August 30/Gold falls by $5.00 down to $1308.50/silver down only one cent/GLD adds another 2.08 tonnes of gold/Giant chemical factory ready to explode in Crosby Texas/Hurricane Harvey makes a 2nd run at landfall travelling up Louisiana/

GOLD: $1308.50  DOWN $5.00

Silver: $17.44  DOWN 1 CENT(S)

Closing access prices:

Gold $1309.00

silver: $17.43

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: $1318.53 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME:  $1312.35

PREMIUM FIRST FIX:  $6.17

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SECOND SHANGHAI GOLD FIX: $1312.31

NY GOLD PRICE AT THE EXACT SAME TIME: $1307.95

Premium of Shanghai 2nd fix/NY:$4.36

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LONDON FIRST GOLD FIX:  5:30 am est  $1310.60

NY PRICING AT THE EXACT SAME TIME: $1310.80

LONDON SECOND GOLD FIX  10 AM: $1308.50

NY PRICING AT THE EXACT SAME TIME. 1307.00  ???

For comex gold:

AUGUST/

NOTICES FILINGS TODAY FOR APRIL CONTRACT MONTH: 444 NOTICE(S) FOR  44,400  OZ.

TOTAL NOTICES SO FAR: 5245 FOR 524,500 OZ  (16.314 TONNES)

For silver:

AUGUST

 1 NOTICES FILED TODAY FOR

5,000  OZ/

Total number of notices filed so far this month: 1249 for 6,245,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

end

As I expected, the criminal bankers tried their best to keep gold and silver from rising so as to pocket underwritten options.  However they did not succeed in lowering the price of gold to $1300.00 and $17.25 silver where the bulk of options were underwritten. London based gold/silver options have an expiry tomorrow morning at around 10 -11 am.  After that we should see our precious metals rise.

 

 

Let us have a look at the data for today

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In silver, the total open interest FELL BY AN APPRECIABLE 7235 contracts from 188,145 DOWN TO 182,823 DESPITE THE NO GAIN IN PRICE THAT SILVER UNDERTOOK WITH  YESTERDAY’S TRADING (UP 0 CENTS).HOWEVER WHEN YOU COMPARE WITH THE INCREASE IN GOLD OI YOU CAN BE COMFORTED THAT THE BANKS ARE STILL QUITE RETICENT TO SUPPLY ANY PAPER. NO DOUBT THAT WE LOST SOME SEPT. COMEX SILVER LONGS TO SEPT. EFP’S (IN EXCESS OF 7300 EFP’S). HOWEVER THE CONTRACTION IN OPEN INTEREST IS CERTAINLY NOT AS GREAT AS GOLD ONCE WE HIT FIRST DAY NOTICE (OR THE DAY BEFORE) OF AN ACTIVE DELIVERY MONTH. AS SOON AS SILVER BROKE RESISTANCE AT $17.25 AND THUS THE NEW SUPPORT LEVEL, NEWBIE LONGS POURED ON THE JUICE WITH RECKLESS ABANDON AS THEY ENTERED THE SILVER ARENA.  SEPT PLAYERS MOVED TO EFP’S BUT THE OBLIGATION TO DELIVER STILL RESTS WITH THEM BUT ON A DIFFERENT EXCHANGE (AND THEY RECEIVED A FIAT REWARD FOR THEIR EFFORT).  THE LOSS IN OI TO EFP’S WAS GREATER THAN NEWBIE SPEC LONGS ENTERING THE SILVER ARENA. 

RESULT: A HIGH DROP IN OI COMEX (OPPOSITE TO GOLD) WITH A ZERO PRICE INCREASE AND A FAIR SIZED GAIN IN SEPT EFP’S DELIVERABLE SILVER i.e.LONDON FORWARDS

 In ounces, the OI is still represented by just UNDER 1 BILLION oz i.e.  0.917 BILLION TO BE EXACT or 131% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT MAY MONTH/ THEY FILED: 1 NOTICE(S) FOR 5,000  OZ OF SILVER

In gold, the open interest ROSE BY  1372 CONTRACTS WITH THE  RISE  in price of gold ($3.95 GAIN YESTERDAY). The new OI for the gold complex rests at 538,875.

AS IN SILVER, THE GEOPOLITICAL LANDSCAPE WITH TRUMP THREATENING TO CLOSE GOVERNMENT IF HE DID NOT GET HIS WALL , THE DOVISH SPEECHES BY BOTH DRAGHI AND YELLEN ON FRIDAY AT JACKSON HOLE, THE HOUSTON FLOODING & NORTH KOREA FIRING MORE MISSILES CAUSED A HUGE NUMBER OF NEWBIE SPECS TO AGAIN ENTER THE GOLD ARENA WITH THE COMMERCIALS SUPPLYING THE NECESSARY PAPER LIKE DRUNKEN SAILORS. ONCE 1300 DOLLAR GOLD WAS PIERCED, MORE NEWBIE LONGS CAME EMBOLDENED CONTINUING THEIR QUEST OF TAKING ON THE BANKERS WHO RECIPROCATED IN KIND WITH THE PAPER. SOME OLD SPECS LEFT FOR A PROFIT WITH THE GOOD SIZED RISE IN PRICE. YESTERDAY AFTERNOON GOLD WAS HIT IN THE ACCESS MARKET TO WHICH IT RECOVERED BY 2 AM.  THE BANKERS WHACKED AGAIN AND TRUE TO FORM GOLD RECOVERED IN PRICE AGAIN BY 7 AM TO WHICH ANOTHER RAID WAS INITIATED ALL TO CAUSE UNDERWRITTEN OPTION CONTRACTS TO EXPIRE WORTHLESS.  THE BANKS ARE CROOKS AND RECEIVE HELP FROM OUR REGULATORS.

Result: A FAIR SIZED GAIN IN OI WITH THE RISE IN PRICE IN GOLD AND RESISTANCE/NEW SUPPORT LEVELS HOLDING AT $1300 GOLD.

we had: 444 notice(s) filed upon for 44,400 oz of gold.

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

GLD:

Tonight , we had another big  change in gold inventory: a deposit of 2.07 tonnes into the GLD inventory.  I doubt very much if this is physical gold/probably a paper gold entry:

Inventory rests tonight: 816.43 tonnes

IN THE LAST 33 TRADING DAYS: GLD SHEDS 20.54 TONNES YET GOLD IS HIGHER BY $76.25 .

SLV

Today:  WE HAD NO CHANGES IN SILVER INVENTORY TONIGHT:

INVENTORY RESTS AT 333.178 MILLION OZ

end

.

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

1. Today, we had the open interest in silver FELL BY 7235 contracts from 188,145 DOWN TO 182,823 (AND now A LITTLE FURTHER FROM THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) WITH YESTERDAY’S 0 CENT GAIN IN TRADING. SILVER RESPONDED TO 1) THE GEOPOLITICAL CLIMATE WHEREBY TRUMP THREATENED TO SHUT DOWN GOVERNMENT UNLESS HE GOT HIS WALL , 2) THE TWO DOVISH SPEECHES BY YELLEN 3) NORTH KOREA FIRING MORE MISSILES,4) THE HOUSTON FLOODING AND 5 THE PIERCING OF THE HUGE RESISTANCE LEVEL OF $17.25 WHICH NOW BECOMES THE NEW SUPPORT LEVEL. WE NO DOUBT HAD IN EXCESS OF 7300 LONG SEPT. SILVER PLAYERS TENDERING THEIR LONGS FOR SEPT. EFP’S (BUT THAT OBLIGATION STILL RESTS WITH THE BANKERS BUT ON A DIFFERENT EXCHANGE LONDON). NEWBIE LONGS ENTERED THE ARENA WHEN THEY SAW ANOTHER FAILED RAID ATTEMPT. HOWEVER THE GAIN IN NEWBIE LONGS WAS FAR LESS THAN THOSE PAPER PLAYERS EXITING FOR EFP’S. THE BANKERS CONTINUE TO BE RETICENT IN SUPPLYING THE SHORT PAPER. ANOTHER RAID WAS ORCHESTRATED TO CAUSE UNDERWRITTEN OPTIONS CONTRACTS TO EXPIRE WORTHLESS.

RESULT:  A LOWER OI AT THE COMEX, IN CONTRAST TO GOLD) WITH A ZERO PRICE INCREASE AND AN HUGE 7300+ GAIN IN SEPT EFP’S.

(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 TUESDAY night/WEDNESDAY morning: Shanghai closed DOWN 1.60 POINTS OR 0.05%   / /Hang Sang CLOSED UP 329.60 POINTS OR 1.19%/ The Nikkei closed UP 143.99 POINTS OR 0.74%/Australia’s all ordinaires CLOSED UP 0.01%/Chinese yuan (ONSHORE) closed UP at 6.5920/Oil DOWN to 46.17 dollars per barrel for WTI and 51.76 for Brent. Stocks in Europe OPENED DEEPLY IN THE GREEN. Offshore yuan trades  6.5933 yuan to the dollar vs 6.5920 for onshore yuan. NOW THE OFFSHORE MOVED SLIGHTLY WEAKER  TO THE ONSHORE YUAN/ ONSHORE YUAN MUCH STRONGER (TO THE DOLLAR)  AND THE OFFSHORE YUAN IS MUCH STRONGER TO THE DOLLAR AND THIS IS COUPLED WITH THE SLIGHTLY STRONGER DOLLAR. CHINA IS  HAPPY TODAY 

 

3a)THAILAND/SOUTH KOREA/NORTH KOREA

i)NORTH KOREA/USA/SOUTH KOREA

b) REPORT ON JAPAN

c) REPORT ON CHINA

4. EUROPEAN AFFAIRS

The world is going crazy.  Believe it or not but Lithuania and Cyprus just went into negative interest rates becoming the 18th and 19th country with a negative 2 yr sovereign interest rate

(/zerohedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

6 .GLOBAL ISSUES

7. OIL ISSUES

i)Gasoline prices rise due to output problems due to Hurricane Harvey

( zerohedge)

ii)A new storm is heading towards the USA, named Irma.  We will be watching this over the next week

( StockBoardAsset.com)

iii)Gasoline tumbles lower as Valero states that they have started to resume refining gasoline

(courtesy zerohedge)

8. EMERGING MARKET

VENEZUELA

9.   PHYSICAL MARKETS

i)Rickards believes that the Treasury might revalue gold to present value to gain an extra 355 billion dollars to avoid the debt ceiling:

( Jim Rickards/daily reckoning/GATA)

ii)Freeport McMoRan has agreed to a compromise whereby they give up 51% of Grasberg by selling that portion to the Indonesian government.  They still retain control over the operations of the mine.  That ends years of wrangling by the crooked regime over there.

( GATA/Reuters)

a must read…

( Craig Hemke/T/F Metals report)

10. USA Stories

i)Trump finally breaks his silence on North Korea by stating that talking is not the answer and that the USA is through with giving North Korea bribe money.

the markets are still calm..

ib)Mattis contradicts Trump: “We are never out of diplomatic solutions” with respect to North Korea:

( zerohedge)

 

( zero hedge)

ii)TUESDAY NIGHT

 

A giant chemical plant in Crosby Texas warns that it is in danger of exploding;

 

( zero hedge)

ii b) then the CEO states that there was no way to prevent an imminent explosion at the flooded chemical plant in Crosby Texas

( zerohedge)

iii)WEDNESDAY MORNING

( zero hedge)

iv)Port closures are certainly hurting the economy and this may have a huge dent in 3rd quarter GDP( zerohedge)

v)Hurricane Harvey’s destruction lessens the odds of a government shutdown from 50% to 33% according to Goldman Sachs but it is still prominent.  Goldman Sachs offers three scenarios

 

( zero hedge)

vi)Now Houston is suffering from an outbreak of looting and armed robberies.  Now the vigilantes emerge:

( zerohedge)

vii)I would not read too much into the ADP report: it added 237,000 jobs in August

( zero hedge)

viii)This is a surprise:  USA 2nd quarter revised sharply higher to 3.0% from 2.6%

( zerohedge)

 

 

 

Let us head over to the comex:

The total gold comex open interest ROSE BY A GOOD SIZED 1,372 CONTRACTS UP to an OI level of 538,875 WITH THE FAIR SIZED GAIN IN THE PRICE OF GOLD  ($3.95 GAIN / YESTERDAY’S trading).  This time the bankers did supply the necessary gold short paper when newbie longs took on our criminal bankers realizing that the geopolitical climate in the states was getting to their liking as Trump threatened to close government unless he got his wall plus the two dovish speeches by Yellen and Draghi at Jackson Hole, THE FLOODING OF HOUSTON , and the firing of those North Korean missiles. Once gold pierced the 1300 dollar resistance level, the bankers realized the trouble they were in but had no choice but to supply all the necessary comex paper short to satisfy the longs  and then orchestrate a raid in the access market. Gold responded beautifully rising steadily up to 2 am in the morning whereupon another raid commenced. .The bankers were trying to make good on all of those underwritten options they took on.  They looked for divine intervention this morning  as they failed to get gold below$1300.00.

