Sept 15/Your usual Friday whacking on gold and silver/gold down $4.25 and silver was down 13 cents/Open interest in silver continues to rise coupled with another 845,000 oz gain in amount standing/North Korea launches another ballistic missile and everybody yawns/the bill for Irma and Harvey may top 300 billion USA and the world yawns/Terrorist attack in London and in France/ UK now on critical terror threat meaning an attack is imminent/USA retail sales plummet in August along with industrial production/

GOLD: $1321.40 DOWN   $4.25

Silver: $17.64  DOWN 13 CENT(S)

Closing access prices:

Gold $1320.30

silver: $17.61

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: $1334.30 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME:  $1331.30

PREMIUM FIRST FIX:  $3.00

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

SECOND SHANGHAI GOLD FIX: $1332.13

NY GOLD PRICE AT THE EXACT SAME TIME: $1329.95

Premium of Shanghai 2nd fix/NY:$2.18

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

LONDON FIRST GOLD FIX:  5:30 am est  $1325.00

NY PRICING AT THE EXACT SAME TIME: $1325.75

LONDON SECOND GOLD FIX  10 AM: $1322.85

NY PRICING AT THE EXACT SAME TIME. 1324.65 ???

For comex gold:

SEPTEMBER/

NOTICES FILINGS TODAY FOR SEPT CONTRACT MONTH: 0 NOTICE(S) FOR  nil  OZ.

TOTAL NOTICES SO FAR: 54 FOR 5400 OZ  (0.1679 TONNES)

For silver:

SEPTEMBER

 226 NOTICES FILED TODAY FOR

1,130,000  OZ/

Total number of notices filed so far this month: 5,479 for 27,395,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

end

 

Despite the ballistic launch by North Korea, the bill for Hurricane Harvey and Irma may approach 300 billion dollars, retail sales in the uSA and industrial production sink, the boys decided again to raid our precious metals.  Friday is a good day for them to raid as they do not have to worry about providing any physical because of the weekend.  They love to hit anytime after 10 am est -1200 am est and that is because the physical market in London has already been put to bed. The COT report is really lopsided in both gold and silver and that in itself explains why they raid.

Let us have a look at the data for today

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

In silver, the total open interest ROSE BY A RATHER LARGE 2577 contracts from  188,971 UP TO 191,548 DESPITE THE  DROP IN PRICE THAT SILVER UNDERTOOK IN YESTERDAY’S TRADING (DOWN 2 CENT(S). WE HAVE NOW HAD FIVE DAYS OF TORMENT AND YET THE SILVER OPEN INTEREST HARDLY BUDGES SOUTHBOUND..ONLY ADVANCES NORTHBOUND.  THE LONGS ARE REMAINING STOIC AND REFUSE TO GIVE IN TO THE ANTICS OF THE BANKERS. NO WONDER WE ARE UNDERGOING ANOTHER DAY OF TORMENT TODAY AS THE BANKS SEEMED TRAPPED IN THE OWN JUICE…THEY ARE DESPERATELY TRYING TO CAUSE SOME OF THE SILVER LEAVES TO FALL FROM THE SILVER TREE. WE WILL KNOW LATE TONIGHT IF THEY HAD ANY SUCCESS!

RESULT: A STEADY RISE IN OI COMEX  DESPITE THE 2 CENT PRICE LOSS. 

 In ounces, the OI is still represented by just UNDER 1 BILLION oz i.e.  0.958 BILLION TO BE EXACT or 137% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT MAY MONTH/ THEY FILED: 226 NOTICE(S) FOR 1,130,000  OZ OF SILVER

In gold, the open interest FELL BY A SMALL 2666 CONTRACTS DESPITE THE  GAIN  in price of gold ($1.10 GAIN YESTERDAY). The new OI for the gold complex rests at 576,765. THE BANKERS ORCHESTRATED ANOTHER RAID THIS MORNING WORRIED ABOUT THE STEADY OI RISE IN SILVER AND THE HIGH OI IN GOLD, AS THE BANKERS TRY  TO FLEECE INVESTORS OF THEIR LONG POSITIONS.

Result: A SMALL DECREASE IN OI DESPITE THE  RISE IN PRICE IN GOLD ($1.10). THE COMMERCIALS SUPPLIED THE NECESSARY SHORT PAPER.  WE HAVE ANOTHER RAID ORCHESTRATED THIS MORNING AS THE BANKERS ARE DESPERATE TO SHAKE OUR PRECIOUS METALS FROM THEIR RESPECTIVE TREE 

we had: 0 notice(s) filed upon for nil oz of gold.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD:

Tonight , we had no change in gold inventory last night:

Inventory rests tonight: 838.64 tonnes

SLV

Today: no change in inventory.

INVENTORY RESTS AT 327.088 MILLION OZ

end

.

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

1. Today, we had the open interest in silver ROSE BY A STEADY  2577 contracts from 188,971  UP TO 191,548(AND now A LITTLE CLOSER TO THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) DESPITE YESTERDAY’S 2 CENT LOSS IN TRADING. OUR LONGS ARE STRONG AND REFUSE TO BUDGE WITH THE ANTICS OF OUR BANKERS.

RESULT:  A  STEADY RISE IN OI  AT THE COMEX  DESPITE THE FALL IN PRICE OF 2 CENTS. WE HAVE ANOTHER RAID UNDERWAY THIS MORNING BY OUR BANKERS AS THE OPEN INTEREST ON BOTH GOLD AND SILVER REFUSE TO BUDGE 

(report Harvey)

.

2.a) The Shanghai and London gold fix report

(Harvey)

 

2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY:  Bloomberg

3. ASIAN AFFAIRS

i)Late THURSDAY night/FRIDAY morning: Shanghai closed DOWN 17.81 POINTS OR 0.53%   / /Hang Sang CLOSED UP 30.29 POINTS OR 0.11%/ The Nikkei closed UP 102.06 POINTS OR 0.52%/Australia’s all ordinaires CLOSED DOWN 0.74%/Chinese yuan (ONSHORE) closed WELL UP at 6.5442/Oil UP to 49.97 dollars per barrel for WTI and 55.52 for Brent. Stocks in Europe OPENED RED EXCEPT GERMANY. Offshore yuan trades  6.5464 yuan to the dollar vs 6.5426 for onshore yuan. NOW THE OFFSHORE MOVED A LITTLE WEAKER  TO THE ONSHORE YUAN/ ONSHORE YUAN MUCH STRONGER (TO THE DOLLAR)  AND THE OFFSHORE YUAN IS A MUCH STRONGER TO THE DOLLAR AND THIS IS COUPLED WITH THE SLIGHTLY  WEAKER DOLLAR. CHINA IS NOT HAPPY TODAY 

 

 

3a)THAILAND/SOUTH KOREA/NORTH KOREA

i)Oh No!! North Korea fires a suspected ICBM over Sea of Japan
( zerohedge)
ii)South Korea angry, as they threaten to destroy the North.  Japan asks for restraint

( zerohedge)

b) REPORT ON JAPAN

c) REPORT ON CHINA

4. EUROPEAN AFFAIRS

i) London/UKExplosion and fire from a bucket bomb in the London subway system at Parson Green and this is treated as a terrorist incident

( zerohedge)

ib)Then late in the afternoon, the uK terror threat level was raised to critical, meaning another terrorist attack may be imminent

( zero hedge)

ii) Spain/Catalonia

Spain tries to restrict Catalans finances ahead of the independence vote despite the fact that they supply more dollars to Madrid that Catalan receives
( zerohedge)
iii) France
Another terrorist attack in France
( zero hedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

6 .GLOBAL ISSUES

7. OIL ISSUES

Rig counts lower again by 7 as crude fails at the 50 dollar level

( zerohedge)

8. EMERGING MARKET

VENEZUELA

 

9.   PHYSICAL MARKETS

i)David Morgan agrees with us that a Chinese gold to oil link will be a huge boost to our precious metals.

( David Morgan/GATA)

ii)The following commentary is extremely important.  First Alasdair talks about the continual whacking of paper gold/silver at the comex.  However he states that this is coming to an end once China implements its oil contract denominated in yuan and then convertible to gold.  This will cause less dollars floating around the world and will also cause China to liquidate its dollars for commodities, something that we have noted to you on many occasions. He talks about Trump’s ill fated “make America great protectionist policies as troublesome..

a very important read.

( Alasdair Macleod/Goldmoney)

 

iii)Hugo also is in full agreement with  us:  Bitcoin will fall to its intrinsic value and value is zero

( Hugo Salinas Price/GATA)

iv)Rory Hall interviews our good friend Chris Powell, secretary of GATA who talks about the gross failure of journalism in not writing about the truth especially in the precious metals market

( Chris Powell/GATA/Rory Hall)

 

v)Wow!! Hugo did it..Mexico is discussing the monetization of a 1 oz silver libertad coin. This will help this impoverished nation if implemented

( MPlata/Hugo Salinas Price/GATA)

vi)As we indicated to you last night, we have crypto carnage as bitcoin crashes below 3,000 dollars after China is halting local bitcoin exchanges.  This will be a boon for gold and silver as they only true currencies

 

( zero hedge)

10. USA Stories

i)Janet will not like this; as promised by Bank of America, August retail sales tumbled .2% month over month with July’s surprise gains cut in half due to revisions. This is a terrible report and it has not seen such results since Jan. 2016:

( zerohedge)

(courtesy zero hedge)

ii b) Even soft data U.Mich consumer confidence slides as we now see a loss of hope

(courtesy UMichigan ConsumerConfidence/zerohedge)

ii c)The New York Fed just slashed Q3 and Q4 GDP.  If they are correct, the total growth for the year 2017 will be just 1.8%..not the 3% promised by Trump

(courtesy zerohedge)

iii)More problems for Florida as Irma released a massive 250 million gallons of untreated sewage onto the streets

( zerohedge)

iv)This is something that we must be cognizant of:  Southern California received 40,000 lightning strikes betweeen Sept 10 and Sept 11 AND NO RAIN.  MEXICO ALSO RECEIVED HUGE LIGHTNING STRIKES WITHOUT RAID AND THEN THEY HAD A HUGE 8.2 MAGNITUDE EARTHQUAKE..IS AN EARTHQUAKE HEADING FOR SOUTH CALIFORNIA?

( MacSlavo/SHFTplan.com)

Let us head over to the comex:

The total gold comex open interest FELL BY A SMALL 2577 CONTRACTS DOWN to an OI level of 577,765 DESPITE THE GAIN IN THE PRICE OF GOLD  ($1.10 GAIN IN YESTERDAY’S trading). THE HIGH OPEN INTEREST IN GOLD RESULTS IN MORE BANKER TORMENT AS THESE CROOKS TRY AND LIBERATE GOLD LEAVES FROM THE GOLD TREE.  YESTERDAY  THEY HAVE  SUCCEEDED IN LIBERATING A TINY NUMBER OF OPEN INTEREST.  WE AWAIT TONIGHT TO SEE IF ANY MORE GOLD LEAVES FELL!

Result: a  SMALL SIZED open interest DECREASE with a RISE IN THE PRICE OF GOLD TO THE TUNE OF $1.10   

The new non active September contract month saw it’s OI RISE BY 298 contracts UP to 1111.   We had 0 notices filed UPON YESTERDAY so we GAINED 298 contracts or an additional 29,800 oz will stand AND 0 EFP’s WERE ISSUED which entitles them to a fiat bonus plus a deliverable contract on a different exchange and most likely that would be London.  These are private deals so we do not get to see the makeup of these deals only the number of EFP’s issued. SOMEBODY WAS IN URGENT NEED OF PHYSICAL GOLD LAST NIGHT.

The next active contract month is Oct and here we saw a LOSS of 291 contracts DOWN to 38,987.

The November contract saw A GAIN OF 25 contracts UP to 438.

The very big active December contract month saw it’s OI LOSS OF 3752 contracts DOWN to 452,222.

We had 0 notice(s) filed upon today for  nil oz

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
And now for the wild silver comex results.  Total silver OI ROSE BY A STEADY  2,577 CONTRACTS FROM 188,971 UP TO 191,548 DESPITE YESTERDAY’S  2 CENT LOSS IN PRICE.   DESPITE THE CONSTANT TORMENT FROM THE BANKERS, OUR LONGS REMAIN RESOLUTE DETERMINED TO TAKE ON OUR BANKERS AS NO SILVER LEAVES FELL FROM THE SILVER TREE.  DEMAND FOR PHYSICAL SILVER REMAINS EXTREMELY HIGH AS AGAIN THE AMOUNT STANDING FOR DELIVERY INCREASED AGAIN AND THIS TIME BY A WHOPPING 845,000 OZ.  WE HAVE BEEN WITNESSING THIS PHENOMENA FOR THE PAST 5 MONTHS.  (SEE BELOW).
RESULT:  A STEADY INCREASE IN OI AT THE COMEX  DESPITE A 2 CENT LOSS IN PRICE. DEMAND FOR PHYSICAL SILVER RISES AGAIN AS THE AMOUNT STANDING INCREASES FOR THE SEPT CONTRACT MONTH BY A WHOPPING 845,000 OZ.  THE BANKERS THIS TIME WERE RETICENT TO SUPPLY THE NECESSARY SHORT PAPER AS THEY COULD NOT CAUSE MORE SILVER LEAVES (OI) TO FALL!!. JUDGING FROM THE TRADING IN GOLD/SILVER TODAY, THE BANKERS SEEM TRAPPED AS THEY RAID TRYING TO COVER SOME OF THEIR HUGE PAPER SHORTS. LATE TONIGHT WE WILL SEE IF THEY HAD ANY SUCCESS IN CAUSING SILVER LEAVES TO FALL.

We are now in the active contract month of September (and the last active month until December). Today we witness Sept. OI LOSS OF 186 contacts DOWN to 736. We had 355 notices filed yesterday, so we again gained 169 contracts or an additional 845,000 oz will stand for delivery. This phenomenon has been happening in silver for the past 5 months whereby the amount standing increases on each and every delivery day.  This queue jumping highlights the huge demand for silver that we have been witnessing around the globe. The next non active contract month for silver after September is October and here the OI LOST 87 contacts DOWN TO 941. November saw a GAIN of 0 contract(s) and thus REMAINING AT  64. After November, the NEXT big active contract month is December and here the OI LOST 994 contracts DOWN to 156,795 contracts.

We had 226 notice(s) filed for  1,330,000 oz for the SEPT. 2017 contract

VOLUMES: for the gold comex

ESTIMATED VOLUME TODAY: 196,550 CONTRACTS WHICH IS FAIR

(not available today)

YESTERDAY’S confirmed volume was 348,625 which is EXCELLENT

volumes on gold are STILL HIGHER THAN NORMAL!

INITIAL standings for SEPTEMBER

 Sept.15/2017.

