russians were not involved in the hacking or disclosure of those emails.”

 

Pressed for more detail on the source of the documents, Rohrabacher said he had information to share privately with President Donald Trump.

 

“Julian also indicated that he is open to further discussions regarding specific information about the DNC email incident that is currently unknown to the public,” he added.

Of course, this is hardly the first time that Assange has publicly denied that Russia was his source for the DNC and/or Podesta leaks.  Back in January, Assange recorded an interview with Sean Hannity of Fox News and unequivocally stated that “our source is not the Russian government and it is not a state party.”

HANNITY: Can you say to the American people, unequivocally, that you did not get this information about the DNC, John Podesta’s emails, can you tell the American people 1,000 percent that you did not get it from Russia or anybody associated with Russia?

 

ASSANGE: Yes. We can say, we have said, repeatedly that over the last two months that our source is not the Russian government and it is not a state party… Obama is trying to say that President-elect Trump is not a legitimate President.

http://content.jwplatform.com/players/8o1zA4rX-EAYoNgFe.html

 

So, what does Assange want in return for his evidence that could completely undermine Special Counsel Mueller’s entire investigation?  Apparently he would like for Wikileaks to be granted a seat in the White House press corps…oh, and we’re sure a presidential pardon would be welcome as well.

Rohrabacher said he had information he planned to carry back to Trump when he returned to the United States, including a request that the WikiLeaks organization be given a news media seat inside the White House press room.

 

“Julian passionately argued the case that WikiLeaks was vital to informing the public about controversial though necessary issues. He hoped that Wikileaks — an award winning journalistic operation — might be granted a seat in the White House press corps. As a former newsman myself I can’t see a reason why they shouldn’t be granted news status for official press conferences,” he said.

 

As for other information to be given to the president, Rohrabacher said: “We left with the understanding that we would be going into further details in the near future. The rest of the message is for the president directly and I hope to convey it to him as more details come in.”

Of course, we’re certain it won’t take long for the mainstream media to label Rohrabacher as just another of Putin’s “useful idiots” and discredit whatever information Assange eventually releases about his source as a desperate attempt to curry favor with an administration that could negotiate his freedom after being holed up in the Ecuadorian embassy for 5 years.

 

 

Bannon breaks his silence and gives his opinion on China, North Korea and what is happening internally . Correctly he admits that the USA is in an economic war with China and they must try and curtail their advances.

 

a must read..

 

(courtesy zero hedge)

 

Bannon Breaks Silence: Slams “Far-Right Clowns”, Vows “Economic War With China”

After weeks of speculation about his future, Trump White House Chief Strategist Steve Bannon has broken free of his self-imposed exile, unloading a torrent of Scaramucci-esque comments to none other than Robert Kuttner – the editor of The American Prospect, a progressive publication (the cover lines on whose first two issues after Trump’s election were “Resisting Trump” and “Containing Trump.”

Kuttner sets the surprising scene…

Trump’s embattled strategist phones me, unbidden, to opine on China, Korea, and his enemies in the administration…

 

Needless to say, I was a little stunned to get an email from Bannon’s assistant midday Tuesday, just as all hell was breaking loose once again about Charlottesville, saying that Bannon wished to meet with me.

But unload Bannon did:

He began with China

“We’re at economic war with China,” he added. “It’s in all their literature. They’re not shy about saying what they’re doing. One of us is going to be a hegemon in 25 or 30 years and it’s gonna be them if we go down this path.

 

Bannon said he might consider a deal in which China got North Korea to freeze its nuclear buildup with verifiable inspections and the United States removed its troops from the peninsula, but such a deal seemed remote. Given that China is not likely to do much more on North Korea, and that the logic of mutually assured destruction was its own source of restraint, Bannon saw no reason not to proceed with tough trade sanctions against China.

 

“To me,” Bannon said, “the economic war with China is everything. And we have to be maniacally focused on that. If we continue to lose it, we’re five years away, I think, ten years at the most, of hitting an inflection point from which we’ll never be able to recover.”

Contrary to Trump’s threat of fire and fury, Bannon said of Korea:

“On Korea, [China’s] just tapping us along. It’s just a sideshow.”

 

“There’s no military solution [to North Korea’s nuclear threats], forget it.