Result: a  GOOD SIZED open interest increase with an FAIR rise in the price of gold with GOLD’S HOLDING OF resistance/NEW SUPPORT  level of $1300.00 

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 171 contract(s) to stand at 444 contracts. We had 179 notices filed YESTERDAY so we FINALLY GAINED 8 contracts or an additional 800 oz will stand at the comex and 0 EFP’s were issued in August 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 LOSS OF 132 contracts DOWN to 1026.

The next active contract month is Oct and here we saw a LOSS of 871 contracts DOWN to 50,276.

The very big active December contract month saw it’s OI gain 2,342 contracts up to 420,043.

We had 444 notice(s) filed upon today for  44,400 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 2016 CONTRACT MONTH 44.358 TONNES STOOD FOR DELIVERY. THIS YEAR, WE INITIALLY HAD 25.85 TONNES STANDING ON AUGUST 1/2017 AND WE WILL END UP WITH PROBABLY 16.33 TONNES.

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And now for the wild silver comex results.  Total silver OI FELL BY 7235 CONTRACTS FROM 188,145 DOWN TO 182,823 WITH  YESTERDAY’S  0 CENT GAIN IN PRICE. THESE REMAINING CONTRACTS ARE IN VERY STRONG HANDS AND NOTHING WILL CAUSE THEM TO LOSE ANY OF THEIR SILVER FROM THEIR SILVER TREE. SILVER RESPONDED TO THE GEOPOLITICAL CLIMATE WITH TRUMP THREATENING TO SHUT DOWN GOVERNMENT UNLESS HE GETS HIS WALL, THE TWO DOVISH SPEECHES BY YELLEN AND DRAGHI AT JACKSON HOLE, THE FLOODING OF HOUSTON AND THE FIRING OF THOSE NORTH KOREAN MISSILES. WE LOST IN EXCESS OF 7300+ CONTRACTS AS THESE PAPER PLAYERS TENDERED THEIR SEPT. LONGS FOR SEPT. EFP’S (BUT THAT OBLIGATION STILL RESTS WITH THE BANKERS BUT ON A DIFFERENT EXCHANGE LONDON). HOWEVER ONCE THE HUGE RESISTANCE LEVEL OF $17.25 HELD, NEWBIE LONGS BECAME EMBOLDENED TO TAKE ON THE BANKERS. THE BANKERS ARE LOATHE TO SUPPLY NEW SILVER SHORT PAPER. SOME OLD SPECS EXITED WITH PROFITS FROM A HIGHER PRICE. ANOTHER RAID WAS ORCHESTRATED TO CAUSE UNDERWRITTEN OPTION CONTRACTS TO EXPIRE WORTHLESS.
RESULT:  A GOOD SIZED DECREASE IN OI AT THE COMEX WITH A ZERO GAIN IN PRICE (IN TOTAL CONTRAST TO GOLD). WE HAD A GOOD SIZED TRANSFER OF LONGS FOR ANOTHER PHYSICAL DELIVERY PRODUCT, EFP’S ,WHEREBY THEY RECEIVE A FINANCIAL REWARD PLUS A DELIVERABLE PRODUCT IN LONDON. 

We are now in the next big non active silver contract month of August and here the OI LOST 1 contract DOWN TO 0. We had 1 notice(s) filed yesterday.  Thus we GAINED 0 contract(s) or an additional NIL 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 throughout the delivery month but not in silver!! HOWEVER WE DID HAVE A GOOD SIZED NUMBER OF SILVER LONGS IN SEPTEMBER RECEIVE EFP’S IN EXCHANGE FOR THEIR DEPARTED LONG POSITIONS. THESE GUYS RECEIVE A FIAT BONUS PLUS A DELIVERABLE PRODUCT ON ANOTHER EXCHANGE.

The next active contract month is September (and the last active month until December) saw it’s OI fall by 14,659 contacts down to 14,125.  The next non active contract month for silver after September is October and here the OI GAINED 31 contacts UP TO 873. After October, the big active contract month is December and here the OI GAINED by 7,116 contracts UP to 151,651 contracts.

We had 1 notice(s) filed for  5,000 oz for the AUGUST 2017 contract

VOLUMES: for the gold comex

ESTIMATED VOLUME TODAY: 191,355 CONTRACTS

YESTERDAY’S confirmed volume was 489,465 which is HUGE

volumes on gold are STILL HIGHER THAN NORMAL!

FINAL standings for AUGUST

 August 30/2017.

Gold Ounces
Withdrawals from Dealers Inventory in oz   nil
Withdrawals from Customer Inventory in oz  
7,144.59 oz
Brinks
Scotia
incl 40 kilobars
Deposits to the Dealer Inventory in oz    nil oz
Deposits to the Customer Inventory, in oz 
  17,182.222 oz
Scotia
No of oz served (contracts) today
 
444 notice(s)
44,400 OZ
No of oz to be served (notices)
0 contracts
(NIL oz)
Total monthly oz gold served (contracts) so far this month
5245 notices
524500 oz
16.314 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   58,818.1  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 1 customer deposit(s):
 i) Into Scotia: 17,182.222 oz
total customer deposits; 17,182.222  oz
We had 2 customer withdrawal(s)
i) Out of Brinks: 5858.59 oz
ii) Out of scotia: 1286.00 oz (40 kilobars)
total customer withdrawals;  7,144.59 oz
 we had 1 adjustment(s)
i) out of brinks:  1991.400 oz was removed from the dealer and this landed into the customer account of Brinks
For AUGUST:

Today, 0 notice(s) were issued from JPMorgan dealer account and 27 notices were issued from their client or customer account. The total of all issuance by all participants equates to 444  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 (5245) x 100 oz or 524,500 oz, to which we add the difference between the open interest for the front month of AUGUST (444 contracts) minus the number of notices served upon today (444) x 100 oz per contract equals 524,500  oz, the number of ounces standing in this active month of AUGUST.
 
Thus the FINAL standings for gold for the AUGUST contract month:
No of notices served so far (5245) x 100 oz  or ounces + {(444)OI for the front month  minus the number of  notices served upon today (444) x 100 oz which equals 524,500 oz standing in this  active delivery month of AUGUST  (16.331 tonnes)
 we GAINED 8 contracts or an additional 800 oz will  stand for delivery and 0 EFP’s for August were issued.
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Total dealer inventory 733,310.965 or 22.8012 tonnes  (dealer gold continues to disappear)
Total gold inventory (dealer and customer) = 8,696,179.55 or 270.48 tonnes 
 
Over a year ago the comex had 303 tonnes of total gold. Today the total inventory rests at 270.48 tonnes for a  loss of 33  tonnes over that period.  Since August 8/2016 we have lost 84 tonnes leaving the comex. However I am including kilobar transactions and they are very suspect at best.
I have a sneaky feeling that these withdrawals of gold in kilobars are being used in the hypothecating process  and are being used in the raiding of gold!

The gold comex is an absolute fraud.  The use of kilobars and exact weights makes the data totally absurd and fraudulent! To me, the only thing that makes sense is the fact that “kilobars: are entries of hypothecated gold sent to other jurisdictions so that they will not be short with their underwritten derivatives in that jurisdiction.  This would be similar to the rehypothecated gold used by Jon Corzine at MF Global.
 
IN THE LAST 12 MONTHS  84 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
AND NOW THE AUGUST DELIVERY MONTH
August final standings
 August 30  2017
Silver Ounces
Withdrawals from Dealers Inventory  nil
Withdrawals from Customer Inventory
31,012.570 oz
CNT
DELAWARE
Deposits to the Dealer Inventory
nil  oz
Deposits to the Customer Inventory 
 658,931.13 oz
CNT
Delaware
Scotia
No of oz served today (contracts)
1 CONTRACT(S)
(5,000 OZ)
No of oz to be served (notices)
0 contracts
( NIL oz)
Total monthly oz silver served (contracts) 1249 contracts (6,245,000 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 3,959,871.6 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 CNT: 29,946.97 oz
ii) Out of DELAWARE: 1065.600 oz
TOTAL CUSTOMER WITHDRAWALS: 31,012.57 oz
We had 3 Customer deposit(s):
 I) INTO CNT:  58,783.200 OZ
ii) Into Delaware: 1095.200 oz
iii) Into Scotia: 599.052.73 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: 658,931.13 oz
 
 we had 1 adjustment(s)
 i) from Scotia:  56,078.960 was removed from the customer account  as a counting error.
The total number of notices filed today for the AUGUST. contract month is represented by 1 contract(s) for 5,000 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 1249 x 5,000 oz  = 6,245,000 oz to which we add the difference between the open interest for the front month of AUGUST (1) and the number of notices served upon today (1) x 5000 oz equals the number of ounces standing.
 

 

.
 
Thus the FINAL standings for silver for the AUGUST contract month:  1249 (notices served so far)x 5000 oz  + OI for front month of AUGUST(1 ) -number of notices served upon today (1)x 5000 oz  equals  6,245,000 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. 
(TO GIVE YOU AN IDEA OF THE HUGE DEMAND FOR PHYSICAL IN THIS AUGUST NON ACTIVE DELIVERY MONTH WE HAD INITIALLY 1.965 MILLION OZ STAND FOR DELIVERY ON AUGUST 1. WE HAVE ENDED WITH 6.245 MILLION OZ EVENTUALLY STAND.)
We GAINED 0 contracts or an additional NIL oz wishes to stand for delivery in this non active month of August and 0 EFP’s were issued for the silver August month. We may have had a tiny number of Sept EFP’s issued.
At this point in the delivery cycle last year on August 29/2016 we had 10,613 contracts standing vs this yr at 14,125. WE HAVE ONE MORE READING DAY BEFORE FIRST DAY NOTICE TOMORROW. JUDGING FROM WHAT WE HAVE BEEN EXPERIENCING IN SILVER, THIS WEEK’S FIRST DAY STANDING WILL BE A DILLY!!
Last yr on the first day notice for the Sept silver 2016 contract we had 17.070 million oz stand for delivery.
By month end:  16.075 million oz/
 
Volumes: for silver comex
ESTIMATED VOLUME TODAY: 64,602 CONTRACTS WHICH IS EXCELLENT
YESTERDAY’s  confirmed volume was 202,259 contracts which is OUT OF THIS WORLD
FRIDAY’S CONFIRMED VOLUME OF 202,259 CONTRACTS WHICH EQUATES TO 1,011 MILLION OZ OF SILVER OR 144% 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:  38.363 million (close to record low inventory  
Total number of dealer and customer silver:   217.654 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 6.2 percent to NAV usa funds and Negative 6.2% to NAV for Cdn funds!!!! 
Percentage of fund in gold 62.4%
Percentage of fund in silver:37.6%
cash .+0.0%( August 30/2017) 
2. Sprott silver fund (PSLV): STOCK   NAV FALLS TO -0.55% (August 30/2017) 
3. Sprott gold fund (PHYS): premium to NAV FALLS TO -0.60% to NAV  (August 30/2017 )
Note: Sprott silver trust back  into NEGATIVE territory at -0.55%/Sprott physical gold trust is back into NEGATIVE/ territory at -0.60%/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 30/another deposit of 2.07 tonnes into the GLD inventory/inventory rests at 816.43 tonnes

August 29/a huge deposit of 9.16 tonnes of probable paper gold/inventory rests at 814.36 tonnes

AUGUST 28/a huge deposit f 5.91 tonnes of gold into GLD inventory/inventory rests at 805.20 tonnes

AUGUST 25/NO CHANGE IN GOLD INVENTORY/INVENTORY RESTS AT 799.29 TONNES

AUGUST 24/no change in gold inventory at the GLD/inventory rests at 799.29 tonnes

August 23/no change in gold inventory at the GLD/Inventory rests at 799.29 tonnes

August 22/no change in gold inventory at the GLD/Inventory rests at 799.29 tonnes/

AUGUST 21/this is good!! a huge deposit of gold into the GLD to the tune of 3.85 tonnes/Inventory rests at 799.29 tonnes

August 18/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 795.44 TONNES

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

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
August 30 /2017/ Inventory rests tonight at 816.43 tonnes
*IN LAST 222 TRADING DAYS: 133.45 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 160 TRADING DAYS: A NET  23.98 TONNES HAVE NOW BEEN ADDED INTO  GLD INVENTORY.
*FROM FEB 1/2017: A NET  7.17 TONNES HAVE BEEN ADDED.

end

Now the SLV Inventory

August 30/no change in silver inventory at the SLV/inventory rests at 333.178 million oz

August 29/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 333.178 MILLION OZ

AUGUST 28/no change in silver inventory at the SLV/Inventory rests at 333.178 million oz/

AUGUST 25/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 333.178 MILLION OZ

AUGUST 24/A HUGE WITHDRAWAL OF 1.229 MILLION OZ FROM THE SLV/INVENTORY RESTS AT 333.178 MILLION OZ

August 23/no change in silver inventory at the SLV/Inventory rests at 334.407 million oz

August 22/no change in silver inventory at the SLV/inventory rests at 334.407 million oz.