Gold Ounces
Withdrawals from Dealers Inventory in oz   nil
Withdrawals from Customer Inventory in oz  
NIL oz
Deposits to the Dealer Inventory in oz    nil oz
Deposits to the Customer Inventory, in oz 
 NIL oz
No of oz served (contracts) today
 
0 notice(s)
NIL OZ
No of oz to be served (notices)
1111 contracts
(111,100 oz)
Total monthly oz gold served (contracts) so far this month
54 notices
5400 oz
0.1679 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   9,996.8  oz
Today we HAD  0 kilobar transaction(s)/ 
total dealer deposits: nil oz
We had nil dealer withdrawals:
total dealer withdrawals:  0 oz
we had 0 customer deposit(s):
total customer deposits; NIL  oz
We had 0 customer withdrawal(s)
total customer withdrawals;NIL oz
 we had 1 adjustment(s)
i) Out of Brinks:  18,033.383 oz was adjusted out of the dealer and this landed into the customer account of Brinks
For SEPT:

Today, 0 notice(s) were issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 0  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.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
To calculate the initial total number of gold ounces standing for the SEPTEMBER. contract month, we take the total number of notices filed so far for the month (54) x 100 oz or 5400 oz, to which we add the difference between the open interest for the front month of SEPT. (1111 contracts) minus the number of notices served upon today (0) x 100 oz per contract equals 116,500  oz, the number of ounces standing in this active month of SEPT.
 
Thus the INITIAL standings for gold for the SEPTEMBER contract month:
No of notices served so far (54) x 100 oz  or ounces + {(1111)OI for the front month  minus the number of  notices served upon today (0) x 100 oz which equals 116,500 oz standing in this  active delivery month of SEPTEMBER  (3.6236 tonnes)
We GAINED 298 contracts OR AN ADDITIONAL 29800 OZ standing FOR GOLD and 0 EFP’s were issued for September which gives the long holder a fiat bonus plus a deliverable product on another exchange and that most likely will be London.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Total dealer inventory 713,322.712 or 22.187 tonnes  (dealer gold continues to disappear)
Total gold inventory (dealer and customer) = 8,696,115.287 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 34 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 13 MONTHS  84 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
AND NOW THE AUGUST DELIVERY MONTH
September initial standings
 Sept 15  2017
Silver Ounces
Withdrawals from Dealers Inventory  nil
Withdrawals from Customer Inventory
50,460.580oz
 Scotia
Deposits to the Dealer Inventory
 nil oz
Deposits to the Customer Inventory 
 nil oz
No of oz served today (contracts)
226 CONTRACT(S)
(1,330,000 OZ)
No of oz to be served (notices)
510 contracts
(2,550,000 oz)
Total monthly oz silver served (contracts) 5479 contracts (27,395,000 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 4,359,304.5 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 1 customer withdrawal(s):
i) out of Scotia  18,033.383 oz
TOTAL CUSTOMER WITHDRAWALS: 18,033.383  oz
We had 0 Customer deposit(s):
***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: nil oz
 
 we had 0 adjustment(s)
The total number of notices filed today for the SEPTEMBER. contract month is represented by 226 contract(s) for 1,130,000 oz. To calculate the number of silver ounces that will stand for delivery in SEPTEMBER., we take the total number of notices filed for the month so far at 5479 x 5,000 oz  = 27,395,000 oz to which we add the difference between the open interest for the front month of SEPT (736) and the number of notices served upon today (226) x 5000 oz equals the number of ounces standing.
 

 

.
 
Thus the INITIAL standings for silver for the SEPTEMBER contract month:  5479 (notices served so far)x 5000 oz  + OI for front month of SEPTEMBER(736 ) -number of notices served upon today (226)x 5000 oz  equals  29,945,000 oz  of silver standing for the SEPTEMBER contract month. This is excellent for this active delivery month. Silver is being constantly demanded at the silver comex and we witness again the amount of silver demanded daily increase right from the get go. (ON AUGUST 31 (FIRST DATE NOTICE) WE HAD 20.15 MILLION OZ STAND. THUS IN THE FIRST 15 DAYS OF SEPTEMBER, WE HAVE HAD A HUGE INCREASE OF  9.9 MILLION OZ STAND FOR DELIVERY AS DEALERS JUMP QUEUE TRYING TO FIND THE NECESSARY SILVER TO SUPPLY TO OUR LONGS.)
 
WE HAD AN INCREASE OF 169 CONTRACTS OR AN ADDITIONAL 845,000 OZ OF SILVER WILL STAND FOR DELIVERY IN THIS ACTIVE CONTRACT MONTH OF SEPTEMBER. THIS HAS BEEN THE 5th CONSECUTIVE MONTH THAT WE HAVE WITNESSED EITHER AN INCREASE (95% OF THE TIME) OR STANDING PAT (THE OTHER 5%).  WE HAVE NOT HAVE A DECREASE IN STANDING I.E. AS THEY DELIVERY MONTH PROCEEDS NOBODY WISHES AN EFP PRODUCT IN EXCHANGE FOR A DEPARTING LONG.SOMEBODY BIG WANTS SILVER IN A VERY BIG WAY.
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: 38,953 CONTRACTS
WHICH IS GOOD
YESTERDAY’s  confirmed volume was 96,741 contracts which is EXCELLENT
YESTERDAY’S CONFIRMED VOLUME OF 96,741 CONTRACTS WHICH EQUATES TO 483 MILLION OZ OF SILVER OR 69% 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:  43.694 million (close to record low inventory  
Total number of dealer and customer silver:   218.246 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 6.1 percent to NAV usa funds and Negative 6.3% to NAV for Cdn funds!!!! 
Percentage of fund in gold 62.3%
Percentage of fund in silver:37.7%
cash .+0.0%( Sept 15/2017) 
2. Sprott silver fund (PSLV): STOCK   NAV FALLS TO -0.56% (Sept 15/2017) 
3. Sprott gold fund (PHYS): premium to NAV FALLS TO -0.87% to NAV  (Sept 15/2017 )
Note: Sprott silver trust back  into NEGATIVE territory at -0.56%/Sprott physical gold trust is back into NEGATIVE/ territory at -0.87%/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

Sept 15./strange!!no change in GLD after the whacking of gold/inventory remains at 838.64 tonnes

Sept 14./no changes at the GLD/inventory rests at 838.64 tonnes

Sept 13/late last night a huge 4.14 tonnes of gold was added to the GLD inventory/inventory rests at 838.64 tonnes.

Sept 12/as of 5: 40 pm est, no changes in gold inventory at the GLD/Inventory rests at 834.50 tonnes

Sept 11/Today we had a rather large 2.37 tonnes of gold removed from the GLD/Inventory rests at 834.50 tonnes

Sept 8/we had a tiny withdrawal of .34 tonnes and probably that would be to pay for fees like insurance etc.

Inventory rests at 836.87 tonnes

Sept 7./no changes in gold inventory at the GLD/Inventory rests at 837.21 tonnes

SEPT 6/WE HAD ANOTHER DEPOSIT OF 5.91 TONNES INTO THE GLD/IN THE LAST TWO DAYS: 20.69 TONNES/INVENTORY RESTS AT 837.21 TONES

Sept 5/we had a huge deposit of 14.78 tonnes into the GLD/Inventory rests at 831.21 tonnes

Sept 1/ no change in gold inventory at the GLD/Inventory rests at 816.43 tonnes

AUGUST 31/no change in gold inventory at the GLD. Inventory rests at 816.43 tonnes

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.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Sept 15 /2017/ Inventory rests tonight at 838.64 tonnes
*IN LAST 233 TRADING DAYS: 102.46 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 169 TRADING DAYS: A NET  54.97 TONNES HAVE NOW BEEN ADDED INTO  GLD INVENTORY.
*FROM FEB 1/2017: A NET  23.58 TONNES HAVE BEEN ADDED.

end

Now the SLV Inventory

Sept 15./no change in silver inventory at the SLV/Inventory rests at 327.088 million oz/

Sept 14/no change in silver inventory at the SLV/Inventory rests at 327.088 million oz/

Sept 13/no change in silver inventory at the SLV/Inventory rests at 327.088 million oz/

Sept 12.2017/no change in silver inventory at the SLV/Inventory rests at 327.088 million oz/

Sept 11.2017: no change in silver inventory at the SLV/Inventory rests at 327.088 million oz/

Sept 8/no change in silver inventory at the SLV/Inventory rests at 327.088 million oz/

Sept 7/STRANGE!! WITH DEMAND FOR SILVER HUGE WE HAD ANOTHER 945,000 OZ WITHDRAWN. NO DOUBT THAT THIS IS CRIMINAL ACTIVITY AS SILVER IS WITHDRAWN AND USED TO CONTAIN THE RISE IN PRICE/INVENTORY RESTS AT 327.088 MILLION OZ/

SEPT 6/STRANGE WITH A HUGE DEMAND FOR SILVER THROUGHOUT THE WORLD THESE DOORKNOBS WITHDRAW A HUGE 3.148 MILLION OZ OF SILVER FROM THE SLV/INVENTORY RESTS AT 328.033 MILLION OZ

Sept 5/2017: no change in silver inventory at the SLV/Inventory rests at 331.178 million oz/

Sept 1/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 331.178 MILLION OZ

AUGUST 31/STRANGE!! a huge withdrawal of 2.019 million oz with silver up today./INVENTORY RESTS AT 331.178 MILLION OZ

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

Sept 15.2017:

Inventory 327.088  million oz
end
  • 6 Month MM GOFO

    Indicative gold forward offer rate for a 6 month duration

    + 1.37%
  • 12 Month MM GOFO
    + 1.57%
  • 30 day trend

end

At 3:30 pm we receive the COT report which gives us position levels of our major players.  Last week we saw a huge increase in banker shorts.  Let us see this week…

Gold COT Report – Futures
Large Speculators Commercial Total
Long Short Spreading Long Short Long Short
351,492 96,732 57,172 123,298 395,396 531,962 549,300
Change from Prior Reporting Period
15,419 5,957 2,314 -1,847 8,444 15,886 16,715
Traders
182 111 72 51 62 274 210
 
Small Speculators  
Long Short Open Interest  
48,644 31,306 580,606  
-2,097 -2,926 13,789  
non reportable positions Change from the previous reporting period
COT Gold Report – Positions as of Tuesday, September 12, 2017

Our large speculators

those large speculators who have been long in gold added another 15,419 contracts to their long side

those large specs that have been short in gold added a rather large 5937 contracts to their short side

large specs go net long by 6,000 contracts.

Our large commercials,

those commercials that have been long in gold pitched 1847 contracts from their long side

those commercials that have been short in gold added 8444 contracts to their short side

commercials go net short by 10,200 contracts.

Our small speculators.

those small specs that have been long in gold pitched 2097 contracts from their long side

those small specs that have been short in gold covered 2926 contracts.

Conclusions:  the boat is heavy on one side, the longs with the commercials heavy on the other side. Something has to give

now silver COT

Silver COT Report: Futures
Large Speculators Commercial
Long Short Spreading Long Short
102,243 27,256 16,089 45,932 130,613
5,869 -4,947 2,498 -1,557 6,436
Traders
88 47 38 30 37
Small Speculators Open Interest Total
Long Short 188,207 Long Short
23,943 14,249 164,264 173,958
-1,879 944 4,931 6,810 3,987
non reportable positions Positions as of: 141 104
Tuesday, September 12, 2017   © SilverSe

Our large speculators

those large speculators who have been long in silver added 5869 contracts to their long side

those large speculators who have been short in silver covered 4947 contracts from their short side

large specs go net long by 11700 contracts

Our large commercials,

those commercials that are long in silver pitched 1557 contracts from their long side

those commercials that have short in silver added 6436 contracts to their short side

commercials go net short by 8000 contracts

Our small speculators.

those small specs that are long in silver pitched 1931 contacts from their long side

those small specs that have been short in silver added 983 contracts from their short side.

Conclusion:  the boat is again very lopsided but the increase is not as bad as gold.  Something must give!

Major gold/silver trading/commentaries for FRIDAY

GOLDCORE/BLOG/MARK O’BYRNE.

GOLD/SILVER

Gold Up, Markets Fatigued As War Talk Boils Over

By Jan Skoyles

  • North Korea threatens to reduce the U.S. to ‘ashes and darkness’
  • Markets becoming used to ongoing provocations from North Korea
  • Russia and China continue to support watered down versions of sanctions on Kim’s regime
  • Both NATO and Russia running war games on one another’s borders
  • Putin says Russia will give a suitable response” to NATOs threatening behaviour
  • Gold set to climb as fears over economy and war will drive safe haven demand

https://i0.wp.com/www.goldseek.com/news/2017/9-15gc/1.png

This year North Korea has launched a dozen missiles. With the latest one it has threatened the U.S. with ‘ashes and darkness’ as Kim believes it ‘should be beaten to death like a rabid dog.’

Russia and China continue to support watered down sanctions on the isolated country. Both have made it clear that they will not tolerate a war on their borders.

War talk is not just about North Korea anymore.  NATO and Russia have been or are currently carrying out war games on one another’s borders. Both parties feel the other one has acted unreasonably in doing so.  U.K. Defense Secretary Michael Fallon has accused Russia of deliberately provoking NATO, whilst Putin has said Russia has no other choice than to “give a suitable response to all of these actions,”

Russia has previously used military exercises as a cover for what has ultimately been invasions and war. See Georgia in 2008 and Ukraine in 2014 for the most recent examples.

Saber rattling is quickly looking like its going to become full-blown sword fighting at least somewhere in the world.

But few seem to be worried. Markets are not only apparently fatigued by the war cries of the world’s nuclear powers but are evidently ignoring the risks in the financial system.

Gold is currently up over 15% for the year, silver by nearly 12%. Both offer financial safe havens during times of war. All parties involved in the current geopolitical fracas are big holders of gold. Two of them, Russia and China are enabling the trade of the precious metal for key commodities.

Markets would be wise to look at how our great leaders are behaving before deciding that there is little to currently see on the global stage.

The four nos

On Monday UN representatives of both Russia and China reiterated what they refer to as “the four nos”: No regime change, No regime collapse, No accelerated reunification or military deployment north of the 38th parallel dividing the Korean Peninsula.

Neither China nor Russia see any advantage in heavily punishing North Korea whether through sanctions or military action.

They recognise the regime’s need for security guarantees from the U.S. before Kim is likely to stop with his nuclear missile program.

Both Putin and Xi Jinping have an incentive to prevent the U.S. from going to war with North Korea. Both are the biggest economic partners of the dictatorship. Neither wish to see a war on their borders that will only serve to protect and expand American strategic interests.

Both China and Russia are aware of both the economic and military power they currently wield . The situation is very different to say 20 years ago when the West was significantly ahead on all levels, when neither Russia nor China were able to compete on either front.