 

Until somebody solves the part of the equation that shows me that ten million people in Seoul don’t die in the first 30 minutes from conventional weapons, I don’t know what you’re talking about, there’s no military solution here, they got us.”

 

Bannon went on to describe his battle inside the administration to take a harder line on China trade, and not to fall into a trap of wishful thinking in which complaints against China’s trade practices now had to take a backseat to the hope that China, as honest broker, would help restrain Kim.

Bannon’s plan of attack includes: a complaint under Section 301 of the 1974 Trade Act against Chinese coercion of technology transfers from American corporations doing business there, and follow-up complaints against steel and aluminum dumping.

“We’re going to run the tables on these guys. We’ve come to the conclusion that they’re in an economic war and they’re crushing us.”

With regard his internal adversaries, at the departments of State and Defense, who think the United States can enlist Beijing’s aid on the North Korean standoff, and at Treasury and the National Economic Council who don’t want to mess with the trading system, Bannon was ever harsher…

“Oh, they’re wetting themselves,” he said, explaining that the Section 301 complaint, which was put on hold when the war of threats with North Korea broke out, was shelved only temporarily, and will be revived in three weeks. As for other cabinet departments, Bannon has big plans to marginalize their influence.

 

“That’s a fight I fight every day here,” he said. “We’re still fighting. There’s Treasury and [National Economic Council chair] Gary Cohn and Goldman Sachs lobbying.”

 

“We gotta do this. The president’s default position is to do it, but the apparatus is going crazy. Don’t get me wrong. It’s like, every day.”

Bannon dismissed the far-right as irrelevant:

“Ethno-nationalism—it’s losers. It’s a fringe element. I think the media plays it up too much, and we gotta help crush it, you know, uh, help crush it more.”

 

“These guys are a collection of clowns, he added.

And finally, Bannon scoffed at The Democrats

“…the longer they talk about identity politics, I got ’em. I want them to talk about racism every day. If the left is focused on race and identity, and we go with economic nationalism, we can crush the Democrats.

Read more here…

Bannon going down with a fight or a massive effort to distract from the carnage of the last few days? You decide.

end

 

This is deadly and not good for Trump: Senator Corker, who is probably the wealthiest of all the senators has now called for a “radical change’ in the White House

(courtesy zerohedge)

 

Republican Senator Corker Calls For “Radical Change” In The White House

Tennessee Republican Senator Bob Corker has just unloaded on President Trump as he spoke to reporters…

I do think that there do need to be radical changes. The President has not yet been able to demonstrate the stability nor some of the competence that he needs to demonstrates in order to be successful. And we need for him to be successful, our nation needs for him to be successful. It doesn’t matter whether you are republican or democrat. We need for our president, the world needs our president to be successful.”

 

He also has recently not demonstrated that he understands the character of this nation. He has not demonstrated that he understands what makes this nation great and what it is today. He has got to demonstrate the characteristics of a president who understands that.

 

And without the things that I just mentioned happening our nation is going to go through great peril.

 

We should hope that he inspires, that he does some self-reflection that he does what is necessary to demonstrate stability, to demonstrate competence, to demonstrate that he understands the character of our nation and works daily to bring out the best in the people of our nation.

Corker’s comments come a day after he appeared in Knoxville and declined to rebuke Trump for his statements about the violence that erupted in Charlottesville, Va., over the weekend.

“I did not see them (Trump’s comments),” he said.

 

“I don’t see a lot of television, I apologize … look, I respond in my own way. My comments are the ones I focus on and I think the media does a plenty good job and has plenty of panelists on and others giving editorial comment about other peoples’ comments and mine.”

Watch the full interview below…

https://www.facebook.com/plugins/video.php?href=https%3A%2F%2Fwww.facebook.com%2FChloeNooga%2Fvideos%2F1527134817346102%2F&show_text=0&width=560

Separately, the IJR quoted a GOP aide who said that “It’s just frustrating to be constantly reacting to his sh*t…. The president has torched whatever political capital or moral authority he ever had,” he said, adding that “he is uniquely incapable of political leadership. If we get tax reform done, it won’t be with his help. It’ll be in spite of him and his vortex of incompetence and destruction.”

WELL THAT ABOUT DOES IT FOR TONIGHT

I will see you FRIDAY  night

Harvey.

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