AUGUST 21/no change in silver inventory/inventory rests at 334.407 million oz/

August 18/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY REST AT 334.407 MILLION OZ

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

August 30.2017:

Inventory 333.178  million oz
end
  • 6 Month MM GOFO

    Indicative gold forward offer rate for a 6 month duration

    + 1.45%
  • 12 Month MM GOFO
    + 1.54%
  • 30 day trend

end

Major gold/silver trading/commentaries for WEDNESDAY

GOLDCORE/BLOG/MARK O’BYRNE.

GOLD/SILVER

Gold Reset To $10,000/oz Coming “By January 1, 2018” – Rickards

– Trump could be planning a radical “reboot” of the U.S. dollar
– Currency reboot will see leading nations devalue their currencies against gold
– New gold price would be nearly 8 times higher at $10,000/oz
– Price based on mass exit of foreign governments and investors from the US Dollar
– US total debt now over $80 Trillion – $20T national debt and $60T consumer debt
– Monetary reboot or currency devaluation seen frequently – even modern history
– Buy gold eagles, silver eagles including monster boxes and gold bars 

– Have a 10% allocation to gold, smaller allocation to silver

Editor: Mark O’Byrne

A new monetary standard which will see the dollar “reboot” and gold be revalued to $10,000/oz according to best-selling author and Pentagon insider Jim Rickards.

A monetary ‘reboot’ is not unprecedented

Articles about an imminent return to the gold standard are not exactly infrequent in the gold world and it can be easy to become immune to them and dismiss them without considering the facts and case being made.

Many of the articles are not just based one ever-wishful daydreams. Much of it comes from information that is true about today and is then applied to situations that we have seen in the past.

Rickards makes this point himself. A monetary reset is not unheard of. Since the Genoa Accord in 1922 there have been a further eight reboots. The most recent was in 2016 in what Rickards refers to as the Shanghai Accord which purportedly saw deals done that would allow China to ease without leading to a sharp correction in the US stock market.

Rickards isn’t the only one who is speculating that there could be some big monetary changes on the horizon. In March intelligence service Stratfor wrote:

Trump may consider unilateral or, failing that, multilateral currency interventions to bring it back down…Negotiating a new coordinated monetary intervention

Stratfor’s analysis was considering the threat of a strong dollar on Trump’s plans to reduce the trade deficit. We have recently discussed the danger of political deadlock and uncertainty on the US Dollar and how this will benefit gold.

Rickards’ comments come from a similar viewpoint in that there is decreasing faith in the US dollar. This lack of trust is mainly driven by the more than $100 trillion debt ($20 trillion national debt and another $100 trillion in off ‘balance sheet’ liabilities) in the country and the ongoing dedollarisation by major economies.

Should Trump continue to stumble, disappoint and provoke then we will no doubt see this issue snowball even faster.

No longer banking on debt

The Federal Reserve — America’s central bank — has lowered interest rates and printed nearly 4 trillion new dollars out of thin air since the economic crisis in 2008.

That’s equivalent to nearly one quarter the size of the entire U.S. economy.

The number one consequence of all of this money printing so far hasn’t been inflation at all…

It’s been debt.

Total U.S. debt — across all private sectors — has risen to nearly $60 TRILLION…

That’s over three times as big as the entire U.S. economy.

If you add the federal debt to that number, you get $80 trillion! That’s more than four times the size of the U.S. economy.

In fact, the Government Accountability Office just reported this year that the U.S. is at risk of “fiscal failure.”

And Harvard Economics Professor Kenneth Rogoff says, “There’s no question that the most significant vulnerability… is the soaring government debt. It’s very likely that will trigger the next crisis as governments have been stretched so wide.”

And Investor’s Business Daily reports that: “Current total debt, at roughly 105% of GDP, is already in the danger zone — and based on historical economic studies, this is where nasty things can happen.”

All of this is the result of too much debt… too many Obama policies… and too much meddling by the Federal Reserve.

But what happens when there is too much debt? The dollar is still relatively strong so does it matter? Yes, says Rickards, ‘many countries are relentlessly abandoning the dollar.’ 

Too much debt to make America Great Again

Countries aren’t sticking around to figure out whether the U.S. can really pay back its debt or wait to see if their dollar reserves are going to keep losing their value…

Like billionaire investor Warren Buffett said

“People are right to fear paper money… it’s only going to be worth less and less over time…”

And he’s right. The U.S. dollar has lost 96% of its value since the Federal Reserve was created in 1913. Meanwhile the national debt has skyrocketed!

The dollar and debt are two sides of the same coin:

That’s why many countries are relentlessly abandoning the dollar.

Typically most foreign governments invest their surplus or savings in U.S. financial assets.

Global trade is typically conducted in U.S. dollars, too.

The dollar is what’s called the “world’s reserve currency.”

As one Forbes columnist put it, “ There is a global currency. It’s called the ‘U.S. dollar.’”

But all of that is about to change if the dollar is not rebooted.

The dollar is getting dumped around the globe because of our debt, spending and money printing.

The total amount of “de-dollarization” is at least: $1.14 TRILLION…

But it’s not just the “de-dollarization” of the world that’s making this so urgent. You see, countries have not only stopped buying U.S. Treasuries… but they’re selling them at a record clip.

Bloomberg reports, “ America’s Biggest Creditors Dump Treasuries in Warning to Trump .”

The Economist says, “As America’s economic supremacy fades, the primacy of the dollar looks unsustainable.”

Trump to call global summit and take control

Rickards believes that the situation of dedollarization will get so bad that the US President will be forced to call a summit of world leaders and monetary authorities.

Using his stature as leader of the free world, he’ll bring the financial leaders of the globe together.

This would include delegates from the U.S., China, Japan, Germany, Italy, France, the UK and the International Monetary Fund.

Then, they’ll agree to simultaneously revalue all of their currencies against gold until the price reached $10,000 per ounce.

Will Trump really call a global summit? Who knows. His own team probably won’t know until he tweets about it.

But you should consider one element that Rickards mentions. Aside from a new monetary order, Trump is about to become the most powerful US president when it comes to looking after the US Dollar.

You see, there are seven total seats on the Board of Governors of the Federal Reserve. That’s the group that makes our central bank’s decisions.

The president appoints each governor.

That means Trump could be able to appoint five governors in the coming months, including a chair and two vice chairs.

Trump will have six out of seven board seats in Republican hands.

In effect, Trump will own the Fed!

The Republicans will also have the White House…

And a majority in the House of Representatives and Senate…

Conservatives will soon be a majority on the Supreme Court, too.

And there are more Republican state legislatures and governors in the state mansions than at any time since Civil War reconstruction.

This means President Trump could have zero resistance to changing the debt-dollar system we have.

Whether Trump ‘owning’ the Fed means he would seek to upend the international monetary order is one thing. But, even if he doesn’t do that, investors would be wise to consider what impact a Trump-controlled Federal Reserve would have on the world.

Why $10,000 per ounce?

It’s the gold price Donald Trump will need to use to “reboot” the U.S. dollar and the world’s international monetary system.

This isn’t a far-fetched concept, by the way…

Since the world financial crisis in 2008, many of the world’s governments have been buying physical gold in record amounts.

In fact, according to a recent report by the Official Monetary and Financial Institutions Forum (OMFIF), world central banks have been buying gold at a rate of 385 tons per year since the 2008 crisis.

Those are levels last seen when the world was on the gold standard pre-1971.

Why are they buying so much gold?

Because they know gold is going to be money again…

And the more gold they own, the more leverage they’ll have when Trump calls the world’s financial powers together to reform the monetary system at his Mar-a-Lago resort.

As with chat surrounding soon-to-be gold standard, calls for $10,000/oz gold (or more) are also not uncommon in precious metal spheres. Since I began in the gold industry I have been reading about the imminent rise of the gold price to $30,000 even $40,000.

In truth, I believe such outlandish predictions are damaging for the long-term reputation of the gold and silver investment community. Regardless of where you think the gold price and gold standard could head to, it is all relative to your own situation, your own portfolio and the currencies you buy it in.

At the same time, while gold at $10,000 per ounce seems outlandish now, it is not impossible and indeed the scale of the levels of debt in the U.S. and internationally make it quite possible. When gold was trading at $250/oz in 2002, a rise of more than seven times and gold at $1,900 seemed outlandish to most.

Whether or not you believe Trump will ever achieve a new gold standard in a currency reset, it is vital to consider the point that central banks have been net buyers of gold for some time. A lesson for all investors.

And the most important nugget to takeaway from pieces such as this is that governments are in a completely unsustainable, debt-laden position. The current state of the global economy is unprecedented. We are also in unknown times when it comes to technology, cyber threats and nuclear sabre rattling. Governments buying gold is sensible portfolio diversification.

Buying gold coins and bars a prudent way to hedge coming currency devaluations

Rickards, Stratfor and even us here at GoldCore cannot predict what will happen in terms of the gold price. What we do know is that gold has played a very important role throughout history – especially as a hedge against currency devaluation.

Currency devaluations are coming and currencies are set to fall in value against gold as they have done throughout history. The only question is how much fiat currencies will fall versus gold and silver.

History has taught us that governments rarely know what they are doing when it comes to financial and monetary planning. It has also taught us that when times are tough countries turn on one another and war becomes common. Trade wars lead to currency wars lead to real wars. We are seeing that today.

Investors and savers are wise to think small. They should consider their own form of gold standard and how they can protect themselves. Buying gold bars, gold eagles and silver eagles including monster boxes is a prudent way to hedge the real risk of global currency debasement today.

The extracts are taken from an article which originally appeared on Agora Financial.

Gold eagles can currently be acquired from GoldCore at record low premiums of 3%.
Please call to secure coins as this is a phone call offer only and not available online.

 

END

 

Freeport McMoRan has agreed to a compromise whereby they give up 51% of Grasberg by selling that portion to the Indonesian government.  They still retain control over the operations of the mine.  That ends years of wrangling by the crooked regime over there.

(courtesy GATA/Reuters)

(courtesy John Embry/Kingworldsnews)

 

a must read…

(courtesy Craig Hemke/T/F Metals report)

 

TF Metals Report: Total G-3 central bank control of the ‘markets’

 Section: 

6:56p ET Tuesday, August 29, 2017

Dear Friend of GATA and Gold:

The TF Metals Report shows tonight how currency market rigging by central banks is controlling the stock “market” by controlling the variables used by high-frequency trading programs. The TF Metals Report’s analysis is headlined “Total G-3 Central Bank Control” and it’s posted here:

https://www.tfmetalsreport.com/blog/8530/total-g-3-central-bank-control

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

 

 

END

 

Rickards believes that the Treasury might revalue gold to present value to gain an extra 355 billion dollars to avoid the debt ceiling:

(courtesy Jim Rickards/daily reckoning/GATA)

Rickards: Repatriation will slow gold leasing; U.S. may revalue gold if debt ceiling isn’t raised

 Section: 

8:36p ET Tuesday, August 29, 2017

Dear Friend of GATA and Gold:

Fund manager and author Jim Rickards writes today that repatriation of German gold from the New York Fed to the Bundesbank’s vault in Frankfurt will greatly reduce the gold available for market manipulation through leasing, because there is no well-developed system of leasing in Frankfurt nor adequate law to provide for it.