Tensions are coolest they’ve been since Cold War

Russia and China are clearly not happy with Kim’s nuclear ambitions. However it seems that currently it is more important for those classed as anti-Western to work together and thereby gain more influence in the international order.

Russia has its own problems with sanctions. It has been under them since the U.S. and European Union sanctions for its annexation of Crimea in 2014, its continued invasion of eastern Ukraine, and the shoot-down of Malaysian Airlines Flight 17 in July 2014.

It is perhaps the case that helping North Korea stand firm against the U.S and the U.N. is perhaps as much a matter of principle as it is strategic.

Refusing to give into Western calls for tougher sanctions on Pyongyang is perhaps more a statement of Putin’s insistence that he will not give in to demands regarding his own military activities in both Crimea and Ukraine.

This week Russia is hosting large scale military drills on the border of three NATO countries. The drills (known as Zapad 2017) have been happening every year since 1999.

They have been growing in size since, especially as relations between Moscow and Washington grow every frostier.

The Moscow Times explains:

Military exercises like Zapad and other demonstrations of military power are designed, in part, to provide coercive credibility that any attempt by the United States to undermine core Russian security interests will be met by force and will extract a high cost.

Along with Zapad 2017 and defence of North Korea, Putin has been chest beating for some time now. It has carried out major propaganda operations across the West, tested other countries’ airspace, and supposedly hacked the US and French elections (watch out Germany).

In response NATO has  taken several steps to warn Russia off. It has sent four multinational battalions to rotate around the Baltics and Poland. In 2016 NATO members deployed around 30,000 troops in Poland, this was apparently its largest  military exercise in eastern European since the end of the Cold War.

Zerohedge explains that Zapad isn’t the only war-game going on:

just days before the dreaded Russian “Zapad 2017” exercise is set to begin, NATO’s own Steadfast Pyramid 2017 military exercise kicked off in Latvia on Sunday, with 40 senior commanders from NATO states, as well as Finland and Sweden. They are expected to train how to “plan and conduct operations” amid the bloc’s buildup in the region.

Steadfast Pyramid 2017 and Steadfast Pinnacle 2017, involving more than 40 senior officers from NATO member states, plus Finland and Sweden, will take place at the Riga-based Latvian Defense Academy, the country’s national news agency LETA reported on Sunday.

Covering the duration of Russia’s drills, Steadfast Pyramid, the first part of the exercise, will last until September 15. It is reportedly “to improve the ability of top-level officers and commanders to plan and lead joint operations,” according to LETA. Steadfast Pinnacle, the next stage of the drill, will last from September 17 until September 22. Steadfast Pyramid and Steadfast Pinnacle were first held in Latvia in 2011.  British General James Everard, the NATO Deputy Supreme Allied Commander Europe, is expected to arrive in Latvia to oversee both stages of the exercise, Latvia’s Defense Ministry said, according to LETA.

fictional war

Where is the risk with China?

China might not be warming up the tanks on NATO borders but it certainly yields significant economic power, despite what the U.S. might think.

As we explained last week:

Currently Trump is relying heavily on China to cool things down with Kim Jong- Un of maniacal despot fame.

In Keen’s latest book China is one of the countries he believes is a debt junkie. The country’s credit-driven expansion has accounted for more than half of global growth since 2008. Why? Because it dealt with the collapse of the Western credit bubble in 2008 by fuelling a bubble of its own.

Today Chinese banks have $35tn of assets on their balance sheets – a fourfold increase since 2008. In the last decade private debt as a proportion of the country’s annual economic output (GDP) has increased from 120% to 210%.

Its financial system could almost be a mirror to those seen in the US and UK in the run up to the financial crisis. It has a large shadow banking system and special investment vehicles that take assets off balance sheets.

How does this relate to Trump, North Korea and the next financial crisis? Trump needs China on side when dealing with Kim Jong-Un. However, last week Beijing said that in the event of war between the two nuclear powers it would sit on the sidelines.

Trump now has to decide how to handle China as the country clearly has its limits in how much it will help. The most obvious option would be to impose economic sanctions for example, slapping tariffs on steel imports. It could also put China in a negative light in terms of its dealings in markets such as going back to Trump’s old rhetoric branding the country as a currency manipulator or accusing it of facilitating illegal piracy businesses.

Should sanctions be imposed then a trade war would inevitably erupt. This eruption would firmly put a pin in China’s bubble and ripples would be sent out across the world.

Is the market slowly waking up to the risks?

Last week we brought you the news that Goldman Sachs is warning of bubbles. This week they have reissued their warning of ‘blue sky’ views on the state of the world.

“We believe it is the right time, when markets look at the blue sky with sunglasses and when the trend and carry is your friend, to recommend downgrading risk assets,” the SocGen analysts wrote.

We also explained yesterday about Russia and China’s monetary moves behind the scenes. Whilst the West distracts themselves with economic sanctions, interest rate hikes and booking stock markets the BRICs are finding ways to manage as far away from the system as they can.

What does this mean? Those doing much of the provoking, Russia and China, are fully aware of what comes with potential nuclear war and financial weapons – destruction of currencies and strength in gold.

Unfortunately Western markets aren’t picking this up (as you can see from the opening chart). Everything reacted slightly this morning to the North Korea news but otherwise fell back thanks to news regarding the US inflation data.

Buy gold before everyone wakes up

Gold has fallen back slightly this morning. However over the year it is one of the best performing assets. There is certainly a rising undercurrent of uncertainty and concern for how the next few months will play out.

As always, we still do not have a crystal ball to tell you how this will end. It may end in nuclear war, it may end with Russia invading Eastern European countries or it may end with a stock market crash.

The geopolitical disasters are of course preventable. However, the cracks in the financial system have been brewing for some time and there is little that can be done to fix them.

Dramas with North Korea, Russia war-games and Chinese economic concerns are just more pressure on an already crumbling wall.

Countries know this, this is why they’re buying gold and facilitating gold markets. Investors would be wise to follow their lead instead of following market complacency.

-END-

end

David Morgan agrees with us that a Chinese gold to oil link will be a huge boost to our precious metals.

(courtesy David Morgan/GATA)

David Morgan: China’s gold-oil link, debt ceiling repeal will boost metals

 Section: 

11:50a ET Thursday, September 14, 2017

Dear Friend of GATA and Gold:

Market analyst David Morgan of Silver-Investor.com thinks that the monetary metals will be strengthened by any linkage by China of gold and oil trading, as well as by the increasing possibility of repeal of the U.S. government’s debt limit. Morgan’s comments come in his 10-minute weekly audio review here:

http://www.blogtalkradio.com/themorganreport/2017/09/13/the-weekly-persp…

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

END

The following commentary is extremely important.  First Alasdair talks about the continual whacking of paper gold/silver at the comex.  However he states that this is coming to an end once China implements its oil contract denominated in yuan and then convertible to gold.  This will cause less dollars floating around the world and will also cause China to liquidate its dollars for commodities, something that we have noted to you on many occasions. He talks about Trump’s ill fated “make America great protectionist policies as troublesome..

a very important read.

(courtesy Alasdair Macleod/Goldmoney)

in full….

 

Outlook for the dollar price of gold

Now that gold has become overbought on Comex, the price is vulnerable to being trashed, yet again, by the too-big-to-fail banks. It is a familiar operation in gold futures markets, where speculators buying contracts protect themselves with stop-losses.

All the TBTF banks need is a pause in the speculator’s buying and a little good news (bad for gold). Ideally, the active contract will be running into maturity, so the speculators are forced to put up or shut up: in other words, sell the contract, roll it into another later maturity, or stand for delivery.

Bearing in mind these speculators are running highly leveraged positions, greed turns to fear on a sixpence. The TBTF banks will have supplied the speculators with their longs by going short. From the moment you go long, you are trapped in a trader’s version of Hotel California.

The TBTFs start off sitting on losses, not worrying for them, being TBTF. But they know how to turn it around. Just pick a quiet moment, sell a few billions-worth of contracts, and take out all those stops. It is a cycle of events that happens time after time, a money machine for the bullion banks. Just occasionally, it goes wrong, because the physical markets take back control of pricing away from futures markets. But what the heck, these guys will be bailed out by the Fed, or the Bank of England. Meanwhile their traders have made bonuses quarter after quarter.

Speculators fall for it every time. Sooner or later, they argue, the TBTF traders will get their comeuppance. But now that gold has risen $140 in less than two months, we are due for another rinse cycle in the Comex washing machine. Gold is as overbought as it has ever been. The punters are due to be cleaned out again. Only a fool would bet otherwise. But, this time it just might be different.

For this time to be different, the dollar will have to continue to weaken. Not much else can save the bulls from the TBTF bullion banks. This article discusses the prospects for the dollar, and concludes that, other than a technical rally in the short-term, the prospects for the dollar are not good.

There are four fronts opening that could drive the dollar down: the stagnating US economy, oil producer nations discarding the dollar, the interests of China moving towards abandoning the dollar, and lastly, the commercial interests of the major bullion banks shifting towards the China story. We shall consider each in turn.


US economy stagnating

All the hype during President Trump’s first hundred days, when he behaved like a latter-day Franklin Roosevelt in a flurry of initial activity, is being replaced by cold reality. The dollar first rose, and then started to decline. The fiscal benefits of tax reform remain pie in the sky. The stimulus to American industry from tariffs and import duties on imported goods, on second thoughts, is no stimulus, and merely raises the costs faced by consumers. Most of The Donald’s anti-establishment, reforming team has resigned, replaced in the White House by three establishment generals. In a banana republic, the press would call it a military coup. Make America Great Again is now not much more than an empty phrase.

President Trump’s election appears to have set up the dollar for a substantial decline, as this reality sinks in. His policies are being exposed as bombastic and autarkic. By isolating America from the benefits of world trade, she gets almost no benefit from the rapid transformation progressing the Asian continent from economic backwater to economic powerhouse.

Meanwhile, the accumulation of debt is unproductive and a burden on the economy, still financing wasteful government deficits, and inflating consumption. Consumers’ income has failed to keep pace with the cost of living for at least the last two credit cycles. And with the consumer becoming overburdened with a legacy of debt, the economy is struggling, no longer in crisis, but going nowhere.

Those analysts who unwisely think trade protectionism will create American jobs fail to understand that trade deficits arise from a combination of government deficits, the expansion of bank credit, and low savings. Yet these are the policies the government and the Fed are actively pushing for economic recovery. Consequently, the budget deficit next fiscal year is likely to be another $500bn, which we can add to the running total.

For the dollar’s prospects, the most important thing to know is that since 1980 the accumulated deficit on the balance of payments, of which the balance of trade is the major component, will have totalled over $11 trillion by the end of this year. The accumulated balance of payments deficit serves as an indication of the scale of foreign ownership of dollars, only $4.36 trillion of which is identified in central bank reserves around the world. Much of the balance of foreign-owned dollars is owned by businesses, engaged in global trade.

The management of dollar balances is crucial for these businesses’ profitability. They will have noted that on a trade-weighted basis the dollar peaked in January, and since then has lost 7.5%. That is a severe impact on profits. They will be on the alert for further signs of weakness, and will have noted the improving trade prospects for Europe and the Eurozone, which have driven the euro up against the dollar by 15% this year. Furthermore, the Eurozone is running a trade surplus of an estimated €200bn for 2017, leading to an underlying contraction of euros in foreign ownership. The Chinese renminbi (or yuan), has risen 7.3% against the dollar this year, affecting corporations trading with China. Most importantly, it affects oil producers selling into their largest single market. They will be watching the dollar’s progress from here.

There is little doubt that the non-US world owns substantial quantities of the dollar, and can be spooked into selling. For this reason, the poor relative performance of the US economy compared with the more dynamic performances of China, Japan and Europe places the dollar at a severe long-term disadvantage on the foreign exchanges.


Oil producers moving away from USD

The pact between Nixon and Saudi Arabia back in 1973 set the dollar up as the exclusive settlement currency for oil exports, following the collapse of the Bretton Woods Agreement in 1971. Since then, the very few countries that threatened to sell oil for other currencies, notably Iraq under Saddam Hussein, and Libya under Colonel Gaddafi, have met with unfortunate accidents. The only countries to successfully challenge the dollar’s oil hegemony have been Russia, China and Iran, but not without adverse consequences. And now, Venezuela is ditching US Imperialism by selling her oil for a range of currencies, excluding US dollars.

Perhaps Venezuela hasn’t been listening. The experiences of Iraq and Libya sent a clear message to other countries about the consequences of denying dollar hegemony. In the case of Iran, the Americans even leant on SWIFT through the EU, the supposedly independent interbank settlement system, to freeze out all transfers involving Iran in 2012. Iran’s currency all but collapsed under this pressure. But tactics of this sort create more resentment than anything else, and have undermined goodwill among non-aligned countries. The Russians, powerful enough to survive America’s financial wrecking tactics, have now set up their own rival to SWIFT, as well as other moves to make them entirely independent of the dollar.

Increasingly, the Russians and Chinese, as well as the Shanghai Cooperation Organisation which they lead, are encouraging oil producers to sell oil for consumption in Asia for Asian currencies, principally the yuan. To achieve this objective China is developing capital markets to improve the yuan’s liquidity and acceptance as a trade medium. However, she knows that she must offer something more than an alternative to the dollar than the yuan, with its shorter and less certain track record. And this is where physical gold comes in, sound money that is no government’s liability, universally recognised as such even by those that publicly deny its monetary credentials.

China long knew gold would be central to her geopolitical strategy as well as her own long-term security. In the last few years, she has dominated physical markets. She is the largest gold mining nation by far. There can be no doubt she has accumulated substantial undeclared gold reserves since 1983, when the central bank was first appointed for this purpose. She is on the verge of offering oil producers the facility in the Shanghai futures markets to swap oil for yuan and yuan for gold, sourced from outside China. There can be little doubt that oil producers will see this as an attractive alternative to the dollar. Russia and Iran are already signed up. Other countries, such as Venezuela, heavily dependent on Chinese oil demand, appear to be in the process of doing so. But the real prize will be Saudi Arabia.

Saudi Arabia needs money, and if Western capital markets do not provide it in return for a minority stake in Aramco, there’s little doubt the Chinese will strike a deal. The policy of turning the world’s oil suppliers away from the dollar and in favour of the yuan for exports to China has made significant progress in recent months. The next key development will be the full implementation of a yuan futures contract for oil, and that could be introduced in the coming months. When that happens, the dollar’s function as the sole reserve currency will effectively cease.


China’s foreign reserves

China has accumulated a large pile of foreign reserves, the equivalent of $3 trillion. This accumulation, perhaps over $2 trillion of it in dollars, is the consequence of past currency management, the objective having been to enhance the profits of Chinese-based manufacturers exporting to other countries. The early development of the Chinese economy was just an initial phase that encouraged strong flows of inward investment followed by net exports. Furthermore, the Chinese are avid savers, putting aside as much as 40% of their earnings, leading to large and persistent trade surpluses.

