GOLD: $1270.00 down $6.15
Silver: $16.70 down 13 cents
Closing access prices:
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: $1289.75 DOLLARS PER OZ
NY PRICE OF GOLD AT EXACT SAME TIME: $1275.85
PREMIUM FIRST FIX: $13.90(premiums getting larger)
SECOND SHANGHAI GOLD FIX: $1291.50
NY GOLD PRICE AT THE EXACT SAME TIME: $1276.70
Premium of Shanghai 2nd fix/NY:$14.80 PREMIUMS GETTING LARGER)
CHINA REJECTS NEW YORK PRICING OF GOLD!!!!
LONDON FIRST GOLD FIX: 5:30 am est $1274.40
NY PRICING AT THE EXACT SAME TIME: $1275.60
LONDON SECOND GOLD FIX 10 AM: $1270.15
NY PRICING AT THE EXACT SAME TIME. 1271.70 ??
For comex gold:
NOTICES FILINGS TODAY FOR OCT CONTRACT MONTH: 523 NOTICE(S) FOR 52300 OZ.
TOTAL NOTICES SO FAR: 523 FOR 52300 OZ (1.626TONNES)
427 NOTICE(S) FILED TODAY FOR
Total number of notices filed so far this month: 427 for 2,135,000 oz
Bitcoin: $6196 bid /$6216 offer up $84.00 (MORNING)
BITCOIN CLOSING;$6309 BID:6329. OFFER UP $197.00
Let us have a look at the data for today
In silver, the total open interest ROSE BY A tiny sized 451 contracts from 195 ,953 UP TO 196,434 with YESTERDAY’S TRADING IN WHICH SILVER ROSE BY 8 CENTS. THE CROOKS ARE STILL HAVING AN AWFUL TIME TRYING TO COVER THEIR MASSIVE SILVER SHORTS SO THEY CONTINUE TO TORMENT. TODAY ALL OPTIONS ON THE LBMA/LONDON BOARD HAVE EXPIRED.
RESULT: A TINY SIZED RISE IN OI COMEX WITH THE 8 CENT PRICE GAIN. OUR BANKERS COULD NOT COVER ANY OF THEIR HUGE SHORTFALL.
In ounces, the OI is still represented by just UNDER 1 BILLION oz i.e. 0.981 BILLION TO BE EXACT or 140% of annual global silver production (ex Russia & ex China).
FOR THE NEW FRONT OCT MONTH/ THEY FILED: 427 NOTICE(S) FOR 2,135,000 OZ OF SILVER
In gold, the open interest SURPRISINGLY ROSE BY A HUGE 9,033 CONTRACTS DESPITE THE SMALL RISE IN PRICE OF GOLD ($5.30) . The new OI for the gold complex rests at 528,459. NO DOUBT MANY OF THE PAPER LONGS THAT RECEIVED THEIR NOV. EFP’S SOLD AND BOUGHT NOVEMBER AND DECEMBER GOLD COMEX CONTRACTS AS THEY CONTINUE WITH THEIR PAPER GAME.
Result: A HUGE SIZED INCREASE IN OI DESPITE THE SMALL RISE IN PRICE IN GOLD ($5.30). IT SEEMS THAT OUR PAPER EFP’S SOLD LONDON AND BOUGHT BACK COMEX NOVEMBER AND DECEMBER COMEX CONTRACTS.
we had: 523 notice(s) filed upon for 52,300 oz of gold.
With respect to our two criminal funds, the GLD and the SLV:
No change in inventory at the GLD/
Inventory rests tonight: 850.77 tonnes.
STRANGE: WITH SILVER UP THESE PAST TWO TRADING DAYS WE HAD A BIG WITHDRAWAL IN SILVER INVENTORY AT THE SLV: 1.133 MILLION OZ
INVENTORY RESTS AT 319.155 MILLION OZ
First, here is an outline of what will be discussed tonight:
1. Today, we had the open interest in silver ROSE BY A TINY 451 contracts from 195,983 UP TO 196,434(AND now A LITTLE CLOSER TO THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) . OUR BANKERS WERE AGAIN UNSUCCESSFUL IN THEIR ATTEMPT TO COVER ANY OF THEIR SILVER SHORTS.
RESULT: A SMALL SIZED INCREASE IN SILVER OI AT THE COMEX WITH THE 8 CENT GAIN IN PRICE (WITH RESPECT TO YESTERDAY’S TRADING). OUR BANKER FRIENDS WERE UNSUCCESSFUL IN THEIR ATTEMPT TO COVER ANY OF OUR SILVER SHORTS . .NO EFP’S WERE ISSUED FOR THE UPCOMING NOVEMBER CONTRACT
2.a) The Shanghai and London gold fix report
2 b) Gold/silver trading overnight Europe, Goldcore
and in NY: Bloomberg
3. ASIAN AFFAIRS
i)Late MONDAY night/TUESDAY morning: Shanghai closed UP 3.00 points or .09% /Hang Sang CLOSED DOWN 90.65 pts or 0.32% / The Nikkei closed UP 0.06 POINTS OR 0.00/Australia’s all ordinaires CLOSED DOWN 0.12%/Chinese yuan (ONSHORE) closed UP at 6.6315/Oil UP to 54.02 dollars per barrel for WTI and 60.86 for Brent. Stocks in Europe OPENED IN THE GREEN . ONSHORE YUAN CLOSED UP AGAINST THE DOLLAR AT 6.6315. OFFSHORE YUAN CLOSED AT VALUE OF THE ONSHORE YUAN AT 6.6335 AND //ONSHORE YUAN STRONGER AGAINST THE DOLLAR/OFF SHORE STRONGER TO THE DOLLAR/. THE DOLLAR (INDEX) IS STRONGER AGAINST ALL MAJOR CURRENCIES. CHINA IS NOT HAPPY TODAY
3a)THAILAND/SOUTH KOREA/NORTH KOREA
We warned you that this could happen. More than 200 are dead after tunnels collapse at the North Korean nuclear test site after suffering minor quakes last month:
b) REPORT ON JAPAN
Japan leaves its policy unchanged and that puts a little damper on the yen value. The bank of Japan lowered its purchases of ETF’s dramatically.
c) REPORT ON CHINA
i)China is definitely slowing down as its manufacturing and service PMI disappoint by tumbling in October.
ii)China;’s yield curve has now been inverted for 10 days signifying a huge slowdown in China and this inversion spells an upcoming disaster
4. EUROPEAN AFFAIRS
5. RUSSIAN AND MIDDLE EASTERN AFFAIRS
6 .GLOBAL ISSUES
7. OIL ISSUES
Both oil and gasoline rise after major inventory draw downs
8. EMERGING MARKET
9. PHYSICAL MARKETS
ii)We brought you this story yesterday and it is quite concerning: somebody made a fake one oz Canadian gold bar with fake mint wrapping. So far only one bar has shown up( Ottawa Citizen/GATA)
iii)Nothing new her The gold market is moving from West to East;
( Xinhua News Agency, Beijing)
10. USA Stories
iib)Trump calls on both Podesta brothers to ‘drain the swamp’ by revealing the real earth shattering dirt perpetrated by the Democrats with their fake news that it was the Republicans only that tried to influence the elections with the help of Russian authorities
ii c) The real plot as described by Pat Buchanan: they were all trying to bring down Trump
(courtesy Pat Buchanan)
iii)John Kelly reports that the White House is totally unfazed by the Mueller Indictments as nothing relates to the Russian investigation
iv)Soft data Chicago PMI surges to its highest point since 2011 despite employment faltering. All soft data reports are fudged.
v)The pharmaceutical industry is to immune to corruption: Generic companies colluded by diving up the market. Six manufactures are involved
Let us head over to the comex:
The total gold comex open interest SURPRISINGLY ROSE BY 9,033 CONTRACTS UP to an OI level of 528,459 WITH THE SMALL RISE IN THE PRICE OF GOLD ($5.30 RISE IN YESTERDAY’S TRADING). IT SEEMS THAT THE NEWBIE LONG EFP’S SOLD THEIR LONDON BASED CONTRACTS AND BOUGHT BACK COMEX NOVEMBER AND DECEMBER AND POCKETED THE FIAT BONUS.
HERE IS A SUMMARY OF EFP’S ISSUED TO LONGS IN EACH OF THE PAST 3 MONTHS:
The amount of EFP’s issued for each of the past 3 months at month’s end;
Result: a GOOD SIZED open interest INCREASE WITH THE RISE IN THE PRICE OF GOLD ($5.30.)
We have now entered the NON active contract month of NOVEMBER.HERE WE HAD A LOSS OF ONLY 42 CONTRACTS DOWN TO 610 AND BY DEFINITION THAT IS THE PRELIMINARY AMOUNT OF GOLD CONTRACTS STANDING FOR DELIVERY OR 61000 OZ (1.897 TONNES)
The very big active December contract month saw it’s OI GAIN OF 4426 contracts UP to 382,729. FEBRUARY saw a gain of 3893 contacts up to 84,741.
We had 523 notice(s) filed upon today for 52300 oz
VOLUME FOR TODAY (PRELIMINARY) 266,119
CONFIRMED VOLUME YESTERDAY: 272, 175
We had 427 notice(s) filed for 2,135,000 oz for the OCT. 2017 contract
|Withdrawals from Dealers Inventory in oz||nil oz|
|Withdrawals from Customer Inventory in oz||
|Deposits to the Dealer Inventory in oz||nil oz|
|Deposits to the Customer Inventory, in oz||
|No of oz served (contracts) today||
|No of oz to be served (notices)||
|Total monthly oz gold served (contracts) so far this month||
|Total accumulative withdrawals of gold from the Dealers inventory this month||NIL oz|
|Total accumulative withdrawal of gold from the Customer inventory this month||xxx oz|
Today, 0 notice(s) were issued from JPMorgan dealer account and 337 notices were issued from their client or customer account. The total of all issuance by all participants equates to 532 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 124 notice(s) was (were) stopped/ Received) by j.P.Morgan customer account.
|Withdrawals from Dealers Inventory||nil|
|Withdrawals from Customer Inventory||
|Deposits to the Dealer Inventory||
|Deposits to the Customer Inventory||
|No of oz served today (contracts)||
|No of oz to be served (notices)||
|Total monthly oz silver served (contracts)||427contracts
|Total accumulative withdrawal of silver from the Dealers inventory this month||NIL oz|
|Total accumulative withdrawal of silver from the Customer inventory this month||xx oz|
NPV for Sprott and Central Fund of Canada
will update later tonight
Sprott WINS hostile 3.1 billion bid to take over Central Fund of Canada
Sprott Inc. to take control of rival gold holder Central Fund of Canada
Posted Oct 2, 2017 8:43 am PDT
Last Updated Oct 2, 2017 at 9:20 am PDT
TORONTO – Sprott Inc. (TSX:SII) says it has struck a deal to take control of rival gold-holding firm Central Fund of Canada Ltd. (TSX:CEF.A) after a protracted takeover effort.
Toronto-based Sprott said Monday it will pay $120 million in cash and stock for Central Fund of Canada Ltd.’s common shares and for the right to administer and manage the fund’s assets.
The deal, which requires approval from Central Fund shareholders, would see its class A shareholders transferred to a new Sprott Physical Gold and Silver Trust.
Sprott says the deal would add $4.3 billion to its assets under management, which are focused largely on holding physical precious metals on behalf of clients, and 90,000 investors to its client base.
In March, Sprott tried to go through the Court of Queen’s Bench of Alberta to allow Central Fund’s class A shareholders to swap their shares to Sprott after the family that controls Central Fund rebuffed their attempt to make a deal.
Last year Sprott took over Central GoldTrust, a similar fund controlled by the same family, after securing support from more than 96 per cent of shareholder votes cast.
And now the Gold inventory at the GLD
OCT 31/no change in gold inventory at the GLD/Inventory rests at 850.77 tonnes
Oct 30/STRANGE WITH GOLD UP THESE PAST TWO TRADING DAYS, THE GLD HAS A WITHDRAWAL OF 1.18 TONNES FROM ITS INVENTORY/INVENTORY RESTS AT 850.77 TONES
Oct 27/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 851.95 TONNES
Oct 26./A WITHDRAWAL OF 1.18 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 851.95 TONNES
Oct 25/NO CHANGE (SO FAR) IN GOLD INVENTORY/INVENTORY RESTS AT 853.13 TONNES
Oct 24./no change in gold inventory at the GLD/inventory rests at 853.13 tonnes
OCT 23./NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY REMAINS AT 853.13 TONNES
OCT 20/NO CHANGE IN GOLD INVENTORY AT THE GLD/ INVENTORY REMAINS AT 853.13 TONNES
oCT 19/NO CHANGE/853.13 TONNES
Oct 18 /no change in gold inventory at the GLD/ inventory rests at 853.13 tonnes
Oct 17./no change in gold inventory at the GLD/inventory rests at 853.13 tonnes
Oct 16/A HUGE WITHDRAWAL OF 5.32 TONNES FROM THE GLD/INVENTORY RESTS AT 853.13 TONNES
0CT 13/ NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 858.45 TONNES
Oct 12/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 858.45 TONNES
Oct 10/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 858.45 TONNES
Oct 9/ANOTHER DEPOSIT OF 4.43 TONNES INTO GLD/INVENTORY RESTS AT 858.45 TONNES
Oct 6/A DEPOSIT OF 2.96 TONNES OF GOLD INVENTORY INTO THE GLD/TONIGHT IT RESTS AT 854.02 TONNES
Oct 5/A LOSS OF 3.24 TONNES OF GOLD INVENTORY FROM THE GLD/INVENTORY RESTS AT 851.06 TONNES
Oct 4/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 854.30 TONNES
oCT 3/ A HUGE WITHDRAWAL OF 10.35 TONNES FROM THE GLD/INVENTORY RESTS AT 854.30 TONNES
Oct 2/STRANGE/WITH GOLD’S CONTINUAL WHACKING WE GOT A BIG FAT ZERO OZ LEAVING THE GLD/INVENTORY RESTS AT 864.65 TONNES
SEPTEMBER 29/no changes in gold inventory at the GLD/Inventor rests at 864.65 tonnes
Sept 28/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 864.65 TONNES
Sept 27/WOW!! WITH GOLD DOWN $13.25, WE HAD A HUGE 8.57 TONNES OF GOLD ADDED TO THE GLD/
Sept 26/no changes in gold inventory at the GLD/Inventory rests at 856.08 tonnes
Sept 25./Another big deposit of 3.84 tonnes into GLD/Inventory rests tonight at 856.08 tonnes
Sept 22/with gold up only 1 dollar on the day we had a massive 6.21 tonnes of gold added to the GLD/.this is a good sign that gold will advance nicely this coming week.
Sept 21/no change in gold inventory tonight/inventory rests at 846.03 tonnes
Sept 20/no change in gold inventory tonight/inventory rests at 846.03 tonnes
Now the SLV Inventory
Oct 31/no change in silver inventory at the SLV/Inventory rests at 319.155 million oz
Oct 30/STRANGE!WITH SILVER UP THESE PAST TWO TRADING DAYS, WE HAD A HUGE WITHDRAWAL OF 1.133 MILLION OZ FROM THE SLV/INVENTORY RESTS AT 319.155 MILLION OZ/
Oct 27/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 320.288 MILLION OZ
Oct 26/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 320.288 MILLION OZ/
Oct 25/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 320.288 MILLION OZ
Oct 24/no change in inventory at the SLV/inventory rests at 320.288 million oz/
oCT 23./STRANGE!!WITH SILVER RISING TODAY WE HAD A HUGE WITHDRAWAL OF 1.039 MILLION OZ/inventory rests at 320.288 million oz/
OCT 20NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 321.327 MILLION OZ
oCT 19/INVENTORY LOWERS TO 321.327 MILLION OZ
Oct 18 no change in silver inventory at the SLV/inventory rest at 322.271 million oz
Oct 17/ A MONSTROUS WITHDRAWAL OF 3.494 MILLION OZ FROM THE SLV/INVENTORY RESTS AT 322.271 MILLION OZ
Oct 16/ NO CHANGES IN SILVER INVENTORY AT THE SLV.INVENTORY RESTS AT 325.765 MILLION OZ
oCT 13/ NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 325.765 MILLION OZ
Oct 12/THE LAST TWO DAYS WE LOST 1.113 MILLION OZ FROM THE SLV/INVENTORY RESTS AT 325.765 MILLION OZ
Oct 10/NO CHANGE IN INVENTORY AT THE SLV/INVENTORY RESTS AT 326.898 MILLION OZ/
Oct 9/A HUGE DEPOSIT OF 1.227 MILLION OZ INTO THE INVENTORY OF THE SLV/INVENTORY RESTS AT 326.898 MILLION OZ
Oct 6/NO CHANGE IN SILVER INVENTORY/ INVENTORY RESTS AT 325.671 MILLON OZ
Oct 5/ANOTHER WITHDRAWAL OF 944,000 OZ FROM THE SLV/INVENTORY RESTS AT 325.671 MILLION OZ
OCT 4/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 326.615 MILLION Z
Oct 3/A TINY WITHDRAWAL OF 143,000 FROM THE SLV FOR FEES/INVENTORY RESTS AT 326.615 MILLION OZ
Oct 2/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 326,757 MILLION OZ
SEPTEMBER 29/no changes in silver inventory at the SLV/inventory rests at 326.757 million oz/
Sept 28/NO CHANGES IN SILVER INVENTORY/INVENTORY RESTS AT 326.757 MILLION OZ/
Sept 27/STRANGE!! SILVER IS HIT FOR 24 CENTS YESTERDAY AND. 9 CENTS TODAY AND YET NO CHANGE IN SILVER INVENTORY/INVENTORY RESTS AT 326.757 MILLION OZ
Sept 26./no change in silver inventory at the SLV/.inventory rests at 326.757 million oz
Sept 25./ a big deposit of 1.842 million oz into the SLV/inventory rests at 326.757 million oz/
Sept 22/no change in silver inventory at the SLV/Inventory rests at 324.915 million oz/
Sept 21/no change in silver inventory at the SLV/Inventory rests at 324.915 million oz
Sept 20/no changes in silver inventory/Inventory remains at 324.915 million oz
Indicative gold forward offer rate for a 6 month duration+ 1.40%
Major gold/silver trading/commentaries for TUESDAY
Stumbling UK Economy Shows Importance of Gold
– UK economy outlook bleak amid Brexit, debt woes and rising inflation
– Confidence in UK housing market at five-year low
– UK high street sales crash at fastest rate since 2009
– Number registering as insolvent in England and Wales hit a five-year high in Q3
– UK public finance hole of almost £20bn in the public finances set to grow to £36bn by 2021-22
– Protect your savings with gold in the face of increased financial woes in UK
This week markets will be watching the UK with baited breath as the Monetary Policy Committee meets this Thursday to discuss a potential rate rise.
Expectations of a rise have increased to 80% in the last week. If the Bank of England does raise rates it will be for the first time in a decade. It is unlikely to be a dramatic increase though, probably a rise of 25 basis points to reverse the emergency rate cut which followed the Brexit vote.
Should the UK decide to raise rates this will likely boost confidence somewhat in the economy. However any increase in positivity regarding the UK will be short lived once markets realise it will take more than a small rate rise to get the country out of the huge red hole it is currently digging its way into.
Brexit is being blamed for the majority of the UK’s woes at present, however this is merely a politician’s scapegoat. Confidence in the UK housing market has slipped to its lowest level in five years, family spending power has declined in five out of the last six months, the hole in public finances is likely to increase over 100% from the initial forecast by 2020, personal insolvencies are at a five year high and inflation has hit 3%.
These plus many more financial and economic problems have long been brewing. Problems with money naturally lead to social problems which end up exacerbating themselves further as individuals find continue to struggle on a daily basis.
Sadly the UK is in a real state of limbo thanks to Brexit, how the government will manage to solve the other significant issues such as rising debt levels (public and private), inflation and a slowing economy whilst managing EU negotiations is a feat yet to be witnessed.
We have been approaching a juncture for some time where we must decide as individual savers, investors, pensioners and future pensioners what the best way to prepare for the future is. Do we stand back and believe that the government has our best interests at heart or do we prepare for their failure? Their inability to support the value of the pound, protect interest rates, avoid bank bail-ins and solve the debt crisis are all situations that could see our own savings put at real risk.
Falling confidence both in and inside the UK
Despite expectations of a rate rise, sterling stumbled in October thanks to weak economic data and more negative headlines regarding Brexit.
What’s the one thing governments like to say positively about a weak currency? That it’s good for exports…but not in the UK it’s not.
As we explained earlier this month, a much revered boost to UK exports following the Brexit vote was most likely down to our gold market. Now that the Chinese have calmed down on their gold shopping spree we are seeing what state the rest of the export market is really in.
The trade deficit in goods hit a record high, as the gap between what the UK bought and sold widened in August to £14.2bn. That was much bigger than expected, and up from £12.8bn in July. Imports surged by 4.2% during the month, while exports only rose by 0.7%. The overall trade deficit, including services, widened to £5.6bn in August from £4.2bn in July.
…and from within things aren’t much better
Currency and export markets are not the only ones having a problem with the UK. There are nervous feelings much closer to home – in people’s own homes and on the high street.
A Halifax bank survey found one in five British adults surveyed expect house prices to fall over the next 12 months. This is the weakest reading for consumer expectations since October 2012.
This negativity regarding the housing market is thanks to concerns over the economy, weak wage growth and concerns over rising inflation. For years the UK government has rallied around the UK housing market, convincing citizens that owning a home was a right of passage. It seems the jig is up.
Most new buyers are losing faith in the housing market as not only is the cost of borrowing set to raise but raising the funds for a deposit is near impossible. In the three months to August there was negative wage growth, bringing the total number of months of negative growth to six for 2017, alone.
In all regions of the UK incomes have failed to rise by more than the current inflation rate of 3%. This is not only placing pressure on the housing market but also on consumer spending.
A ‘steep drop’ in retail sales was reported in the CBI survey this month, alongside orders placed with suppliers dropping at their fastest rate since the spring of 2009.
But people still need to eat, clothe themselves, keep a roof over their families’ heads and this is where the government has gone so badly wrong. By fuelling an era of cheap credit, stealthflation, zero-hour contracts and low wage growth families and individuals no longer know how to survive on their wage packets.
The annual rate of growth of consumer credit climbed is currently at 9.9%, having been as high as 10% in the summer.
According to Bank of England data, another £641m was put onto plastic in the month of September, the sharpest increase in debt since May 2016. The total credit card debt stock reached £69.4bn, the highest on record.
Unsurprisingly, this isn’t sustainable. The number of people registering as insolvent in England and Wales hit a five-year high in the third quarter
The number of those registering as insolvent is only set to get worse should interest rates rise. A hike would push up the cost of both secured and unsecured borrowing.
As Gillian Guy, the chief executive of Citizens Advice, told the Independent:
“The rise and rise of consumer debt is a cause for alarm at a time when large numbers of people are already in financial difficulty.”
Broken government = broken economy
Of course, very little of the ‘on the ground’ problems such as wage growth and consumer debt levels are making the headlines.
The headlines are the same as they have been for the last 18 months or so: BREXIT DISASTER.
Is it a disaster? Who knows, but what we do know is that it is costing a huge amount of money with even more expected to be paid out in the coming years. This is all money that the UK simply does not have.
It was only a fortnight ago that we found out Britain’s stock of wealth had fallen from a surplus of of £469 billion to a net deficit of £22 billion. This is down to a massive write-down of the UK’s assets and a drop in foreign direct investment (again, a lack of confidence in the UK).
Meanwhile the gap between government spending and tax receipts is also expected to ‘outperform’ expectations. The Institute for Fiscal Studies (IFS) expects it to reach £36bn by 2021-22, more than twice the initial official forecast of £17bn.
On the issue the IFS said:
“It is hard to see how the chancellor can both maintain the credibility of his fiscal targets and respond effectively to the growing demands for spending”
Quite. The outlook is not good. Productivity is expected to decline in the UK as the majority of jobs being created are low-skilled, low-wage jobs created for those in need. How this helps the UK tax receipts? It doesn’t.
The Office for Budget Responsibility (OBR) has said the UK government will need to significantly lower its estimates for the economic output per hour worked in Britain. In a massive miscalculation admission it states that it views the 0.2% rate of productivity growth over the past five years as a better guide for 2017 than its forecast of 1.6% in March.
EU, it holds the first charge
Not only does the UK government not have the income to sort out its deficit or increase spending but the EU is coming after us for more money.
No one quite knows just yet what the ‘divorce bill’ will be, but more worryingly it looks like we can’t get back the money we placed in a bank we own 16% of.
According to Alexander Stubb (vice president of the European Investment Bank) the UK may have to wait 30 years to get its £3bn back from the EU’s bank after Brexit and could be on the hook for £30billion if “things go sour”.
As bad as this sounds, can we at least enjoy the hint of irony in this situation. A UK government that has done very little to support customers from the tyranny of British banks, supported bail-outs and pushed for bail-ins is now facing its own problems getting back its money from a bank.
UK savers need to start learning from the mistakes of their leaders.
Conclusion: prepare for the long-term
The 2008/09 financial crisis was not the first economic disaster to hit the United Kingdom. Consider the Wall Street crash on 1929. It very quickly affected this small island nation, causing the economy to shrink by more than 5% and unemployment to spiral to 17%. All in just three years.
Today we find ourselves on arguably scarier ground. Despite lower unemployment, it is an increasingly unproductive labour force with which we find ourselves. It’s nine years ago that the last financial crisis started and the economy has rebounded by less than 10% – a far slower pace than after the Great Depression.
The difference? In the 20th century the government put in place policies that worked for the long-term health of the economy. Today, governments are not looking at anything other than day-to-day results. They no longer prepare for the long-term health of the economy.
They are looking at Brexit and how to boost confidence in the UK. They have no idea how to do anymore, Brexit has got their knickers in a twist. This is unlikely to help struggling savers and consumers in the meantime.
Very often plans that result in positive outcomes a few years down the line aren’t good for an election just a couple of years away. This means that we live in a five-year cycle of economic policies, budgets and grand plans.
Unfortunately this leaves savers and investors fending for themselves when it comes to planning their long-term finances. This is made more complex by the increasingly uncertain times in which politicians and central bankers are inevitably navigating us towards.
With this in mind we need to take our finances into our own hands. As we explained last week, we must prepare. Failure to prepare is preparing to fail.
Investors should protect themselves from the financial risks of the UK government by diversifying their savings and owning physical gold -not paper or digital gold.
Physical gold that is allocated and segregated cannot fall victim to bail-ins when the government is short of cash or inflation when the central ban needs to print more money.
Physical gold in your portfolio reduces the level of counterparty risk your savings are exposed to and ensures some level of sovereignty and financial safety and freedom when it comes to your wealth.
These financial risks including bail-ins are a threat to all savers in the western world.
News and Commentary
Gold Prices (LBMA AM)
31 Oct: USD 1,274.40, GBP 964.21 & EUR 1,095.60 per ounce
30 Oct: USD 1,272.75, GBP 966.91 & EUR 1,093.80 per ounce
27 Oct: USD 1,267.80, GBP 968.35 & EUR 1,090.18 per ounce
26 Oct: USD 1,278.00, GBP 968.34 & EUR 1,082.34 per ounce
25 Oct: USD 1,273.00, GBP 964.81 & EUR 1,081.67 per ounce
24 Oct: USD 1,278.30, GBP 970.36 & EUR 1,087.32 per ounce
Silver Prices (LBMA)
31 Oct: USD 16.82, GBP 12.72 & EUR 14.45 per ounce
30 Oct: USD 16.74, GBP 12.69 & EUR 14.39 per ounce
27 Oct: USD 16.72, GBP 12.76 & EUR 14.38 per ounce
26 Oct: USD 16.97, GBP 12.84 & EUR 14.37 per ounce
25 Oct: USD 16.89, GBP 12.75 & EUR 14.34 per ounce
24 Oct: USD 17.04, GBP 12.92 & EUR 14.49 per ounce
Recent Market Updates
– Wozniak and Thiel Fuel Bitcoin-Gold Debate: Gold Comes Out On Top
– Russia Buys 34 Tonnes Of Gold In September
– Gold Will Be Safe Haven Again In Looming EU Crisis
– Gold Is Valuable Due to “Extreme Rarity” – Must See CNN Video
– Gold Is Better Store of Value Than Bitcoin – Goldman Sachs
– Next Wall Street Crash Looms? Lessons On Anniversary Of 1987 Crash
– Key Charts: Gold is Cheap and US Recession May Be Closer Than Think
– Gold Up 74% Since Last Market Peak 10 Years Ago
– How Gold Bullion Protects From Conflict And War
– Silver Bullion Prices Set to Soar
– Brexit UK Vulnerable As Gold Bar Exports Distort UK Trade Figures
– Puerto Rico Without Electricity, Wifi, ATMs Shows Importance of Cash, Gold and Silver
– U.S. Mint Gold Coin Sales and VIX Point To Increased Market Volatility and Higher Gold
Japan Just Killed The “Bitcoin Will Be Banned” Meme
The Japanese recognize the adoption of cryptocurrencies and blockchain technologies as a competitive advantage, and they’re right.
One of the most durable claims of cryptocurrency skeptics is that “governments will ban bitcoin once it threatens their fiat currency or their control.” Ben Bernanke recently gave voice to this claim as if it was received wisdom.
Sorry, crypto-skeptics: Japan just killed the “bitcoin will be banned” meme. Japan has established itself as the safe haven of all legit cryptocurrencies and cryptocurrency exchanges.
Japan is not just the world’s third largest economy; it is a keystone of the global economy in supply chains, ownership of overseas assets, capital flows and technology. Japan’s embrace of cryptocurrencies suggests the Japanese understand that adoption of crypto and blockchain technology offers whatever nation is firstest with the mostest in legal protection of these technologies will have a powerful competitive advantage.
Many crypto skeptics claim the U.S. can browbeat adopters of bitcoin into banning cryptos via various threats such as limiting access to U.S. banking. Memo to skeptics: Japan is too strategically important for the U.S. to browbeat over something as small in scale as cryptos. Furthermore, Japan is long past the point where it will automatically comply with every self-destructive demand of the American Imperial project.
As I have often noted here, the market cap of the entire crypto market–$170 billion– is mere signal noise in the $500+ trillion market of global assets. Even if the crypto market rose 10-fold to $1.7 trillion, it would still be nothing but a tiny blip in the global asset marketplace.
Japan has the regulatory legal and bureaucratic structure to monitor and police crypto exchanges and transactions. This complex structure can be deployed to bog down whatever Japan doesn’t favor in endless red tape, or it can accommodate whatever Japan favors. Clearly, Japan favors the adoption of cryptocurrencies and blockchain technologies.
The legalization of cryptocurrencies is now a done deal. Any nation foolish and self-destructive enough to attempt to outlaw cryptos will simply hasten the flow of capital to Japan and other safe-haven early adopters.
Clearly, the Japanese recognize the adoption of cryptocurrencies and blockchain technologies as a competitive advantage, and they’re right.
Sorry, Mr. Bernanke, you’re wrong yet again.
Of related interest: Why Governments Will Not Ban Bitcoin (October 23, 2017)
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(courtesy Ottawa Citizen/GATA)
A futures market for bitcoin will be the death knell for this cryptocurrency as paper shorts will swamp this vehicle
Bitcoin Bounces Back To Record High As CME Launches Bitcoin Futures In Q4
As the mainstream continues to embrace cryptocurrencies – much to the chagrin of Jamie Dimon et al. in the establishment – CME Group is “responding to client interest” and launching a Bitcoin Futures contract in Q4.
CME Group says new contract will be cash-settled, based on the CME CF Bitcoin Reference Rate (BRR) which serves as a once-a-day reference rate of the U.S. dollar price of bitcoin.
This news has sent Bitcoin back up to record highs…
CME Group, the world’s leading and most diverse derivatives marketplace, today announced it intends to launch bitcoin futures in the fourth quarter of 2017, pending all relevant regulatory review periods.
The new contract will be cash-settled, based on the CME CF Bitcoin Reference Rate (BRR) which serves as a once-a-day reference rate of the U.S. dollar price of bitcoin. Bitcoin futures will be listed on and subject to the rules of CME.
“Given increasing client interest in the evolving cryptocurrency markets, we have decided to introduce a bitcoin futures contract,” said Terry Duffy, CME Group Chairman and Chief Executive Officer.
“As the world’s largest regulated FX marketplace, CME Group is the natural home for this new vehicle that will provide investors with transparency, price discovery and risk transfer capabilities.”
Since November 2016, CME Group and Crypto Facilities Ltd. have calculated and published the BRR, which aggregates the trade flow of major bitcoin spot exchanges during a calculation window into the U.S. Dollar price of one bitcoin as of 4:00 p.m. London time. The BRR is designed around the IOSCO Principles for Financial Benchmarks. Bitstamp, GDAX, itBit and Kraken are the constituent exchanges that currently contribute the pricing data for calculating the BRR.
“We are excited to work with CME Group on this product and see the BRR used as the settlement mechanism of this important product,” said Dr.Timo Schlaefer, CEO of Crypto Facilities.
“The BRR has proven to reliably and transparently reflect global bitcoin-dollar trading and has become the price reference of choice for financial institutions, trading firms and data providers worldwide.”
CME Group and Crypto Facilities Ltd. also publish the CME CF Bitcoin Real Time Index (BRTI) to provide price transparency to the spot bitcoin market. The BRTI combines global demand to buy and sell bitcoin into a consolidated order book and reflects the fair, instantaneous U.S. dollar price of bitcoin in a spot price. The BRTI is published in real time and is suitable for marking portfolios, executing intra-day bitcoin transactions and risk management.
Cryptocurrency market capitalization has grown in recent years to $172 billion, with bitcoin representing more than 54 percent of that total, or $94 billion. The bitcoin spot market has also grown to trade roughly $1.5 billion in notional value each day.
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As CoinTelegraph noted previously, mainstream exchange embrace of Bitcoin could lead to less volatility and further acceptance and new opportunities.
In what can be seen as a mainstream financial world’s embrace of Bitcoin, the Chicago Mercantile Exchange (CME Group) and Intercontinental Exchange Inc. (ICE) are all set to publish data on prices of Bitcoin. CME Group is likely to start publishing this data in the fourth quarter of 2016 while ICE, the owner of the New York Stock Exchange (NYSE) is considering if it should include data from various exchanges for a daily settlement price which it has been publishing since May of 2015.
Recently Dwijen Gandhi of ICE told Reuters that NYSE will soon launch a real-time pricing index which he said would provide additional transparency and insight into the Bitcoin price.
CME Group plans two new Bitcoin products
CME Group and ICE taking the Bitcoin dive is good news for the newly established ‘Digital Asset Class’. The participation of exchanges would allow investors and traders alike to easily acquire the information that they need to trade Bitcoin with more confidence.
According to a press release dated May 2, 2016, the CME group has said that they will collaborate with Crypto Facilities Ltd, a digital assets trading platform, and that they will be developing two new products which they plan to launch by Q4, 2016.
CME CF Bitcoin Reference Rate (BRR), which will provide a final settlement price in US dollars at 4 PM London Time on each trading day and the CME Bitcoin Real Time Index (RTI), which allows for real time access to Bitcoin prices.
Cointelegraph talked with Sandra Ro, Executive Director at CME Group about how these developments would affect Bitcoin prices and she says:
“There is no current bitcoin reference rate which is considered “standard” market convention. There are many real time indices but we believe our methodology, inclusion of only the most serious bitcoin exchange data, and focus on developing digital assets will add significant credibility to the nascent digital asset market.”
It is notable that RTI will be calculated by Crypto Facilities and will be calculated based on global demand to buy and sell Bitcoin aggregated into a consolidated order book.
The Price of Bitcoin will be in US dollar terms and will be published once every second according to data made available by CME on the website.
NYSE Bitcoin index NYXBT
On the other hand, the New York Stock Exchange has already wet its feet in the Bitcoin pool by launching the NYSE Bitcoin Index (NYXBT). NYXBT is the first ever exchange-calculated and disseminated Bitcoin index according to ICE.
NYXBT uses a ‘unique methodology’ according to the ICE press release which relies on “rules-based logic to analyse a dataset of matched transactions and verify the integrity of the data to ultimately produce an objective and fair value for one Bitcoin in US Dollars at 4 pm London Time.”
NYXBT will at first take data from transactions from the Coinbase exchange. It is pertinent to mention here that NYSE had made a minority investment in Coinbase in 2015.
Thomas Farley, NYSE Group President, says:
“As a global index leader and administrator of ICE LIBOR, ICE Futures U.S. Dollar Index and many other notable benchmarks, we are pleased to bring transparency to this market. By combining our technology infrastructure with our expertise in index calculation and data management, we will continue to launch complementary products based on our rigorous standards and proprietary index methodology.”
Expect more mainstream participation and new products
It seems that the mainstream financial world is finally ready for Bitcoin. This could mean a new era in which Bitcoin could actually become THE digital asset class and could also lead to further delivery of new financial products for traders and investors.
Cointelegraph talked with Fran Strajnar, Founder and chief executive officer of BraveNewCoin (BNC), an institutional Digital Asset Data provider. Strajnar is excited about these new developments.
Strajnar says to CoinTelegraph:
“What Bitcoin and the entire Digital Asset Class needs to hit mainstream is not just consumer and application adoption but financial infrastructure and the adoption of quality market data services, by well established trading platforms.”
As for opportunities for traders in the form of new products, he thinks that because Bitcoin is global, functions like nothing else and requires a global spot price.
Strajnar expects to see two things evolve from CME’s Bitcoin reference rollout in Q4:
- Creation of various Derivative products & further ETF potential, which will help with reducing volatility.
- A disparity between US Dollar denominated Bitcoin trading activity and other BTC trading pairs, seeing as the CME index only includes BTC/USD trading. A good arbitrage opportunity will come out of this.
Nothing new here” The gold market is moving from West to East;
(courtesy Xinhua News Agency, Beijing)
Gold market is moving from West to East, Shanghai exchange chief says
Submitted by cpowell on Tue, 2017-10-31 01:31. Section: Daily Dispatches
Shanghai Gold Exchange Marks 15th Anniversary
From Xinhua News Agency, Beijing
Tuesday, October 31, 2017
SHANGHAI — The Shanghai Gold exchange celebrated its 15th anniversary on Monday.
The exchange started business on Oct. 30, 2002, and the last 15 years have been a journey of the opening up of China’s gold market, the exchange said in a statement.
In 2007 China became the world’s largest gold producer, replacing South Africa, it said. According to the China Gold Association, China produced 453 tonnes of gold and bought 975 tonnes in 2016.
“The exchange has led the international gold market in terms of volumes, and the market is moving from the West to the Dast,” said Jiao Jinpu, chairman of the exchange. …
… For the remainder of the report:
Your early TUESDAY morning currency, Asian stock market results, important USA/Asian currency crosses, gold/silver pricing overnight along with the price of oil Major stories overnight/9 AM EST
2. Nikkei closed UP 0.06 POINTS OR 0.00% /USA: YEN RISES TO 113.33
3. Europe stocks OPENED ALL GREEN /USA dollar index RISES TO 94.62/Euro DOWN TO 1.1634
3b Japan 10 year bond yield: RISES TO +.071/ GOVERNMENT INTERVENTION !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 113.72/ 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:: 54.02 and Brent: 60.46
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 FALLS TO +.381%/Italian 10 yr bond yield DOWN to 1.857% /SPAIN 10 YR BOND YIELD DOWN TO 1.486%
3j Greek 10 year bond yield FALLS TO : 5.523???
3k Gold at $1273.60 silver at:16.83: 6 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50
3l USA vs Russian rouble; (Russian rouble DOWN 33/100 in roubles/dollar) 58.31
3m oil into the 54 dollar handle for WTI and 60 handle for Brent/
3n Higher foreign deposits out of China sees huge risk of outflows and a currency depreciation (already upon us). This can spell financial disaster for the rest of the world/China forced to do QE!! as it lowers its yuan value to the dollar/GOT A SMALL SIZED REVALUATION NORTHBOUND
JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 113.33 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 0.9984 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1616 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.
3p BRITAIN VOTES AFFIRMATIVE BREXIT/LOWER PARLIAMENT APPROVES BREXIT COMMENCEMENT/ARTICLE 50 COMMENCES MARCH 29/2017
3r the 10 Year German bund now POSITIVE territory with the 10 year FALLING to +0.381%
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 2.379% early this morning. Thirty year rate at 2.888% /
5. Details Ransquawk, Bloomberg, Deutsche bank/Jim Reid.
(courtesy Jim Reid/Bloomberg/Deutsche bank/zero hedge)
US Futures Rebound After Disappointing Chinese, European Data
Yesterday’s sharp Chinese selloff is now a distant memory after the BTFDers emerged, and this morning U.S. equity futures are once again levitating as the FOMC begins its two-day policy meeting, following an uneventful BOJ announcement on Tuesday morning which left all QE parameters unchanged. Asian stocks traded mixed steady while European shares climb.
The key event overnight was the BOJ meeting, in which the central bank maintained QQE with Yield Curve Control and kept NIRP unchanged at -0.1% as expected. The decision to keep QQE with YCC was made by 8-1 vote, with Kataoka the sole dissenter again who suggested the BoJ needs to buy JGBs so that 15yr yield stays below 0.2%, while Kataoka also commented that the BoJ should ease if domestic factors lead to delays in reaching the inflation target. In terms of changes to its outlook forecasts, the BoJ raised FY 17/18 Real GDP growth forecast to 1.9% from 1.8%, while it cut Core CPI forecasts to 0.8% from 1.1% for FY 17/18 and to 1.4% from 1.5% for FY 18/19
Asian shares rose in afternoon trading, with the MSCI Asia Pacific Index gaining 0.1 percent to 168.29 and ignoring the overnight miss across the board in Chinese PMIs…
… Confirming China’s economy is rolling over…
… supported by tech stocks as companies including Sony and Nintendo boosted their forecasts. Samsung gave the biggest boost to the regional gauge and South Korea’s benchmark after announcing a revamp of its executives. Japan’s Nikkei closed just barely lower, technically only its second down day in October, with SoftBank weighing on the index after talks to merge its Sprint unit with T-Mobile US were said to be in peril. Samsung Electronics closed at a record after nominating its Chief Executive Officer Lee Sang-hoon as its next board chairman, along with other management changes, hours after detailing a boost in shareholder payouts. The company’s plans, along with a pledge by South Korea and China to move beyond a year-long dispute over Seoul’s decision to deploy a U.S. missile shield, helped lift the Kospi Index to a new all-time high (remember the North Korea nuclear armageddon threat? Neither does the market).
“South Korean equities gained led by the Korea-China agreement on the Thaad issue and also because of Samsung Electronics’ announcement,” said Min Byungkyu, a global market analyst at Yuanta Securities Korea. Technology stocks rose the most among sub-indexes on the regional gauge, with Nintendo soaring after nearly doubling its annual profit forecast and Sony and Denso Corp. climbing after both companies boosted earnings outlooks. In India, Axis Bank surged after a report that Bain Capital plans to invest in the lender.
Speaking of China, the slump in Chinese government bonds is close to an end, with sentiment set to stabilize as the central bank boosts cash injections, analysts said The yield on the benchmark 10-year government bond fell 3 basis points to 3.90% on Tuesday, halting a four-day increase of 20 basis points that took it to the highest level in three years. The People’s Bank of China injected funds for a fourth day on Tuesday, adding a net 230 billion yuan ($35 billion) in the period.As a result, the SHCOMP halted the recent slump, rising just under 0.1% to 3,393.
In Europe, traders ignored the miss in euro-area inflation data in stride as closed German markets due to a local public holiday has led to a muted European session. The euro-area’s unemployment rate inched lower in September as the economy expanded for an 18th consecutive quarter, but consumer inflation unexpectedly slowed in October, complicating the European Central Bank’s task as it considers tightening policy.
Oil and gas stocks led gains in the Stoxx Europe 600 Index as crude hovered near a six-month high. Most European stocks climb, led by oil and gas sector; FTSE 100 rebounds after BP (+2.6%) earnings and buyback announcement. European energy names lead the way higher in the wake of BP’s earnings (+3.3%) which have subsequently supported the index. Financial names have seen slight underperformance after BNP’s (-3.2%) weak earnings which has also subsequently seen the CAC modestly underperform its peers. Elsewhere, UK gambling names have been granted some reprieve after the UK government’s crackdown on fixed-odd betting terminals does not appear to be as bad as some had initially feared.
Treasuries and core European bonds were mostly steady. Earlier a note of caution had crept into markets in Asian hours following a drop in China’s factory gauge, and equity benchmarks in that region were mixed. Japanese stocks ended the day slightly lower after the Bank of Japan maintained its key policy rate and target for the yield on 10-year government bonds, while showing concerns remain on the inflation outlook.
The yield on 10Y TSY rose less than one basis point to 2.37%. Germany’s 10Y yield decreased less than one basis point to 0.37%, the lowest in two weeks. Britain’s 10Y yield dipped one basis point to 1.335%, the lowest in more than a week.
American tax reform also remains a key theme, with lawmakers said to be considering a phase-in plan. The indictment of former Trump campaign aides in Robert Mueller’s investigation of Russian meddling in the U.S. election, however, may pose a danger to the White House as it tries to push tax cuts though Congress. Fed and BOE rate decisions this week remain in focus for FX, with major currency pairs trading in tight ranges; GBP/USD continues to trade with an upside bias due to positioning into BOE announcement.
West Texas Intermediate crude fell less than 0.05 percent to $54.14 a barrel. Gold decreased 0.1 percent to $1,275.55 an ounce. Oil is poised for its second monthly gain for the first time this year.
Economic data include employment-cost index, Chicago PMI and consumer confidence. Mastercard and Pfizer are among companies reporting earnings today
Bulletin Headline Summary from RanSquawk
- European bourses trade higher with energy names topping the leaderboard after earnings from BP
- EU inflation fell short of expectations but little reaction for EUR with markets already braced for a softer print given German readings yesterday
- Looking ahead, highlights include US APIs
- S&P 500 futures up 0.2% to 2,573.25
- MSCI Asia up 0.1% to 168.30
- MSCI Asia ex Japan up 0.3% to 550.81
- Nikkei unchanged at 22,011.61
- Topix down 0.3% to 1,765.96
- Hang Seng Index down 0.3% to 28,245.54
- Shanghai Composite up 0.09% to 3,393.34
- Sensex down 0.06% to 33,245.25
- Australia S&P/ASX 200 down 0.2% to 5,909.02
- Kospi up 0.9% to 2,523.43
- STOXX Europe 600 up 0.08% to 394.22
- German 10Y yield fell 0.8 bps to 0.359%
- Euro down 0.06% to $1.1644
- Brent Futures down 0.4% to $60.67/bbl
- Italian 10Y yield fell 10.0 bps to 1.582%
- Spanish 10Y yield fell 1.8 bps to 1.477%
- Brent Futures down 0.3% to $60.70/bbl
- Gold spot up 0.05% to $1,276.96
- U.S. Dollar Index down 0.04% to 94.52
Top Overnight News
- The Bank of Japan left its massive monetary-stimulus program unchanged even as it trimmed its inflation forecasts, signaling further divergence ahead from its global peers
- France’s economy extended its run of growth into a fifth quarter, marking its best streak in more than six years; the 0.5% expansion in the three months through September, compared with an upwardly revised 0.6% the previous three quarters, was supported by corporate and household investment while trade weighed on growth
- Catalan leader Carles Puigdemont kept his followers guessing as to the next step in his pursuit of an independent republic, after fleeing to Belgium where he’s expected to emerge on Tuesday
- China’s official factory gauge fell to 51.6 in Oct., vs. 52 forecast in Bloomberg survey, and five-year high of 52.4 in Sept., with new orders and prices leading the decline, as officials increasingly prioritize a campaign to clamp down on polluting industries and rein in debt
- White House Downplays Mueller Indictments; Apple Escalates Qualcomm Dispute; Ex-Third Point Partner Drawing SEC Probe
- Congress will put Facebook, Twitter and Google under a public microscope Tuesday about Russia’s use of their networks to meddle in the 2016 election, a day after Special Counsel Robert Mueller’s criminal investigation disclosed its first indictments and guilty plea
- Apple Inc. is designing iPhones and iPads for 2018 that don’t use components from Qualcomm Inc. amid an escalating dispute between the companies
- House tax writers have completed about 90 percent of the tax bill they plan to release this week, Ways and Means Chairman Kevin Brady said Monday — but the last part may be the hardest
- SoftBank Group Corp.’s talks to merge U.S. unit Sprint Corp. with T-Mobile US Inc. have hit a serious snag throwing the deal into jeopardy after months of talks
- The Bank of Japan left its massive monetary stimulus program unchanged even as it trimmed its inflation forecasts, signaling further divergence ahead from its global peers
- Treasury Secretary Steven Mnuchin put to rest for now the idea bubbling in the $14.2 trillion Treasuries market that the government might introduce ultra-long term debt sales
- The old recipe of using bonds to hedge against risks from equity holdings may not be a winner anymore, and investors would be better off with a more complex approach that relies on multiple tactics, according to Pacific Investment Management Co. analysis
A cautious tone persisted in Asia as the region digested softer than expected Chinese PMI data and a dampened lead from the US where reports suggested corporate tax cuts could be gradual. ASX 200 (-0.2%) was indecisive and failed to maintain early energy-led gains, while Nikkei 225 (unch) was kept grounded by a firmer JPY and with SoftBank among the worst performers on reports it plans to abandon merger talks between its unit Sprint and T-Mobile US. KOSPI (+0.9%) gained after reports China and South Korea agree to resolve THAAD-related dispute and with Samsung shares buoyed by record quarterly profits, while Shanghai Comp (+0.1%) and Hang Seng (-0.3%) initially weakened following the miss on Chinese Manufacturing PMI and with some of the big 4 banks pressured post-earnings; the mainland pared losses heading into the clsoe. Finally, 10yr JGBs were relatively flat with only minimal gains seen amid a risk averse tone in Japan and after an unsurprising BoJ policy announcement where dovish dissenter Kataoka suggested more easing.
Top Asian News
- China Factory PMI Falls From Five-Year High on Pollution Cleanup
- BOJ Keeps Stimulus Unchanged as It Trims Inflation Outlook
- China, South Korea Agree to Shelve Thaad Missile Shield Dispute
- Macau Casinos Emerge From Rut as October Revenue Hopes Brighten
- Indian Billionaire Fund Says Bank Boost to Help Clear Loans
With Germany on vacation today, European bourses have started the session on the front-foot (Eurostoxx 50 +0.2%), albeit modestly so. In terms of sector performance, energy names notably lead the way higher in the wake of FTSE-heavyweight BP’s earnings (+3.3%) which have subsequently supported the index. Financial names have seen slight underperformance after BNP’s (-3.2%) lacklustre earnings which has also subsequently seen the CAC modestly underperform its peers. Elsewhere, UK gambling names have been granted some reprieve after the UK government’s crackdown on fixed-odd betting terminals does not appear to be as bad as some had initially feared. A really low key final business day of October in the sovereign bond markets, thus far. Turnover has been extremely light, even allowing for Germany’s Reformation holiday with Bund volume on Eurex around 100k lots (at writing). The German benchmark has also been very rangebound, albeit mainly on the plus side of a 162.64-162.83 trading band, and it appears that many are sitting tight ahead of the key risk events later this week. Indeed, UK Gilts are even more contained within 124.37-54 parameters, awaiting BoE ‘super Thursday’ when a widely anticipated first rate hike in a decade comes with an uncertain vote split, policy meeting minutes, forward guidance and the latest QIR. US Treasuries largely consolidating on Monday’s decent gains made on risk aversion and month end positioning, which saw the 10 year yield retreat clearly below 2.40%, ahead of the FOMC, new Fed chair announcement and monthly jobs report.
Top European News
- Standard Chartered Retail Banking Chief Karen Fawcett to Retire
- Ryanair Chief Seeks Solution to Pilot Crisis as Earnings Slide
- Davis to Brief Cabinet on Brexit Amid Plans to Ramp Up Talks
- MiFID Investment Research May Face VAT Hit From U.K. Taxman
- BNP Slides as 3Q Earnings Miss Estimates on Weaker CIB Revenue
- WPP Lowers Revenue Forecast as Ad Industry’s Woes Deepen
In FX, trade has been particularly tentative thus far with the BoJ only causing a modest uptick in USD/JPY towards 113.00 after the Bank stood pat on rates as expected with 1 dissenter suggesting the need to buy 15yr JGBs to keep yields below 0.2%. EUR saw little in the way of a reaction to the latest miss on expectations for Eurozone inflation (Y/Y 1.4% vs. Exp. 1.5% and core 0.9% vs. Exp. 1.1%) with markets potentially already braced for a lacklustre figure given yesterday’s German prints.
Commodities continue to trade in a particularly tight range with WTI crude futures consolidating around USD 54/bbl. Elsewhere, the metals complex has been relatively non-committal ahead of this week’s FOMC and NFP, while copper lacked impetus overnight amid a cautious risk tone and after weaker than expected PMI data from its largest consumer China.
Looking at today’s key data, notable data includes the flash October CPI print for the Euro area and France, the advanced Q3 GDP report for the Euro area and consumer confidence for the UK for October. In the US the Q3 employment cost index, October Chicago PMI, October consumer confidence and the August S&P/ Case-Shiller house price index is amongst the data due. Onto other events, the ECB’s Visco and Padoan are also due to speak while UK Brexit Secretary David Davis is questioned by the House of Lords EU Committee about the state of Brexit talks. BP and BNP Paribas are amongst the companies reporting results.
US Event Calendar
- 8:30am: Employment Cost Index, est. 0.7%, prior 0.5%
- 9am: S&P CoreLogic CS 20-City MoM SA, est. 0.4%, prior 0.35%; YoY NSA, est. 5.93%, prior 5.81%; US HPI YoY NSA, prior 5.94%;
- 9:45am: Chicago Purchasing Manager, est. 60, prior 65.2
- 10am: Conf. Board Consumer Confidence, est. 121.3, prior 119.8; Present Situation, prior 146.1; Expectations, prior 102.2
DB’s Jim Reid concludes the overnight wrap
The bond bullish/bearish switch that has alternated at regular intervals over the last few weeks has firmly switched to bull mode since the ECB meeting less than 72 business hours ago. Yesterday this got an additional boost by good news from the Peripherals, weaker German inflation, a former Trump campaign manager charged in connection with the Russia probe and reports that the US corporate tax rate may only be lowered in increments over 5 years.
In the US, House tax writers are discussing a phase-in approach for corporate tax cuts, allowing the tax rate to gradually fall from 35% in 2018 to 20% by 2022 (ie: -3ppt per year), as per Bloomberg. The plans are not yet final and when asked, House Ways and Means Chairman Brady only said “we want to get the growth up front”. Treasury secretary Mnuchin noted “the objective is not to have that phase in, but we will see how that goes”. Looking ahead, the Ways and Means panel is expected to release the draft bill this Wednesday for further debate.
Staying in the US, Bloomberg reported that three people have been indicted by Robert Mueller’s Special Counsel in relation to potential Russian influence on the 2016 US presidential election, including: 1) President Trump’s former campaign chairman (Paul Manafort) for conspiracy and money laundering (receiving payments from Ukrainian political parties and then laundered some of the payments back into US, 2) Ex-foreign policy adviser to Trump (George Papadopoulos), who reportedly lied about the timing of his contacts with foreign nationals, where he communicated with an overseas professor during the campaign (March 2016), who told him about Russians possessing “dirt” on Hillary Clinton in the form of “thousands of emails” and 3) a business partner of Mr Manafort. Elsewhere, President Trump tweeted “sorry, but this is years ago, before Paul Manafort was part of the Trump campaign”. However, the indictment noted Manafort’s illegal acts lasted into early 2017.
It’s too early to know if there’s are any ramifications for politics or even the tax reforms but the guilty plea by George Papadopoulos, who served as a foreign-policy adviser to President Trump during the campaign suggests the Investigators may have someone who appears to be fully cooperating. This could potentially have a material impact.
Turning to Catalonia where tensions have cooled. The Spanish government retook control of the Catalan region yesterday with little resistance and the ousted Catalan President Puigdemont has reportedly fled to Brussels, potentially seeking asylum while other party members will continue with the new election scheduled for 21 December. Puigdemont is expected to make an address later today. Elsewhere, El Mundo reports that opinion polls conducted early last week (before independence was declared) show that support for Catalan independence fell to 33.5% in the region. As a reminder, El Mundo also reported yesterday that opinion polls suggest Catalan secessionists could win 65 seats in a new election, but fall short of the 68 seats needed for new majority. The Spanish markets responded favourably, with the IBEX up 2.44% and 10y yields down 9.3bp. To put the mini bond rally in context, Spanish 10y yields are now the lowest since early September and 20bp lower than the day after referendum took place (1 October) and 15bp lower than the day before last week’s ECB meeting.
Staying in government bonds, core European bond yields fell c2bp yesterday (Bunds -1.6bp; Gilts -1.4bp; OATs -2.9bp) while UST 10 fell 3.8bp driven by the aforementioned factors. Peripherals outperformed with 10y yields down 9-12bp (Spain -9.3bp; Italy -10.4bp; Portugal -11.9bp), with Italian bonds likely supported by S&P’s credit rating upgrade late last Friday, where it lifted the country’s rating 1 notch higher to BBB, citing strengthening economic outlook, an uptick in employment and a stronger banking sector.
This morning, the BOJ voted 8-1 to retain its monetary stimulus policy, with the new board member dissenting. As our Japanese economist expected, the BOJ has trimmed its near term core inflation outlook to 0.8% for 2017 (-0.3ppt) and 1.4% for 2018 (-0.1ppt). However, the outlook for 2019 remains unchanged at 1.8%. In China, the October manufacturing PMI was softer than expectations at 51.6 (vs. 52), but remember that last month’s reading of 52.4 was the highest since 2012. This morning, Asian markets have followed the negative lead from the US and are trading slightly lower. The Nikkei (-0.24%), Hang Seng (-0.08%) and Shanghai Comp. (-0.25%) are down slightly, but the Kospi is up 0.66%, after China and South Korea agreed to restore bilateral relations and put aside a yearlong disagreement over the deployment of a US missile shield.
Recapping other market performance from yesterday now. US bourses softened from their record highs with the S&P and Dow both down slightly (-c0.3%), while the Nasdaq was broadly flat (-0.03%), partly aided by Apple where its shares rose 2.25% following reports of strong demand for its new iPhone X. Indeed my devise won’t be shipped for 4-5 weeks!!! Within the S&P, modest gains in the real estate and tech sectors were more than offset by losses from health care and t elco stocks (-1.41%), with the latter partly impacted by reports suggesting the merger between Sprint and T-Mobile may not occur. Core European markets were little changed, with the Stoxx 600 and DAX up 0.1% while the FTSE dipped 0.23%. Elsewhere, Spain’s IBEX led the gains (+2.44%) as tensions cooled in the region, while Italy’s MIB also rose 0.39%.
Turning to currencies, the US dollar index fell 0.38%, while the Euro gained 0.37% and Sterling rose 0.61% ahead of the BOE rate meeting this Thursday where the majority expect a rate hike (85.9% odds per Bloomberg). In commodities, WTI rose slightly (+0.46%) while Iron ore fell (-2.21%) for the fourth consecutive day. Elsewhere, both precious metals (Gold +0.23%; Silver -0.07%) and other base metals were mixed but little changed (Copper +0.28%; Zinc +0.57%; Aluminium -0.22%).
Away from the markets, Treasury secretary Mnuchin has backed away from the notion of issuing US treasuries with ultra-long maturities. He noted “we’ve done a bunch of research…at least for now, we don’t see a lot of demand for it” and that “if we could issue ultra-long bonds at the same yield as 30-year bonds, it makes a lot of sense”, but “if it turns out there’s a big premium….there’s no reason for us to do that”.
Turning to Brexit, perhaps in a bid to fast track progress before the big EU summit on 14 December where EU leaders may give the green light to start talks on trade and transition deals, the UK PM May and Brexit Secretary Davis are seeking to change the timing and structure of the negotiations with the EU, from four day sessions held once a month to more regular and ongoing talks as it may help both sides to make the necessary compromises. We shall find out more today as Mr Davis is scheduled to speak to the cabinet.
The latest ECB holdings were released yesterday. Net CSPP averaged €352mn/ per day last week (€367mn before April 2017 and €321mn since then, i.e. -12.3% since QE trimming). Net PSPP averaged €2,286mn/per day last week (€3,178mn before April 2017 and €2,440mn since then, i.e. -23.2% since QE trimming). This left the CSPP/PSPP ratio at 15.4% last week (13.5% over last 4 weeks vs. 11.5% before QE was trimmed in April 2017). We still think the ECB will likely keep CSPP relatively unscathed when they halve their APP in January.
Before we take a look at today’s calendar, we wrap up with other data releases from yesterday. In the US, the macro data was a bit mixed. The September PCE Core was in line at 0.1% mom and 1.3% yoy. On a six-month annualized basis, core inflation is running slightly higher at 1.5%, but still remains below the Fed’s target of 2%. Elsewhere, personal spending grew at the fastest pace since 2009 up 1% mom (vs. 0.9%) and outpacing an in line personal income growth of 0.4% mom. Finally, the October Dallas Fed manufacturing activity index was above expectations at 27.6 (vs. 21 expected) – marking the highest reading since March 2006.
In Germany, October CPI was lower than expected, at -0.1% mom (vs. 0.1% expected) and 1.5% yoy (vs. 1.7% expected) – the lowest annual rate since November 2016. The September retail sales was in line at 0.5% mom, but datarevisions to prior readings meant annual growth was higher at 4.1% yoy (vs. 3% expected). In Europe, the final reading of consumer confidence was in line at -1, while the business climate confidence (1.44 vs 1.4 expected) and economic confidence (114 vs 113.3 expected) both beat expectations, the latter is now at the highest level since January 2001. In the UK, the September mortgage approvals was broadly in line at 66.2 (vs. 66k expected). Over in Spain, 3Q GDP was in line at 0.8% qoq, leaving a solid through year growth of 3.1%. Elsewhere, October Spanish inflation rose 0.6% mom, leading to an annual reading of 1.7% yoy (vs. 1.7% expected).
Looking at the day ahead, notable data includes the flash October CPI print for the Euro area and France, the advanced Q3 GDP report for the Euro area and consumer confidence for the UK for October. In the US the Q3 employment cost index, October Chicago PMI, October consumer confidence and the August S&P/ Case-Shiller house price index is amongst the data due. Onto other events, the ECB’s Visco and Padoan are also due to speak while UK Brexit Secretary David Davis is questioned by the House of Lords EU Committee about the state of Brexit talks. BP and BNP Paribas are amongst the companies reporting results
3. ASIAN AFFAIRS
i)Late MONDAY night/TUESDAY morning: Shanghai closed UP 3.00 points or .09% /Hang Sang CLOSED DOWN 90.65 pts or 0.32% / The Nikkei closed UP 0.06 POINTS OR 0.00/Australia’s all ordinaires CLOSED DOWN 0.12%/Chinese yuan (ONSHORE) closed UP at 6.6315/Oil UP to 54.02 dollars per barrel for WTI and 60.86 for Brent. Stocks in Europe OPENED IN THE GREEN . ONSHORE YUAN CLOSED UP AGAINST THE DOLLAR AT 6.6315. OFFSHORE YUAN CLOSED AT VALUE OF THE ONSHORE YUAN AT 6.6335 AND //ONSHORE YUAN STRONGER AGAINST THE DOLLAR/OFF SHORE STRONGER TO THE DOLLAR/. THE DOLLAR (INDEX) IS STRONGER AGAINST ALL MAJOR CURRENCIES. CHINA IS NOT HAPPY TODAY.
3a)THAILAND/SOUTH KOREA/NORTH KOREA
We warned you that this could happen. More than 300 are dead after tunnels collapse at the North Korean nuclear test site after suffering minor quakes last month:
“More Than 200” Dead After Tunnel Collapses At North Korean Nuclear Test Site
North Korean nuclear scientists apparently ignored warnings from a group of Chinese scientists who briefed them back in September that the North’s Punggye-ri nuclear test site was slowly imploding following the country’s sixth nuclear test, which involved a 100-kiloton hydrogen bomb roughly seven times more powerful than the atomic bomb the US dropped on Hiroshima in 1945.
As Japanese TV station Asahi TV reported Tuesday, more than 200 North Koreans were killed earlier this month when several tunnels in the underground complex collapsed, killing more a crew of laborers and a crew of rescue workers sent to save them. As we’ve reported previously, scientists in the US, China and South Korea have warned that further tests at the site could blow the top off the mountain, causing it to collapse. Meanwhile, it could send a plume of radioactive particles into the atmosphere that could deleteriously impact population centers in Northern China and across the region.
Scientists detected a series of small earthquakes under Punggye-ri after the country’s Sept. 3 nuclear test. The seismic activity, combined with satellite images of landslides and depressions forming on the mountain’s surface, led a group of American scientists to declare that Punggye-ri was suffering from “tired mountain syndrome” – a condition previously observed at Soviet nuclear test sites. South Korea’s weather agency chief Nam Jae-Cheol told a meeting of the lawmakers Monday that any future nuclear test at the site could cause a collapse. One of the Korea Meteorological Administration researchers, Lee Won-Jin, presented an analysis of satellite images indicating landslides occurred near the facility following the September test.
The small-scale quakes at the facility, built south of the Mantapsan mountain, suggest it may not be stable enough to conduct any further tests. However, the construction of new underground tunnels in the complex would suggest the North – unwilling or unable to build an entirely new facility in a different location – has instead opted to move its tests to another area of the mountain.
“If North Korea were to attempt to continue testing under this mountain (such as in the area more to the eastern side), then we would expect to see new tunneling in the future near the North Portal, still under Mt. Mantap,” researchers Frank Pabian and Jack Liu wrote in a report published earlier this month.
Of course, the condition of the test site would be irrelevant if the North decides to follow through with a threat to conduct “an unprecedented scale hydrogen bomb” test over the Pacific. North Korean officials have insisted in recent weeks that these threats are serious. Perhaps the Kim regime has been so preoccupied assessing the damage at Pyungge-ri, where five of the North’s six nuclear tests held since 2006 have taken place, that it has been forced to put any future tests on hold.
Fearing a collapse, China has stepped up its radiation monitoring on the border. Meanwhile, a researcher studying the radioactive risk from the North Korean nuclear program at Peking University said China could no longer tolerate another land-based explosion.
“China cannot sit and wait until the site implodes. Our instruments can detect nuclear fallout when it arrives, but it will be too late by then. There will be public panic and anger at the government for not taking action,” the researcher said.
“Maybe the North Koreans themselves have realized that the site cannot take another blow. If they still want to do it, they have to do it somewhere else.”
3b) REPORT ON JAPAN
Japan leaves its policy unchanged and that puts a little damper on the yen value. The bank of Japan lowered its purchases of ETF’s dramatically.
Japanese Stocks, USDJPY Rise After BoJ Leaves Policy Unchanged
With the Nikkei 225 having only suffered one down day (so far) in the whole month of October (a record), The BoJ decided it’s better not to rock the boat and left monetary policy unchanged, as expected.
With new members at The BoJ, there was perhaps some uncertainty about Kuroda’s decision today…
Boradly speaking Japanese economic data has been supportive but in recent days, disappointment has begun to set in once again…
But, as expected, The BoJ, hot on the heels of Abe’s snap-election victory, left policy unchanged…
- BOJ Board Votes 8-1 to Keep Policy Unchanged
- Kataoka Dissents, Says BOJ Should Target 15 Yr JGB Yield
- BOJ trims next year’s inflation forecast as anticipated, 1.4% vs 1.5% last time.
- BOJ statement keeps reference to 80 trillion yen bond buying target as well as 6 trillion yen ETF target.
- Hedging their bets, the BOJ says “upside and downside risks to economic activity are generally balanced.”
So, no major surprise in those headlines but the inflation downgrade indicates challenges still ahead… and provide an ‘out’ for easing firther if the stock market ever drops.
And the reaction…
* * *
October will be the best month for Japanese stocks in 2 years and given today’s weakness so far, there were only two down days in the whole month…
JGB yields remain rangebound and ‘under control’ for now…
BOJ bought 7.74 trillion yen of JGBs in October in its market operations, little changed from about 7.7 trillion yen purchased in September. It has bought about 57 trillion yen so far this fiscal year, after taking into account around 40 trillion yen of notes that are due for redemption in the period. That’s well below the BOJ’s 80 trillion yen target, but the bank has succeeded in its stealth tapering and keep yields generally pinned near zero.
and it appears 114.00 is the limit for USDJPY for now…
Here’s something odd, as Bloomberg’s Min Jeong Lee notes, BoJ bought 94.9 billion yen worth of ETFs in October, compared with an average monthly purchase of 505 billion yen in 2017. Here’s a chart that shows the BOJ’s ETF buying so far this year…
So who was buying in October?
3C CHINA REPORT.
China is definitely slowing down as its manufacturing and service PMI disappoint by tumbling in October.
The following data is something that Draghi did not want to war: Eurozone’s closed watched CPI weakened in level to only 1.4% year over year. The month before had a reading of 1.5%. Bankers need inflation and especially wage inflation to continue with their crooked games.
5. RUSSIA AND MIDDLE EASTERN AFFAIRS
6 .GLOBAL ISSUES
Both oil and gasoline rise after major inventory draw downs
WTI/RBOB Jump After Major Inventory Draws Across Entire Energy Complex
WTI posted a 5.2% gain in October, the first back-to-back monthly advance this year, and held up near the highs of the day into the API print. WTI/RBOB kneejerked higher as the data hit showing large inventory draws across everything…
- Crude -5.087mm (-1.3mm exp)
- Cushing -263k
- Gasoline -7.697mm (-1.55mm exp)
- Distillates -3.106mm
Big product draws in the previous week – and a modest crude build – bucked the recent trend but tonight’s API data shows huge draws across everything…
Expectations that OPEC’s cuts are “tightening the market supply-demand fundamentals continues to drive prices higher,” Gene McGillian, a market research manager at Tradition Energy, told Bloomberg.
There is “a little bit of profit-taking and that’s why the rally seems to have kind of stalled. But, I don’t think we have any indications that the rebalance has completely been priced into the market”
The reaction was an immediate algo-buying panic then modest fade…
Jay Hatfield, portfolio manager at the InfraCap MLP exchange-traded fund, told Bloomberg, “inventories are in good shape. Demand is quite positive globally. We’ve been appropriately bullish.”
8. EMERGING MARKET
Your early morning currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings TUESDAY morning 7:00 am
Euro/USA 1.1634 DOWN .0017/ REACTING TO SPAIN VS CATALONIA/REACTING TO +GERMAN ELECTION WHERE ALT RIGHT PARTY ENTERS THE BUNDESTAG/ 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 ALL IN THE GREEN
USA/JAPAN YEN 113.33 UP 0.324(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 1.3215 UP .0002 (Brexit March 29/ 2017/ARTICLE 50 SIGNED
THERESA MAY FORMS A NEW GOVERNMENT/STARTS BREXIT TALKS/MAY IN TROUBLE WITH HER OWN PARTY/
USA/CAN 1.2845 UP .0021(CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA)
Early THIS TUESDAY morning in Europe, the Euro FELL by 17 basis points, trading now ABOVE the important 1.08 level FALLING to 1.1634; / Last night the Shanghai composite CLOSED UP 3.00 POINTS OR .09% / Hang Sang CLOSED DOWN 90.65 PTS OR 0.32% /AUSTRALIA CLOSED DOWN 0.12% / EUROPEAN BOURSES OPENED IN THE GREEN
The NIKKEI: this TUESDAY morning CLOSED UP 0.06 POINTS OR 0.00%
Trading from Europe and Asia:
1. Europe stocks OPENED IN THE GREEN
2/ CHINESE BOURSES / : Hang Sang CLOSED DOWN 90.65 POINTS OR 0.32% / SHANGHAI CLOSED UP 3.00 POINTS OR .09% /Australia BOURSE CLOSED DOWN 0.12% /Nikkei (Japan)CLOSED UP 0.06 POINTS OR 0.00% / INDIA’S SENSEX IN THE RED
Gold very early morning trading: 1273.10
Early TUESDAY morning USA 10 year bond yield: 2.379% !!! UP 1/ 2 IN POINTS from MONDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%. (POLICY FED ERROR)
The 30 yr bond yield 2.888 UP 1/2 IN BASIS POINTS from MONDAY night. (POLICY FED ERROR)
USA dollar index early TUESDAY morning: 94.62 UP 6 CENT(S) from YESTERDAY’s close.
This ends early morning numbers TUESDAY MORNING
And now your closing TUESDAY NUMBERS \1 PM
Portuguese 10 year bond yield: 2.075% DOWN 2 in basis point(s) yield from MONDAY
JAPANESE BOND YIELD: +.071% UP 1/10 in basis point yield from MONDAY/JAPAN losing control of its yield curve/
SPANISH 10 YR BOND YIELD: 1.457% DOWN 4 IN basis point yield from MONDAY
ITALIAN 10 YR BOND YIELD: 1.823 DOWN 3 POINTS in basis point yield from MONDAY
the Italian 10 yr bond yield is trading 36 points HIGHER than Spain.
GERMAN 10 YR BOND YIELD: +.364% down 0 IN BASIS POINTS ON THE DAY
IMPORTANT CURRENCY CLOSES FOR TUESDAY
Closing currency crosses for TUESDAY night/USA DOLLAR INDEX/USA 10 YR BOND YIELD/1:00 PM
Euro/USA 1.1645 DOWN ,0005 (Euro DOWN 5 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/
USA/Japan: 113.65 UP 0.634(Yen DOWN 63 basis points/
Great Britain/USA 1.3270 UP 0.0057( POUND UP 57 BASIS POINTS)
USA/Canada 1.2894 UP.0037 Canadian dollar DOWN 68 Basis points AS OIL ROSE TO $54.15
This afternoon, the Euro was DOWN 5 to trade at 1.1645
The Yen FELL to 113.65 for a LOSS of 52 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 57 basis points, trading at 1.3270/
The Canadian dollar FELL by 68 basis points to 1.2894 WITH WTI OIL RISING TO : $54.15
Your closing 10 yr USA bond yield DOWN 0 IN basis points from MONDAY at 2.374% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 2.876 DOWN 2 in basis points on the day /
Your closing USA dollar index, 94.58 UP 2 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 TUESDAY: 1:00 PM EST
London: CLOSED UP 2.43 POINTS OR 0.03%
German Dax :CLOSED UP 12.03 POINTS OR 0.00%
Paris Cac CLOSED UP 15.24 POINTS OR 0.28%
Spain IBEX CLOSED UP 103.00 POINTS OR 0.99%
Italian MIB: CLOSED UP 53.34 POINTS OR 0.23%
The Dow closed up 28.50 POINTS OR .12%
NASDAQ WAS closed up 28.71 PTS OR 0.43% 4.00 PM EST
WTI Oil price; 54.16 1:00 pm;
Brent Oil: 60.69 1:00 EST
USA /RUSSIAN ROUBLE CROSS: 58.34 UP 36/100 ROUBLES/DOLLAR (ROUBLE LOWER BY 36 BASIS PTS)
TODAY THE GERMAN YIELD FALLS TO +.364% FOR THE 10 YR BOND 1.00 PM EST EST
This ends the stock indices, oil price, currency crosses and interest rate closes for today 4:30 PM
Closing Price for Oil, 4:30 pm/and 10 year USA interest rate:
WTI CRUDE OIL PRICE 4:30 PM:$54.44
USA 10 YR BOND YIELD: 2.372% (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)
USA 30 YR BOND YIELD: 2.872%
EURO/USA DOLLAR CROSS: 1.1649 DOWN .0002
USA/JAPANESE YEN:113.68 up 0.668
USA DOLLAR INDEX: 94.55 down 1 cent(s)/
The British pound at 5 pm: Great Britain Pound/USA: 1.3286 : up 73 POINTS FROM LAST NIGHT
Canadian dollar: 1.2898 down 70 BASIS pts
German 10 yr bond yield at 5 pm: +0.364%
And now your more important USA stories which will influence the price of gold/silver
TRADING IN GRAPH FORM FOR THE DAY
Stocks Advance For 7th Straight Month As Yield Curve Crashes To 10 Year Lows
Well that was easy…
When does this mouth snap shut?
Japan wins October… with only two down days all month (the first -0.4% and the 2nd last night -0.003%!)…NKY’s best month since Oct 2015
S&P, Dow, and Nasdaq’s best month since February, Trannies were the only major index red with Small Caps bouncing back green today…
This is the 7th straight monthly advance for the S&P 500 (and Dow)(Last 7 mth, May 2013. Last 8 mth, Jan 2007. Last 9, Mar 1983).. and 11th of the last 12 months up…
Tech, Utes, and Financials outperformed in October… Retailers lagged…
FANG Stocks surged almost 8% in October – 2nd best month ever…
TSLA ended the month -3%… AMZN up 15%
Another ugly day for Under Armour… to the lowest since April 2013…
It was a big month for other assets too…
- Dollar Index rose 1.7% in October – best month since Nov 2016
- Bitcoin surged 52% in October to a new record high
- 2Y Treasury yield rose 11bps in Oct, 2nd monthly rise in a row to highest monthly close since Sept 2008
- TSY 5s30s curve flattened for 3rd month in a row to flattest monthly close since Oct 2007
- WTI Crude’s highest monthly close since June 2015 (up 2 months in a row)
- Gold’s first consecutive monthly drop since Dec 2016
Stocks bounced back from yesterday’s dip with Small Caps outperforming today and Nasdaq since Friday
VIX hit a 9 handle early on… bounced… then was pushed back down a 9 handle in the last hour…before rising once again…
Treasury yields were mixed today (long-end outperforming), echoing the month of October (2Y +11bps, 30Y +1bps)
With the yield curve starting to re-accelerate flatter…
The Dollar Index surge in October but has fallen the last 3 days…
Driven by slump in CAD (offset by strength in CNY)…
Bitcoin hit a new record high today after news of a Bitcoin Futures contract broke…
Copper and Crude ended October up 5.3% – oddly the same – with silver and gold stuck at the flatline…
Just one last thing… While US equity markets had a big October run…all the major US equity indices implied vols rose on the month… led by Small Caps…
And remember – October was all about China…
Tony Podesta Threatens Tucker Carlson After Bombshell Report On Russian Influence Peddling
Submitted by iBankCoin
Tony Podesta sent a Cease and Decist letter to “Tucker Carlson Tonight” hours after resigning from his role at the Podesta Group – a D.C. lobbying firm accused by a former executive of pedaling Russian influence along with fellow lobbyist and short-lived Trump campaign manager Paul Manafort.
Manfort was indicted over the weekend on 12 counts ranging from tax fraud, money laundering and giving false statements between 2006 and 2015, and is currently under house arrest after turning himself over to the FBI Monday morning – fueling speculation as to whether Tony Podesta’s sudden departure from his firm is connected.
Of note, Monday’s indictment lists “Company A” and “Company B” as firms involved in the investigation – which NBC reports are the Podesta Group and DC public relations firm Mercury Public Affairs.
Last week Carlson reported that Tony Podesta is a central figure in Special Counsel Robert Mueller’s investigation. Directly after his report, Carlson’s show was contacted by a former long-time executive of the Podesta Group with “direct personal knowledge” of Tony Podesta’s questionable activities, which Carlson divulged the next evening.
While the nature of Podesta’s threat has not been made public, Carlson later tweeted “We’re confident the Mueller probe will reveal a lot more about Tony Podesta’s lobbying practices in the near future.”
After meeting with the former Podesta Group executive who has been “extensively” interviewed by Robert Mueller’s Special Counsel, Tucker Carlson Tonight relayed several highly troubling aspects of the Tony Podesta’s relationship with business associate and fellow lobbyist, Paul Manafort.
According to the former Podesta Group executive, Manafort and Tony Podesta were running a Russian influence-peddling racket up and down Washington D.C., bringing a “parade” of Russian oligarchs to congress for meetings. Podesta was also “Basically part of the Clinton Foundation,” meeting regularly to discuss the now-infamous Uranium One deal.
Highlights, as previously reported (video below):
- Lobbyist and temporary Trump campaign manager Paul Manafort is at the center of the Russia probe – however the scope of the investigation has broadened to include his activities prior to the 2016 election.
- Manafort worked with the Podesta Group since at least 2011 on behalf of Russian interests, and was at the Podesta Group offices “all the time, at least once a month,” peddling Russian influence through a shell group called the European Centre for a Modern Ukraine (ECMU).
- Manafort brought a “parade” of Russian oligarchs to congress for meetings with members and their staffs, however, the Russia’s “central effort” was the Obama Administration.
- In 2013, John Podesta recommended that Tony hire David Adams, Hillary Clinton’s chief adviser at the State Department, giving them a “direct liaison” between the group’s Russian clients and Hillary Clinton’s State Department.
- In late 2013 or early 2014, Tony Podesta and a representative for the Clinton Foundation met to discuss how to help Uranium One – the Russian owned company that controls 20 percent of American Uranium Production – and whose board members gave over $100 million to the Clinton Foundation
- “Tony Podesta was basically part of the Clinton Foundation.”
- Believing she would win the 2016 election, Russia considered the Podesta Group’s connection to Hillary highly valuable.
- Podesta Group is a nebulous organization with no board oversight and all financial decisions made by Tony Podesta. Carlson’s source said payments and kickbacks could be hard for investigators to trace, describing it as a “highly secret treasure trove.” One employee’s only official job was to manage Tony Podesta’s art collection, which could be used to conceal financial transactions.
Full monologue below:
Follow on Twitter @ZeroPointNow
Trump Lashes Out At Indictments, Fake News: “Check The DEMS!”
President Trump’s frustration is showing through once again as special counsel Mueller’s indictments from yesterday have created whirlwind of media speculation – despite the nothingburger – while ‘facts’ and uncomfortable narratives related to Hillary and the democrats (take your pick – Uranium One or Fusion GPS) go unmonitored…
Trump’s perspective fits right in with The Wall Street Journal’s Editorial Board, who reminded readers the charges have nothing at all to do with Trump, or Russia collusion…
Special Counsel Robert Mueller indicted former Trump campaign chairman Paul Manafort for tax fraud on Monday, and the main charge against Donald Trump is poor judgment for hiring the notorious Beltway operator.
The indictment accuses Mr. Manafort (and business partner Richard Gates ) of funneling money from a pro-Russia party in Ukraine into offshore shell companies and bank accounts. They then allegedly used these accounts to fund their spending habits, neglecting to declare the money to the IRS.
The indictment also accuses Mr. Manafort of failing to register as an agent for a foreign government as required under the Foreign Agents Registration Act (FARA). This is news mainly because violations of that law haven’t been successfully prosecuted since 1966. The Russia probe has exposed the degree to which lobbyists ignore this statute that the Justice Department has failed to enforce. (Democrat Anthony Podesta announced Monday that he is leaving his lobbying firm amid the Mueller probe. He is the brother of John Podesta, who ran Hillary Clinton’s campaign.)
The most striking news is that none of this involves the 2016 election campaign. The indictment makes clear that Mr. Manafort’s work for Ukraine and his money transfers ended in 2014. The 2016 charges are related to false statements Mr. Manafort made to the Justice Department.
In other words, Mr. Manafort stands accused of a financial and lobbying scam, which is exactly what Mr. Trump risked in hiring a swamp denizen. Mr. Manafort has lobbied for a rogues gallery of dictators, with the occasional domestic scandal (HUD contracts).
Separately, Mr. Mueller released a guilty plea by Trump campaign policy adviser George Papadopoulos for lying to the FBI in early 2017 about his interaction with “foreign nationals whom he understood to have close connections with senior Russian government officials.” The plea suggests Russians might have been attempting to supply the Trump campaign with opposition research on Hillary Clinton. But Mr. Mueller provides no evidence this happened.
One popular theory is that Mr. Mueller is throwing the book at Mr. Manafort so he will cop a plea and tell what he knows about Russian-Trump campaign chicanery. But that assumes he knows something that to date no Congressional investigation has found. Prosecutors typically try to turn witnesses before they indict, and Messrs. Manafort and Gates pleaded not guilty on Monday.
Meanwhile, we’ve learned in recent days that Fusion GPS, the oppo research firm hired by Democrats to dig up dirt on Mr. Trump, was hired initially by the Washington Free Beacon, a conservative website largely funded by GOP donor Paul Singer. This is embarrassing for the Free Beacon, which has been caught jumping in bed with sleazy operators like Fusion.
But none of this absolves Democrats from their role in financing Fusion to hire Christopher Steele, the former British spook, to collect information about Mr. Trump’s ties to Russia. The Free Beacon says it had nothing to do with Mr. Steele or his dossier.
The Democrat-Fusion-Russia story requires as full an investigation as the question of Trump-Russia collusion. All the more so given that the FBI may have used the Steele dossier, much of which has been discredited, to begin investigating the Trump campaign and to seek a warrant from the Foreign Intelligence Surveillance Court.
Some readers were offended that we suggested last week that Mr. Mueller is too close to the FBI after running it for a dozen years to investigate the agency’s role with the dossier. But no one has explained why such a relationship isn’t a conflict of interest. The probe can continue with someone else in charge, but most of the press corps is so invested in the Russia-Trump collusion narrative that they refuse even to acknowledge uncomfortable facts they’d usually be shouting about.
Americans deserve to know how Russia interfered in the 2016 campaign, but one problem with special prosecutors is that they exist to prosecute—someone, somewhere for something—more than they shed light. The latter should be Congress’s job, and the Members should keep pressing to tell the complete story.
Notably it seems WSJ is very much in the ‘defend Trump’ camp – actually reporting real news in this case, as opposed to the sensationalism occurring elsewhere.
Of course, desperate for some headlines, Preet Bharara chimed in…
Keep up the tweeting. Seriously, keep it up. https://twitter.com/realdonaldtrump/status/925335577217683456 …
John Kelly Says White House Unfazed By Mueller Indictments
White House Press Secretary Sarah Sanders delivered the administration’s official response to yesterday’s developments in Special Counsel Bob Mueller’s probe into collusion between the Trump campaign and Russia during a press conference yesterday, but just in case anybody has any doubts about the Trump administration’s attitude toward the indictments (not to mention Papadopoulos’s guilty plea), Chief of Staff John Kelly took to Fox News last night to echo his boss’s comments on the matter.
During an appearance on Fox News’ “The Ingraham Angle,” the retired Marine general reminded viewers that everybody is innocent until proven guilty. Kelly said Paul Manafort and Rick Gates’s alleged crimes, which were purportedly carried out between 2006 and 2015, happened long before they joined the Trump campaign. In a 12-count indictment unsealed yesterday, Manafort – a former Trump campaign executive – and Gates – Manafort’s longtime deputy – have been accused of a bevy of offenses, including tax fraud, money laundering, failing to disclose their foreign lobbying work, and conspiring against the US.
He also suggested that the administration has no plans to fire Mueller, as was reported yesterday, and also doesn’t plan on taking steps to defund the investigation, like Steve Bannon reportedly suggested.
“All of the activities as I understand it that they were indicted for was long before they ever met Donald Trump or had any associated with the campaign. I think the reaction of the administration is let the legal justice system work, everyone is innocent until proven guilty and we’ll see where this goes.”
The indictment does not point to any of Manafort’s work for Trump’s campaign, which took place between March of 2016 until his ouster in August.
Asked by Ingraham about morale in the West Wing, Kelly said members of the ‘”vast majority” of the White House staff are law-abiding citizens just trying to serve their country.
“I think the staff is very comfortable we’re simply serving the nation. The vast majority of the staff would have nothing to do with this kind of thing.”
In addition to the indictments, court records unsealed yesterday revealed that George Papadopoulos, nominally a foreign policy adviser for the Trump campaign, pleaded guilty to charges of lying to FBI agents in the investigation.
Delivering a Kremlin-approved statement Tuesday morning, Russian government spokesman Dmitry Peskov said Russia wasn’t implicated in the first round of indictments, the Associated Press reported.
“So far Russia doesn’t figure in any way in these charges which have been made,” Peskov said, adding that he hopes they do not feed the anti-Russia “hysteria.”
Peskov adds that accusations of Russian meddling in the election remain “unfounded,” and “we are observing (the situation) with interest.”
Shortly after Manafort and Gates turned themselves in to the FBI on Monday, Trump emphatically tweeted that there was no evidence of collusion, adding that the alleged crimes took place long before the two men joined his campaign.
The president lashed out at “fake news” coverage of the indictments in three more tweets published Tuesday morning…
I hope people will start to focus on our Massive Tax Cuts for Business (jobs) and the Middle Class (in addition to Democrat corruption)!
Trump calls on both Podesta brothers to ‘drain the swamp’ by revealing the real earth shattering dirt perpetrated by the Democrats with their fake news that it was the Republicans only that tried to influence the elections with the help of Russian authorities
Trump Calls On Podesta Bros To “Drain The Swamp” By Revealing “Earth Shattering” Dirt On Dems
As the mainstream media circus ran wild with the Paul Manafort indictment yesterday, Trump, who repeatedly dismissed the charges as being unrelated to his campaign, has just tweeted that the biggest story revealed yesterday, a story which was largely ignored by the “fake news”, was Tony Posesta’s sudden resignation from the powerful lobbying group that bears his name.
Meanwhile, Trump also seemingly called on the Podesta brothers to “Drain the Swamp” by dishing whatever “earth shattering” dirt they have on Democrats to Special Counsel Mueller.
“The biggest story yesterday, the one that has the Dems in a dither, is Podesta running from his firm. What he know about Crooked Dems is earth shattering. He and his brother could Drain The Swamp, which
would be yet another campaign promise fulfilled. Fake News weak!”
Of course, as we noted yesterday, the founder of the Podesta Group, Tony Podesta, stepped down from his own lobbying shop after coming under investigation by Special Prosecutor Robert Mueller.
Meanwhile, even though the Podesta / Manafort news might seem unrelated, as we explained in Aug 2016, Paul Manafort – now under indictment on 12 charges – and his deputy
Rick Gates previously worked with the Podesta Group where they lobbied various U.S. senators and congressmen on behalf of various Ukranian officials.
…emails obtained by the Associated Press showed that Gates personally directed two Washington lobbying firms, Mercury LLC and the Podesta Group, between 2012 and 2014 to set up meetings between a top Ukrainian official and senators and congressmen on influential committees involving Ukrainian interests. Gates noted in the emails that the official, Ukraine’s foreign minister, did not want to use his own embassy in the United States to help coordinate the visits.
And this is where the plot thickens, because while the bulk of the press has so far spun the entire Ukraine lobbying scandal, which led to Manafort’s resignation, as the latest “proof” that pro-Moscow powers were influencing not only Manafort but the Trump campaign in general (who some democrats have even painted of being a Putin agent), the reality is that a firm closely tied with the Democratic party, the Podesta Group, is just as implicated.
As AP further adds, the European Center for a Modern Ukraine, a Brussels-linked nonprofit entity which allegely ran the lobbying project, paid Mercury and the Podesta Group a combined $2.2 million over roughly two years. In papers filed in the U.S. Senate, Mercury and the Podesta Group listed the European nonprofit as an independent, nonpolitical client. The firms said the center stated in writing that it was not aligned with any foreign political entity.
Perhaps Podesta knows what is likely to happen next. Podesta announced his decision during a firm-wide meeting Monday morning and is alerting clients of his impending departure.
“[Tony] was very magnanimous and said, “This is an amazing group of people,” a source said of Podesta’s remarks.
Podesta also told staff he “doesn’t intend to go quietly, or learn how to play golf.” He said he “needs to fight this as an individual, but doesn’t want the firm to fight it.”
Fritts also addressed the gathering, telling staff that she is “thrilled at this opportunity” and that, “This is not about me, this is about y’all.”
Several other senior staff spoke about their excitement about the future of the firm. The meeting ended with a standing ovation for Podesta.
It emerged last week that Podesta is the subject of a criminal investigation led by Mueller’s team for potentially violating a federal disclosure law. That law, known as the Foreign Agents Registration Act, pertains to working on behalf of foreign governments. An NBC report found that the Podesta Group was one of several firms working on Paul Manafort’s public relations campaign for European Centre for a Modern Ukraine, which the Podesta Group claims it thought was a nonpartisan think tank, something which this site reported first last August.
It goes without saying, that Podesta’s brother, John, is arguably one of the top figures in Democratic politics, serving most recently as chief of staff in the Bill Clinton White House and also as the chairman of Hillary Clinton’s 2016 presidential campaign.
What happens next to Tony (and perhaps his brother John) is to be determined, but one thing is clear: both sides of the swamp should probably control themselves in any premature celebrations as this appears to be far from over….
The real plot as described by Pat Buchanan: they were all trying to bring down Trump
(courtesy Pat Buchanan)
Pat Buchanan Exposes “That Other Plot…” To Bring Down Trump
Well over a year after the FBI began investigating “collusion” between the Trump campaign and Vladimir Putin, Special Counsel Robert Mueller has brought in his first major indictment.
Trump campaign manager Paul Manafort has been charged with a series of crimes dating back years, though none is tied directly to President Donald Trump or 2016.
With a leak to CNN that indictments were coming, Mueller’s office stole the weekend headlines.
This blanketed the explosive news on a separate front, as the dots began to be connected on a bipartisan plot to bring down Trump that began two years ago.
And like “Murder of the Orient Express,” it seems almost everyone on the train had a hand in the plot.
The narrative begins in October 2015.
Then it was that the Washington Free Beacon, a neocon website, engaged a firm of researchers called Fusion GPS to do deep dirt-diving into Trump’s personal and professional life — and take him out.
A spinoff of Bill Kristol’s The Weekly Standard, the Beacon is run by his son-in-law. And its Daddy Warbucks is the GOP oligarch and hedge fund billionaire Paul Singer.
From October 2015 to May 2016, Fusion GPS dug up dirt for the neocons and never-Trumpers. By May, however, Trump had routed all rivals and was the certain Republican nominee.
So the Beacon bailed, and Fusion GPS found two new cash cows to finance its dirt-diving — the DNC and the Clinton campaign.
To keep the sordid business at arm’s length, both engaged the party’s law firm of Perkins Coie. Paid $12.4 million by the DNC and Clinton campaign, Perkins used part of this cash hoard to pay Fusion GPS.
Here is where it begins to get interesting.
In June 2016, Fusion GPS engaged a British spy, Christopher Steele, who had headed up the Russia desk at MI6, to ferret out any connections between Trump and Russia.
Steele began contacting old acquaintances in the FSB, the Russian intelligence service. And the Russians began to feed him astonishing dirt on Trump that could, if substantiated, kill his candidacy.
Among the allegations was that Trump had consorted with prostitutes at a Moscow hotel, that the Kremlin was blackmailing him, that there was provable collusion between the Trump campaign and Russia.
In memos from June to October 2016, Steele passed this on to Fusion GPS, which passed it on to major U.S. newspapers. But as the press was unable to verify it, they declined to publish it.
Steele’s final product, a 35-page dossier, has been described as full of “unsubstantiated and salacious allegations.”
Steele’s research, however, had also made its way to James Comey’s FBI, which was apparently so taken with it that the bureau considered paying Steele to continue his work.
About this “astonishing” development, columnist Byron York of the Washington Examiner quotes Sen. Chuck Grassley:
“The idea that the FBI and associates of the Clinton campaign would pay Mr. Steele to investigate the Republican nominee for president in the run-up to the election raises … questions about the FBI’s independence from politics, as well as the Obama administration’s use of law enforcement and intelligence agencies for political ends.”
The questions begin to pile up.
What was the FBI’s relationship with the British spy who was so wired into Russian intelligence?
Did the FBI use the information Steele dug up to expand its own investigation of Russia-Trump “collusion”? Did the FBI pass what Steele unearthed to the White House and the National Security Council?
Did the Obama administration use the information from the Steele dossier to justify unmasking the names of Trump officials that had been picked up on legitimate electronic intercepts?
In testimony before the Senate Intelligence Committee, Clinton campaign chair John Podesta and DNC chair Debbie Wasserman Schultz claimed they did not know that Perkins Coie had enlisted Fusion GPS or the British spy to dig up dirt on Trump.
Yet, when Podesta testified, the lawyer sitting beside him in the committee room was Marc Elias of Perkins Coie, who had engaged Fusion GPS and received the fruits of Steele’s undercover work.
Here one is tempted to cite Bismarck that, if you wish to enjoy politics or sausages, you should not inquire too closely how they are made.
Thus we have Free Beacon neocons, never-Trump Republicans, the Hillary Clinton campaign, the DNC, a British spy and comrades in Russian intelligence, and perhaps the FBI, all working with secret money and seedy individuals to destroy a candidate they could not defeat in a free election.
If future revelations demonstrate that this is what went down, it is not only the White House that has major problems.
If you wish to know why Americans detest politics and hate the “swamp” that has been made of their capital city, follow this story all the way to its inevitable end. It will be months of unfolding.
The real indictment here is of the American political system, and the true tragedy is the decline of the Old Republic.
John Podesta tries to fight back but the swamp is engulfing both him and his brother:
Podesta Fires Back: “I’m The Victim Of A Big Lie”
Earlier this morning we noted a pair of Trump tweets which seemingly called on the Podesta brothers to “Drain the Swamp” by dishing whatever “earth shattering” dirt they have on Democrats to Special Counsel Mueller (see: Trump Calls On Podesta Bros To “Drain The Swamp” By Revealing “Earth Shattering” Dirt On Dems).
Now, it seems as though one of the embattled Podesta brothers, Hillary’s former campaign chair John Podesta, is more than ready to engage in a twitter war with the President after firing back that he’s the “victim of a big lie campaign by the American President.”
“Not bad enough that I was the victim of a massive cyber crime directed by the Russian President.”
“Now I’m the victim of a big lie campaign by the American President “
Of course, Podesta’s tweets come after his brother, Tony Podesta, was forced to resign from a firm that the two founded together in 1988 after it was announced that Special Counsel Mueller had suddenly taken an interest in lobbying efforts undertaken by that firm on behalf of a pro-Russian party in Ukraine. Per The Hill:
His brother, Tony Podesta, on Monday stepped down from the lobbying firm he has run for three decadesafter special counsel Robert Mueller charged former Trump campaign chairman Paul Manafort and his top deputy, Rick Gates, with crimes related to his work for a pro-Russia political party in Ukraine.
Trump on Tuesday said Tony Podesta’s exit from his firm — and not the indictment of his former campaign chairman — was Monday’s “biggest story.”
A report earlier this month said Mueller is investigating Tony Podesta and the Podesta group.
The siblings co-founded Podesta Group in 1988.
To summarize the irony in these tweets, here is our loose understanding of how we arrived at this point:
- John Podesta lost an election;
- He and his party enlisted the support of media partners to launch an all out crusade against the newly elected administration alleging, among other things, treasonous collusion with a foreign government to effectuate a coup in the U.S.;
- That crusade, while resulting in no actual evidence of collusion with the newly elected administration, has now engulfed his own party in a collusion investigation of its own.
Oh the tangled webs…
The pharmaceutical industry is to immune to corruption: Generic companies colluded by diving up the market. Six manufactures are involved
Mylan Shares Tumble On Generic Drugs Collusion Probe
Mylan’s second-highest-ranking executive, Rajiv Mailk, is the target of a civil investigation by dozens of states conducting in a widespread, multiyear probe into alleged price collusion by makers of generic drugs.
As Bloomberg reports, state attorneys general said they’re seeking to sue Rajiv Malik, Mylan’s president and executive director, as part of an expanded complaint against pharmaceutical companies from 45 states and the District of Columbia, according to a statement by Connecticut Attorney General George Jepsen.
Malik would be the first senior executive from a major drugmaker sued in the case.
“These conspiracies were part of a much broader, overarching industry code of conduct that enabled the defendant manufacturers to divvy up the market for specific generic drugs in accordance with an established, agreed-upon understanding for assigning each competitor their share of the market,” Jepsen said in the statement.
Connecticut and other states are asking a federal judge to allow them to add to their existing complaint against six drugmakers.
Mylan share price immediately feel over 7% on the news…
Led by Jepsen, the civil investigation is naming executives for the first time, as well as expanding the number of drugmakers in the probe to 18 from 6, and the number of drugs to 15 from two, according to Jepsen. Previously, it had focused on an antibiotic and an oral diabetes medication, which it said executives had fixed prices on while meeting at trade shows, customer events and dinners.
The drugmakers the states are seeking to add to the lawsuit include Apotex Inc., Dr. Reddy’s Laboratories Ltd., Lannett Co., Glenmark Pharmaceuticals Ltd., Endo International Plc’s Par Pharmaceutical unit, Novartis AG’s Sandoz unit, Sun Pharmaceutical Industries Ltd. and others. Mylan and Teva Pharmaceutical Industries Ltd. were among the drugmakers named in the earlier version of the suit.
“‘We allege in this complaint that the defendant companies’ collusion was so pervasive that it essentially eliminated competition from the market for these 15 drugs in its entirety,” Jepsen said. The result, he said, was higher costs for patients and states.
Soft data Chicago PMI surges to its highest point since 2011 despite employment faltering. All soft data reports are fudged.
Chicago PMI Surges To Highest Since March 2011 (As Employment Falls)
Another day, another ‘soft’ survey shows improvement. Following Dallas Fed’s surge yesterday, Chicago PMI printed a dramatically better than expected 66.2 (60.0 exp) – the highest since March 2011.
This print is above the highest estimate (forecast range 58 – 64.7 from 31 economists surveyed) and is a 4 standard deviation beat…
To the highest since March 2011…
Under the hood it was oddly disappointing…
- Prices paid rose at a slower pace, signaling expansion
- New orders rose at a faster pace, signaling expansion – highest since Feb 1974
- Employment fell and the direction reversed, signaling contraction
- Inventories rose at a slower pace, signaling expansion
- Supplier deliveries rose at a slower pace, signaling expansion
- Production rose at a faster pace, signaling expansion
- Order backlogs rose at a faster pace, signaling expansion
- Business activity has been positive for 12 months over the past year.
Oddly, only 3 factors rose in October compared to September (compared to 7 in September)
6 Killed After Truck Plows Into NYC Crowd; Police Suspect Terrorism
In an attack that bears some of the hallmarks of terror attacks that have unfolded in the UK, Spain and France, a truck veered into the West Side Highway bike lane Tuesday afternoon and mowed down cyclists and pedestrians, leaving as many as six dead and up to 15 injured near Chambers Street and West Street. The as-yet-unidentified suspect has reportedly been taken into custody after being shot by police, according to the New York Times.
Police said the suspect may have shouted Allahu Akbar before the attack, according to several witnesses.
The scene is still active: NBC New York has a live feed below:
It was unclear if this was an act of terrorism. NBC is reporting that shots were fired at the scene, but it’s unclear if those shots were fired by police responding to the incident or the attacker. The vehicle also collided with a school bus carrying students from Stuyvesant High School. There were reports that the suspect fired shots from his truck, but these reports could not be immediately confirmed. Police say they are not looking for additional suspects. Several nearby buildings, including Stuyvesant High, were placed under lockdown. The FBI’s New York field office is also responding. The attack occurrred at 3:15 pm Eastern Time.
NBC is reporting that the driver fired a paintball gun or a bb gun before driving the truck into pedestrians. NBC has confirmed that the incident was a deliberate attack.
One witness told the New York Post the suspect got out of his vehicle and was armed with two guns.
CBS is reporting that police are treating the incident as a terrorist attack:
“What happened was there was a car crash … he came out of one of the cars. He had two guns,” a 14-year-old Stuyvesant High School student said. “We thought it was a Halloween thing. He started running around the highway. There was another guy in a green shirt that was chasing him around.”
“I heard four to six gunshots — everybody starts running,” she added.
Grisly video taken at the scene shows the aftermath of the attack:
Police shut down the FDR to rush victims to Bellevue Hospital. The West Side Highway has been closed from 20th street down. The Home Depot truck used in the attack can be seen in the photo below…
The school bus rammed by the truck appears badly damaged…
Witness reports are trickling in…
“I saw a truck – a white pick-up truck – going down the bicycle lane and running people over,” one witness told CBS.
NYPD has confirmed that the suspect is in custody.
Video from NBC shows the blocked-off West Side Highway. Mayor Bill DeBlasio is on his way to the scene.
UPDATE: New York City Mayor Bill de Blasio is en route to the scene of the incident in lower Manhattan pic.twitter.com/4lCMsPAjEO
Witnesses reported hearing gunshots.
Singer-songwriter Josh Groban tweted that he heard gunshots at the scene…
Will America’s Prosperity Be Completely Wiped Out By Our Growing Debt?
The federal government is now 20.4 trillion dollars in debt, and most Americans don’t seem to care that the economic prosperity that we are enjoying today could be completely destroyed by our exploding national debt.
Over the past decade, the national debt has been growing at a rate of more than 100 million dollars an hour, and this is a debt that all of us owe. When you break it down, each American citizen’s share of the debt is more than $60,000, and so if you have a family of five your share is more than $300,000. And when you throw in more than 6 trillion dollars of corporate debt and nearly 13 trillion dollars of consumer debt, it is not inaccurate to say that we are facing a crisis of unprecedented magnitude.
Debt cannot grow much faster than GDP indefinitely. At some point the bubble bursts, and when it does the pain that the middle class is going to experience is going to be off the charts. Back in 2015, the middle class in the U.S. became a minority of the population for the first time ever. Never before in our history has the middle class accounted for less than 50 percent of the population, and all over the country formerly middle class families are under a great deal of stress as they attempt to make ends meet. The following comes from an absolutely outstanding piece that was just put out by Charles Hugh Smith…
If you talk to young people struggling to make ends meet and raise children, or read articles about retirees who can’t afford to retire, you can’t help but detect the fading scent of prosperity.
It has steadily been lost to stagnation, under-reported inflation and soaring inequality, a substitution of illusion for reality bolstered by the systemic corruption of authentic measures of prosperity and well-being.
In other words, the American-Dream idea that life should get easier and more prosperous as the natural course of progress is still embedded in our collective memory, even though the collective reality has changed.
The reality that most of us are facing today is a reality where many are working two or three jobs just to make it from month to month.
The reality that most of us are facing today is a reality where debts never seem to get repaid and credit card balances just continue to grow.
The reality that most of us are facing today is a reality where we work day after day just to pay the bills, and yet we never seem to get anywhere financially.
The truth is that most people out there are deeply struggling. The Washington Post says that the “middle class” encompasses anyone that makes between $35,000 and $122,500 a year, but very few of us are near the top end of that scale…
It’s also situation specific. “The more people in a family, the more money they typically need to live a comfortable middle-class lifestyle,” writes the Post. Likewise, the more expensive your area, the more you need to make to qualify. Overall, “America’s middle-class ranges from $35,000 to $122,500 in annual income, according to The Post’s calculation” approved by the Pew Research Center.
“The bottom line is: $100,000 is on the middle-class spectrum, but barely: 75 percent of U.S. households make less than that,” writes the Post.
In a previous article, I noted that the bottom 90 percent of income earners in the U.S. brought home more than 60 percent of the nation’s income back in the early 1970s, but last year that number fell to just 49.7 percent.
The middle class is shrinking year after year, and the really bad news is that it appears that this decline may soon accelerate. In fact, one major European investment bank is warning that the U.S. economy will “slow down substantially” in 2018.
But we can’t afford any slow down at all. As it is, there is no possible way that we are going to be able to deal with our exploding debts at the rate the economy is growing right now. According to Boston University professor Larry Kotlikoff, we are facing a “fiscal gap” of 210 trillion dollars over the next 75 years…
We have all these unofficial debts that are massive compared to the official debt. We’re focused just on the official debt, so we’re trying to balance the wrong books…
If you add up all the promises that have been made for spending obligations, including defense expenditures, and you subtract all the taxes that we expect to collect, the difference is $210 trillion. That’s the fiscal gap. That’s our true indebtedness.
Where in the world is all of that money going to come from?
Are you willing to pay much higher taxes?
Are you willing to see government programs slashed to a degree that we have never seen before in U.S. history?
If your answer to both of those questions is no, then what would you do to solve the fiscal nightmare that we are facing?
According to Brian Maher, author Robert Benchley once sat down to write an article about this fiscal mess, and what he came up with sums up the situation perfectly…
Benchley sat at his typewriter one day to tackle a vexing subject.
He opened his piece with “The”… when the full weight of his burden collapsed upon his shoulders.
He abandoned his typewriter in frustration.
He returned shortly thereafter and resumed the task anew…
With only “The” to work with… Benchley immediately knocked out the article, presented here in its entirety:
“The hell with it.”
Unfortunately, we can’t afford to say that.
Our exploding debt is a crisis that we must tackle, and the first step is to understand that our current financial system was literally designed to create as much debt as possible. Once we abolish the Federal Reserve, our endless debt spiral will end, but until we do our debt problems are only going to continue to grow until the system completely implodes in upon itself.
* * *
Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on Amazon.com.
Well that about does it for tonight
I will see you WEDNESDAY night
JUST TO GIVE YOU A HEADS UP MY WEDNESDAY COMMENTARY WILL BE DELIVERED TO YOU LATE IN THE EVENING. MY FRIDAY COMMENTARY WILL BE DELIVERED ON SATURDAY MORNING.