Rickards adds that the repatriation was hastened so that German Chancellor Angela Merkel, embroiled in an election campaign, could appease a small nationalist party that advocates gold repatriation if she needs to form a coalition government. Presumably that party is Alternative for Germany, which has nominated GATA’s friend Peter Boehringer, founder of the Repatriate Our Gold campaign, for Germany’s parliament, the Bundestag.

Rickards also writes today that Treasury Secretary Steven Mnuchin’s surprise visit to Fort Knox last week may have been preparation for plans to revalue the U.S. gold reserve to market prices in case Congress fails to raise the U.S. debt ceiling. A higher book value for the reserve, Rickards writes, would enable the Treasury Department to issue new gold certificates to the Federal Reserve in exchange for billions of dollars in cash.

All this is at best informed speculation but it’s an important reminder that, as GATA long has maintained, gold is the secret knowledge of the financial universe and that governments feel compelled to conceal that knowledge from the public and the markets at all costs.

Rickard’s commentary is headlined “Weird Things Are Happening with Gold” and it’s posted at the Daily Reckoning here:

https://dailyreckoning.com/weird-things-happening-gold/

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

 

and in full…

 

Weird Things Are Happening With Gold

Authored by James Rickards via Daily Reckoning blog,

Last week featured two unusual stories on gold – one strange and the other truly weird. These stories explain why gold is not just money but is the most politicized form of money.

They show that while politicians publicly disparage gold, they quietly pay close attention to it.

The first strange gold story involves Germany…

The Deutsche Bundesbank, the central bank of Germany, announced that it had completed the repatriation of gold to Frankfurt from foreign vaults.

The German story is the completion of a process that began in 2013. That’s when the Deutsche Bundesbank first requested a return of some of the German gold from vaults in Paris, in London and at the Federal Reserve Bank of New York.

Those gold transfers have now been completed.

This is a topic I first raised in the introduction to Currency Wars in 2011. I suggested that in extremis, the U.S. might freeze or confiscate foreign gold stored on U.S. soil using powers under the International Emergency Economic Powers Act, the Trading With the Enemy Act or the USA Patriot Act.

This then became a political issue in Europe with agitation for repatriation in the Netherlands, Germany and Austria. Europeans wanted to get gold out of the U.S. and safely back to their own national vaults. The German transfer was completed ahead of schedule; the original completion date was 2020.

But the German central bank does not actually want the gold back because there is no well-developed gold-leasing market in Frankfurt and no experience leasing gold under German law.

German gold in New York or London was available for leasing under New York or U.K. law as part of global price-manipulation schemes. Moving gold to Frankfurt reduces the floating supply available for leasing, making it more difficult to keep the manipulation going.

Why did Germany do it?

The driving force both in 2013 (date of announcement) and 2017 (date of completion) is that both years are election years in Germany. Angela Merkel’s position as chancellor of Germany is up for a vote on Sept. 24, 2017. She may need a coalition to stay in power, and there’s a small nationalist party in Germany that agitates for gold repatriation.

Merkel stage-managed this gold repatriation with the Deutsche Bundesbank both in 2013 and this week to appease that small nationalist party and keep them in the coalition. That’s why the repatriation was completed three years early. She needs the votes now.

The truly weird gold story comes from the United States…

Secretary of the Treasury Steve Mnuchin and Senate Majority Leader Mitch McConnell just paid a visit to Fort Knox to see the U.S. gold supply. Mnuchin is only the third Treasury secretary in history ever to visit Fort Knox and this was the first official visit from Washington, D.C., since 1974.

The U.S. government likes to ignore gold and not draw attention to it. Official visits to Fort Knox give gold some monetary credence that central banks would prefer it does not have.

Why an impromptu visit by Mnuchin and McConnell? Why now?

The answer may lie in the fact that the Treasury is running out of cash and could be broke by Sept. 29 if Congress does not increase the debt ceiling by then.

But the Treasury could get $355 billion in cash from thin air without increasing the debt simply by revaluing U.S. gold to a market price. (U.S. gold is currently officially valued at $42.22 per ounce on the Treasury’s books versus a market price of $1,285 per ounce.)

Once the Treasury revalues the gold, the Treasury can issue new “gold certificates” to the Fed and demand newly printed money in the Treasury’s account under the Gold Reserve Act of 1934. Since this money comes from gold revaluation, it does not increase the national debt and no debt ceiling legislation is required.

This would be a way around the debt ceiling if Congress cannot increase it in a timely way. This weird gold trick was actually done by the Eisenhower administration in 1953.

Maybe Mnuchin and McConnell just wanted to make sure the gold was there before they revalue it and issue new certificates.

Whatever the reason, this much official attention to gold is just one more psychological lift to the price along with Fed ease, scarce supply and continued voracious buying by Russia and China.



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 6.5920 (REVALUATION NORTHBOUND   /OFFSHORE YUAN MOVES SLIGHTLY WEAKER TO ONSHORE AT   6.5933/ Shanghai bourse CLOSED DOWN 1.60 POINTS OR 0.05%  / HANG SANG CLOSED UP 329.60 POINTS OR 1.19% 

2. Nikkei closed UP 143.99 POINTS OR 0.74%    /USA: YEN FALLS TO 109.89

3. Europe stocks OPENED DEEPLY IN THE GREEN     ( /USA dollar index RISES TO  92.48/Euro DOWN to 1.1946

3b Japan 10 year bond yield: RISES  TO  +.011%/ 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::  46.17 and Brent: 51.76

3f Gold DOWN/Yen DOWN

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund RISES TO  +.351%/Italian 10 yr bond yield DOWN  to 2.075%    

3j Greek 10 year bond yield FALLS to  : 5.540???  

3k Gold at $1311.00  silver at:17.41 (8:15 am est)   SILVER NEXT RESISTANCE LEVEL AT $18.50 

3l USA vs Russian rouble; (Russian rouble UP 23/100 in  roubles/dollar) 58.59-

3m oil into the 46 dollar handle for WTI and 51 handle for Brent/

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

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 109.89 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  0.9569 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1431 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.

3p BRITAIN VOTES AFFIRMATIVE BREXIT/LOWER PARLIAMENT APPROVES BREXIT COMMENCEMENT/ARTICLE 50 COMMENCES MARCH 29/2017 

3r the 10 Year German bund now POSITIVE territory with the 10 year RISING to  +0.351%

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 2.132% early this morning. Thirty year rate  at 2.738% /POLICY ERROR)GETTING DANGEROUSLY HIGH

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

6. USA CASH BALANCES ON HAND: $67.7 BILLION

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

World Stocks Rebound, Dollar Rises As Korea Nuclear War Fears Recede

S&P futures are higher in early Wednesday trading, alongside Asian stocks and European bourses, both solidly in the green as the EURUSD drifts below the 1.20 “redline” while the dollar rebounds off a two and a half year low following the US “measured” response to North Korea’s missile test, which soothed jittery investors who now turn their focus to US economic data. Equity indexes in Japan, Hong Kong and South Korea also rose while 10Y US Treasuries are steady before the release of ADP employment and GDP data, both of which are expected to show an increase. The VIX is down fractionally to 11.60.

European stocks rose higher, tracking counterparts in Asia and the United States and reversing losses from the day before when investors were spooked by Pyongyang’s firing of a ballistic missile over Japan. Fears that this could trigger an aggressive response receded on Wednesday after the United Nations – in a statement drafted by the United States – condemned North Korea’s latest missile launch but held back any threat of new sanctions.

Trump, who previously vowed not to let North Korea develop nuclear missiles that can hit the mainland United States, said the world had received North Korea’s latest messageloud and clear”.

“Instead of the (U.S.) President responding to the escalation via Twitter, as has happened on many recent occasions, the White House issued an official statement to condemn the action,” said IronFX analyst Charalambos Pissouros. This may have been interpreted by investors as a sign that the US will approach the situation in a more measured and diplomatic manner, as opposed to raining down ’fire and fury’. North Korean media reports on the launch also lacked their usual claims of technical advances, indicating the test may not have succeeded as planned.

Boosted by this optimism from Trump’s response, European markets rebounded after yesterday’s U.S.-led unwind of the North Korea related risk-off move. DXY holds at overnight strongest levels; AUD marginally outperforms after solid construction data; USD/JPY briefly traded above 110.00 through the European open which also provides a lift to U.S. equity futures.

In Europe, the pan-European STOXX 600 gained 0.5%, recovering nearly all the ground lost in the previous session and banking stocks – which had led the risk-averse move lower on Tuesday – were up nearly 1 percent, while the utilities sector lags after France warns on eventual closure of nuclear plants. European strength emerged after the stronger dollar pushed the EURUSD off the 1.20 ledg, trading below 1.950 last. The U.K.’s FTSE 100 Index increased 0.2%. Germany’s DAX Index rose 0.4 percent, the largest advance in more than a week.

European upside followed gains in Asia, where MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.6% while Japan’s Nikkei rose 0.7%. The Hang Seng Index rose 1.2%, closing above 28,000 for the first time in two years as concern over North Korea tensions waned and China Shenhua Energy led power producers higher, while banks rose ahead of earnings results.  The Shanghai Composite Index fluctuated before edging lower. The MSCI Asia Pacific Index rose 0.2 percent.

The Chinese currency extended a surge that made it Asia’s best performer this month, rising to its highest level since June 2016 amid a weak dollar, following 11 consecutive days of increases in the offshore CNH. The CNY strengthens 0.05% to 6.5923 per dollar as of late afternoon trading in Shanghai in fourth day of gains; the currency has climbed 2.1% this month. On Wednesday, the PBOC strengthened the yuan reference rate for the third day, raising it by 0.29% to 6.6102, meanwhile the Bloomberg replica of CFETS index, which tracks the yuan against 24 currencies, climbed 0.37% to 94.0325, highest since Aug. 11

Meanwhile, Bund futures edged higher as German regional CPIs indicated a national reading broadly in-line with consensus, German and U.K. curves slightly steeper.  Euro zone government bond yields, which fell to fresh lows on Tuesday, edged up on Wednesday as forecast-beating inflation in Spain was expected to be followed by similar data in Germany, defying the euro’s recent strength. The yield on 10-year Treasuries climbed less than one basis point to 2.13%. Germany’s 10-year Bunds increased one basis point to 0.35%, while Britain’s 10-year yield gained two basis points to 1.019%, the largest advance in more than a week.

In commodities, gasoline hit a two-year high, rallying another 2.8%, after Hurricane Harvey shut down nearly a fifth of U.S refining capacity, and more closures are expected.

However, the rising crude inventories as a result of refinery shutdowns, weighed on oil prices. U.S. crude futures fell 0.6 percent to $46.17 a barrel, after touching a five-week low on Tuesday. Brent slipped 0.6 percent to $51.67. Spot gold edged marginally lower to $1,309.39 an ounce on Wednesday. On Tuesday, the precious metal jumped to its highest since Trump was elected U.S. president.

Economic data include second print on GDP growth, weekly MBA mortgage applications and August ADP employment. Analog Devices Inc. and Workday Inc. are among companies reporting earnings.