On the ground, Chinese economic success has brought substantial improvements to the lives of China’s population. The economy is now being refocused towards services and technology, maturing from its export-led model into a fully-fledged advanced economy with a rising middle class. Furthermore, China has a requirement for enormous quantities of raw materials to satisfy her infrastructure plans, which encompass the whole of Asia.

The need for holding large quantities of dollars, the result of neutralising capital inflows and then suppressing the yuan for export price competitiveness, has now passed. China requires far more modest dollar balances, so she will almost certainly invest them in stockpiles of base metals and the raw materials required for the future. This change in policy is already evidenced by the yuan rising against the dollar by over 7% this year, cheapening commodity imports by this amount compared with dollar prices.

There can therefore be little doubt that China will be a big seller of dollars in future. Her problem is if she is too aggressive in this policy, she will trigger selling by other Asian central banks, and could even risk having her $1.1 trillion holdings of US Treasuries frozen by the US Government. She must tread carefully, unless it suits her to become more aggressive in an escalating financial war. Her policy therefore, is likely to be a seller of dollars into strength rather than weakness. The consequence for the dollar is any price recovery is likely to be capped, and therefore limited in scale and duration.


The banks are changing allegiance.

The major global banks are being forced to refocus their activities towards China and her Asian strategy. Infrastructure development needs financing, and this is being coordinated through the Asian Infrastructure Development Bank. China is internationalising her own capital markets through Hong Kong and London. America is deliberately excluded from these activities.

This does not mean that China is against American banks. Her objective is to do business with all foreign banks competitively so long as it does not involve dollars. This leaves the American banks with a decision: do they go with President Trump’s mantra of making America great again and desist from helping China, or do they do their commercial duty for the benefit of their shareholders, and seek to profit from China’s anti-dollar strategy?

Nowhere is this conflict more acute than in the market for gold and silver. Now that China controls both these physical markets, the major bullion banks have no option but to join the Shanghai International Gold and the International Futures Exchanges. Soon, they will no longer be driving prices down on Comex, predominantly as bears supplying paper contracts to speculating buyers. Instead, they will have to become buyers of physical bullion to deliver to the Shanghai physical and futures markets. It is early days, but already ANZ Bank, UBS, BNP Paribas, Standard Chartered, HSBC, JP Morgan (London Branch) and Goldman Sachs are among the leading banks that have made or are making this transition.


Conclusion

There are large quantities of dollars ready to flow away from foreign ownership, a legacy of the days when businesses were unquestioningly happy to hold them as the principal reserve and trade currency. There has been little alternative until now. Furthermore, China’s central bank probably owns half of all the world’s central banks’ dollar reserves, and it is now in her interests to reduce that exposure.

America is isolated from the global economic growth story, which is centred on China and the Chinese-led development of Asia. America’s abuse of her dollar privilege over the years has left a legacy of mistrust in the non-aligned countries, and these countries are now driving the world’s economic progress. At the Asian economic feast hosted by China and Russia, the only guest not invited is America.

America’s poor state finances and her reliance on monetary stimulus will ensure a continuing supply of dollars to the foreign exchanges through persistent trade deficits. The Trump presidency looks like being a disaster for the dollar, and as soon as this becomes apparent in the foreign exchanges, selling is likely to escalate. And as the dollar slides, it should begin to lose its status as the settlement currency for increasing numbers of oil exporting nations.

The final curtain on the Make America Great Again mantra will be the growing covert support for the Chinese opportunity from major international banks, driven by commercial reality. They simply cannot afford to stand by, and there are early indications of JPMorgan and Goldman Sachs positioning themselves to be physical traders and suppliers of bullion in Shanghai. It would be a surprise if more Western bullion banks do not follow their lead.

Whether this is the time physical gold demand begins to take over pricing leadership from futures markets, only time will tell. But there can be no doubt that the balance of interests for China is turning to now see a weakening dollar. However, China is surely aware of the disruption she will cause in Western dollar-centric markets if she precipitates significant dollar weakness, and therefore strength in the gold price. She will not want to be blamed for overtly triggering the dollar’s demise as a reserve currency, which probably explains why she has deferred the launch of the yuan-for-oil contract, and is proceeding cautiously.

Obviously, geopolitics plays a central role in timing, with America desperate to oppose China in partnership with Russia as the dominant state on the Eurasian continent. The consequences of ending America’s financial hegemony are not to be underestimated, and China will not take such a step lightly. However, investors in Western financial markets appear to be beginning to get the message that the heyday of the dollar is now over, there is a significant decline ahead, and therefore mainstream investing institutions need to reconsider their asset allocations in favour of physical gold at the expense of the dollar.


End-2016. http://www.reuters.com/article/us-currency-reserves-imf/dollar-gains-share-of-global-fx-reserves-euro-shrinks-idUSKCN0WX1WR

end

 

Hugo also is in full agreement with  us:  Bitcoin will fall to its intrinsic value and value is zero

(courtesy Hugo Salinas Price/GATA)

Hugo Salinas Price: Bitcoin is a chapter in the history of mass speculation

 Section: 

6:41p ET Thursday, September 14, 2017

Dear Friend of GATA and Gold:

Because it does not function independently of government currencies, Mexican Civic Association for Silver President Hugo Salinas Price writes today, bitcoin is just another mass speculation that will burn a lot of people eventually. Salinas Price’s commentary is headlined “The Bitcoin: A Chapter in the History of Mass Speculation” and it’s posted at the association’s internet site, Plata.com, here:

http://plata.com.mx/mplata/articulos/articlesFilt.asp?fiidarticulo=321

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

END

 

Rory Hall interviews our good friend Chris Powell, secretary of GATA who talks about the gross failure of journalism in not writing about the truth especially in the precious metals market

 

(courtesy Chris Powell/GATA/Rory Hall)

Daily Coin interviews GATA secretary on what he thinks he has learned

 Section: 

7:20p ET Thursday, September 14, 2017

Dear Friend of GATA and Gold:

Your secretary/treasurer, interviewed this week by The Daily Coin’s Rory Hall, discussed a gross failure of journalism at The Wall Street Journal, what seems like improving sentiment toward gold by the financial establishment, and a few big things he thinks he has learned from his nearly 20 years of work with GATA. The interview is 36 minutes long and can be heard at The Daily Coin here:

http://thedailycoin.org/2017/09/14/chris-powell-gold-schemes-journalist-…

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

END

Wow!! Hugo did it..Mexico is discussing the monetization of a 1 oz silver libertad coin. This will help this impoverished nation if implemented

 

(courtesy MPlata/Hugo Salinas Price/GATA)

 

Mexican Congress discusses monetization of Libertad silver ounce coin

 Section: 

9p ET Thursday, September 14, 2017

Dear Friend of GATA and Gold:

Mexican financial journalist Guillermo Barba reports today that Mexico’s Congress yesterday discussed the proposal of Hugo Salinas Price, president of the Mexican Civic Association for Silver, for the country’s central bank to mint, issue, and guarantee a steady price for Mexico’s silver Libertad coin as a savings vehicle for ordinary people.

“This is not the first time that this proposal comes before the Mexican Congress,” Barba writes, “but we pray that this time it becomes a reality. We hope so. It’s for Mexico, the world’s nuúmero uno producer of silver.”

Barba’s report is posted at the civic association’s internet site, Plata.com, here:

http://www.plata.com.mx/Mplata/articulos/articlesFilt.asp?fiidarticulo=3…

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

END

 

As we indicated to you last night, we have crypto carnage as bitcoin crashes below 3,000 dollars after China is halting local bitcoin exchanges.  This will be a boon for gold and silver as they only true currencies

 

(courtesy zero hedge)

 

Crypto-Carnage: Bitcoin Crashes Below $3000 After China Demands Local Exchanges Halt Trading

The latest bitcoin news out of China has confirmed recent rumors and traders’ fears about a widespread crypto-crackdown, sending the price of bitcoin world-wide spiraling lower to levels it hasn’t touched since the beginning of the “summer of bitcoin.” Information appearing from China appears to confirm that trading will no longer be legal for Bitcoin-to-fiat platforms. According to market regulators, all exchanges must close by the end of the month.

Beijing market regulator requires all virtual currency exchanges (ie. OKcoin and Huobi) to stop trading by end of today.

The price is down 20% this morning, adding to a similarly large drop yesterday, slipping below $3,000 for the first time since mid-July.

 

Ethereum is testing $200…

Across all the major Cryptocurrencies, it’s a bloodbath

Cryptocurrency CEOs reacted to the latest developments outof China: several industry players told Cointelegraph that while markets were reacting harshly to Chinese regulatory moves, the long-term benefits for Bitcoin’s ethos and therefore stability were clear.

“The price is always a solid metric of the markets’ greed and fear, and reflects regulatory uncertainty at the moment,” Leverj CEO Bharath Rao commented. “This also signals that development of non-custodial and decentralized models will accelerate.”

“Regulation is neither necessary nor possible for decentralized models, and the future may have gotten just a bit brighter by nudging the crypto community to develop high speed, non-custodial exchanges.”

Of course, Chinese investors are notorious for their bubble-chasing (and forming) and short-term trading activities, which repeatedly influenced Bitcoin volatility in the past. The latest regulatory warnings produced a second mass exodus to p2p trading platforms such as Localbitcoins this year.

With sanctioned Bitcoin-to-fiat trading looking to stop in China altogether, a major market influence will disappear, but some doubt this will last:

“China is practically building a cottage industry for mining and exchanging bitcoin and other cryptocurrencies, so it is hard to believe that they intend to exit a market with so much potential upside,” Jason English of Blockchain alliance Sweetbridge continued.

“Even the apparent ban on ICOs seemed to be more of a stopgap in order to get some policies in place. If anything, this example shows the volatility of the space and that some market-makers can likely take advantage of an unclear news cycle to create a sell-off and buy back opportunity.”

* * *

Meanwhile, in a suggestion that Beijing may be getting a modest case of buyer’s remorse, overnight that Li Lihui, a senior official at the National Internet Finance Association of China urged Chinese regulators to create a regulatory framework to support the development of digital currencies, Reuters says, citing Li who spoke at an event in Shanghai. Li, a former president at Bank of China, said global regulators should work together on virtual currencies, suggesting that while China may well be interested in cryptocurrencies, it wants to assure it has complete control over the capital-control evading protocol.

For now, however, as the recent price suggests, traders are stuck in “sell first, ask questions later” mode.



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

 
 

1 Chinese yuan vs USA dollar/yuan HUGELY STRONGER AT 6.6442 (REVALUATION NORTHBOUND   /OFFSHORE YUAN MOVES SLIGHTLY WEAKER TO ONSHORE AT   6.6464/ Shanghai bourse CLOSED DOWN 17.81 POINTS OR 0.53%  / HANG SANG CLOSED UP 30.29 POINTS OR 0.11% 

2. Nikkei closed UP 102.06 POINTS OR 0.52%    /USA: YEN RISES TO 111.21

3. Europe stocks OPENED MOSTLY IN THE RED     ( /USA dollar index FALLS TO  91.79 /Euro UP to 1.1956

3b Japan 10 year bond yield: FALLS  TO  -+.029%/ GOVERNMENT INTERVENTION    !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 110.43/ 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::  49.97 and Brent: 55.52

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 UP 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  +.435%/Italian 10 yr bond yield UP  to 2.07%    

3j Greek 10 year bond yield FALLS TO  : 5.425???  

3k Gold at $1323.50  silver at:17.69 (8:15 am est)   SILVER NEXT RESISTANCE LEVEL AT $18.50 

3l USA vs Russian rouble; (Russian rouble DOWN 16/100 in  roubles/dollar) 57.67-

3m oil into the 49 dollar handle for WTI and 55 handle for Brent/

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

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 111.21 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  0.9603 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1481 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  +0.398%

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 2.200% early this morning. Thirty year rate  at 2.772% /POLICY ERROR)GETTING DANGEROUSLY HIGH

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

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

Markets Ignore North Korea Missile Launch; Send Pound Soaring, Yen Tumbles

 

S&P futures are slightly lower (ES -0.1%) as traders paid little attention to the latest missile test by North Korea on Friday, with shares and other risk assets barely moving, gold lower and focus rapidly returning to when and where interest rates will go up. Most global market are mostly unfazed, and the Korean Kospi actually closed up 0.4%, by the latest geopolitical escalation after a North Korean ballistic missile flew far enough to put the U.S. territory of Guam in range. European stocks edged fractionally lower while Asian shares advanced.

As reported on Thursday evening, the main overnight event was North Kore’s launch of a missile which passed through Japan’s airspace and over Hokkaido, before landing in the Pacific Ocean. This initially prompted Japan to issue an emergency warning for its residents to seek shelter, while there were also reports that South Korea conducted its own missile firing test as a show of readiness. US military stated North Korean missile did not pose a threat to Guam and that the launch was an intermediate range ballistic missile. South Korean President Moon said will not sit idle on North Korea provocation and that South Korea has power to pulverize should
North Korea provoke. On Friday morning, Russia also denounced the ‘provocative’ N. Korea missile test, according to the Kremlin. Meanwhile, North Korea stated that it will take stronger actions for its self-defence if the US continues to walk on current course.

Still, markets are showing clear signs of habituation to missile launches and other provocative actions from North Korea, which has fired more than a dozen missiles this year and tested a nuclear device. Global equities climbed to a record high this week as earnings and confidence in economic growth overshadowed tensions on the Korean Peninsula. The MSCI All Country World Index is poised for its third week of gains in four. Meanwhile, recent economic data has been supporting of bullish positions, with yesterday’s CPI prints suggesting inflation may again be on the rebound. While China data this week softened, the signals from DM financial markets remain optimistic. As such, investors will look to U.S. retail numbers today for more clues about the policy path.

“You have risk appetite returning in the markets more generally at the moment, so you have all these forces pushing down the yen,” said Vasileios Gkionakis, global head of FX strategy at UniCredit.

In Asia, Japan’s Topix index rose 0.4% at the close in Tokyo to complete its best week since April. South Korea’s Kospi index ended 0.4 % higher after dropping as much as 0.5% in early trading following news of the North Korea launch, while Australia’s S&P/ASX 200 Index fell 0.8 percent. Hong Kong’s Hang Seng Index swung between gains and losses, and the Shanghai Composite Index was also lower.

The Stoxx Europe 600 Index edged lower as North Korea’s latest missile launch raised geopolitical tensions, although to a few lower extent than just three weeks ago and modest moves in risk-off assets showed investors are becoming inured to the provocation. In fact, USDJPY has jumped overnight above 111 and gold was down to 1,324 as few even bothered to wait for the dip to emerge before buying it.