Bulletin Healine Summary from RanSquawk

  • European equities enter the North American crossover higher as markets look through some of the recent NKrelated
    tensions
  • USD is trading at better levels against its major counterparts to pare yesterday’s declines. USD/JPY briefly back above
    110.0, although under now
  • Looking ahead, highlights include national German CPI, US ADP, PCE, DoEs and Fed’s Powell

Market Snapshot

  • S&P 500 futures up 0.1% to 2,450.50
  • VIX -0.10 or -0.85%, to 11.60
  • STOXX Europe 600 up 0.5% to 370.15
  • MSCI Asia up 0.2% to 160.47
  • MSCI Asia ex Japan up 0.6% to 531.87
  • Nikkei up 0.7% to 19,506.54
  • Topix up 0.6% to 1,607.65
  • Hang Seng Index up 1.2% to 28,094.61
  • Shanghai Composite down 0.05% to 3,363.63
  • Sensex up 0.9% to 31,681.89
  • Australia S&P/ASX 200 up 0.01% to 5,669.72
  • Kospi up 0.3% to 2,372.29
  • German 10Y yield rose 1.3 bps to 0.355%
  • Euro down 0.2% to $1.1944
  • Brent Futures down 0.9% to $51.56/bbl
  • US 10Y yield rose 2bp to 2.13%
  • Italian 10Y yield fell 1.6 bps to 1.774%
  • Spanish 10Y yield rose 1.7 bps to 1.579%
  • Brent Futures down 1.1% to $51.41/bbl
  • Gold spot up 0.2% to $1,311.67
  • U.S. Dollar Index up 0.3% to 92.51

Top Overnight News

  • Euro-area economic confidence rose to the highest level in a decade as European Central Bank policy makers prepare for a discussion next week about whether and how to pare back stimulus
  • With floodwaters still rising and damage estimates piling up, analysts expect just a modest dent in the U.S. economy from Hurricane Harvey this quarter, with reconstruction efforts likely to be substantial enough to boost growth later this year
  • North Korea’s Kim says IRBM firing is ’prelude’ to containing Guam; Yonhap says possibility that North Korea launches missile into the Pacific Ocean to show off ability to strike U.S. mainland cannot be excluded
  • On Tuesday morning, disaster analyst Chuck Watson had pegged $42 billion as a reasonable estimate for the cost of destruction Tropical Storm Harvey would leave in its wake. By the end of the day, he’d added another $10 billion
  • With floodwaters still rising and damage estimates piling up, analysts expect just a modest dent in the U.S. economy from Hurricane Harvey this quarter, with reconstruction efforts likely to be substantial enough to boost growth later this year
  • Fed policy makers hoping for a pick-up in inflation in the coming months may end up being frustrated by a quirk in the price data
  • Resilient economic growth and a government campaign against excessive leverage are helping China’s largest banks, curbing their bad loans and underpinning their net interest margins
  • Euro-area economic confidence rose to the highest level in a decade as European Central Bank policy makers prepare for a discussion next week about whether and how to pare back stimulus
  • Banks have a challenge when Congress returns from summer recess next week. His name is John Neely Kennedy. The freshman Republican senator from Louisiana is one of a handful of lawmakers who could squash the finance industry’s dream of tweaking a key Consumer Financial Protection Bureau regulation
  • Toyota Tsusho Corp., the automaker’s trading arm, will invest an undisclosed amount in Grab, Southeast Asia’s leading ride-hailing operator
  • German Aug. Regional CPIs y/y (National est. 1.8%): Saxony 1.9%; Brandenburg 1.8%; Hesse 1.8%; Bavaria 1.8%; NRW 1.9%
  • U.K. PM May: no Brexit deal is still better than a bad deal; wants a smooth Brexit and implementation period
  • ‘Apocalyptic’ Flooding Has Harvey Damages Rising by the Hour
  • Kim Says Missile Over Japan Was ‘Prelude’ to Containing Guam
  • Latest North Korea Missile Launch Spurred White House Game Plan
  • United Technologies Nears $20 Billion Rockwell Deal, WSJ Says
  • Uber Draws Justice Department Inquiry Over Foreign Payments
  • Uber CEO Pick Embraces Job as ‘Opportunity of a Lifetime’
  • RBNZ’s Wheeler says lower NZD needed; scope for easing if growth slows
  • Amazon, Microsoft to Enable Alexa, Cortana to Communicate: NYT
  • China Regulator Is Said to Review Antitrust Complaint on Apple
  • Tillerson to Meet With Heads of Delta, United, American: State
  • Goldman to Detail Bond-Trading Unit Strategy in Sept.: Reuters
  • Equipment Rentals Are Unlikely to Rise From Harvey: Wells Fargo

Asia equities traded mostly positive as the region followed suit from the improvement in sentiment seen in US, where
markets ignored the geopolitical concerns and bought the dip. This saw a rebound in Asia stocks with Nikkei 225 (+0.7%)
underpinned as the USD/JPY-risk relationship took full effect and with better than expected Retail Sales adding to the optimism.
ASX 200 (flat) lagged and was negative for most of the day as continued weakness in financials and hefty losses in telecoms
dragged, with Telstra the worst performer as it traded ex-dividend and after the NBN rejected Co.’s monetisation plan. Elsewhere,
Shanghai Comp. (flat) and Hang Seng (+1.2%) benefited from the increased risk appetite and after a firmer liquidity operation by
the PBoC, although gains in the mainland were later pared amid weakness in Chinese commodity prices. Finally, 10yr JGBs were
lower amid flows into riskier assets, while a lukewarm BoJ Rinban announcement also failed to spur demand.

Top Asian News

  • China’s $2 Trillion of Shadow Lending Throws Focus on Rust Belt
  • Japan Stocks to Watch: Fujifilm, Mitsubishi Motors, Nitto Denko
  • Foreign Banks Chase Panda Bond Deals as Chinese Market Grows
  • Rio Tinto Weighs ‘Stay-or-Go’ Call on Indonesia’s Grasberg
  • Yuan Strength Helps Chinese Airlines Soar Amid Mixed Earnings
  • Japan Stocks Blasé After North Korean Missile Launches This Year
  • M&S in Talks to Sell Hong Kong, Macau Units to Al- Futtaim
  • Hong Kong’s H-Share Index Trailing in Hang Seng’s Wake
  • India Dodgy Contracts Record Risks Turning Away Investors

Modest relief bounce in European equities (Eurostoxx 50 +0.4%) this morning following yesterday’s fall to 6-month lows with all
sectors (with the exception of utilities) trading in positive territory. Jitters regarding North Korea are somewhat dissipating slightly.
EGB yields ticking higher this morning amid the reversal in price action across equity markets, while slight
underperformance has been observed in the belly of the curve with the 10Y yield tracking higher by 2.1bps. Peripheral spreads vs
Germany are slightly narrower today with the German/Portuguese spread tighter by 0.3bps. Supply from Italy was relatively well
absorbed by the market.

Top European News

  • U.K. Asked EU for More Time to Talk Brexit as Reality Sinks in
  • Cryptocurrencies Are New Barbarians at the Gate of Central Banks
  • Russia Readies Emergency Loans to Contain Bank Otkritie Crisis
  • U.K. Consumer Borrowing Cools Slightly as Business Loans Jump
  • Ocado Rises as Citi Sees Amazon-Whole Foods Piquing Interest
  • Siemens Extends Push Into Driverless Cars With TASS Acquisition
  • NordLB First Half Net Interest Income EU731 Mln
  • Fortum May Be Eyeing PVO or Uniper Acquisition, Nordea Says

In currencies, USD trading at better levels against its major counterparts to pare yesterday’s declines. USD/JPY back above 110.00 amid the
slight improvement in risk sentiment, next resistance in the pair resides around 110.35-40.
EUR is lower this morning, albeit mildly so, despite the first of the regional German CPI data (Saxony) showing an increase in Y/Y
inflation, which is also above analyst estimates for the national figure. As such, a continuation of this trend among other regions
could see EUR better supported throughout the session. Slight profit taking has been seen in EUR after yesterday hitting a new 2
and a half year high at 1.2070.
AUD: Main mover overnight had been the AUD, which approached 0.80 having reached a high of 0.7995. This followed some
relatively strong data in the form of building and construction data, while gains against the JPY and NZD further underpinned AUD.
AUD/NZD briefly broke above 1.10 before running into resistance at the YTD high of 1.1020.

In commodities, crude oil prices continuing to feel the pressure from Hurricane Harvey with a 5th of US refining capacity now shut and as
such, likely to reduce demand from refineries. Gasoline however, has hit two year highs given the risk of fuel shortages. Of
note, last night’s API report showed a drawdown of 5.7mln in US crude. Elsewhere, gold has faced some selling pressure amid the
resurgence of the USD and mild reprieve in NK-related tensions. Chinese iron ore prices were also seen lower overnight in a pullback
from some of the recent sharp gains.
Libya’s NOC says 360kbpd of crude production shutdown by pipeline blockades that have closed 3 fields. US API weekly crude stocks (21 Aug, w/e) -5780K (Prev. -3595K). Valero Port Arthur refinery is shutting large crude unit and gasoline unit, due to Harvey. Motiva states that although weather conditions continue to deteriorate, Port Arthur refinery remains stable at 40% of capacity.

Looking at the day ahead, US’s ADP employment change for August (185k expected) will be worth watching in the context of Friday’s payrolls while the second readings for 2Q GDP (2.7% expected) and core PCE are due. Away from the data, the Fed’s Powell will speak today.

US Event Calendar

  • 7am: MBA Mortgage Applications, prior -0.5%
  • 8:15am: ADP Employment Change, est. 185,000, prior 178,000
  • 8:30am: GDP Annualized QoQ, est. 2.7%, prior 2.6%
  • 8:30am: Personal Consumption, est. 3.0%, prior 2.8%
  • 8:30am: GDP Price Index, est. 1.0%, prior 1.0%
  • 8:30am: Core PCE QoQ, est. 0.9%, prior 0.9%

DB’s Jim Reid concludes the overnight wrap

With geopolitics back in the spotlight and markets somewhat treading on eggshells again the most eye-catching move for us yesterday was seeing Treasury yields dart back below their pre-Sintra levels. Indeed at one stage 10y Treasuries touched as low as 2.084% yesterday morning before ending last night a bit higher at 2.129%. On an intraday basis the low for the year had been 2.101% back in the middle of June before the coordinated hawkish message in Portugal later that month. 10y Bunds (-3.4bps to 0.338%) are now also less than 10bps away from their pre-Sintra levels after topping out at 0.597% just over a month ago. Benchmark OATs are also within 6bps of their YTD lows while bond markets in the Netherlands and the UK are also near their lows.

A decent run for DM bond markets then which is noticeable when you consider that global growth signals (recent PMIs) have been robust, commodity prices ex oil are either at or around YTD highs for the most part and the expectation is still that the ECB is likely to signal a tapering this autumn and the Fed might still hike again in December (albeit with market pricing down to just 30% based on Bloomberg’s calculator). All these factors have been put to one side however as politics has taken center stage through the northern hemisphere summer. Concerns firstly about President Trump’s political agenda and more recently the debt ceiling and now the latest North Korea developments have certainly all played a role in the recent moves. Regarding the latter, the response by President Trump yesterday to North Korea firing a missile over Japan was to say that “all options are on the table” for a response while North Korea’s Kim Jong Un has said overnight that the missile test was a “meaningful prelude to containing Guam” according to North Korean state media.

The response from markets meanwhile has actually been more of a tale of two halves. The initial reaction was to see safe havens rally and European equities selloff. Indeed the Stoxx 600 ended -1.04% although in fairness that wasn’t helped by another strong session for the Euro which smashed through 1.200 versus the Dollar before softening a bit into the evening to close at 1.1972 (-0.06%). After the S&P 500 initially opened -0.66% the tone swiftly reversed with the view that the response from world leaders was fairly measured and further escalation was unlikely. The S&P closed +0.08% by the end of play with losses for banks and Best Buy (-12% post results) offset by gains from the industrials and tech sectors. The VIX, which topped out at 14.34 intraday and the highest in over a week, finished up ‘just’ +3.36% at 11.70 and well below  the two peaks of earlier this month (15.55 and 15.51). Other safe havens yesterday pared gains with Gold down -0.07% after being up +1.20% and the Swiss Franc +0.05% after being up +1.32%.

This morning in Asia markets have broadly followed the US lead and are trading higher, with the Kospi (+0.08%), Nikkei (+0.58%) and Hang Seng (+0.75%) all firmer, while only the ASX 200 (-0.20%) is struggling for traction. The Korean Won is also +0.40% this morning while US equity futures are pointing towards a positive start. The other notable mover is US gasoline prices which having rallied over +4% yesterday are up another +3.21% this morning in the wake of Tropical Storm Harvey.

Moving on. One thing worth highlighting this morning is a Politico story which ran last night suggesting that Trump will today launch a “major push for a sweeping tax overhaul” at a speech in Missouri. The article suggests that the speech is to be focused on the US corporate system and making it more competitive on a global scale, as well as wiping out deductions that benefit higher-income tax payers. So we’ll see what that has in store.

Jumping to the latest on Brexit now where there are only two more rounds of talks penciled in before an EU summit and things do not appear to be going smoothly based on the reports that have emerged. The UK has reportedly asked for more negotiating time with the EU to pick up the pace, but the EU first wants to settle the terms of the split, particularly the financial settlement and seems happy to shift to more talks in December. To put it into context, European Commission President Juncker said “I’ve read all (UK government’s) position papers and none of them is satisfactory”. A spokesman for UK PM Theresa May said “we believe we’re in a good position and we would like to move on to discuss our future relationship”.

Staying in Europe, German Chancellor Angela Merkel spoke at her annual summer press conference and covered a range of topics. On the rising Euro, Merkel highlighted that it is almost certain to have an impact on exports, but the trade surplus is the result of solid demand for German products and “does not view the trade surplus as so dramatic”. Elsewhere, Merkel noted that she “doesn’t have anything against the concept of an EU finance minister”, but “you just have to work out what he/she could do and we’re not at that point yet in our talks with France”.

Across the pond the Treasury’s four week $25bn bill sale went smoothly yesterday at a yield of 0.960% and achieved the highest bid-to-cover ratio since the 7th March auction. The notes mature just before the US potentially facing a funding shortfall if the debt ceiling was not raised.

Wrapping up yesterday’s macro data in the US which was largely in-line to slightly firmer than expected. The August Conference Board consumer confidence index was up 2.9pts to 122.9 (vs 120.7), which is the highest reading since December 2000 (excluding March this year) and could have been stronger if factoring in the small downward revision to the prior reading. Elsewhere, the June Case-Shiller house price index was broadly in line at 0.11% mom (vs 0.10% expected) and 5.65% yoy (vs 5.60% expected).

Over inFrance, 2Q GDP was in line at 0.5% qoq, but revisions nudged the annual growth rate down slightly to 1.7% yoy (vs 1.8%). Consumer spending for July was in line at 0.7% mom, lifting the annual growth rate to 2.1% yoy (vs 1.8%), which is the highest reading for this year. InGermany, the consumer confidence index was slightly ahead of expectations at 10.9 (vs 10.8), which marks a fresh 16-year high. In the UK, the August Nationwide house price index was slightly lower than expected at -0.1% mom (vs 0% expected) and 2.1% yoy (vs 2.5%).

Before we look at the day ahead, a quick mention that on credit derivatives, Michal in our team published a report “iTraxx Main: Buy the 3s5s10s Fly” yesterday. He fleshes out his latest views on CDS index curves and provides a detailed analysis of the trade, including recent regulatory developments that should support its performance. You should find the note in your inbox or email Michal.Jezek@db.com for a copy if not.

Looking at the day ahead,Germany’s preliminary inflation readings for August (0.1% mom and 1.8% yoy expected) and Italy’s July PPI data are due. In the UK, the July mortgage approvals and data on money supply as well as net credit lending are also due. Elsewhere, the Eurozone’s August confidence indicators for business, consumer and the economy are also due. Across the pond, US’s ADP employment change for August (185k expected) will be worth watching in the context of Friday’s payrolls while the second readings for 2Q GDP (2.7% expected) and core PCE are due. Away from the data, the Fed’s Powell will speak today.

 END

3. ASIAN AFFAIRS

i)Late TUESDAY night/WEDNESDAY morning: Shanghai closed DOWN 1.60 POINTS OR 0.05%   / /Hang Sang CLOSED UP 329.60 POINTS OR 1.19%/ The Nikkei closed UP 143.99 POINTS OR 0.74%/Australia’s all ordinaires CLOSED UP 0.01%/Chinese yuan (ONSHORE) closed UP at 6.5920/Oil DOWN to 46.17 dollars per barrel for WTI and 51.76 for Brent. Stocks in Europe OPENED DEEPLY IN THE GREEN. Offshore yuan trades  6.5933 yuan to the dollar vs 6.5920 for onshore yuan. NOW THE OFFSHORE MOVED SLIGHTLY WEAKER  TO THE ONSHORE YUAN/ ONSHORE YUAN MUCH STRONGER (TO THE DOLLAR)  AND THE OFFSHORE YUAN IS MUCH STRONGER TO THE DOLLAR AND THIS IS COUPLED WITH THE SLIGHTLY STRONGER DOLLAR. CHINA IS  HAPPY TODAY 

3a)THAILAND/SOUTH KOREA/NORTH KOREA

NORTH KOREA/USA/SOUTH KOREA

b) REPORT ON JAPAN

end

c) REPORT ON CHINA

end

4. EUROPEAN AFFAIRS

The world is going crazy.  Believe it or not but Lithuania and Cyprus just went into negative interest rates becoming the 18th and 19th country with a negative 2 yr sovereign interest rate

(courtesy/zerohedge)

5. RUSSIA AND MIDDLE EASTERN AFFAIRS

END

6 .GLOBAL ISSUES

7. OIL ISSUES

Gasoline prices rise due to output problems due to Hurricane Harvey

(courtesy zerohedge)

(courtesy StockBoardAsset.com)

 

Gasoline tumbles lower as Valero states that they have started to resume refining gasoline

(courtesy zerohedge)

WTI/RBOB Tumble As Valero Says Refinery Startup Underway

RBOB is tumbling near $1.60 handle after headlines reported Valero saying that startup is underway at its Three Rivers refinery and its Corpus Christi refinery, both in Texas, according to a statement from co. spokeswoman Lillian Riojas.

Blomberg reports that the company is working to ensure availability of critical transportation and logistics infrastructure to resume all operations. Houston and Texas City, Texas, facilities continue to operate. Port Arthur, Texas, refinery shut because of flooding and potential power supply interruption.

Additionally, Plains resumed service on its Cactus crude pipeline after shutting it down Friday in preparation for Harvey, according to person familiar with matter.

And,  Buckeye expects to restore its 50k b/d condensate splitter to normal operations to at Corpus Christi, Texas, later Wednesday.

But it appears the machines took comfort in the headline…sending RBOB to the lows of the day…

Though we are unsure of why this would be bearish for crude (unless it is the crack spread arbs weighing it down).

But RBOB has a long way to go…

8. EMERGING MARKET

VENEZUELA/USA

end

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

Euro/USA   1.1946 DOWN .0023/REACTING TO  + huge Deutsche bank problems + USA election:/TRUMP HEALTH CARE DEFEAT//ITALIAN REFERENDUM DEFEAT/AND NOW ECB TAPERING BOND PURCHASES/ /USA FALLING INTEREST RATES AGAIN/HOUSTON FLOODING/EUROPE BOURSES DEEPLY IN THE GREEN

USA/JAPAN YEN 109.89 UP 0.125(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/   

GBP/USA 1.2922 UP .0001 (Brexit  March 29/ 2017/ARTICLE 50 SIGNED

THERESA MAY FORMS A NEW GOVERNMENT/STARTS BREXIT TALKS

USA/CAN 1.2534 UP .0020 (CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA)

Early THIS WEDNESDAY morning in Europe, the Euro FELL by 23 basis points, trading now ABOVE the important 1.08 level  FALLING to 1.1946; / Last night the Shanghai composite CLOSED  DOWN 1.60 POINTS OR 0.05%     / Hang Sang  CLOSED  UP 329.60 POINTS OR 1.19% /AUSTRALIA  CLOSED UP 0.01% / EUROPEAN BOURSES OPENED DEEPLY IN THE GREEN  

The NIKKEI: this TUESDAY morning CLOSED UP 143.99 POINTS OR 0.74%

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

2/ CHINESE BOURSES / : Hang Sang CLOSED DOWN 98.28 POINTS OR 0.35%  / SHANGHAI CLOSED UP 2.54 POINTS OR 0.08%   /Australia BOURSE CLOSED UP 0.01% /Nikkei (Japan)CLOSED UP 143.99  POINTS OR 0.74%   / INDIA’S SENSEX IN THE GREEN

Gold very early morning trading: 1311.00

silver:$17.42

Early WEDNESDAY morning USA 10 year bond yield:  2.132% !!! UP 1   IN POINTS from TUESDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%.

The 30 yr bond yield  2.738, UP 1  IN BASIS POINTS  from TUESDAY night.

USA dollar index early WEDNESDAY morning: 92.48 UP 23  CENT(S) from TUESDAY’s close.

This ends early morning numbers  WEDNESDAY MORNING

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And now your closing WEDNESDAY NUMBERS

Portuguese 10 year bond yield: 2.860% UP 1 in basis point(s) yield from TUESDAY 

JAPANESE BOND YIELD: +.011%  UP 1/5   in   basis point yield from TUESDAY/JAPAN losing control of its yield curve

SPANISH 10 YR BOND YIELD: 1.580% UP 2   IN basis point yield from TUESDAY 

ITALIAN 10 YR BOND YIELD: 2.078 UP 1  POINTS  in basis point yield from TUESDAY 

the Italian 10 yr bond yield is trading 50 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: +.356% UP 1  IN  BASIS POINTS ON THE DAY

END

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IMPORTANT CURRENCY CLOSES FOR WEDNESDAY

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

Euro/USA 1.1921 DOWN .0048 (Euro DOWN 48 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 110.23 up 0.465(Yen down 47  basis points/ 

Great Britain/USA 1.2932 UP  0.0097( POUND UP11 BASIS POINTS)

USA/Canada 1.2610 UP .0011 (Canadian dollar DOWN 97 basis points AS OIL ROSE TO $46.57

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

This afternoon, the Euro was DOWN  by 48 basis points to trade at 1.1921

The Yen fell to 110.23 for a LOSS of 47  Basis points as NIRP is STILL a big failure for the Japanese central bank/HELICOPTER MONEY IS NOW DELAYED/BANK OF JAPAN NOW WORRIED AS AS THEY ARE RUNNING OUT OF BONDS TO BUY AS BOND YIELDS RISE  /OPERATION REVERSE TWIST ANNOUNCED SEPT 21.2016

The POUND ROSE BY 11  basis points, trading at 1.2932/ 

The Canadian dollar FELL by 97 basis points to 1.2610,  WITH WTI OIL RISING TO :  $46.57

The USA/Yuan closed at 6.5940/
the 10 yr Japanese bond yield closed at +.0011%  UP 1/5 IN  BASIS POINTS / yield/ 

Your closing 10 yr USA bond yield UP 1  IN basis points from TUESDAY at 2.138% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic  USA 30 yr bond yield: 2.742 UP 1 in basis points on the day /

Your closing USA dollar index, 92.68  UP 43 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 WEDNESDAY: 1:00 PM EST

London:  CLOSED UP  27.83 POINTS OR 0.38%
German Dax :CLOSED UP 56.59 POINTS OR 0.47%
Paris Cac  CLOSED UP 24.42 POINTS OR 0.49% 
Spain IBEX CLOSED UP 53.20 POINTS OR 0.52%

Italian MIB: CLOSED UP 94.84 POINTS OR 0.44% 

The Dow closed UP 27.06 OR 0.12%

NASDAQ WAS closed UP 66.42  POINTS OR 1.05%  4.00 PM EST

WTI Oil price;  46.57 at 1:00 pm; 

Brent Oil: 51.69 1:00 EST

USA /RUSSIAN ROUBLE CROSS:  58.69 DOWN 46/100 ROUBLES/DOLLAR (ROUBLE HIGHER BY 46 BASIS PTS)

TODAY THE GERMAN YIELD FALLS TO  +0.356%  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:$45.96

BRENT: $50.76

USA 10 YR BOND YIELD: 2.136%  (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)

USA 30 YR BOND YIELD: 2.742%

EURO/USA DOLLAR CROSS:  1.1885 DOWN .0084

USA/JAPANESE YEN:110.35  UP  0.574

USA DOLLAR INDEX: 92.92  UP 67  cent(s)  

The British pound at 5 pm: Great Britain Pound/USA: 1.2919 : DOWN 3 POINTS FROM LAST NIGHT  

Canadian dollar: 1.2627 DOWN 113 BASIS pts 

German 10 yr bond yield at 5 pm: +0.356%

END

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

TRADING IN GRAPH FORM FOR THE DAY

Korean Missiles, Killer Storm, & Kuroda Spark Biggest Buying-Panic In Tech Stocks Since Election

For today’s stock market recap, see yesterday!

 

In a comedic case of deja vu, somebody flicked the “DUMP VIX, BUY NASDAQ” switch at exactly the moment US equity markets opened…

 

The Dow fell back into the red into the close and there was some selling pressure ahead of tomorrow’s month-end, but still, everything but The Dow just went straight up…

 

On a bed of momentum ignited by Kuroda and his magical USDJPY levitation…

 

With FANG stocks and Biotechs…

Pushing Nasdaq up almost 3% from yesterday’s lows – the biggest swing higher since the election last year (Nov 10th)

On the week, it’s pretty clear where the malarkey is (NOTE the selling as Europe opens and panic-buying as US opens)

 

Nasdaq and The Dow managed to get back into the green for August (which seemed to be critical for the machines), but the S&P remains down 0.5% still…

 

Spot The Odd One Out…

 

The S&P closed above its 50DMA…

 

Treasury yields went absolutely nowhere today – trading in an incredibly narrow range!

 

The Dollar index extended yesterday’s gains, erasing the post-Yellen J-Hole losses…

 

USDJPY (cough Kuroda cough) has just exploded since yesterday’s open…Someone was willing to pile in to every dip for 2 big figures straight up..

 

 

WTI fell further as RBOB rallied but the afternoon saw volatility in the energy complex amid headlines on refiners restarting…

 

Gold and Silver drifted modestly lower on the day…

END

 

Trump finally breaks his silence on North Korea by stating that talking is not the answer and that the USA is through with giving North Korea bribe money.

the markets are still calm..

 

(courtesy zero hedge)

 

Trump Finally Breaks His Silence On North Korea: “Talking Is Not The Answer!”

Following the latest missile launch from North Korea, which sparked panic as it flew over Japan before splashing down in the Pacific, Trump remained noticeably silent on the topic…until now.  In a new tweet this morning, Trump has finally broken his silence saying “talking is not the answer!” to solve the North Korea crisis.

“The U.S. has been talking to North Korea, and paying them extortion money, for 25 years. Talking is not the answer!”

The U.S. has been talking to North Korea, and paying them extortion money, for 25 years. Talking is not the answer!

 

As Bloomberg pointed out yesterday, the delayed Trump tweet on the topic was likely the result of a new process put in place by Chief of Staff Kelly to assure that responses to such crises go through formal White House channels rather than ‘off-the-cuff” tweets.

Coming less than a week after Trump said Kim Jong Un was “starting to respect” the U.S., the test-firing was a provocation and required a clear response. So the team activated a process put in place by Trump’s new chief of staff John Kelly in anticipation of just such a crisis.

 

The idea was to reach out first to reassure allies and ensure the initial response came not as an off-the-cuff presidential tweet but a statement that reflected measured thinking, according to people familiar with the process, who asked not to be identified discussing internal policy.

 

Deliberations were cut off early in the evening as National Security Adviser H.R. McMaster — who was joined in his office by Tillerson for the calls on how to respond — prepared a statement for President Donald Trump’s approval, the people said.

 

The response, announced Tuesday morning in Washington, said North Korea’s latest launches “signaled contempt” for its neighbors and restated the U.S. position that “all options are on the table.”

Meanwhile, stocks were at least momentarily ‘triggered’ by Trump’s tweet this morning even though we fully expect the “buy the dip” crowd to emerge any moment.

Looks like the Armed forces are controlling things in the uSA.

(courtesy zerohedge)

Mattis Contradicts Trump: “We Are Never Out Of Diplomatic Solutions” On North Korea

In the latest public disagreement between President Trump and his top military advisor, Defense Secretary Jim Mattis on Wednesday said that when it comes to North Korea, diplomatic solutions remain on the table after he was asked to respond to a tweet by President Trump that said “talking is not the answer.”

“No, we are never out of diplomatic solutions,” Mattis said in an exchange with pool reporters before meeting with his South Korean counterpart Song Young-moo in the Pentagon. “We continue to work together, and the minister and I share a responsibility to provide for the protection of our nations, our populations, and our interests, which is what we are here to discuss today.”

As discussed this morning, in his first tweet discussing the recent North Korean missile launch, Trump tweeted that “The U.S. has been talking to North Korea, and paying them extortion money, for 25 years. Talking is not the answer!”

The U.S. has been talking to North Korea, and paying them extortion money, for 25 years. Talking is not the answer!

The market slumped briefly (the dip was quickly bought) after Trump appeared to be signaling that the administration was shifting tactics a day after a White House statement said “all options are on the table.” Mattis and Secretary of State Rex Tillerson have repeatedly said the top priority should be a diplomatic solution with North Korea. On Tuesday, U.S. Ambassador to the U.N. Nikki Haley called the test “absolutely unacceptable and irresponsible,” noting that North Korea has violated “every single security council resolutions have had” and suggesting a hard-line shift in US policy.

As Reuters reports, Mattis made the comment during a media availability before the meeting, in which a reporter is allowed to ask a question on behalf of the press corps, which is then distributed to news outlets. Photographers and videographers are also allowed in.

After initially saying “no” after being asked whether the U.S. was out of diplomatic solutions, the reporter pressed Mattis over what options can still be taken.

“Now you’re testing us here, you know,” Mattis joked. “We bring you up here to take pictures.”

 Mattis on : “We’re never out of diplomatic solutions…”

end

TUESDAY NIGHT

 

A giant chemical plant in Crosby Texas warns that it is in danger of exploding;

 

(courtesy zero hedge)

(courtesy zero hedge)

Harvey Makes Second Landfall In Louisiana After Leaving “Apocalyptic” Flooding, Record Rainfall In Texas

Five days after it first plowed into southwest Texas as a category 4 hurricane, Tropical Storm Harvey has made second landfall west of Cameron on the border between Texas and Louisiana, early Wednesday according to the National Hurricane Center. The storm, which has already pummeled the city of Houston with more than 50 inches of rain – a new record for the contiguous US, according to the Wall Street Journal – has left at least 18 dead, including two Houston police officers, and forced tens of thousands of people from their homes.

Though the hurricane (now tropical storm) has wreaked widespread devastation on Texas, Reuters says citizens of Western Louisiana have at least one silver lining to cling to: torrential rains are expected to cease later on Wednesday as the storm picks up speed and moves northeast away from the Gulf of Mexico. NOAA was forecasting less than an inch of rain for the Houston area on Wednesday, with a slight chance of sunshine.

“Harvey, which made landfall west of Cameron, Louisiana on Wednesday, was expected to produce an additional 3 to 6 inches (7.5 to 15.24 cms) of rain to an area about 80 miles east of Houston as well as southwestern Louisiana, where some areas have already seen more than 17 inches of rain.

 

It is projected to weaken as it moves inland to the northeast, the National Hurricane Center said.

 

“We aren’t going to be dealing with it for too much longer. It’s going to pick up the pace and get out of here,” said Donald Jones, a meteorologist at the National Weather Service in Lake Charles, Louisiana.”

However, that’s hardly any consolation to residents of Houston and the surrounding Harris County, an area 15 times the size of Manhattan, one-third of which remains underwater, according to Reuters. It may take days for all flood waters, which have spilled over dams and pushed levees to their limits, to recede.

According to WSJ, Texas officials said 30,000 people could be forced from their homes due to flooding and more than 725,000 people were under a mandatory evacuation order. A convention center equipped to hold 5,000 people was housing over 9,000 evacuees by midday Tuesday.

Last night, Houston Mayor Sylvester Turner ordered a curfew from midnight to 5 am local time to prevent looting and keep the streets clear for first responders.

CURFEW UPDATE: I’m modifying the curfew to start at midnight (and still end at 5 am) to allow volunteers and others to do their great work.

One women who spoke to WSJ compared Harvey with a biblical flood.

“I asked my daughter, is this the end of the world?” said 74-year-old Norma Brown, cradling two of her dogs in a Houston evacuation center after fleeing the flood on a neighbor’s boat. While waiting in the rain to get into the George R. Brown Convention Center downtown, Ms. Brown burst into tears, realizing she had likely lost her home in Dickinson, a badly flooded area southeast of the city.”

The Pentagon said Tuesday it has identified as many as 30,000 troops to assist in a massive military response, and was awaiting a formal request for assistance from Mr. Abbott, who has already activated 12,000 Texas national guardsmen to help with the state’s response to the hurricane.  Federal and local agencies said they’ve already rescued more than 13,000 people from floodwaters in Houston and the surrounding area, according to ABC.

More than four feet of rainfall has badly damaged Houston’s infrastructure, causing one bridge to collapse, as we reported yesterday. Two reservoirs in and around the city were already overflowing, and authorities warned that water levels at a third reservoir were nearing their top.

According to Bloomberg, Harvey has created a situation where Gulf of Mexico waters have kept drumming hard up against the coastline, preventing rain water from running off into the sea and backing everything up for miles around.

The ferocious arrival was tempered by high-pressure systems across the U.S., including a large one that pushed temperatures in California beyond 100 degrees Fahrenheit (38 Celsius), said Phil Klotzbach, a hurricane researcher at Colorado State University. Harvey became “a pebble in stagnant stream.”

 

Predictions were that some areas east of Houston would witness 50 inches or more of rain by the time Harvey moved off into the central U.S. As of 3 a.m. local time Wednesday, the gauge at Mont Belvieu, east of the city, showed 51.88 inches had fallen since the start of the storm. That may be the most in recorded history for a tropical cyclone in the contiguous U.S., breaking a mark also set in Texas back in 1978. The record for all 50 states in such a storm was set in 1950 in Hawaii — 52 inches.

Harvey’s deluge was made all the worse because the ground was already saturated by heavy rainfall earlier in the season. “We have had roughly a year’s worth of rain in the last three months,” said Wendy Wong, a National Weather Service meteorologist in Dickinson, Texas, a city that was evacuated.

* * *

“We’re on the verge of having cascading failures,” said Watson, a Savannah, Georgia-based disaster modeler with Enki Research. “It is conceivable that we could get into the $60 to $80 billion range without that much effort.” Watson said disaster models just aren’t calibrated for a thing like Harvey. For instance, a typical scenario will assume infrastructure such as dams, levees and drainage systems will fail when stress rates reach 80 to 90 percent. “We are seeing failures at 60 percent,” he said.

The pressure on the Addicks and Barker reservoirs west of Houston spurred the Army Corps of Engineers to release water, which flooded neighborhoods that had been dry before. Now such deliberate flooding should be more calculated, Watson said.

“We’re starting to get into the apocalyptic — this is what we don’t want to have happen,” Watson said.

While we wait for the apocalypse, Houston’s largest shelter, the George R. Brown Convention Center, held more than 9,000 people as of Wednesday, almost twice the number officials originally planned to house there. Mayor Turner said the city was working on opening two more shelters, adding that nobody would be turned away.

Meanwhile, Texas Gov. Greg Abbott told ABC News’ “Good Morning America” on Monday that he expects the aftermath of Harvey to be “horrific” and that it will “take years” to rebuild. As reported last night, a nighttime curfew, from 10 p.m. to 5 a.m., was imposed in Houston Tuesday night as the storm’s center drifted back toward the Gulf of Mexico. The storm made landfall between Port Aransas and Port O’Connor in Texas on Friday, stalled out further inland over the weekend and is now trekking eastward. It is expected to reach the Lower Mississippi Valley by Thursday.

Moody’s expects the storm to cause between $30 and $40 billion in property damage, which would make Harvey the fourth most severe hurricane to ever hit the US. Some have estimated as much as $100 billion in damages.

As the storm leaves Texas and Louisiana behind late Wednesday, it’s expected to move across the Lower Mississippi Valley and Tennessee Valley through Thursday. The forecast calls for the storm to continue into the central U.S., and it’s expected to become a tropical depression by tonight.

Even then, Houston won’t be free from threats: rainfall over the state will eventually need to make its way into the Gulf, which means several more pulses of water could be coming the city’s way, Watson said.

“There is another train that is heading toward Houston,” Watson said. “Behind every one of these dollar signs is a family that doesn’t have a house anymore.