The Japanese yen declined 0.9 percent to 111.29 per dollar, the weakest in almost seven weeks. The Japanese currency has seen its biggest fall this week in 10 months while the dollar is headed for its biggest rise since April, thanks to a revival in U.S. inflation data and bets the Federal Reserve could raise rates again this year.

At the same time, sterling surged to a post-Brexit high, taking another leg higher on Friday after BOE policy maker Gertjan Vlieghe turned hawkish and said he may support raising interest rates in the near future. Following his comments, sterling soared above 1.36 for the first time since June 2016, and was in touching distance to post Brexit highs, breaking through the September 2016 high of 1.3442.

“If these data trends of reducing slack, rising pay pressure, strengthening household spending and robust global growth continue, the appropriate time for a rise in the Bank Rate might be as early as in the coming months,” BoE member Gertjan Vlieghe said on Friday.

Vlieghe said the appropriate time for hike might be “as early as the coming months”, further stating that risks remain that Brexit will have bigger impact on economy but for now wage pressures are gently building. He also stated that conditions for hike are fall in slack, rising pay pressures and household spending and robust global growth.

“The standout undervalued currency in G-10 is sterling,” Citigroup Inc. Strategists led by Jeremy Hale said in a report. “The possibility of a hike in the near term is now non-negligible and this, combined with the fact that the pound’s real effective exchange rate is close to its all-time low, could support the currency from here.”

On the other hand, as Unicredit’s Gkionakis said, “If they don’t do it (hike rates) this time, their credibility will be lost completely for the next few years.” Markets expect the BoE to move in November, he added.

Meanwhile, not even a report this morning of an explosion on a London underground train at Parsons Green station, which is being dealt with as a terrorist related incident,

The dollar stayed on the backfoot, slipping a second day amid the North Korea tensions; sterling surged past $1.35 as Bank of England policy maker Gertjan Vlieghe turned hawkish, stoking speculation of a rate increase within months. Treasuries edged lower and the yen reversed earlier gains as the geopolitical concerns faded, while the euro gained modestly as the ECB’s Sabine Lautenschlaeger said now is the time to take the decision on scaling back quantitative easing.

Overnight, the People’s Bank of China offered most cash in open-market operations since July 24 to meet funding demand. Onshore markets: the PBOC pumped in a net 200b yuan via reverse-repurchase agreements, after adding 100b yuan Thursday. The PBOC said that “injections help offset impact of corporate tax and reserve-requirement payments on liquidity.” With help of PBOC’s liquidity offering, money rates have declined and will continue to do so until the upcoming party Congress, China Merchants Securities analysts led by Xu Hanfei write in note

Treasury yields rose before U.S. data on manufacturing and retail sales.  The yield on 10-year Treasuries climbed one basis point to 2.20 percent, the highest in more than three weeks. Germany’s 10-year yield increased two basis points to 0.44 percent, hitting the highest in a month with its sixth consecutive advance. Britain’s 10-year yield gained six basis points to 1.294 percent, reaching the highest in two months on its sixth consecutive advance.

Elsewhere, the bitcoin crash which started last Friday following reports that China would stop local exchanges from trading of cryptocurrencies by the end of September, has acclerated, and the cryptocurrency is now down 40% from its all time highs just shy of $5,000 hit on September 1, and was trading a little over $3,000 this morning.

Today’s Economic data include retail sales, U. of Michigan consumer sentiment index.

Bulletin Headline Summary

  • GBP trades in Brexit night’s range, following comments from Vlieghe
  • North Korea launched a missile that flew through Japanese airspace, prompting Japan to issue an emergency warning
  • Looking ahead, highlight include US retail sales, industrial output and U of Michigan

Market Snapshot

  • S&P 500 futures down 0.1% to 2,491.00
  • STOXX Europe 600 down 0.1% to 381.32
  • MSCI Asia up 0.2% to 162.62
  • MSCI Asia es Japan  up 0.09% to 538.66
  • Nikkei up 0.5% to 19,909.50
  • Topix up 0.4% to 1,638.94
  • Hang Seng Index up 0.1% to 27,807.59
  • Shanghai Composite down 0.5% to 3,353.62
  • Sensex down 0.06% to 32,222.34
  • Australia S&P/ASX 200 down 0.8% to 5,695.02
  • Kospi up 0.4% to 2,386.07
  • German 10Y yield fell 0.5 bps to 0.408%
  • Euro up 0.03% to $1.1922
  • Italian 10Y yield rose 1.9 bps to 1.767%
  • Spanish 10Y yield fell 1.1 bps to 1.591%
  • Brent Futures little changed at $55.46/bbl
  • Gold spot down 0.2% to $1,327.57
  • U.S. Dollar Index down 0.3% to 91.85

Top Overnight News

  • North Korea Puts Guam in Range With Missile Launch Over Japan
  • Trump Push for U.S. Jobs May Spur Boom in ‘Corporate Welfare’
  • Icahn Is Said to Seek $1.5 Billion as Fel-Pro Sale Considered
  • Oracle First Quarter Adjusted EPS Beats Estimates
  • Alphabet Is Said to Consider Lyft Investment of About $1 Billion
  • Nestle Is Said to Pay $425 Million to Buy Blue Bottle Coffee
  • Police Investigate London Subway Incident as Explosion Reported
  • BlackRock Hires Ex-Goldman Derivatives Trader Cho for Equities
  • MoneyGram Deal Panel Is Said to Weigh Data Theft in Review: NYP
  • Morgan Stanley CEO: Low Chance of U.S. Rules Overhaul: Echos
  • Array Biopharma 20.9m-Share Offering Prices at $10.75 Apiece
  • Facebook Plans to Open AI Center in Montreal: WSJ
  • Japan Considering Tax Increase for E-Cigarettes, Asahi Says
  • Credit Suisse Reaches Settlement of MassMutual Litigation
  • Reps. Gowdy, Smith Ask Equifax CEO for Briefing, Documents
  • Dole Food Is Said to Be Exploring a Sale, DJ Says
  • China Credit Expansion Remains Robust as PBOC Maintains Support
  • Google and Facebook Fret Over Anti-Prostitution Bill’s Fallout
  • Trump Deal With Democrats Brings New Wall Pledge: Build It Later

Asia equity markets traded mixed after North Korea launched a missile that flew through Japanese airspace and over the Hokkaido prefecture before landing in the Pacific Ocean, which prompted Japan to issue an emergency warning for its residents and South Korea also conducted its own missile firing test as a show of readiness. This triggered a risk-averse tone across asset classes with ASX 200 (-0.7%) and KOSPI (-0.2%) pressured from the open, while Nikkei 225 (+0.5%) pared early losses as USD/JPY rebounded from its lows. Shanghai Comp. (-0.3%) and Hang Seng (+0.4%) both initially conformed to the downbeat sentiment caused by the renewed geopolitical concerns, although downside in mainland China was stemmed and Hong Kong recovered amid a firm liquidity effort by the PBoC. 10yr JGBs were higher and eyed the 151.00 level amid the mostly risk-averse tone in the region and with the BoJ present in the market for JPY 880bln in JGBs of maturities across the curve. PBoC injected CNY 120bln via 7-day reverse repos, CNY 60bln via 14-day reverse repos and CNY 20bln via 28-day reverse repos. (Newswires) PBoC set CNY mid-point at 6.5423 (Prev. 6.5465).

Top Asian News

  • South Korean Markets Show Resilience After North Fires Missile
  • N.Korea Says Missile Launch Normal Part of Nuclear Deterrent:NHK
  • China Says Unhelpful to Unjustly Blame Others on N. Korea Issue
  • Hedge Fund Farallon’s Singapore CEO to Resign After 17 Years
  • China’s JD.com, Thailand’s Central Group to Venture in Fintech
  • Formula One Extends Singapore Race Contract for Four More Years
  • Tata Feud With Mistry Deepens With Plan to Change Holding Firm
  • GM’s Record China Deliveries Mask Muted Electric Car Sales

European equities trade marginal lower amid geopolitical tensions, where North Korea fired another missile into Japanese airspace. Market reaction was minimal in Asia, led into European trade where equity markets trade with slight losses. FTSE under-performs as a result of the buoyant Sterling, as hawkish BoE comments were supported by Governor Carney and noticeable dove Vlieghe, with the former stating, the probability of a hike has definitely increased, may need to adjust Bank Rate in the coming months. European bonds trade in a tight range, with yields now slightly higher vs. yesterday across the board. Gilts have been in focus following the volatility that has been seen in UK asset classes post BoE. The UK 10y continues to trade near lows, pushed by comments from BoE’s Vlieghe, now trading through July’s lows.

Top European News

  • BOE’s Vlieghe Says Rate Increase May Be Needed in Coming Months
  • Axa Said to Weigh Merger for European Asset Management Unit
  • Bavarian Plunges as Committee Recommends Ending Phase 3 Study
  • EU Eyes Monetary Fund for Region as Political Wills Align
  • HSH Nordbank Is Good Opportunity for the Right Buyer: Flowers
  • Dutch State Sells Stake of About $1.8 Billion in ABN Amro
  • Iceland Government Faces Breakup as Coalition Partner Quits

In currencies, the geopolitical concerns saw USD/JPY briefly spike below 110.00, as unfazed bids were stacked around 109.50, bouncing the pair 100 pips. The JPY safe-haven flow has become a concern of late, as threats against Japan could lead to flows outside of the JPY, and some traders looking for other safe haven assets. This could be indicated by the lack of aggression in the bounce in USD/CHF, with the cross remaining other the 2017 downward resistance trendline. The other notable currency move was in the pound: following Vlieghe’s comments, Cable is now in touching distance of those post Brexit highs, breaking through the September 2016 high of 1.3442, next key resistance could be at 1.3535.

In commodities, WTI trades just short of USD 50.00, as some bids have been evident as we approached the European lunch hour. Gold fell 0.4 percent to $1,323.88 an ounce. Copper increased 0.2 percent to $6,512.00 per metric ton.

Looking at the day ahead, we get numerous data releases including: IP for August (0.1% mom expected), the empire manufacturing survey, August retail sales, business inventories as well as the University of Michigan’s consumer sentiment index. Onto other events, EU finance ministers will hold Ecofin and Eurogroup meetings, the agenda includes: deepening of economic and monetary ties, developing capital-markets union, and tax and customs matters.

US Event Calendar

  • 8:30am: Empire Manufacturing, est. 18, prior 25.2
  • 8:30am: Retail Sales Advance MoM, est. 0.1%, prior 0.6%; Retail Sales Ex Auto MoM, est. 0.5%, prior 0.5%
  • 8:30am: Retail Sales Ex Auto and Gas, est. 0.3%, prior 0.5%; Retail Sales Control Group, est. 0.2%, prior 0.6%
  • 9:15am: Industrial Production MoM, est. 0.1%, prior 0.2%; Capacity Utilization, est. 76.7%, prior 76.7%;
  • 10am: Business Inventories, est. 0.2%, prior 0.5%
  • 10am: U. of Mich. Sentiment, est. 95, prior 96.8; Current Conditions, est. 108, prior 110.9; Expectations, est. 83, prior 87.7
    • 1 Yr Inflation, prior 2.6%; 10am: U. of Mich. 5-10 Yr Inflation, prior 2.5%

DB’s Jim Reid concludes the overnight wrap

Happy Friday. It wasn’t so long ago that the weekend ahead would offer the enticing prospect of a couple of rounds of golf, maybe a game of cricket, a night out with the boys, watching Liverpool on the telly and then a box set and a steak on Sunday evening. Oh how things have changed. This weekend I’ll be on strict duty for the regular 90 minute feeding sessions every 3 hours and around this we have two birthday parties to attend for 2 years olds. To be fair one of them is my own daughter’s tomorrow (unbelievably she’ll be two) but the other on Sunday possibly involves me driving my wife and Maisie there and then waiting in the car with the twins as given the big party it might not be advisable for them to be exposed to a big crowd before they’ve had their injections.

Oh what fun. That’s not where it ends as many of Maisie’s friends are turning two and my weekend diary is full for the next month attending these. My advice to the younger readers of this note is make sure you fill your weekend with every fun thing imaginable. Days like these won’t last!

There’s been enough going on in markets over the last 18 hours to keep my mind off the stresses of the weekend ahead. In fact there was a fairly fascinating middle few hours of the day yesterday with the BoE surprising on the hawkish side, US inflation higher than expected, North Korea trying to grab back the spotlight and halting the rise in yields, Mr Trump publicly haggling with Democrats on a DACA deal, which is apparently “fairly close”, and as the European day ended, Mr Carney admitting he was one of those leaning towards a hike as prices were going up due to a weaker currency.

Adding to this, this morning North Korea has fired off another missile that flew over Japan and landed into the Pacific Ocean. This follows their threats yesterday to use a nuclear weapon against Japan and turn the US into “ashes and darkness” for agreeing on new UN sanctions this week. The range of the test is important as the 3700km travelled is further than the distance to US controlled Guam (3400km). So it looks highly provocative. Asian markets are surprisingly taking the news in their stride with the Nikkei (+0.46%) and Hang Seng (+0.3%) higher but with the Kospi (-0.14%) and Shanghai Comp (-0.32%) slightly lower.

Elsewhere UST 10yrs have only dipped 0.5bp. So we’ll see if Europe gets more stressed by the news. The UN Security Council reconvenes at 3pm NYT today so we’ll see if there is an additional response here.

The North Korean headlines yesterday slightly overshadowed the US CPI numbers as they came out. After five consecutive downside misses, core Inflation surprised on the upside. According to DB’s Matt Luzzetti, much of the volatility in the past two months has been due to large swings in the lodging away subcomponent, which rose sharply in August after plunging in July. Smoothing through this volatility, there are still signs that the core inflation trend is firming: the average monthly inflation rate over the past two months is 0.18%, which annualizes to 2.2%. DB still think YoY inflation for the next few months will be around current levels but that it will move higher in 2018 due to the lagged impact of recent stronger growth, recent $ weakness and tightening labour markets.

In response, the UST 10y yields initially rose c2bp intraday but recovered to close broadly unchanged at 2.186%, in part given the rising tensions with North Korea. Elsewhere, the probability of a rate hike in December has increased 4ppt overnight to 43% and is up c18ppt from recent lows (per Bloomberg calculator). On the BoE, the risks were always to the hawkish side yesterday and this is what we saw. Indeed DB have now changed their official rate call and now expect a 25bp policy rate hike on 2 November. There was no denying the signal in the MPC statement and minutes. A “majority” of committee members would support a rate hike in the near term if the economy performs in line with expectations. “All members” agree that rates are likely to rise more than the market is pricing. As Mark Wall and Oliver Harvey note there now needs to be a surprise event to push the majority away from a near-term hike. Brexit has that potential if negotiations turn disorderly. They remain skeptical about this being the start of a tightening cycle though and see consensus expectations for UK GDP growth as too optimistic. The market responded with Sterling rallying 1.42% vs. USD, 10y Gilts rising 8.5bp to 1.227% and the probability of a rate hike in November also jumping 17ppt to 50% (as per Bloomberg’s calculator).

Notably, changes in other sovereign bond yields were more tempered. Core European bond yields were up around 1bp, with Bunds (2Y: +0.2bp; 10Y: +1bp) and French OATs (2Y: +1bp; 10Y: +1bp) slightly higher in yield while Peripherals rose by around 2bp, with Italian BTPs (2Y: unch; 10Y: +2bp) and Spain (2Y: +1bp; 10Y: +2bp) the highlights.

Onto other markets, US equities were mixed but little changed, with the S&P and Nasdaq down 0.11% and 0.48% respectively, but the Dow bucked the trend to be up 0.20%. Within the S&P, gains were led by utilities (+0.87%) and the real estate sector as they partly recovered from prior day losses, while the discretionary consumer and Telco names underperformed. European markets were also little changed, with the Stoxx up 0.12%, with gains from energy names being largely offset by a decline in mining stocks. Elsewhere, the DAX dipped 0.10%, the CAC rose 0.15% and the FTSE 100 fell 1.14% as the BOE got more hawkish  and Sterling rallied.

Turning to currencies, most of the action was in Sterling as noted earlier. The US dollar index fell -0.43%, while the Euro/USD gained 0.29% but fell 1.13% against Sterling. In commodities, WTI oil increased 1.20%, building on the momentum from higher demand forecasts from IEA and OPEC yesterday as well as OPEC members voicing a preference to the extension to production cuts. Elsewhere, precious metals were slightly higher (Gold +0.56%; Silver +0.13%), but base metals weakened following the earlier softer than expected Chinese macro data (Copper -1.27%; Aluminium -0.67%, LME Nickel -1.41%).

Away from the markets, PM Theresa May’s big speech has been confirmed to take place on 22 September in Florence, which could provide direction or alternatively chaos to the Brexit talks. Shortly after that, the official talks with the EU will begin again on the 25th September.

Across the Pond, President Trump said he is close to a deal with Congressional democrats to permanently avoid deportation of 0.8m of immigrants brought illegally to the US as children. He noted that “we’re working on a plan for DACA (deferred action for childhood arrivals). People want to see that happen”. Notably, he is now flagging the DACA issue and his desire for a Mexican border wall to be handled separately, provided that the democrats promise not to “obstruct” it (funding for the wall) in the future.

Before we take a look at today’s calendar, we wrap up with other data releases from yesterday. In the US, as discussed earlier, core inflation was slightly above market at 0.2485% mom (vs. 0.2% expected), enabling the annual rate to rise to 1.7% yoy (vs. 1.6% expected). Elsewhere, both initial jobless claims and continuing claims were lower than expectations, with jobless claims at 284k (vs. 300k expected) and continuing claims at 1,944k (vs. 1,965k expected).

In the UK, The August RICS survey revealed that on balance, surveyors continued to report a decline in both buyer enquiry and new selling instructions. Elsewhere, the final readings on inflation for France and Italy were unchanged at 0.9% yoy and 1.4% yoy respectively.

Turning to the lower than expected Chinese macro data we touched on yesterday, our China research team highlights that they maintain their baseline GDP growth forecast at 6.6% yoy in Q3 and 6.5% yoy in Q4 (Q2 was 6.9% yoy). They see no reason to panic, noting that the land market continued to boom in August which will help government revenue in H2. And if the government is concerned by slower growth, they could suspend the supply constrain on upstream sectors and increase infrastructure spending.

Looking at the day ahead, the Eurozone’s trade balance stats for July are due. Then the US will release numerous data including: IP for August (0.1% mom expected), the empire manufacturing survey, August retail sales, business inventories as well as the University of Michigan’s consumer sentiment index. Onto other events, EU finance ministers will hold Ecofin and Eurogroup meetings, the agenda includes: deepening of economic and monetary ties, developing capital-markets union, and tax and customs matters.

3. ASIAN AFFAIRS

i)Late THURSDAY night/FRIDAY morning: Shanghai closed DOWN 17.81 POINTS OR 0.53%   / /Hang Sang CLOSED UP 30.29 POINTS OR 0.11%/ The Nikkei closed UP 102.06 POINTS OR 0.52%/Australia’s all ordinaires CLOSED DOWN 0.74%/Chinese yuan (ONSHORE) closed WELL UP at 6.5442/Oil UP to 49.97 dollars per barrel for WTI and 55.52 for Brent. Stocks in Europe OPENED RED EXCEPT GERMANY. Offshore yuan trades  6.5464 yuan to the dollar vs 6.5426 for onshore yuan. NOW THE OFFSHORE MOVED A LITTLE WEAKER  TO THE ONSHORE YUAN/ ONSHORE YUAN MUCH STRONGER (TO THE DOLLAR)  AND THE OFFSHORE YUAN IS A MUCH STRONGER TO THE DOLLAR AND THIS IS COUPLED WITH THE SLIGHTLY  WEAKER DOLLAR. CHINA IS NOT HAPPY TODAY 

3a)THAILAND/SOUTH KOREA/NORTH KOREA

NORTH KOREA/USA

 Oh No!! North Korea fires a suspected ICBM over Sea of Japan
(courtesy zerohedge)

North Korea Fires Ballistic Missile Which Passes Over Japan

Update 5: US Secretary of State Tillerson has issued a rather aggressive (towards China and Russia) statement:

 

North Korea’s Missile Launch

 

North Korea’s provocative missile launch represents the second time the people of Japan, a treaty ally of the United States, have been directly threatened in recent weeks.

 

These continued provocations only deepen North Korea’s diplomatic and economic isolation.

 

United Nations Security Council resolutions, including the most recent unanimous sanctions resolution, represent the floor, not the ceiling, of the actions we should take.

 

We call on all nations to take new measures against the Kim regime.

 

China supplies North Korea with most of its oil. Russia is the largest employer of North Korean forced labor.

 

China and Russia must indicate their intolerance for these reckless missile launches by taking direct actions of their own.

*  *  *

Update 4: The UN Security Council is set to meet at 4am Saturday Seoul time (3pm ET on Friday)

*  *  *

Update 3: US Pacific Command has confirmed that its commitment to the defense of Japan and South Korea (via NBC News)

U.S. Pacific Command detected and tracked what we assess was a single North Korean ballistic missile launch at 11:57 a.m. (Hawaii lime) Sept. 14. Initial assessment indicates the launch of an intermediate range ballistic missile (IRBM). The launch occurred in the vicinity of Sunan, North Korea and flew east.

 

The ballistic missile overflew the territory of northern Japan before landing in the Pacific Ocean east of Japan. We are working with our interagency partners on a more detailed assessment and we will provide a public update if warranted.

 

The North American Aerospace Defense Command (NORAD) determined this ballistic missile did not pose a threat to North America, U.S. Pacific Command determined this ballistic missile did not pose a threat to Guam. We continue to monitor North Korea’s actions closely.

 

Our commitment to the defense of our allies, including the Republic of Korea and Japan, in the face of these threats, remains ironclad. We remain prepared to defend ourselves and our allies from any attack or provocation.

*  *  *

Update 2: Japanese and South Korean officials have started to respond:

Japanese officials are very unappy (and are seeing much support from their ally in Washington)

  • *JAPAN PM ABE HAS RETURNED TO JAPAN FROM INDIA: KYODO (that was quick)
  • *ABE: N.KOREA ACT ABSOLUTELY UNACCEPTABLE
  • *ABE: N.KOREA THREATENING WORLD PEACE THROUGH PROVOCATION
  • *ABE: INTL COMMUNITY MUST SEND CLEAR MESSAGE TO N.KOREA (because “firs & fury” was not clear enough)
  • *ABE: IF N.KOREA CONTINUES ON THIS PATH IT HAS NO BRIGHT FUTURE
  • *ABE: JAPAN WAS COMPLETELY AWARE OF MISSILE MOVEMENT

 

  • *SUGA: N. KOREA LAUNCH WAS ONE-WAY ACT OF ESCALATION
  • *SUGA: MISSILE FLEW 3,700 KM, ALTITUDE ABOUT 800KM
  • *SUGA: BELIEVE MISSILE WASN’T LAUNCHED VIA LOFTED TRAJECTORY
  • *SUGA: STILL EVALUATING WHAT TYPE OF MISSILE N.KOREA LAUNCHED

Then it seems the South Koreans are gravely coincerned about their stock market more than any existential threat to their citizens…

  • *S. KOREA TO STRENGTHEN MONITORING OVER MARKETS ON N. KOREA RISK
  • *S. KOREA SAYS N. KOREA PROVOCATION CAN DESTABILIZE MARKETS
  • *S. KOREA GOVT TO TAKE FIRM AND SWIFT STEPS ON MARKETS IF NEEDED

And just as we saw yesterday – after US officials noted that North Korea appeared to be preparing for a launch, we suspect we will see Korea’s PPT in action soon…

*  *  *

Update 1:  According to Fox News, the U.S. has now confirmed the latest North Korean missile launch.

  • U.S. OFFICIAL CONFIRMS #NORTHKOREA FIRED BALLISTIC MISSILE: FOX NEWS
  • WHITE HOUSE SAYS TRUMP BRIEFED ON N.KOREA MISSILE: YONHAP NEWS

All the diplomatic posturing, the jawboning, the UN sanctions, and threats over the past three weeks has achieved absolutely nothing because as Yonhap and NHK report, North Korea has just launched an “unidentified” missile eastward from the capital Pyongyang.

A live feed from NHK in English is available after clicking on the image below:

According to Yonhap, “North Korea fired an unidentified missile eastward from the vicinity of Pyongyang this morning,” the Joint Chiefs of Staff (JCS) said. It added that South Korea and the United States are analyzing additional information.

Following the launch Japan has issued a missile alert to mobile phones and on national television, with the government advising people outside to take shelter immediately.

Worse, it appears that the missile has once again flown over Japan:

  • NORTH KOREA MISSILE PASSES OVER JAPAN, GOVT SAYS
  • N.KOREA MISSILE PASSES OVER JAPAN’S HOKKAIDO, GOVT SAYS

As NHK further adds, the missile which was launched at 6:57am local time, passed over Hokkaido at 7:06am local time, and came down in the Pacific Ocean, some 2,000 KM east of Japan’s Erimo Misaki.

Japan’s cabinet minister Suga said that the missile situation is similar to that on August 29, NHK adds.

NHK adds that Japan did not attempt to shoot down the missile, while the South Korean presidential office notes that the country’s national security council will meet at 8am local time.

Separately, according to South Korea military, North Korea fired unidentified missile in eastern direction. South Korea’s president Moon will chair a national security meeting shortly.

Developing

 

end

(courtesy zerohedge)

b) REPORT ON JAPAN

c) REPORT ON CHINA

end

Explosion and fire from a bucket bomb in the London subway system at Parson Green and this is treated as a terrorist incident

(courtesy zerohedge)

Explosion, Fire From “Bucket Bomb” On London Subway Train Treated As “Terrorist Incident”

Update:

As Reuters updates, the home-made bomb left on a packed rush-hour commuter train in London engulfed a carriage in flames and injured 22 people on Friday in what police said was Britain’s fifth terrorism incident this year, but apparently failed to fully explode. Passengers on board a train heading into the capital fled in panic as the fire erupted at Parsons Green underground station in West London at 8.20 a.m. (0720 GMT).

Charlie Craven said he had just got on the train when the device exploded. “Literally within three seconds of putting your bag down, the doors just closing, we hear a loud explosion,” he told Reuters. “I looked around and saw this massive fireball … coming down the carriage.”

He said terrified passengers fled, fearing a second explosion or a gunman, with people being knocked to the ground and crushed in the stampede to escape. Outside the station, a woman was carried off on a stretcher with her legs covered in a foil blanket while others were led away swathed in bandages.

Some suffered burns while others were injured in a stampede to escape. The National Health Service said 22 people had been taken to London hospitals, most believed to be suffering flash burns. None were thought to be in a serious condition, the ambulance service said.

“We now assess that this was a detonation of an improvised explosive device,” Britain’s top counter-terrorism officer Mark Rowley told reporters. Rowley declined to say if the suspected bomber had been on the train, saying it was a live investigation.

Police said officers were making urgent inquiries involving hundreds of detectives backed by the intelligence services to find out who was responsible.

Pictures taken at the scene showed a slightly-charred white bucket with a supermarket freezer bag on the floor of one train carriage. The bucket, still intact, was in flames and there appeared to be wires coming out of the top. “I was on second carriage from the back. I just heard a kind of whoosh. I looked up and saw the whole carriage engulfed in flames making its way toward me,” Ola Fayankinnu, who was on the train, told Reuters.

“There were phones, hats, bags all over the place and when I looked back I saw a bag with flames.”

* * *

London police are responding to “a terrorist incident” at Parsons Green tube station in London, following an explosion on a packed rush-hour commuter train on Friday morning. Several people have been reportedly injured.

The details of the incident weren’t immediately clear, but witnesses described what sounded like an explosion and a burst of flames on a car of a train as it was stopped at the Parsons Green station in West London. They described panic and chaos as passengers rushed to flee across a crowded platform during the morning rush hour.

One eyewitness described an “Explosion on Parsons Green district line train. Fireball flew down carriage and we just jumped out open door”

ice are responding to “a terrorist incident” at Parsons Green tube station in London, following an explosion on a packed rush-hour commuter train on Friday morning. Several people have been reportedly injured.

The Met’s Counter Terrorism Command are investigating after the incident at  tube station is declared a terrorist incident

The details of the incident weren’t immediately clear, but witnesses described what sounded like an explosion and a burst of flames on a car of a train as it was stopped at the Parsons Green station in West London. They described panic and chaos as passengers rushed to flee across a crowded platform during the morning rush hour.

One eyewitness described an “Explosion on Parsons Green district line train. Fireball flew down carriage and we just jumped out open door”

View image on TwitterView image on Twitter

Explosion on Parsons Green district line train. Fireball flew down carriage and we just jumped out open door.

The Metro newspaper reported that passengers had suffered facial burns from a blast and others had been hurt in a subsequent stampede. “I was on second carriage from the back. I just heard a kind of whoosh. I looked up and saw the whole carriage engulfed in flames making its way towards me,” a man who was on the train told Reuters.

“We are aware of an incident at #ParsonsGreen tube station. Officers are in attendance,” London police said on Twitter.

.@metpoliceuk have now declared this a terror incident. Officers remain at the scene and continue to work with emergency service colleagues

Parsons Green subway station in west London was cordoned off as counter-terrorism police investigated, the Metropolitan Police said in a statement. A number of people were injured, the Met said, and the Press Association said passengers suffered facial burns and some were hurt in a stampede.

A photo posted on social media showed personal belongings and a white bucket in a supermarket freezer bag with what appeared to be wires coming out of the top on the floor of one train carriage.