END

 

 

Now Houston is suffering from an outbreak of looting and armed robberies.  Now the vigilantes emerge:

(courtesy zerohedge)

Houston Reeling Amid Outbreak Of Looting, Armed Robberies; Vigilantes Emerge

Inevitably every major metropolitan crisis brings out the best and worst of what humanity has to offer.  While hundreds/thousands of people have rushed into Houston following the epic destruction of Hurricane Harvey to help in any way possible, others have once again predictably chosen to exploit the misery of others by looting abandoned shopping centers, robbing empty homes and even breaking into the Houston Apple Store (by shooting through the front door).

The doors to a flooded @Apple Store in  appear to have been shot at with a firearm. Looters have been rampant.  

In fact, just last night Houston’s Mayor was forced to impose a strict midnight to 5am curfew amid “an outbreak of looting and armed robberies, in order to prevent property crimes against evacuated homes in the city.  As Reuters notes, the curfew came after, among other things, reports surfaced of people impersonating police officers all so they could tell residents to evacuate their homes and then promptly rob them blind.

That proved too little for county officials who set up their own location as an outbreak of looting and armed robberies prompted the city to order an indefinite curfew from midnight to 5 a.m. (0500 to 1000 GMT).

 

Houston Police Chief Art Acevedo said late Tuesday individuals impersonating police officers knocked on doors in at least two parts of the city telling residents to evacuate their homes.

Imposing curfew from 10 pm to 5 am to stop any property crimes against evacuated homes in city limits.

Meanwhile, Houston Police Chief Art Acevedo hosted a press conference earlier this morning to warn residents that his force is not going to tolerate criminals taking advantage of people in the community and that he is working with the district attorney to strengthen penalties for looting and is encouraging judges and juries to impose the maximum penalties possible.  Per ABC 13 of Houston:

He said his officers arrested 14 alleged looters since Sunday. Those arrested will face stiffer punishments under a Texas law providing heftier penalties during a crisis, prosecutors announced Tuesday.

 

“People displaced or harmed in this storm are not going to be easy prey,”Harris County District Attorney Kim Ogg said.

 

Burglarizing a home would normally bring a penalty of two to 20 years in prison, but now brings five years to life. “This is the state of Texas. We are a welcoming city, but we are not going to tolerate people victimizing others,”Acevedo said. He said he will push for the fullest prosecution possible for any crimes committed during such a sensitive time.

.@ArtAcevedo: If you (criminals) take advantage of people in our community, we will prosecute you to the full extent of the law.

http://abc13.com/video/embed/?pid=2354899

The Police Chief said his officers arrested a crew of armed criminals robbing members of the Houston community on Monday night. “They found them after a pursuit and took them into custody. He said officers also caught three looters at a Game Stop Monday night.”

The owner of the Bronze Bar in Houston also shared a photo of her business with smashed windows writing, “My business that I’ve worked hard for was looted last night. I can’t believe people are capable of this.”

Not surprisingly, some looters either did not get the message or have simply chosen to ignore it as pictures and videos of criminal activity continue to flood twitter.

Meanwhile, other residents have simply chosen to become vigilantes, and take matter into their own hands…

YLIS

Port closures are certainly hurting the economy and this may have a huge dent in 3rd quarter GDP

(courtesy zerohedge)

Coast Guard Updates: Major Ports In Texas Are “Condition Zulu”

Update: Port of Corpus Christi update to port condition Modified Zulu for the Corpus Christi Inner Harbor.

Coast Guard captain of the port in Corpus Christi implemented Port Condition Modified Zulu for the Port of Corpus Christi Inner Harbor.

 

Modified Zulu allows tug and barges with drafts not exceeding 20-feet currently in the Corpus Christi Inner Harbor to transit freely within the Inner Harbor with no requirements to seek the COTP permission to move.

 

“Mariners are to proceed with caution as navigational ads may be missing or off station. All other portions of the captain of the port zone remains in Port Condition Zulu unless they have already been cleared by the COTP,” the Coast Guard said.

 

“I applaud the incredible work of the Port of Corpus Christi, the Army Corp of Engineers and all industry facilities working hard and collaborating in this process,” said Capt. Tony Hahn, COTP of Corpus Christi. “This is a first step but also a very important one towards restoring full capability of the port.”

Via StockBoardAsset.com,

The U.S. Coast Guard along with the U.S. Army Corps of Engineers and the Texas General Land Office have provided an update on the current port conditions within the effected areas of Hurricane Harvey.

Per Coast Guard,

Harvey, now a tropical storm, has resulted in significant flooding and impacts for ports along the Texas coast.

 

“The Coast Guard along with the ASCOE and TGLO understand the international and global significance of the Gulf Coast ports and are currently conducting surveys and thorough port assessments prior to reopening,” the Coast Guard said in a statement Tuesday.

5 out of 7 of the main ports in Texas are closed disrupting some of the world’s largest shipping channels

Ports in the direct path of Harvey and conditions in effect for Tuesday are as follows:

Corpus Christi:

Port of Brownsville – port condition normal
Port of Corpus Christi – Port Condition Zulu
Calhoun Port Authority – Port Condition Zulu

Houston:

Freeport – Port Condition Zulu
Galveston – Port Condition Zulu
Houston – Port Condition Zulu
Texas City – Port Condition Zulu

(Port Condition ZULU: A danger condition in which gale force winds are possible within 12 hours. In Port Condition ZULU the port is closed and all port operations are suspended except for vessel movements and activities specifically authorized by the Coast Guard COTP)

The Port of Houston is a 25-mile long complex of diversified public and private facilities. The petrochemical complex with-in the port is one of the largest in the world. According to , ”the Port of Houston no longer has any tankers in place.”

View image on TwitterView image on TwitterView image on Twitter

The Port of Houston no longer has any tankers in place. 

 

Harvey’s impact on Texas: Port of Houston executive director explains

Conclusion:

If Texas was a sovereign country (2016), it would be the 10th largest economy in the world by GDP. The economic impact of Hurricane Harvey on port closures could be devastating not just for Texas, but perhaps 3Q17 GDP.

 

 

end

 

Hurricane Harvey’s destruction lessens the odds of a government shutdown from 50% to 33% according to Goldman Sachs but it is still prominent.  Goldman Sachs offers three scenarios

 

(courtesy zero hedge)

 

Harvey Destruction Prompts Goldman To Cut Government Shutdown Odds

Having in recent weeks boosted its estimate for government shutdown odds to even, or 50%, in a note overnight from Goldman’s Jan Hatzius, the Goldman chief economists writes that due to the human tragedy from Hurricane Harvey, the odds of a shutdown have been again reduced, back to Goldman’s original shutdown estimate of 33%.

According to Hatzius, “recent events have lowered the odds of a government shutdown or a delayed debt ceiling hike but have also increased the number of possible scenarios, complicating the legislative outlook over the next couple of months. At this point, we peg the probability of a shutdown in early October at 35%, down from our prior view of 50% over the last couple of weeks.

As Goldman explains, the main issue is Hurricane Harvey and the considerations are largely optical: “allowing a partial government shutdown when federal relief efforts are underway would pose greater political risks than under normal circumstances, raising the probability that lawmakers will find a way to resolve disagreements.” In addition, Hatzius predicts that over the next several weeks “Congress will probably need to appropriate additional disaster relief funds”, and Congressional leaders will be “apt to combine this with legislation to extend federal spending authority and/or raise the debt limit if possible.”

If they do, a combined package would be more likely to pass and less likely to be vetoed, in our view.

As a result, the most obvious scenario now, and the one with the highest probability, is that disaster relief funding will be paired with legislation to raise the debt limit (due by September 29) and extend government spending authority (due by September 30), Goldman writes.

Congress Is Likely to Appropriate Emergency Funds

That said, a shutdown or delayed debt ceiling hike is still clearly possible. Hatzius sees three ways that the current standoff could still end in a government shutdown.

  • First, if the combined bill extends spending authority (and possibly the debt limit) for only a short period, a shutdown could still occur at the next expiration if the president insists on border wall funding. At that point, if hurricane relief funding has already been agreed to, a shutdown would have fewer negative political consequences and thus could become more likely. At this point, the continuing resolution (a short-term spending extension) is expected to last until mid-December, but could last anywhere from one week to several months.
  • A second scenario is simply that disaster funding ends up passing separately from the broader spending legislation. While congressional Republican leaders would presumably want to avoid this, it could happen if the funds are needed more quickly than Congress can organize a broader spending/debt limit bill. We also note that the President appears to view this as a plausible outcome: in a press conference on August 28, he was asked regarding the hurricane “does this situation make you reconsider the possibility of a government shutdown?” He replied “I think it has nothing to do with it, really. This is separate — this is going to go very, very quickly.”
  • A third scenario is simply that the president vetoes the spending bill over its omission of border wall funding, potentially vetoing hurricane relief funds as well. This does not appear particularly likely to us, but cannot be ruled out entirely. When asked about the possibility of vetoing the spending bill, President Trump replied “I hope that’s not necessary. If it’s necessary, we’ll have to see.”

Despite these three potential hurdles, Goldman now believes there is a 35% chance of a partial federal shutdown “because it continues to be unlikely that Congress will pass legislation that funds the border wall and it continues to be unclear whether President Trump will sign spending legislation that omits it.” However, the odds of a presidential veto of upcoming spending legislation do appear to have declined somewhat following recent events and we therefore believe that a shutdown is less likely as a result.

Then again, with Trump what typically appears obvious and makes the sense, usually ends up being the last thing to actually happen, so putting on the proverbial “hedging trades” may still not be a bad idea.

end

 

I would not read too much into the ADP report: it added 237,000 jobs in August

(courtesy zero hedge)

ADP Employment Surges By The Most In 5 Months

ADP reports the US economy added 237,000 jobs in August, notably more than the expected 185k. This is the biggest addition since March, and follows upward revisions for July. While Services dominated (adding 204k), Goods-producing jobs rose 33k (with manufacturing adding 16k).

Medium- and Large-seized firms added the most jobs in August.

 

Manufacturing added 16,000 jobs in August….

 

Trade/Transportantion and Leisyure added the most jobs in August…

“In August, the goods-producing sector saw the best performance in months with solid increases in both construction and manufacturing,” said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. “Additionally, the trade industry pulled ahead to lead job gains across all industries, adding the most jobs it has seen since the end of 2016. This could be an industry to watch as consumer spending and wage growth improves.”

Mark Zandi, chief economist of Moody’s Analytics, said, “The job market continues to power forward. Job creation is strong across nearly all industries, company sizes. Mounting labor shortages are set to get much worse. The initial BLS employment estimate is often very weak in August due to measurement problems, and is subsequently revised higher. The ADP number is not impacted by those problems.

Full Breakdown below

<br /> ADP National Employment Report: Private Sector Employment Increased by 237,000 Jobs in August<br />

end

This is a surprise:  USA 2nd quarter revised sharply higher to 3.0% from 2.6%

(courtesy zerohedge)

US Second Quarter GDP Revised Sharply Higher To 3.0%, Best In Two Years

In a surprise for traders – and the Fed – moments ago the BEA reported that after its first revision of Q2 GDP (a quarter which ended two months ago), the initial estimate of 2.6% was revised to 3.0%, beating expectations of a 2.7% print, and the highest annualized growth rate since Q1 2015. The annualized Q2 GDP was more than double the first quarter number which as a reminder printed at 1.2%

While most components were revised higher in the latest release (with the notable exception of government which downshifted from 0.12% to -0.05%) the biggest contributor to the upward revision was Personal Spending, which surged 3.3% in Q2, after rising 1.9% in Q1, and contributing 2.28% of the bottom GDP line.

As a result, the upward revision to the second estimate of GDP growth mainly reflected revisions to consumer spending on goods and to business investment. The full breakdown is shown below.

Meanwhile, looking at the Fed’s preferred inflation indicator, the core PCE, it showed that for one more quarter inflation supposedly remained dormant,  as core PCE rose 0.9% in 2Q, in line with expectations, after rising by 1.8% in the prior quarter.

Today’s report also revealed that NIPA corporate profits increased 1.3% in Q2 after dropping 2.1% in the first quarter.

Profits of domestic nonfinancial corporations increased 5.4% after increasing 0.3%. This however was offset by a sharp drop in profits of domestic financial corporations decreased 6.2% after decreasing 7.9%. Somewhat surprisingly, profits from the rest of the world decreased 2.0% after decreasing 2.1%, despite the steep drop in the USD. In total, the BEA reports that corporate profits increased 7.0 percent from the second quarter of 2016.

end

I will see you THURSDAY  night

Harvey.

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