A passenger shared images of his singed hair after the incident. “Charred head from the fireball at Parsons Green,” Peter Crowley tweeted.

View image on TwitterView image on TwitterView image on TwitterView image on Twitter

Chard head from the fireball at 

The London Ambulance Service said it received a call at 8:20 a.m. and sent multiple vehicles to the scene. Emergency services swarmed the area, which was taped off behind a large cordon. Police advised people to stay away from the area.

Outside the station, a woman was sitting on a pavement with a bandage around her leg, while armed police patrolled. A Reuters witness saw a woman being carried off on a stretcher with her legs covered in a foil blanket.

A Reuters witness could see a bomb disposal unit at the scene while the fire brigade said it had sent six engines and 50 firefighters. London Ambulance said it had sent “multiple resources” including its hazardous area response team to the scene. “Our initial priority is to assess the level and nature of injuries,” it said.

Transport for London said on Twitter there was no service on the western part of the District Line which runs through Parsons Green.

“Thoughts are with those injured at Parsons Green and the emergency services who, once again, are responding swiftly and bravely to a suspected terrorist incident,” British Prime Minister Theresa May said. May will chair a Cabinet Office Briefing Room (Cobra) emergency meeting Friday afternoon, Downing Street said.

“Obviously, everybody should keep calm and go about their lives in a normal way, as normal as they possibly can,” Foreign Secretary and former London Mayor Boris Johnson told Sky News. “As far as I understand it, the British Transport Police and TfL are on it and they will be updating their websites as and when we have more information.”

Britain has suffered four attacks blamed on terrorists so far this year which killed 36 people. In 2005, 52 people were killed when four British Islamists carried out suicide bomb attacks on three London underground trains and a bus.

Live feed from Parson’s Green below

END

 

Then late in the afternoon, the uK terror threat level was raised to critical, meaning another terrorist attack may be imminent

(courtesy zero hedge)

UK Terror Threat Level Raised To “Critical”: Another Terrorist Attack May Be Imminent

British Prime Minister Theresa May has raised the country’s threat level to “critical” from “severe” following today’s subway explosion attack at Parsons Green tube station in south-west London. A “critical” level typically means that the British government believes a terrorist attack is imminent.

Theresa May says UK terror threat level raised to critical, highest possible level, after London Tube blast http://bbc.in/2x2JI21 

As reported earlier in the day, at about 8 AM local time, a homemade bomb was detonated in a London metro station, injuring approximately 30 people. Following the bombing, Westminster raised the national threat level to “severe.” Now, it has been raised again to “critical,” the highest threat level possible.

The escalation in the terror level comes shortly after the Islamic State claimed responsibility for an explosion at the Parsons Green underground station in London which injured 22 people on a packed rush hour train. The claim was made through its propaganda wing, the Amaq News Agency, stating that an IS “detachment” was responsible for the blast.

Police have launched a manhunt for a suspect thought to be behind the attack, which they have identified through CCTV footage. British Prime Minister Theresa May condemned the “cowardly” attack “intended to cause significant harm.” She announced the deployment of more armed police around the London’s transport network

end
Another terrorist attack in France
(courtesy zero hedge)

Man Shouting “Allahu Akbar” Attacks Two Women With A Hammer In French Town

Two days after a Muslim religious fanatic attacked a family in Toulouse,  moments ago two women were among the people injured after a hammer-wielding man assaulted them while screaming “Allahu Akbar” in Chalon-sur-Saone, near Lyon, France, according to media reports. The attacker, wearing all black, is reportedly still on the run.


The town of Chalon-sur-Saône, in eastern France

The first victim was attacked at noon, and the other some 15 minutes later at a nearby location, Le Journal reports.

And, as has so very often been the case in recent weeks, according to a source close to the investigation, preliminary indications are that “the act was carried out by a mentally unstable person,” Le Journal reported. It was unclear if the “mentally unstable person” also had any affiliation to a terrorist organization.

Following the attack, the Police force launched a vast search for the assailant, including a low-flying helicopter.

Two women are reportedly in critical condition after the assault in Chalon-sur-Saône, in Bourgogne-Franche-Comté around lunchtime today. One of the two women is believed to have been hit in the back of the head.

This comes as a knife wielding man attacked a French soldier outside a Metro station in Paris today while praising Allah. The attack in Paris took place att Chatelet metro station at 6.30am this morning, and saw an unnamed assailant attack a soldier with a knife.

The victim managed to wrestle him to the ground and he was arrested by armed police as he shouted ISIS slogans.

The unidentified man is said to have rushed at a patrol of soldiers wearing combat uniforms and brandishing assault rifles. ‘He was restrained, and nobody was injured,’ said a source investigating the case on Friday morning. The man was taken to the main Chatelet police station, and now faces a range of terrorist charges.

It is the latest in a long string of attacks on service personnel involved in Operation Sentinelle – an initiative involving 10,000 soldiers and 4700 gendarmes and police.

The attacks come on the same day as an improvised explosive device blew up on a London subway car, injuring at least 22.

end

Spain tries to restrict Catalans finances ahead of the independence vote despite the fact that they supply more dollars to Madrid that Catalan receives
(courtesy zerohedge)

Spain Passes New Laws To Restrict Catalan Finances Ahead Of Independence Vote

Tyler Durden's picture

With just a few weeks left until Catalonia’s proposed independence referendum on October 1st, Madrid has taken new steps this morning to restrict the finances of local governing entities to “guarantee that not one euro will go toward financing illegal acts.” Per Reuters:

The Spanish government said on Friday it had passed measures to increase control over how Catalonia spends its money in an effort to block the regional government from using state cash to pay for an illegal independence referendum.

 

“These measures are to guarantee that not one euro will go toward financing illegal acts,” Budget Minister Cristobal Montoro said following the weekly cabinet meeting.

Of course, restricting finances is just one of many steps taken by Spain over the past couple of days/weeks to thwart a potential independence vote.  While ruling out the use of the military and imposing direct rule from Madrid, as BBC notes Spain’s government is doing all it can behind the scenes to prevent ballot boxes from being put out for Catalans to vote.

On Wednesday night a judge in Barcelona gave the police authorisation to shut down the Referendum.cat website, created by the government to encourage people to vote on 1 October.

 

Spain’s attorney general has asked prosecutors in Catalonia to interrogate all mayors whose name is the on the list of more than 700 who have signed up to participate in the referendum.

 

Those mayors who respond voluntarily to the summons should be arrested, the government-appointed attorney general said.

 

Catalonia’s top court has called in local police chiefs to remind them that their duty is to report any crime they see being committed and to seize items being used for the purpose of the vote, specifically ballot boxes.

 

The newspaper El Mundo reported that the government may ask the courts to order that electricity be cut at polling stations if all else fails in the bid to thwart the vote.

Catalonia

 

Meanwhile, Catalonia’s governor and the mayor of its biggest city, Barcelona, have appealed to Spain’s premier and king for dialogue to resolve the increasingly bitter dispute over the planned vote.

Governor Carles Puigdemont and Mayor Ada Colau said in the letter addressed to Rajoy and also sent to King Felipe that they wanted support from the Spanish state for the referendum.

 

“We call for … open and unconditional dialogue. A political dialogue, based on the legitimacy we all have, to make possible something that in a democracy is never a problem and even less a crime: listening to the voice of the people,” the officials wrote in the letter seen by Reuters.

 

Most of Catalonia’s 5.5 million voters want to have a say on the region’s relationship with Spain, but the independence cause has lost support in recent years and surveys now indicate less than half the population would choose full self-rule.

 

Colau gave a boost to the referendum campaign on Thursday with a message that the vote would go ahead in Barcelona, the region’s most populous area, without civil servants involved risking their jobs.

For those who aren’t familiar with why Catalonia is seeking independence, we shared this helpful infographic earlier this morning showing how the region pays a disproportionate share of Spain’s taxes, effectively subsidizing the rest of the country.

Of course, no matter how the referendum turns out, we’re almost certain it will be positive for global equity markets.

end

5. RUSSIA AND MIDDLE EASTERN AFFAIRS

6 .GLOBAL ISSUES

END

7. OIL ISSUES

Rig counts lower again by 7 as crude fails at the 50 dollar level

(courtesy zerohedge)

WTI Crude Fails At $50 Again As Rig Count Tumbles Most In 8 Months

As Texas slowly normalizes from Hurricane Harvey’s impact, production has rebounded but the rig count continues to tumble (down 7 to 749 this week). This is the biggest weekly drop in oil rigs since Jan 2017 and June 2016. WTI Crude futures have once again tested $50 (and failed) this morning.

This is the 5th week in a row with no increases in oil rig counts.

 

The massive collapse in US crude production last week – with most of Texas offline – has recovered somewhat with a 572k surge in production this week. However, it is clear that levels of production are well off pre-Harvey levels…

 

WTI retested $50 this morning, and failed, but RBOB gasoline is on the rise…“The dollar is once again weakening and that is adding some support to oil too”

However, some remain bulish – “The market is realizing that demand is a lot stronger than there was given credit for,” says Phil Flynn, senior market analyst at Price Futures Group. “The untold story hidden behind the glut has been the demand growth”

8. EMERGING MARKET

VENEZUELA

end

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

Euro/USA   1.1956 UP .0036/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 mostly IN THE RED EXCEPT GERMANY 

USA/JAPAN YEN 111.21 UP 1.276(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 1.3587 UP .01910 (Brexit  March 29/ 2017/ARTICLE 50 SIGNED

THERESA MAY FORMS A NEW GOVERNMENT/STARTS BREXIT TALKS

USA/CAN 1.2161 DOWN .0002 (CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA)

Early THIS FRIDAY morning in Europe, the Euro ROSE by 13 basis points, trading now ABOVE the important 1.08 level  RISING to 1.1901; / Last night the Shanghai composite CLOSED  DOWN 17.81 POINTS OR 0.53%     / Hang Sang  CLOSED  UP 30.29 POINTS OR 0.11% /AUSTRALIA  CLOSED DOWN 0.73% / EUROPEAN BOURSES OPENED  MOSTLY IN THE RED (EXCEPT GEERMANY)

The NIKKEI: this FRIDAY morning CLOSED UP 102.06 POINTS OR 0.52%

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

2/ CHINESE BOURSES / : Hang Sang CLOSED UP 20.29 POINTS OR 0.11%  / SHANGHAI CLOSED DOWN 17.81 POINTS OR 0.53%   /Australia BOURSE CLOSED DOWN 0.73% /Nikkei (Japan)CLOSED UP 102.06 POINTS OR 0.52%   / INDIA’S SENSEX IN THE RED

Gold very early morning trading: 1323.50

silver:$17.69

Early FRIDAY morning USA 10 year bond yield:  2.200% !!! UP 2   IN POINTS from THURSDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%.

The 30 yr bond yield  2.772, UP 0 IN BASIS POINTS  from THURSDAY night.

USA dollar index early FRIDAY morning: 91.79 DOWN 33  CENT(S) from THURSDAY’s close. 

This ends early morning numbers  FRIDAY MORNING

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

And now your closing FRIDAY NUMBERS

Portuguese 10 year bond yield: 2.803% DOWN 1  in basis point(s) yield from THURSDAY 

JAPANESE BOND YIELD: +.029%  DOWN 3  in   basis point yield from THURSDAY/JAPAN losing control of its yield curve/

SPANISH 10 YR BOND YIELD: 1.609% UP 1  IN basis point yield from THURSDAY 

ITALIAN 10 YR BOND YIELD: 2.079 UP 2 POINTS  in basis point yield from THURSDAY 

the Italian 10 yr bond yield is trading 47 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: +.433% UP 2  IN  BASIS POINTS ON THE DAY

END

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

IMPORTANT CURRENCY CLOSES FOR FRIDAY

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

Euro/USA 1.1958 UP .0037 (Euro UP 37 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 110.81 UP 0.876(Yen DOWN 88  basis points/ 

Great Britain/USA 1.3576 UP  0.0180( POUND UP 180 BASIS POINTS)

USA/Canada 1.2183 UP .0020 (Canadian dollar DOWN 20 basis points AS OIL FELL TO $49.81

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

This afternoon, the Euro was UP  by 37 basis points to trade at 1.1958

The Yen FELL to 110.81 for a LOSS of 88  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  

The POUND ROSE BY 180  basis points, trading at 1.3576/ 

The Canadian dollar FELL by 20 basis points to 1.2183,  WITH WTI OIL RISING TO :  $49.81

The USA/Yuan closed at 6.5526/
the 10 yr Japanese bond yield closed at +.029%  DOWN 2 IN  BASIS POINTS / yield/ 

Your closing 10 yr USA bond yield UP 1  IN basis points from THURSDAY at 2.197% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic  USA 30 yr bond yield: 2.769 DOWN 3  in basis points on the day /

Your closing USA dollar index, 91.79  DOWN 33 CENT(S)  ON THE DAY/1.00 PM/BREAKS RESISTANCE OF 92.00 

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

London:  CLOSED DOWN  79.92 POINTS OR 1.10%
German Dax :CLOSED DOWN 21.64 POINTS OR 0.17%
Paris Cac  CLOSED DOWN 11.29 POINTS OR 0.22% 
Spain IBEX CLOSED DOWN 43.70 POINTS OR 0.42%

Italian MIB: CLOSED DOWN 51.65 POINTS OR 0.23% 

The Dow closed UP 64.96 OR 0.29%

NASDAQ WAS closed UP 19.39  POINTS OR 0.30%  4.00 PM EST

WTI Oil price;  49.81  1:00 pm; 

Brent Oil: 55.38 1:00 EST

USA /RUSSIAN ROUBLE CROSS:  57.57 UP 7/100 ROUBLES/DOLLAR (ROUBLE LOWER BY 7 BASIS PTS)

TODAY THE GERMAN YIELD RISES TO  +0.43%  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:$49.90

BRENT: $55.50

USA 10 YR BOND YIELD: 2.198%  (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)

USA 30 YR BOND YIELD: 2.767%

EURO/USA DOLLAR CROSS:  1.1958 UP .0037

USA/JAPANESE YEN:110.85  up  0.918

USA DOLLAR INDEX: 91.77  DOWN 35  cent(s)/

The British pound at 5 pm: Great Britain Pound/USA: 1.3591 : UP 194 POINTS FROM LAST NIGHT  

Canadian dollar: 1.2183 down 21 BASIS pts 

German 10 yr bond yield at 5 pm: +0.433%

END

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

TRADING IN GRAPH FORM FOR THE DAY

Stocks Soar To Record Highs As Crypto Crashes After Terror, Nukes, & Dismal Data; Here’s Why

So to be clear, this week we had:

  • Hurricane Irma crushes Florida
  • North Korea test fires ICBMs across Japan (again)
  • Economic data misses across the globe (China and US most notably)
  • Terrorism in UK and France

And the result – drum roll please – new record highs for The Dow, The S&P, and The Nasdaq… with The Dow’s best week of the year!!

 

And in case you wondered what sent stocks soaring this week… The Fed (which is supposedly on the verge next week of starting to reduce the balance sheet) saw a $17.7bn spike in its balance sheet – the biggest weekly jump since Dec 2016

But, now that the ubiquitous pre-Quad-Witch ramp in stocks is over (and with The Fed about to start ‘normalizing’ the balance sheet)… what happens next?

We think this sums the week up nicely…

*  *  *

So having got that off our chests… here’s what happened this week (in the markets)…6-day win streak for The Dow – best week since Dec 2016

S&P was perfectly manipulated to cross 2500 at the close…

 

VIX was clubbed all the way down to 10.00…

 

But we note that the VIX term structure is notably steepening…

 

Small Caps were best on the week thanks to a short-squeeze at the open every day…

 

FANG Stocks opened notably lower but for the 5th day in a row were panic-bid immediately…

 

Financials outperformed on the week (with Utes down)…

 

But, notably Financials were firmly rejected at their 50DMA…

 

Treasury yields rose once again today but once again the long-end outperformed…

 

5s30s flattened dramatically (to its lowest since early July) despite the bearish tilt…this was the biggest flattening since December!

 

All of which makes perfect sense in light of financials huge week…

 

The Dollar Index slipped lower for the second day in a row but ended the week higher (best week in 5 months!)

 

Of course, the big headlines today (and this week) were made by Cryptocurrencies.

Bitcoin crashed as much as 20% at one point today after news of all China bitcoin exchanges being closed by BTFDers came rushing in to save the day…

 

Nevertheless this was the worst week for Bitcoin since jan 2015 (but for some context – even after this most recent crash, BTC is still up 275% YTD)

 

Copper was worst among the major commodities (copper’s worst 2-week drop soince December) and Crude was best (biggest week for WTI since July)

 

But Crude failed to hold $50 again… (RBOB biggest weekly loss since June)

 

Gold and Silver fell on the week… (worst weekly drop in 2 months)

*  *  *

And one more thing… US ‘Hard’ Economic Data (i.e. excluding ‘soft survey’-based data) collapsed to its weakest since March 2009 this week…

 

But it’s probably nothing…

 

Bonus Chart: WTF-Panic-Buying from Korea’s Plunge Protection Team after North Korea’s missile launch!!

 

end

 

Janet will not like this; as promised by Bank of America, August retail sales tumbled .2% month over month with July’s surprise gains cut in half due to revisions. This is a terrible report and it has not seen such results since Jan. 2016:

(courtesy zerohedge)

Retail Sales Tumble In August – Worst Since Jan 2016 As Online Sales Slump

Following July’s exuberant bounce back in retail sales (due to auto sales spike, despite auto manufacturers reporting a collapse in sales?), August Retail sales tumbled 0.2% MoM (just as we warned) and July’s surprise gains were cut in half due to revisions. Retail sales growth has not been worse than this since January 2016, as online spending tumbled 1.1%.

We warned that August would be weak (basically due to i) Hurricane Harvey; ii) Pull fwd from Amazon Prime Day; and iii) very weak back to school spending)

Don’t be fooled by blaming Hurricane Harvey since July’s data was revised drastically lower (from +0.6% to just +0.3% MoM) as the reality of slumping auto sales hit.

Retail Sales Ex Autos dropped 0.1% – the biggest drop since July 2016.

8 categories posted increases this month versuss 7 last month:

  1. Furniture and home furnishing +0.4%
  2. Food and beverage stores +0.3%
  3. Health and personal care +0.1%
  4. Gasoline stations 2.5%
  5. Sporting Goods, Hobby, Book and Music sales +0.1%
  6. General Merchandise +0.2%
  7. Miscellaneous store retailers 1.4%
  8. Food service and drinking places 0.3%

But confirming the Amazon Prime Day effect, online spending tumbled…

This is the biggest drop in online spending since Jan 2014…

(courtesy zero hedge)

(courtesy zerohedge)

(courtesy UMichigan ConsumerConfidence/zerohedge)

UMich Consumer Confidence Slides On Loss Of ‘Hope’

University of Michigan’s headline consumer confidence index slipped lower in Septemeber (prelim) from 96.8 to 95.3 driven by a tumble in ‘expectations’ that offset a burst in ‘current conditions’ to its highest since Nov 2000!

As Bloomberg reports, the figures are the first to broadly capture the effects of Harvey and Irma, which caused more than $100 billion in damage and sparked a jump in claims for unemployment benefits. According to the survey, 9 percent of respondents spontaneously said the storms would hurt the economy. The sentiment index was unchanged among consumers who didn’t mention the storms.

Across all interviews in early September, 9% spontaneously mentioned concerns that Harvey, Irma, or both, would have a negative impact on the overall economy.

Among those who mentioned the hurricanes, the Sentiment Index was 80.2…

 

while among those who did not spontaneously mention either hurricane, the Sentiment Index remained unchanged from last month at 96.8.

Notably the number of UMich survey respondents collapsed to a record low last month…

Consumers expected slight increases in gasoline prices and inflation, as Harvey temporarily shuttered refineries in Texas.

“Given the current resilience of consumers, recent events are unlikely to derail confidence,” Richard Curtin, director of the University of Michigan consumer survey, said in a statement.

 

“Nonetheless, the disruptions will cause a brief period of weakness in economic growth and employment, accompanied by increased precautionary motives that will temper spending trends.”

Policy makers don’t expect the disasters to have a long-term effect on the economy, as reconstruction later in the year should offset their negative impact on third-quarter growth.

A little over half of consumers reported improved finances for the fourth straight month, the highest percentage since November 2000.

Meanwhile, President Donald Trump is stepping up efforts to promote tax cuts that he says will benefit the middle class and boost an already-tight labor market. Most consumers said the economy had improved of late, with just one in five expecting conditions to deteriorate in the coming year. Only 25 percent of respondents expected an increase in unemployment, which is hovering near a 16-year low.

More problems for Florida as Irma released a massive 250 million gallons of untreated sewage onto the streets

(courtesy zerohedge)

Hurricane Irma Released “250 Million Gallons Of Untreated Sewage” Into The Streets Of Florida

One could be forgiven for believing that, with all this talk of the coming “climate catastrophe,” Americans would be scrambling to flee Hurricane-prone states like Texas and Florida. The reality is just the opposite: Thanks to their low cost of living, and minimal taxes, Florida and Texas are among the states in the US where populations are rising via interstate migration. Contrast that with Connecticut, which is far less vulnerable to hurricanes, and where the population drain has accelerated dramatically in recent years.

Both Harvey and Irma impacted some of the fastest-growing counties in the US, exposing a problem that’s probably frustrated city and county officials for years. How to upgrade decades-old sewage and water-treatment systems.

When the storms struck, the ancient systems quickly failed, releasing millions of gallons of raw sewage into city streets and canals, complicating the cleanup effort, according to Bloomberg:

“Millions of gallons of poorly treated wastewater and raw sewage flowed into the bays, canals and city streets of Florida from facilities serving some of the nation’s fastest-growing counties. In fact, 4 of the 10 fastest-growing coastal counties in the eastern U.S. are in Florida. More than 9 million gallons of releases tied to Irma have been reported as of late Tuesday as inundated plants were submerged, forced to bypass treatment or lost power.”

Of course, this problem requires a monumentally expensive fix: The Environmental Protection Agency estimated last year that $271 billion is needed to maintain and improve the nation’s wastewater pipes, treatment plants and associated infrastructure. In fact, many parts of Florida and Texas face infrastructure challenges even when they aren’t deluged by rain because of rapid population growth.

Otherwise, populations risk the spread of pathogens with every overflow.

Estimates for scale of the untreated and poorly treated wastewater that leaked because of both Irma and Harvey are expected to keep climbing. Even Hurricanes Hermine and Matthew, which were modest compared with this year’s storms, released some 250 million gallons of wastewater that hadn’t been fully treated between Aug. 31 and Oct. 15, 2016, according to the Florida Department of Environmental Protection.

A treatment facility in Clearwater, Fla. Leaked 1.6 million gallons of wastewater into a creek, according to filings with the state’s Department of Environmental Protection. And that incident paled in comparison to a 30-million-gallon discharge of raw sewage after Hurricane Hermine caused pumps to fail, according to David Porter, the city’s public utilities director.

Electrical outages throughout the state caused lift station pumps to stop running in St. Petersburg and Orlando, prompting at least 500,000 gallons of spillage. A pipeline broke in Miramar, Florida, sending sewage spilling across a parkway – creating a nasty scene for the contractors who had to hunt for the rupture. And operators of a Miami-area wastewater treatment plant blamed a power outage for 6 million gallons of sewage released into Biscayne Bay.

Of course, this isn’t limited to a regional issue: Hurricane Sandy also unleashed a flood of sewage when it struck New York and New Jersey in 2012:

“After Hurricane Sandy ravaged the northeast US in 2012, damaged treatment plants and pumping stations caused untreated sewage to flow into local waterways for weeks. All told, facilities in the eight states hardest hit by the super storm released 11 billion gallons of untreated and partially treated sewage, according to one assessment.”

And as Bloomberg explains, loose sewage poses lingering public-health and economic risks to a community…

“Sewage discharges carry both health and economic risks, as officials may order the closing of affected beaches and rivers for swimming and boating long after storm clouds have passed. When untreated water or raw sewage is spilled, it can deliver toxic chemicals from roads, E. coli from human waste and other pathogens that have the potential to cause viruses, parasitic infections, rashes and other health conditions.”

…Because the pollution can often be difficult to detect.

“We focus on the water and the flooding and the impacts to homes and everything else, which is super important,” said Danielle Droitsch, a program director with the Natural Resources Defense Council. “But understanding environmental contamination issues is more complicated. We don’t necessarily see the pollution, sometimes you can’t smell it and yet it’s there.”

And while there’s no such thing as a perfect sewer system…

“There’s no sewer system in the world that can be built that’s completely leak proof,” said Nathan Gardner-Andrews, chief advocacy officer for the National Association of Clean Water Agencies. Plants generally are designed to handle twice their normal capacity, but “when you get some of these rain events and you’re talking four to six to eight inches of rain in an hour, the engineering is such that you cannot build a system to hold that capacity.”

…Some sewage systems in rapidly growing southern counties, including the Florida counties affected by Irma, are more than 50 years old, and they demand immediate attention.

“Aging infrastructure may not be able to keep up with the demands of a surging southern population. In many cases, such as in south Florida, elements of the sewer system range from 60 to 70 years old, with pipelines that are even older, said Kelly Cox, a staff attorney and program director for the environmental group Miami Waterkeeper.”

 

“You throw a hurricane on top of that, and you are starting to see a lot more problems,” she said.

Talk about a sh—storm…

 

 

END

 

This is something that we must be cognizant of:  Southern California received 40,000 lightning strikes betweeen Sept 10 and Sept 11 AND NO RAIN.  MEXICO ALSO RECEIVED HUGE LIGHTNING STRIKES WITHOUT RAID AND THEN THEY HAD A HUGE 8.2 MAGNITUDE EARTHQUAKE..IS AN EARTHQUAKE HEADING FOR SOUTH CALIFORNIA?

(courtesy MacSlavo/SHFTplan.com)

Do 40,000 Lightning Strikes Over SoCal Point To A Mega Quake On The Horizon?

Authored by Mac Slavo via SHTFplan.com,

A volatile storm has ignited a slew of 40,000 lightning strike in southwestern California.

The strikes have hit Los Angeles, Santa Barbara, San Luis Obispo, and Ventura counties – all between September 10-11.

The electric storm was most active on Sunday with an amazing 5,000 lightning bolts in the area over a three-hour period. NWS Los Angeles took to Twitter to report the tremendous display. The intense storm brought plenty of lightning to the Golden state’s southern region, but almost no rain.  The greatest rain total of .44 inches at Sudden Peak on Sunday. By Monday morning, heavy showers, thunderstorms, and 35-mph winds were reported in eastern Los Angeles County.

Tremendous number of lightning strikes & in-cloud flashes over SW CA in last 24-hours. Nearly 40,000 in total! 

But now conspiracy is swirling around this fascinating and unique electric storm.  Strange lights and electrons acting oddly seem to have been appearing either before or during major earthquakes – like the recent 8.2 magnitude quake in Mexico. Could these lightning strikes be a sign thatCalifornia’s mega quake is on the horizon?

Like California, Mexico is a seismically active region that has seen smaller quakes that have caused death and destruction. But Thursday’s temblor is a reminder that even larger quakes — while rare — do occur. Scientists say it’s possible for Southern California to be hit by a magnitude 8.2 earthquake. Such a quake would be far more destructive to the Los Angeles area because the San Andreas fault runs very close to and underneath densely populated areas.

It’s often stated that California is ripe for a devastating mega earthquake and after some noticed the strange lights in the sky above Mexico during its quake, this conspiracy conclusion was an easy one to jump to.

Let us close out the week with this offering from Greg hunter of USAWatchdog
(courtesy Greg Hunter/USAWatchdog)

North Korea Fires Another, China US Trade Friction, Dollar Negative NewsBy Greg Hunter On September 15, 2017

North Korea (NK) has done it again and has fired another ballistic missile over the top of Japan. NK is extremely upset over the latest round of sanctions unanimously approved by the U.N. Security Council. NK has reportedly threatened to “sink” Japan and “reduce the U.S. to ashes.”

Meanwhile, the U.S. wants China to enforce the latest round of sanctions put on North Korea. This week, Secretary of Treasury Steve Mnuchen threatened to cut China off from the dollar trading system if they do not get tough on NK. This could set off a financial war of massive consequences for the U.S. dollar as China holds an estimated $1 trillion of U.S. debt.

President Trump may be cutting a deal on immigration with top Democrat lawmakers. President Trump is reportedly working with Nancy Pelosi and Chuck Schumer in return for their support for things in the Trump agenda. This has infuriated some core Trump supporters. Mark Taylor, author of the hit book “The Trump Prophecies,” says he is not worried about Trump or his tactics. He told me that “this is how the game is played. Trump is exposing who is for him and against him and his agenda.” Taylor went on to say, “In the 2018 mid-term elections, the people in the way of God’s agenda will be removed.”

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

After the Wrap-Up:

Dr. Chris Martenson, founder of PeakProsperity.com, is the guest for the “Early Sunday Release.” Dr. Martenson talks about the possible U.S./China financial war and what could suddenly happen to the buying power of the U.S. dollar.

Video Link

https://usawatchdog.com/north-korea-fires-another- china-us-trade-friction-dollar-negative-news/

-END-

that about does it for tonight

 

HAVE A GREAT WEEKEND

I will see you MONDAY  night

Harvey.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: