Nov 13/GOLD UP $4.85 AND SILVER RISES 16 CENTS/CHAOS IN ENGLAND AS THERESA MAY COULD BE OUSTED AS LEADER/TENSIONS AGAIN ESCALATE THROUGHOUT THE MIDDLE EAST/GE CRASHES TODAY/

GOLD: $1278.85  UP $4.85

Silver: $17.05 UP 16  cents

Closing access prices:

Gold $1278.50

silver: $17.05

SHANGHAI GOLD FIX:  FIRST FIX  10 15 PM EST  (2:15 SHANGHAI LOCAL TIME)

SECOND FIX:  2:15 AM EST  (6:15 SHANGHAI LOCAL TIME)

SHANGHAI FIRST GOLD FIX: $1288.37 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME:  $1276.60

PREMIUM FIRST FIX:  $11.77

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SECOND SHANGHAI GOLD FIX: $1288.37

NY GOLD PRICE AT THE EXACT SAME TIME: $1276.60

Premium of Shanghai 2nd fix/NY:$11.77 

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LONDON FIRST GOLD FIX:  5:30 am est  $1278.40

NY PRICING AT THE EXACT SAME TIME: $1278.10

LONDON SECOND GOLD FIX  10 AM: $1277.95

NY PRICING AT THE EXACT SAME TIME. 1277.30

For comex gold:

NOVEMBER/

NOTICES FILINGS TODAY FOR OCT CONTRACT MONTH: 2 NOTICE(S) FOR  20000  OZ.

TOTAL NOTICES SO FAR: 991  FOR 99,100 OZ  (3.082TONNES)

For silver:

NOVEMBER

 1 NOTICE(S) FILED TODAY FOR

5,000  OZ/

Total number of notices filed so far this month: 872 for 4,360,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Bitcoin: BID  $6729 OFFER /$6764    DOWN $308.00  (MORNING)

BITCOIN CLOSING;  BID $6498 OFFER: $6523 //  UP $78.00

end

Let us have a look at the data for today

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In silver, the total open interest FELL BY A SMALL  1393 contracts from 200,595 DOWN TO 199,358 WITH RESPECT TO  FRIDAY’S  TRADING IN WHICH SILVER FELL 11 CENTS. JUDGING FROM THE MASSIVE VOLUME, IT DOES NOT LOOK LIKE WE GOT SOME LONG LIQUIDATION BUT AGAIN IT LOOKS LIKE WE GOT A FEW MORE COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP ROUTE.  IN SILVER THE TOTALS FOR DECEMBER EFP’S ARE 721 CONTRACTS. WE ALSO HAVE 69 MARCH EFP’S FOR A TOTAL ISSUANCE OF 790 CONTRACTS WHICH IS IN LINE WITH WHAT I HAVE THOUGHT HAS HAPPENED.

RESULT: A SMALL SIZED DROP IN OI COMEX  WITH THE 11 CENT PRICE FALL. COMEX LONGS EXITED OUT OF THE COMEX AND FROM THE CME DATA IT SEEMS THAT A HUGE NUMBER OF EFP’S WERE ISSUED  FOR A DELIVERABLE CONTRACT OVER IN LONDON WITH A FIAT BONUS WHICH DEFINITELY EXPLAINS THE FALL IN OI. 

 In ounces, the OI is still represented by just OVER 1 BILLION oz i.e.  0.997 BILLION TO BE EXACT or 142% of annual global silver production (ex Russia & ex China).

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

In gold, the open interest FELL  BY A SMALLER THAN EXPECTED 3,786 CONTRACTS DESPITE THE GOOD SIZED FALL IN PRICE OF GOLD ($13.00) WITH FRIDAY’S TRADING . THE RAID ORCHESTRATED BY OUR BANKERS SHOULD HAVE HAD A GREATER LOSS AS THE OBJECT OF THE EXERCISE IS TO CAUSE AS MANY GOLD LEAVES FROM THE GOLD TREE AS POSSIBLE. SOME GOLD OI EXITED THROUGH THE EFP ROUTE AND SOME EXITED ALTOGETHER FORM THE COMEX ARENA. THE TOTAL NUMBER OF GOLD EFP’S ISSUED SO FAR THIS MONTH TOTAL 10,591 CONTRACTS WHICH IS HUGE. The new OI for the gold complex rests at 530,404. 

 

Result: A SMALLER SIZED  DECREASE IN OI DESPITE THE GOOD SIZED WHACK IN PRICE IN GOLD ON FRIDAY ($13.00). WE PROBABLY HAD SOME COMEX LONG TRANSFERS TO LONDON THROUGH THE EFP ROUTE AS THERE DOES NOT SEEM TO BE MUCH PHYSICAL AT THE COMEX AND WE ARE APPROACHING THE HUGE DELIVERY MONTH OF DECEMBER. WE ALSO HAVE SOME GOLD COMEX OI LEAVE THE ARENA WITHOUT AN EFP TRANSFER.  

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

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

GLD:

No changes in gold inventory at the GLD/

Inventory rests tonight: 843.09 tonnes.

SLV

TODAY WE HAD NO CHANGE IN SILVER INVENTORY AT THE SLV

INVENTORY RESTS AT 318.074 MILLION OZ

end

.

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

1. Today, we had the open interest in silver FELL  BY 1,290  contracts from 200,595  DOWN TO 199,358 (AND now A LITTLE FURTHER FROM THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) WITH THE FALL IN SILVER PRICE (A LOSS OF 11 CENTS). OUR BANKERS PROBABLY USED THEIR EMERGENCY PROCEDURE TO ISSUE SOME PRIVATE EFP’S FOR DECEMBER(WE DO NOT GET A LOOK AT THESE CONTRACTS) WHICH GIVES OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. THIS IS QUITE EARLY FOR THESE EFP ISSUANCE..USUALLY WE WITNESS THIS ONE WEEK PRIOR TO FIRST DAY NOTICE AND THIS CONTINUES RIGHT UP UNTIL FDN. I ALSO THINK THAT WE HAD SOME SILVER COMEX LIQUIDATION.  TOTAL EFP’S ISSUED BY THE CME IN SILVER TOTAL 790 CONTRACTS.

 

RESULT:  A SMALL SIZED DECREASE IN SILVER OI AT THE COMEX WITH THE 11 CENT FALL IN PRICE  (WITH RESPECT TO YESTERDAY’S TRADING). WE PROBABLY HAD MORE EFP’S ISSUED TRANSFERRING OUR COMEX LONGS OVER TO LONDON TOGETHER WITH SOME  SMALL SILVER LIQUIDATION. 

(report Harvey)

.

2.a) The Shanghai and London gold fix report

(Harvey)

 

2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY:  Bloomberg

3. ASIAN AFFAIRS

i)Late SUNDAY night/MONDAY morning: Shanghai closed UP 15.16 points or .44% /Hang Sang CLOSED UP 61.26 pts or 0.21% / The Nikkei closed DOWN 300.43 POINTS OR 1.32%/Australia’s all ordinaires CLOSED DOWN 0.12%/Chinese yuan (ONSHORE) closed UP  at 6.6412/Oil DOWN to 56.83 dollars per barrel for WTI and 63.47 for Brent. Stocks in Europe OPENED  RED  .  ONSHORE YUAN CLOSED UP AGAINST THE DOLLAR AT 6.6412. OFFSHORE YUAN CLOSED WEAKER TO THE ONSHORE YUAN AT 6.6533  //ONSHORE YUAN  STRONGER AGAINST THE DOLLAR/OFF SHORE STRONGER TO THE DOLLAR/. THE DOLLAR (INDEX) IS STRONGER AGAINST ALL MAJOR CURRENCIES. CHINA IS NOT  VERY HAPPY TODAY.

3a)THAILAND/SOUTH KOREA/NORTH KOREA

i)North Korea//South Korea

As a show of force for the first time in 10 years, the USA has put 3 carriers next to the North Korean/Soth Korean peninsula

( zerohedge)

b) REPORT ON JAPAN

c) REPORT ON CHINA

4. EUROPEAN AFFAIRS

i)SUNDAY/BARCELONA SPAIN

We are going to see more of this:  750,000 protesters line the streets of Barcelona as they demand the release of those political prisoners that tried for Catalonia to secede from Spain

( zerohedge)

ii)GREAT BRITAIN/MONDAY MORNING

( zerohedge)

iii)A must read..

David Stockman explains the global bond bubble including the Junk bond yields at 2.42%. The bubble must burst and it will leave those holding the bag enormous losses

( David Stockman/ContraCorner)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

 

i)On Friday, Bahrain experienced  a huge fireball explosion in its  major oil pipeline.  Bahrain blamed Iran as the Bahranian dollar plummets. Bahranian may have to declare bankruptcy.

( zerohedge)

ii)IRAN/IRAQ

A huge earthquake on the border between Iraq and Iran

( zerohedge)

iii)ISRAEL/SYRIA

 more tension as Israel shoots down a Syrian drone flying over the key Golan heights. if Hezbollah had anything to do with the drone that would certainly escalate the situation
( zerohedge)

iv)This is good!. Russia, the uSA and Jordan agree on a “Iran free zone” in southern Syria.  Israel is adamant that the Golan Heights must be Iranian free!!( zerohedge)

v)The Arab league, headquartered in Cairo is holding an emergency meeting on Iranian dominance in the region. Saudi Arabia has mobilized fighter jets in anticipation of war.

(courtesy zerohedge)

vi) We reported last week the blockade of all airports and sea ports in Yemen by the Saudi’s This is causing starvation as no food or medicines can get into the country.  The rebel Houthis which controls most of Yemen have now threatened to sink only Saudi Oil tankers and Saudi battleships which are orchestrating the blockade

( zerohedge)

6 .GLOBAL ISSUES

 

7. OIL ISSUES

OPEC reports on a considerable October crude output and they raise demand for 2018

( zerohedge)

8. EMERGING MARKET

9.   PHYSICAL MARKETS

i)Sunday night:

the cryptos are going crazy  with Bitcoin crashing to 44370 but bitcoin cash rising. later in the evening Bitcoin recovered all of its losses and then gained:    this is insane and all of these cryptos will revert to their intrinsic  value and that value is zero.

( zerohedge)

ii)Monday morning/

Bitcoin reverses course and wipes out all of its losses and then gains a huge 300 dollars:

(courtesy zerohedge)

iii)Again, the London Financial times refuses to ask the right questions on questionable gold trading by central banks

( London’s Financial Times/GATA)

iv)Greg Mannarino tells Greg Hunter that central banks with their cohort banks are rigging all markets and central to the rigging is gold and this prevents real market price discovery.

( Mannarino/Greg Hunter)

v)Ray Dalio is one smart cookie.  He now realizes that the only asset that will grow exponentially is gold and he went on a buying spree and he now owns  3.9 million shares worth 473 million dollars.  He also bought other gold ETF’s.

(courtesy zerohedge)

 

 10.  USA stories which will influence the price of gold/silver

i)According to zero hedge, the Podesta Group has run out of money and will not exist by the end of the year. The former head Tony Podesta is facing possible indictment as he failed to register as foreign lobbyist

( zerohedge)

ii)Kevin Brady, Ways and Means chairman declares that the House will not accept total elimination of the SALT deductions  (state and local taxes)

( zerohedge)

 

iii)Here is the latest update on the GPO tax bill and why (as I promised) will be impossible to pass.  Here are the differences:

( zero hedge)

iv)A good bellwether of things to come.  GE is crashing today:( zerohedge)

v)JPMorgan went to court in Texas asking the court to lower its stunning 8 billion dollar verdict again an heir due to criminal fraud committed by the company

( zerohedge)

 

 

Let us head over to the comex:

The total gold comex open interest SURPRISINGLY FELL BY  ONLY 3,786 CONTRACTS DOWN to an OI level of 530,404 DESPITE THE HUGE FALL IN THE PRICE OF GOLD ($13.00 FALL WITH RESPECT TO FRIDAY’S RAID).  OBVIOUSLY WE DID NOT HAVE THE LIQUIDATION OF LONGS AS EXPECTED. I BELIEVE THAT SOME OF THE LONGS THAT LEFT THE COMEX  TRANSFERRED OUT OF THE COMEX TO A DELIVERABLE FORWARD AT LONDON THROUGH THE EFP ROUTE.(RECEIVED A DECEMBER EFP) ALONG WITH A SMALL GOLD LIQUIDATION.

Result: a  SURPRISE SMALL  DECREASE IN OPEN INTEREST DESPITE THE CONSIDERABLE  FALL IN THE PRICE OF GOLD ($13.00.)   

 

We have now entered the NON active contract month of NOVEMBER.HERE WE HAD A LOSS OF 8 CONTRACT(S) UP TO 84.  We had 2 notices filed YESTERDAY so GAINED 6 contracts or 600 additional oz will  stand for delivery in this non active month of November. TO SEE BOTH GOLD AND SILVER RISE IN AMOUNT STANDING (QUEUE JUMPING) IS A GOOD INDICATOR OF PHYSICAL SHORTNESS FOR BOTH OF OUR PRECIOUS METALS.

The very big active December contract month saw it’s OI LOSE 20,017 contracts DOWN to 301,919. January saw its  open interest rise by 68 contracts up to 804.  FEBRUARY  saw a gain of 15,267 contacts up to 157,104.

.

We had 2 notice(s) filed upon today for  200 oz

 VOLUME FOR TODAY : 228,818 (PRELIMINARY)

CONFIRMED VOLUME YESTERDAY: 402,844

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And now for the wild silver comex results.  Total silver OI FELL BY  1290 CONTRACTS FROM 200,595 DOWN TO 199,358 WITH FRIDAY’S 11 CENT LOSS IN PRICE (HUGE RAID). WE PROBABLY HAD SOME PRIVATE EFP’S ISSUED FOR DECEMBER BY OUR BANKERS TO COMEX LONGS WHO RECEIVED A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. THIS IS QUITE EARLY FOR THE ISSUANCE. USUALLY WE WITNESS THIS EVENT ONE WEEK PRIOR TO FIRST DAY NOTICE AND IT CONTINUES RIGHT UP TO FDN.  I  THINK THAT WE HAD SOME LONG LIQUIDATION ALONG WITH A SMALL  TRANSFER OF LONGS OVER TO A LONDON FORWARD (THROUGH THE EFP ROUTE AS THEY RECEIVE A BONUS FOR THAT TRANSFER). THE TOTAL SO FAR THIS MONTH FOR EFP’S ISSUED TOTAL 790 CONTACTS (OR 39.5 MILLION OZ)
The new front month of  November saw its OI FALL by 1 contract(s)  and thus it stands at 3.  We had 2 notice(s) served YESTERDAY so we gained 1 contracts or an additional 5,000 oz will stand in this non active month of November.   After November we have the big active delivery month of December and here the OI FALL by 6446 contracts DOWN to 114,696.  January saw A LOSS OF 22  contracts RISING TO 1031.

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

INITIAL standings for NOVEMBER

 Nov 13/2017.

Gold Ounces
Withdrawals from Dealers Inventory in oz   nil oz
Withdrawals from Customer Inventory in oz  
23,598.1
 oz
Scotia
734 kilobars
Deposits to the Dealer Inventory in oz    nil oz
Deposits to the Customer Inventory, in oz 
nil oz
No of oz served (contracts) today
 
2 notice(s)
200 OZ
No of oz to be served (notices)
69 contracts
(6900 oz)
Total monthly oz gold served (contracts) so far this month
991 notices
99,100 oz
3.082 tonnes
Total accumulative withdrawals  of gold from the Dealers inventory this month   NIL oz
Total accumulative withdrawal of gold from the Customer inventory this month     xxx oz
Today we HAD  1 kilobar transaction(s)/ 
 WE HAD nil DEALER DEPOSIT:
total dealer deposits: nil oz
We had nil dealer withdrawals:
total dealer withdrawals:  nil oz
we had 0 customer deposit(s):
total customer deposits  nil  oz
We had 1 customer withdrawal(s)
 i) out of Scotia:  23,598.100 OZ
total customer withdrawals; 23,598.100  oz
734 KILOBARS
 we had 0 adjustment(s)
For NOVEMBER:

Today, 0 notice(s) were issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 2 contract(s)  of which 0 notices were stopped (received) by j.P. Morgan dealer and 1 notice(s) was (were) stopped/ Received) by j.P.Morgan customer account.

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To calculate the INITIAL total number of gold ounces standing for the NOVEMBER. contract month, we take the total number of notices filed so far for the month (991) x 100 oz or 99100 oz, to which we add the difference between the open interest for the front month of NOV. (71 contracts) minus the number of notices served upon today (2 x 100 oz per contract equals 106,100  oz, the number of ounces standing in this NON active month of NOV
 
Thus the INITIAL standings for gold for the NOVEMBER contract month:
No of notices served  (991) x 100 oz  or ounces + {(71)OI for the front month  minus the number of  notices served upon today (2) x 100 oz which equals 106,100 oz standing in this  active delivery month of NOVEMBER  (3.300 tonnes)
WE GAINED 6 ADDITIONAL CONTRACTS OR 600  OZ OF ADDITIONAL GOLD STANDING FOR METAL AT THE COMEX
THIS IS THE FIRST TIME EVER THAT WE HAVE WITNESSED CONSIDERABLE QUEUE JUMPING IN GOLD AT THE COMEX. SILVER’S QUEUE JUMPING STARTED IN MAY 2017 AND HAS NOT LET UP ONCE COMMENCED.
.
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Total dealer inventory 527,069.052 or 16.394 tonnes  (dealer gold continues to disappear)
Total gold inventory (dealer and customer) = 8,697,603.007 or 270.53 tonnes 
 
I have a sneaky feeling that these withdrawals of gold in kilobars are being used in the hypothecating process  and are being used in the raiding of gold!

The gold comex is an absolute fraud.  The use of kilobars and exact weights makes the data totally absurd and fraudulent! To me, the only thing that makes sense is the fact that “kilobars: are entries of hypothecated gold sent to other jurisdictions so that they will not be short with their underwritten derivatives in that jurisdiction.  This would be similar to the rehypothecated gold used by Jon Corzine at MF Global.
 
IN THE LAST 14 MONTHS  84 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
AND NOW THE NOVEMBER DELIVERY MONTH
NOVEMBER INITIAL standings
 Nov 13/ 2017
Silver Ounces
Withdrawals from Dealers Inventory  nil
Withdrawals from Customer Inventory
 100,521.890 oz
SCOTIA
Deposits to the Dealer Inventory
 nil oz
Deposits to the Customer Inventory 
 301,351.296
oz
No of oz served today (contracts)
2 CONTRACT(S)
(10,000,OZ)
No of oz to be served (notices)
1 contract
(5,000 oz)
Total monthly oz silver served (contracts) 871 contracts

(4,355,000 oz)

Total accumulative withdrawal of silver from the Dealers inventory this month  NIL oz
Total accumulative withdrawal  of silver from the Customer inventory this month    xx oz
today, we had  0 deposit(s) into the dealer account:
total dealer deposit: nil    oz
we had nil dealer withdrawals:
total dealer withdrawals: nil oz
we had  1 customer withdrawal(s):
 i) Out of  SCOTIA: 100,521,890 oz
TOTAL CUSTOMER WITHDRAWAL 100,521.890  oz
We had 1 Customer deposit(s):
i) Into Delaware:  301,351.296 oz
***deposits into JPMorgan have stopped  again
In the month of March and February, JPMorgan stopped (received) almost all of the comex silver contracts.
why is JPMorgan bringing in so much silver??? why is this not criminal in that they are also the massive short in silver
total customer deposits: 301,351.296   oz
 
 we had 0 adjustment(s)
The total number of notices filed today for the NOVEMBER. contract month is represented by 2 contracts FOR 10,000 oz. To calculate the number of silver ounces that will stand for delivery in NOVEMBER., we take the total number of notices filed for the month so far at 872 x 5,000 oz  = 4,360,0000 oz to which we add the difference between the open interest for the front month of NOV. (3) and the number of notices served upon today (2 x 5000 oz) equals the number of ounces standing.
 

 

.
 
Thus the INITIAL standings for silver for the NOVEMBER contract month:  872 (notices served so far)x 5000 oz  + OI for front month of NOVEMBER(3) -number of notices served upon today (2)x 5000 oz  equals  4,370,000 oz  of silver standing for the NOVEMBER contract month. This is EXCELLENT for this NON active delivery month of November. 
We gained 1 contracts or an additional 5,000 oz will stand for metal in the non active delivery month of November.
AS I MENTIONED ABOVE, WE HAVE BEEN WITNESSING QUEUE JUMPING IN SILVER FROM MAY 1 2017 ONWARD. IT IS NOW COMFORTING TO SEE CONSIDERABLE QUEUE JUMPING OCCURRING CONTINUALLY IN GOLD FOR THE FIRST TIME SINCE RECORDED TIME AT THE GOLD COMEX!!(1974). QUEUE JUMPING CAN ONLY OCCUR ON PHYSICAL METAL SHORTAGE.
 
 ESTIMATED VOLUME FOR TODAY:  33,605
CONFIRMED VOLUME FOR YESTERDAY:  114,201 CONTRACTS
YESTERDAY’S CONFIRMED VOLUME OF 114,201 CONTRACTS EQUATES TO 571 MILLION OZ OR 81.5% OF ANNUAL GLOBAL PRODUCTION OF SILVER
 
 
Total dealer silver:  43.218 million 
Total number of dealer and customer silver:   229.956 million oz
The record level of silver open interest is 234,787 contracts set on April 21./2017  with the price at that day at  $18.42
The previous record was 224,540 contracts with the price at that time of $20.44
end

 

NPV for Sprott and Central Fund of Canada

1. Central Fund of Canada: traded at Negative 1.7 percent to NAV usa funds and Negative 1,4% to NAV for Cdn funds!!!! 
Percentage of fund in gold 62.3%
Percentage of fund in silver:37.4%
cash .+.3%( Nov 13/2017) 
2. Sprott silver fund (PSLV): STOCK  FALLS TO -0.99% (Nov 13 /2017) 
3. Sprott gold fund (PHYS): premium to NAV FALLS TO -0.73% to NAV  (Nov 13/2017 )
Note: Sprott silver trust back  into NEGATIVE territory at -0.99%-/Sprott physical gold trust is back into NEGATIVE/ territory at -0.73%/Central fund of Canada’s is still in jail  but being rescued by Sprott.

Sprott WINS hostile 3.1 billion bid to take over Central Fund of Canada

(courtesy Sprott/GATA)

Sprott Inc. to take control of rival gold holder Central Fund of Canada

by THE CANADIAN PRESS

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.

END

And now the Gold inventory at the GLD

Nov 13/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 843.09 TONNES

Nov 10/no change in gold inventory at the GLD/Inventory rests at 843.09 tonnes

Nov 9/no changes in inventory at the GLD/Inventory rests at 843.09 tonnes

NOV 8/ANOTHER HUGE WITHDRAWAL OF 1.18 TONNES OF GOLD FROM THE GLD DESPITE GOLD’S RISE TODAY.  INVENTORY RESTS AT 843.09

Nov 7/a huge withdrawal of 1.48 tonnes of gold from the GLD/Inventory rests at 844.27 tonnes

NOV 6/ a tiny withdrawal of .29 tonnes to pay for fees etc/inventory rests at 845.75 tonnes

Nov 3/no change in gold inventory at the GLD/Inventory rests at 846.04 tonnes

NOV 2/STRANGE!!! WE HAD ANOTHER WITHDRAWAL OF 3.55 TONNES FROM THE GLD DESPITE GOLD’S RISE OF $6.60 YESTERDAY AND $1.55 TODAY/INVENTORY RESTS AT 846.04 TONNES

Nov 1/a withdrawal of 1.18 tonnes of gold from the GLD/Inventory rests at 849.59 tonnes

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

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Nov 13/2017/ Inventory rests tonight at 843.09 tonnes
*IN LAST 270 TRADING DAYS: 97.86 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 205 TRADING DAYS: A NET  59,42 TONNES HAVE NOW BEEN ADDED INTO  GLD INVENTORY.
*FROM FEB 1/2017: A NET  28.31 TONNES HAVE BEEN ADDED.

end

Now the SLV Inventory

Nov 13/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.074 MILLION OZ

Nov 10/no change in silver inventory at the SLV/Inventory rests at 318.074 million oz/

Nov 9/no change in silver inventory at the SLV/inventory rests at 318.074 million oz.

NOV 8/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.074 MILLION OZ

Nov 7/a huge withdrawal of 944,000 oz from the SLV/inventory rests at 318.074 million oz/

NOV 6/no change in silver inventory at the SLV/Inventory rests at 319.018 million oz/

Nov 3/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS TONIGHT AT 319.018 MILLION OZ.

NOV 2/A TINY LOSS OF 137,000 OZ BUT THAT WAS TO PAY FOR FEES LIKE INSURANCE AND STORAGE/INVENTORY RESTS AT 319.018 MILLION OZ/

Nov 1/STRANGE!  WITH SILVER’S HUGE 48 CENT GAIN WE HAD NO GAIN IN INVENTORY AT THE SLV/INVENTORY RESTS AT 319.155 MILLION OZ/

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

Nov 13/2017:

Inventory 318.074 million oz
end
  • 6 Month MM GOFO

    Indicative gold forward offer rate for a 6 month duration

    + 1.50%
  • 12 Month MM GOFO
    + 1.72%
  • 30 day trend

end

 

 

Major gold/silver trading/commentaries for MONDAY

GOLDCORE/BLOG/MARK O’BYRNE.

GOLD/SILVER

116 Internet Shutdowns Show Why Physical Gold Is Ultimate Protection

GoldCore's picture

Internet shutdowns (116 in two years) show physical gold is ultimate protection

– Number of internet shutdowns increased in 2017 as 30 countries hit by shutdowns
– Democratic India experienced 54 internet shutdowns in last two years; Brazil 2
– EU country Estonia, a technologically advanced nation, experienced a shutdown
– Gallup poll shows Americans more worried about cybercrime than violent crime
– Governments use terrorist threat as reason for internet kill switch powers
– Own physical coins and bars rather than digital gold on a single platform 

Editor: Mark O’Byrne

internet shutdown

UNESCO is warning that the number of internet shutdowns is increasing worldwide. According to Statista.com when reporting data provided by digital rights platform accessnow.org, “internet access has been curbed 116 times in 30 countries since January 2016.”

“Internet shutdown: An intentional disruption of Internet or electronic communications, rendering them inaccessible or effectively unusable, for a specific population or within a location, often to exert control over the flow of information.” – Access Now.

One question that so many ask when first hearing about bitcoin is ‘what if the internet stops working?’ Bitcoin and crypto proponents scoff and point out that there is no singular ‘off button’ i.e. it would be near impossible.

According to ‘father of the internet’ Tim Berners-Lee, this is true:

“The way the internet is designed is very much as a decentralised system. At the moment, because countries connect to each other in lots of different ways, there is no one off switch, there is no central place where you can turn it off.”

Try telling that to the one billion plus people in India who have experienced over 54 internet shutdowns in the last two years.

Or those in Egypt who on January 27th 2011 could no longer get online as the government shut down the internet in response to the pre-Arab Spring protests.

Even in the EU, ten years ago technologically advanced Estonia appears to have been a victim of Kremlin-sponsored cyber warfare, when Estonians found they could no longer access their bank accounts. Individuals and companies could not use their computers for the simple daily tasks that we take for granted today – such as email.

The above three examples are not rare occurrences. In the last two years alone there have been 116 situations where governments or state sponsored hackers seem to have found the ‘off button’ for the internet across 30 countries. That’s not counting all of the incidences when there have been other cyber attacks that have ‘merely’ affected vital internal systems and disrupted key infrastructure for large sections of society.

So whilst countries might be more connected than ever, that isn’t much help to the citizens who find themselves very much disconnected whether on a mass or individual scale. Internet shutdown is definitely possible and it is happening: 

“There are several ways to shut down the Internet. One way is to make sure that when you type in a web address, such as dw.com/mediadev, your Internet service provider doesn’t allow you to find the underlying IP address. Another way is when an Internet service provider messes with the routing tables and removes key details so that packets of information traveling on the web aren’t allowed to travel to their final destination. Governments are using increasingly sophisticated methods to disrupt communications”

This isn’t just a disaster for those using bitcoin, this is a disaster for anyone who relies on an internet connection be it for communication or accessing their finances. Many in the West look at internet controls as something that is exclusive to developing nations or those more on the totalitarian-regime end of the political spectrum.

Sadly this is not the case. As you will see government-sanctioned internet shutdown and cyberterrorism are ever-present across many nations. The result? Individuals must protect their own freedom and safety of their assets as the authorities may have other priorities.

Internet shutdown increases government powers

As the examples of India, Estonia and Egypt show internet shutdown is very much possible. It was the Egyptian shutdown of 2011 that prompted many other governments to realise the powers they could attain:

Until then, many governments had assumed it was not possible to turn off internet access to their entire nation, due to the decentralized nature of the network. But soon after, governments across the globe educated themselves about AS numbers and internet routing, and started using their power to set up systems that would allow them to order network shutdowns.

What was originally only intended to be used in more extreme circumstances has quickly devolved into officials using their powers for all sorts of questionable – and often political – reasons.

Internet shutdowns can be either at the will of the domestic government or a form of financial or military warfare from an outside authority or organisation.

India is where we see the highest number of authorised internet blackouts. Here government policy states that whilst such action requires the highest-level official in charge of domestic security – the Ministry of Home Affairs for the whole country or a state’s Home Department official – to sign off on any shutdown a junior member can shutdown the internet for a full 24-hours should gaining permission be unfeasible.

Many in Western countries might dismiss such government behaviour as perhaps a feature of developing nations or despot-led countries. Not so. In the UK  the Communications Act 2003 and the Civil Contingencies Act 2004 gives internet suspension powers to the Secretary of State for Culture, Media and Sport. This can be done either by ordering the shutdown of operations by internet service providers or by closing exchange points.

When questioned about such a power a government representative said that it would have to be a very exceptional circumstance that led to the shutdown of the internet. However, those circumstances have not been specified and therefore cannot be challenged. Who is to say from one government to the next or one perceived threat to the next what an ‘exceptional circumstance’ is?

One person’s exceptional circumstances differ to another’s. For example, it’s interesting that in India the majority of shutdowns happen in Kashmir, the region which is heavily involved in a  political border dispute. The same goes for Turkey which since 2016 has allowed authorities to implement an internet ‘kill switch’ to “partially or entirely” suspend internet access when deemed necessary.

In most countries government-sanctioned internet shutdown is now part and parcel of policy. More often than not they are justified by their use in protecting citizens. However, as Deji Bryce Olukotun, Senior Global Advocacy Manager at Access Now explains:

There is no evidence that shutting down the Internet helps prevent terrorist attacks or stops them while they’re occurring.

Internet access: a human right

There are 3.5 billion internet users around the world, approximately 50% of the global population. It is therefore unsurprising that internet use is increasingly considered to be a human right by many.

“As the Internet is a key enabler of many fundamental rights, including freedom of speech and expression, such frequent disruptions have been a cause for concern,” states InternetShutdowns.in.

“They threaten the democratic working of nations, and also point to the gradual normalization of the mindset that permits such blanket restriction on Internet access.”

Where there is internet access managing your day and business online is just an accepted fact of life, particularly in developed countries. When indicators such as the political, economic and social impact of the web, connectivity and use are considered the UK and US are ranked in the top three for web use by citizens.

The Internet helps us realize our human rights, including freedom of expression and privacy. When governments shut off the Internet, people can’t communicate with loved ones, run their businesses or even visit their doctors during an emergency. – Deji Bryce Olukotun

One would also assume therefore that our governments understand the importance of internet security and have several measures in place to prevent the likes of military-level cyber attacks or DDOS attacks from terrorist organisations.

Not so, the most progress that has been made by Western governments in recent years has been in regard to how much control they have over the internet as shown by the aforementioned policies.

Do companies and governments even care?

Ten years ago Estonia experienced what appears to have been a state-sponsored cyberattack of unimaginable proportions. Citizens found they were unable to access bank accounts, websites, social media and infrastructure began to fall apart such as traffic lights no longer working.

This was not down to an internal failure. It was quickly clear that there had been an attack from outside the country. It was a Distributed Denial of Service Attack — an orchestrated swarm of internet traffic that swamps servers and shuts down websites for hours or even days.

The result for Estonians citizens was that cash machines and online banking services were sporadically out of action; government employees were unable to communicate with each other on email; and newspapers and broadcasters suddenly found they couldn’t deliver the news.

The Estonian government reacted in a manner that other governments should have been proud to follow. They used it as a step to up foreign policy and gain immense understanding and training on all matters of cybersecurity.

The attack on Estonia may have been Russia telling the rest of the world that it had the capabilities to bring a country to its knees should they be displeased.

Internet shutdowns are serious. A cyberattack or a government-sanctioned internet shutdowns due to a perceived threat could have dire financial consequences:

The wheels of finance and banking also could grind to a halt if an event compelled all U.S. Internet Service Providers to cut off all Internet access. A shutdown of the stock markets, where billions of dollars are exchanged daily, might prove especially crippling.

But this isn’t just about disaster at a government and national level. Consider businesses and the impact on their operations. How many organisations assume internet access is a given? How many base their business offering on the existence of customers being online?

Dangers of Digital Gold

Consider companies that offer digital gold an an investment or store of value. These electronic platforms offer investors access to pooled gold in large gold bar format.  Investors do not know which part of a particular gold bar they own. Sometimes such investments are mis-labelled as allocated gold.

Not only this, but these platforms are “closed loop systems”. This means liquidity and pricing are dependent on a single platform, website and company. The investor is in effect “captive” as they would be to a bank account or having to deal with one single stockbroker. Should the company be acquired by a bank, venture capitalists or other institution, the spread between buy and sell and overall costs could rise. The client would have no choice but to accept the increased charges.
Source: Bullionvault.com (June 2017)

How would this work in the event of a cyber attack and or internet shutdowns? Your digital gold would be about as much use as the cash in the bank account you can’t access, as ATMs would also be down and online banking is not online.

We are in no way casting aspersions as to the good name of BullionVault.com or other digital gold platforms. We have a lot of respect for them and what they have achieved. However, we view them as a great way for people to speculate on gold, silver and platinum and go long and short, rather than as providers of financial insurance and safe haven long term investments.

The point we are making is that investors concerned about systemic risk, including cyber risk, should consider the cyber and electronic threats to their investments – with whatever provider they may be with.

Higher rate of victimisation: don’t be a statistic

chartoftheday_11735_the_crimes_americans_worry_about_most_n

67% of Americans are more worried about cyberattacks than physical theft and attacks. Why is this? Most likely because few know where to turn in order to protect themselves. It is not an irrational fear.

Even if you live in a country that was not victim to an internet shutdown, consider the following relevant information:

– According to a study by Incapsula 30.5% of non-human web traffic is compromised of ‘bad bots’. These bots are responsible for stealing data and distributing malware.
– Symantec’s 2017 Internet Security Threat Report reported that more than $3 billion has been stolen from businesses in the past three years.
– The United States’ Computer Crime and Intellectual Property Section (CCIPS) report that more than 4,000 ransomware attacks have occurred every day since the beginning of 2016. A 300% increase over 2015, where 1,000 ransomware attacks were seen per day.
– This is a major financial problem. The Brookings Institution found that the global economy lost at least 2.25 billion euro ($2.4 billion) from Internet shutdowns over a one year period from 2015-2016.

Individuals must take their own precautions, both at a computer security level but also in terms of personal assets.

More and more people need the Internet to connect and make a living, and cannot afford to lose access on a routine basis. The worst thing we can do is sit and do nothing. – Deji Bryce Olukotun

Internet shutdowns and cybersecurity attacks compromise our democratic freedoms. The shutdown of the internet by governments should only be allowed in the most extreme of cases. Sadly as we see in the likes of India it is often used as a first response.

When our democratic freedoms are threatened it means our financial ones are also at risk. Many savers and investors consider these threats and choose to diversify their portfolios. They spread the risk and hedge their bets against such events.

This is a sensible first step, however it can be rendered pointless if your management of your assets is reliant on internet access. Gold has been bought by millions all over the world because of its role in protecting investors during times of war, financial hardship and economic disasters. It is only recently that the idea of cyber warfare and the misuse of this power by governments has become a point of consideration.

Gold is as relevant here as it always has been. But it is specifically allocated, segregated physical gold which must be considered.

Owning gold coins and bars either in one’s possession or in allocated and segregated storage will protect people and will be accessible and liquid should an internet shutdown be triggered in your country tomorrow.

Related Content

Yahoo Hacking Highlights Cyber Risk and Increasing Importance of Physical Gold

Cyber Attacks Show Vulnerability of Digital Systems and Digital Currencies

Sell Gold Now – Time To Liquidate Gold ETFs, Pooled and Digital Gold

Digital Gold On The Blockchain – For Now Caveat Emptor

 

News and Commentary

Gold takes a leg lower, but hangs on for first weekly gain in a month (Marketwatch )

Gold prices trade in range, but US rate hike view weighs (CNBC.com)

Asia Stocks Mixed; Pound Slides With May Pressured (Bloomberg)

Saudi Arabia Credit Risk Surges Most in Almost Two Years (Bloomberg)

Mysterious Gold Trades of 4 Million Ounces Spur Price Plunge (Bloomberg)

Bitcoin Plunges 29% From Record High (Bloomberg)

Gold Slammed After Someone Pukes $4 Billion Notional In Gold Futures (Zerohedge)

How Germany Got Its Gold Back (FT.com)

BIS gold swaps rose substantially in October (Gata.org)

Why doesn’t gold get the respect it deserves? (Mining.com)

The Two High-Growth Sectors That Could Outperform Tech (Visual Capitalist)

If The Saudi Arabia Situation Doesn’t Worry You, You’re Not Paying Attention (Zerohedge)

Here’s why investors look too complacent about the Powell Fed (Marketwatch)

Gold Prices (LBMA AM)

10 Nov: USD 1,284.45, GBP 976.44 & EUR 1,102.19 per ounce
09 Nov: USD 1,284.00, GBP 980.98 & EUR 1,106.29 per ounce
08 Nov: USD 1,282.25, GBP 976.82 & EUR 1,105.43 per ounce
07 Nov: USD 1,276.35, GBP 970.92 & EUR 1,103.28 per ounce
06 Nov: USD 1,271.60, GBP 969.72 & EUR 1,095.61 per ounce
03 Nov: USD 1,275.30, GBP 976.24 & EUR 1,094.59 per ounce
02 Nov: USD 1,276.40, GBP 965.09 & EUR 1,095.92 per ounce

Silver Prices (LBMA)

10 Nov: USD 17.00, GBP 12.92 & EUR 14.60 per ounce
09 Nov: USD 17.10, GBP 13.03 & EUR 14.69 per ounce
08 Nov: USD 17.00, GBP 12.96 & EUR 14.65 per ounce
07 Nov: USD 17.01, GBP 12.95 & EUR 14.70 per ounce
06 Nov: USD 16.92, GBP 12.90 & EUR 14.59 per ounce
03 Nov: USD 17.09, GBP 13.05 & EUR 14.67 per ounce
02 Nov: USD 17.08, GBP 12.98 & EUR 14.66 per ounce


Recent Market Updates

– Gold Coins and Bars Saw Demand Rise 17% to 222T in Q3
– Prepare For Interest Rate Rises And Global Debt Bubble Collapse
– Platinum Bullion ‘May Be One Of The Only Cheap Assets Out There’
– World’s Largest Gold Producer China Sees Production Fall 10%
– German Investors Now World’s Largest Gold Buyers
– Gold Price Reacts as Central Banks Start Major Change
– Why Switzerland Could Save the World and Protect Your Gold
– Invest In Gold To Defend Against Bail-ins
– Stumbling UK Economy Shows Importance of Gold
– 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

end

Ray Dalio is one smart cookie.  He now realizes that the only asset that will grow exponentially is gold and he went on a buying spree and he now owns  3.9 million shares worth 473 million dollars.  He also bought other gold ETF’s.

(courtesy zerohedge)

Ray Dalio Goes On Gold Buying Spree, Adds 575% To GLD Holdings, Becomes 8th Largest Holder

Until last quarter, the world’s biggest hedge fund had, curiously, never held a position (according to our records) in any of the most liquid gold ETFs, whether the SPDR Gold Trust, the GLD, or the iShares Gold Trust, the IAU. That changed in the second quarter of 2017, when Bridgewater made its first tentative purchases in the gold ETF space, buying up 577,264 GLD shares, for $68.1 million, as well as 3.1 million IAU shares worth $36.8 million.

That was just the beginning, because as readers will recall, back on August 10 Ray Dalio urged investors to buy gold in case “things go badly.” This is what Dalio said:

When it comes to assessing political matters (especially global geopolitics like the North Korea matter), we are very humble. We know that we don’t have a unique insight that we’d choose to bet on. We can also say that if the above things go badly, it would seem that gold (more than other safe haven assets like the dollar, yen and treasuries) would benefit, so if you don’t have 5-10% of your assets in gold as a hedge, we’d suggest you relook at this. Don’t let traditional biases, rather than an excellent analysis, stand in the way of you doing this.

And that’s also what he did, because in the third quarter Bridgewater was very busy buying gold: in fact, according to the just released 13F, after $3.8BN and $2.9BN positions in EM ETFs VWO and EEM, as well as a $1.3BN position in the SPY ETF, Bridgewater’s 4th largest position as of September 30 was GLD, with 3.894 million shares, worth $473 million. In other words, in Q3, Ray Dalio went on a gold buying spree, increasing his GLD holdings by a whopping 575%.

As a result of the surge in holdings, Bridgewater as of this moment, the 8th largest holder of paper gold, known as GLD.

It wasn’t only GLD, however, because Bridgewater also nearly tripled its IAU holdings, increasing its paper iShares gold holdings by 266%, from 3.1 million shares to 11.3 million.

And now that Ray Dalio is rapidly buying up GLD, IAU and other gold holdings, we wonder how long before the momentum chasers send gold, both paper and physical surging, and whether this shift in momentum could potentially impact the ongoing surge in bitcoin

end

Sunday night:

the cryptos are going crazy  with Bitcoin crashing to 44370 but bitcoin cash rising. later in the evening Bitcoin recovered all of its losses and then gained:    this is insane and all of these cryptos will revert to their intrinsic  value and that value is zero.

(courtesy zerohedge)

 

Crypto Chaos Explained – Bitcoin Crashes As ‘Cash’ Tops Ether For First Time

Bitcoin collapsed overnight, trading as low as $5555 – down 30% from its highs – before bouncing back above $6000, as Bitcoin Cash soared to as high as $2450 (4 times its price on Friday), overtaking Ethereum briefly as the second largest market cap cryptocurrency.

image courtesy of CoinTelegraph

Bitcoin has lost around $30 billion in market cap, but found buying interest as it ripped below $6000 and has stabilized this morning

Bitcoin Cash exploded in thje last two days – quadrupling in price at one point to over $2400 as Bitcoin crashed.

 

As Coin Telegraph reports, the sharp rise in Bitcoin Cash’s price has come at the expense of Bitcoin.Bitcoin’s price has been on a steady downtrend ever since the Segwit2X fork was cancelled. A lot of people had bought Bitcoins in the expectation that they would get free Segwit2x coins after the fork. While market observers had expected some of this hot money to flow into altcoins once the Segwit2X fork happened/got cancelled, Bitcoin Cash seems to have been the main, but not only, beneficiary. The combined price of Bitcoin and Bitcoin Cash is over $8,000, which is not very different from the price on Friday.

That surge in Bitcoin Cash pushed its market cap above Ethereum for a brief time…

 

All of this chaos has left many wondering what is going on. Arjun Balaji provides some much-needed context for what is occurring in the crypto space…

1/August, Bitcoin forks, spawning off a fork that’s supported by a minority of miners. It’s self sustaining though the rate at which Bitcoin blocks are mined is variable and the price tanks. It was initially trading on the futures market prior to the fork between 0.05 and 0.07BTC. The motivations for the initial minority fork are complicated and nuanced, but they were largely driven by the incentives of trading on the futures market prior to the fork between 0.05 and 0.07BTC. The motivations for the initial minority fork are complicated and nuanced, but they were largely driven by the incentives of Chinese mining and Bitcoin businesses whose operation depended on the low transaction fees in the network (given Bitcoin txn fees were approaching $10).

 

2/ When Bitcoin Cash (BCH) tokens were finally accessible, there was a rush to go liquidate the tokens on an exchange. With really thin orderbooks, price shot up to 0.26 on the BTC:BCH pair, but had a slow decline over the next 2 months, bottoming out around 0.05ish. This is all the while Bitcoin continued it’s meteoric rise to $8k+.

 

3/ However, “Segwit2X” (B2X), another long schemed fork was still planned. This fork had even less popularity, reflected on the futures market, but had a lot of support from many mainstream Bitcoin businesses. It had ideological overlap with Bitcoin Cash: increase the block size to lower transaction costs on the Bitcoin network. Many users of Bitcoin who were worried about the merits of the technical block size increase were vocal about avoiding these forks and still maintain conviction that lowering transaction costs through the Bitcoin network is possible through some recent upgrades.

 

4/ As the date for B2X fork grew closer, Bitcoin Cash eventually bottomed out. The market’s assumption here was that there is no need for 2 forks with ideological overlap to exist.

 

4a/ However, in a sudden move, there was a cancellation of the fork on November 8th, with much of the support of the 2X crowd going into Bitcoin Cash. This started a fantastic price spike–in USD, from $400-500 up to $2800 (as of last night) and in Bitcoin, even higher, with orders executing between 0.4-0.5BTC. As of now, it seems to be stable at low volume —0.3BTC.

 

5/ Many long-time holders and significant Bitcoin “whales” noted online how they are planning on selling BTC and buying BCH. Most notably, Roger Ver moved long-time cold storage Bitcoin holdings totaling over $250M to Bitfinex. Not sure if this has been executed upon or not, but the presumption is that he is either buying BCH or selling BTC for USD. The goal of this (IMO) is to generate momentum and the reflexivity needed to create a “flip” between BTC and BCH.

 

6a/ It seems like 1) miners incentives are aligned with BCH for now but it’s unclear if it’s just because of the volatile difficulty or if it is permanent;

 

 

6b/ 2) money is dumping out of BTC into BCH. When/if BCH becomes more profitable, miners will follow — at that point, do businesses like Coinbase recognize Bitcoin Cash as the canonical Bitcoin? No idea, but it’ll be interesting to see play out.

 

7/ Bitcoin Cash has a planned hard fork on Nov 13th to adjust the volatile difficulty of mining. It remains to be seen whether (at a stable price), post-fork, miner incentives will remain as strong as before. If they are anticipating a large increase in price or have spent the last couple of months accumulating BCH at a low price like many have hypothesized, that could play a role as well.

Arjun concludes, net-net, this is a mess for most mainstream users (e.g. my dad), who have no idea what’s happening and potentially don’t own Bitcoin Cash.

The end of Bitcoin (BTC) and rise of Bitcoin Cash could hurt these users, who potentially bought Bitcoin on Coinbase in August and don’t know about these risks. This puts the emerging futures and ETFs in an interesting picture.

*  *  *

The various factions within the crypto space are increasing their rhetoric… (as CoinDesk reports)

When asked about the move Jiang Zhuoer, founder of bitcoin mining pool BTC.Top, said simply that “2x fans” are moving both funds and mining hardware to bitcoin cash.

 

“BTC is going to die,” Zhuoer said. Hapio Yang, CEO of mining pool operator ViaBTC, responded similarly, indicating he believes that businesses and investors are now migrating funds to bitcoin cash.

 

“I think more and more bitcoin holders are starting to understand what is the real bitcoin,” he said via WeChat.

 

“I think a positive feedback loop has been created. This is waking people up to the shaky foundations BTC is built on,” he said.

However, as CoinDesk notes, there remains a great deal of skepticism over cash…

Jack Liao, the CEO of Hong Kong-based mining firm LightningASIC, for instance, sought to frame the idea that the bitcoin cash price increase represented any real uptick in interest in the project as “total bullshit.”

 

For those following the scaling debate, Bitmain’s conduct has been one of the larger contentious narrative points, and Liao (like others) believes the explosion seen in the bitcoin cash market value is nothing more than an orchestrated bid by the firm (and its supporters) to prop up the market.

 

“Many, many investors just see the change in hash rate,” he said. “But they cannot support such a big bitcoin cash price.”

 

Beijing-based over-the-counter Zhao Dong reported a similar sentiment in some circles, crediting the price to manipulation by miners and investors who have supported Segwit2x and bitcoin cash in the past. Bitmain and Ver were both signatories of the agreement that sparked the 2x software.

 

“They have money, they have hash power, they have everything need to pump the bitcoin cash price,” he said.

Finally, to clarify, Willy Woo, recently named one of CoinDesk’s Top 5 Token Analysts of 2017, sees the price move as perhaps one to watch. In contrast to other alternative cryptocurrencies that he said may lack value propositions, he went so far as to color bitcoin cash as a more nuanced option.

“It’s backed by a lot of money from China controlling its price and supporting its network. If you buy bitcoin cash, you are betting that China wants it to dominate. That’s a strategic and geopolitical bet,” he told CoinDesk.

END

Monday morning/Bitcoin reverses course and wipes out all of its losses and then gains a huge 300 dollars:

(courtesy zerohedge)

Bitcoin Soars, Erases Weekend Losses As ‘Cash’ Gets Cut In Half

Well, that de-escalated quickly…

All the hopes and dreams of Bitcoin Cash officianados have been dashed in the last 24 hours. After its mega spike from $600 to over $2400, the forked cryptocurrency has crashed back to around $1000 overnight as traders switch back to the mainstream Bitcoin branch, sending it surging back above $6600 – erasing all the weekend’s “the end is nigh” losses…

As CoinTelegraph reports,cross-exchange data for Bitcoin Cash, which describes itself as “the best money in the world,” shows a swift turnaround in the altcoin’s fortunes through the weekend.

The result of a giant publicity effort from its proponents, BCH saw mass investment as it heads towards a potentially contentious hard fork set for just after 7 p.m. GMT today.

The failure of SegWit2x, coupled with endorsement from the soon-to-be-defunct Bitcoin Classic team meant BCH became the major ‘competitor’ to Bitcoin overnight.

Its rapid rise has ignited the community, with widespread condemnation of lead supporters Roger Ver and Jihan Wu coming in tandem with public praise from Ethereum creator Vitalik Buterin.

As BCH approached its highest-ever point Nov. 11, Buterin delivered his “congratulations” to Ver on Twitter, adding it was a “key reason why he is now so confident in crypto.”

With BTC dominance reduced every time, I think we’re entering a new stage of diversification! Congrats indeed @VitalikButerin – for leading the age of diversification!

A key reason why I am now so confident in crypto is precisely the fact that there are so many different teams trying different approaches.

Criticism meanwhile has focused on the ‘corporatized’ nature of BCH in contrast to Bitcoin’s decentralization, while figures involved insist the altcoin is an improvement on Bitcoin.

The project even has a CEO in the form of Finnish Pirate Party founder Rick Falkvinge, who released a statement aimed at harmonizing its structure.

“…As Chief Executive Officer of this disorganization with made-up titles, where every document is as official as people pretend it to be, I further emphasize that we cannot resolve social disputes by voting, for two reasons: first, there is no boundary on the electorate that determines who gets to vote, which creates winning by trickery rather than by argument, and second, we don’t want to vote anyway.”

But that is all over for now…

As Bitcoin soars back above $6600…

 

Leaving Bitcoin Cash about half the market cap of Ethereum once again…

So what happens next?

end

 

Again, the London Financial times refuses to ask the right questions on questionable gold trading by central banks

(courtesy London’s Financial Times/GATA)

Shilling for Bundesbank, FT avoids key questions about gold

 Section: 

10:34a ET Saturday, November 11, 2017

Dear Friend of GATA and Gold:

Yesterday the Financial Times continued its campaign to persuade the world that nothing deceptive is going on in the gold sector, publishing a long article lauding the German Bundesbank and its board member, Carl-Ludwig Thiele, for flawlessly arranging the repatriation of some of the central bank’s gold from London, Paris, and New York.

At least the article, appended here, quotes the founder of Germany’s “Repatriate Our Gold” campaign, Peter Boehringer, who just has been elected to the country’s parliament, the Bundestag, from the Alternative for Germany list. Boehringer notes the Bundesbank’s long resistance to transparency about the national gold reserves and the FT declines to call him a Nazi, an epithet risked by anyone in Europe who questions central banking and uncontrolled immigration.

 the FT’s article concludes with a somewhat rueful comment from Thiele: “We’re the most transparent of all the central banks about our holdings of gold and there are still more questions. With gold there are always more questions.”

But central banks can count on the Financial Times not to ask those questions — starting with questions about the surreptitious swapping and leasing of gold done by central banks and their constant interventions in the gold market to prevent free markets from breaking out anywhere in the world.

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

* * *

How Germany Got Its Gold Back

By Claire Jones
Financial Times
Friday, November 10, 2017

https://www.ft.com/content/4edf00ee-a43c-11e7-8d56-98a09be71849

When Carl-Ludwig Thiele was 11, his aunt gave him a 21-carat gold coin as a gift. “It was an incredible feeling to own it. I still have it now and can picture it. There is an image of Pope John XXIII on one side, and on the reverse an image of the Holy Ghost floating above the bishops.”

In the five decades since receiving that coin, Mr Thiele — tall and forthright with a liveliness in his face when the subject switches to bullion — has risen high in Germany’s state bureaucracy. He served 20 years in parliament before making the switch from Berlin to Frankfurt to sit on the executive board of the Bundesbank, the country’s central bank and custodian of its gold.

Today, Germany is one of the biggest holders of gold in the world: it owns 3,378 tonnes, worth E119 billion, second only to the United States. But until recently, most of that gold was stored in New York, London and Paris. When the country decided to bring half of its gold back home, Mr. Thiele was put in charge.

Over the past five years, he has masterminded the transportation of almost 54,000 gold bars — each with a value of just under $510,000 — to Frankfurt, Germany’s financial capital, moving $27 billion (in today’s prices) from the vaults of the U.S. Federal Reserve and the Banque de France. The last bars arrived at the Bundesbank’s headquarters, a few kilometres north of Frankfurt’s city centre, in August. But how Germany’s gold came to be abroad is a story that goes back to the second world war and beyond.

* * *

Germany has a stronger relationship with gold than most nations. The country’s experience with hyperinflation between 1919 and 1923, during the years of the Weimar Republic, is ingrained in the national consciousness. Gold, above all, stands for stability.

During the second world war, Nazi Germany looted gold from central banks across Europe. The Reichsbank stored more than 3,700 kilograms (4.1 tonnes) of this stolen gold through the Bank for International Settlements in Switzerland. By the time the Allies, through the Tripartite Commission for the Restitution of Monetary Gold, recovered it in 1948, Germany’s state coffers were bare.

It was during the Wirtschaftswunder — the economic miracle of the 1950s and 1960s — that West Germany began to stockpile large amounts of gold. The country’s export surpluses meant businesses were flush with dollars, which were swapped at the central bank — initially the Bank deutscher Länder, then, from 1957, its successor the Bundesbank — in return for Deutschmarks. Under the Bretton Woods system of fixed exchange rates that then underpinned global finance, the Bundesbank could use the dollars to purchase gold at the rate of $35 an ounce, storing most of its holdings in the New York Fed’s underground stores on Liberty Street. In 2012, just before the move began, just over 1,500 tonnes of German gold was stored there.

Frankfurt was not much more than 100 kilometers from the border with Soviet-controlled East Germany, so with the threat of Russian invasion, West Germany kept bullion built up before the collapse of Bretton Woods in the early 1970s abroad. “During the cold war, the threat came from the east, so it made sense to store it further west, in Paris, London or New York,” says Mr. Thiele. After the fall of the Berlin Wall in 1989 and the collapse of the Soviet Union in 1991, that rationale disappeared.

It was another decade before the Bundesbank began to repatriate its gold, however. In the early years of the new millennium, it moved 930 tonnes, worth about $40 billion today, from the vaults beneath the Bank of England’s Threadneedle Street base in the City of London back to Frankfurt, after the Bank increased its rents. That move, shrouded in secrecy owing to security concerns, came as pressure mounted on the Bundesbank to reveal more about the nation’s reserves.

Ten years later the Bundesrechnungshof, Germany’s federal accounting office, and members of the German parliament, the Bundestag, began asking questions about the country’s gold. Lawmakers wanted to know where the gold was stored, calling on the central bank to provide an inventory of the bars in its possession.

More controversial was a public campaign spearheaded by Peter Boehringer, a former asset manager who this year became a member of parliament representing the Eurosceptic Alternative for Germany (AfD) party. “Initially we weren’t taken seriously. We wrote to the Bundesbank, but we got standardised, worthless answers. We didn’t get any answers, so we had to go public,” Mr. Boehringer says. “We had attention from online media, then the international media. We are the owners; we’re talking about E100 billion of public assets.”

Mr. Boehringer believes that Germany needs its gold back for more than symbolic reasons. The European Central Bank’s aggressive response to the global financial crisis has, he says, made cash worthless. “People are always interested in gold, but we live in a time when central banks are running amok. In 1971 all currencies were linked to gold. That’s no longer the case, and the behavior of central banks is ridiculous. More and more people can see that.”

The Bundesbank denies that Mr. Boehringer’s campaign spurred its decision to bring the gold home. It also denies accusations by gold bugs (those bullish on gold as a commodity) that the German gold has disappeared from the New York Fed’s vaults. Mr. Thiele says he has seen it twice, in 2012 and 2014. “It is there. And it was never a problem to see it or have it transported to Germany.”

* * *

Gold’s appeal has risen in tandem with turmoil throughout history. Many economists agree with John Maynard Keynes’ attack on linking gold and paper money as a “barbarous relic” of a bygone era. The link was abandoned in the 1970s, when the Bretton Woods system ended. Some nations have sold much of their gold since.

Yet when markets become choppy or heads of state turn warmongers, bullion lures back investors. During the most recent global financial crisis, the price rose from around $650 an ounce in the spring of 2007 to a peak of more than $1,800 in summer 2011.

Other central banks have reacted to unrest by storing gold abroad too, although their methods of transportation have, in many instances, created considerable risk. During the first week of July 1940, the Bank of England had gold worth L200 million ($18 billion in today’s prices, according to the World Gold Council) on liners in transit over the Atlantic. If any of those ships had sunk, the bank would not have received a penny in return for the loss of almost 41,000 bars, because the shipments were irreplaceable and thus uninsurable.

* * *

In January 2013 the Bundesbank revealed where its gold was stored and announced the plan to move half of it home. The bank has refused to divulge how the 53,780 bars were transferred, but bullion transportation has moved on from the era of ocean liners.

People familiar with the field say it was most likely that the gold was flown from Paris and New York back to Frankfurt. Road transportation may have been tried but is unlikely to have been used frequently. Moving the gold 600 kilometers from the Banque de France’s vaults in the middle of Paris to the Bundesbank would put drivers at risk, and the bars are often too heavy to be moved in substantial volumes. While a bar of gold takes up less space than a litre of liquid, each weighs about 12.5 kilograms.

Once the Bundesbank had decided to move its gold, lawyers then had to scour contracts to insure it against being lost in transit. Many insurers pay out only in dollars, rather than the precious metal, potentially leaving the central bank on the hook if the price of gold were to rise between the contract being signed and the bullion arriving safely in the Bundesbank’s vaults.

More than 4,400 bars transferred from New York were taken to Switzerland, where two smelters remoulded the bullion into bars that meet London Good Delivery standards for ease of handling. The London market requires gold bars to look as they do on the silver screen — the technical name for the shape is a trapezoid prism — as their sloping edges make the bars easier to pick up than New York bars, which are shaped like simpler-to-store bricks.

The whole exercise cost E7.6 million. All the bars returned from both New York and Paris were checked by an in-house team of between five and eight people. The team assessed the purity using X-ray techniques, and by weighing the bars. In October 2015 the bank published a list (since updated annually) with specific details of all of the gold it held. The gold still abroad is in London — the world’s biggest bullion market — and New York, which remains an important location because of the U.S. dollar’s status as a global reserve currency. Germany currently has no plans to repatriate it.

* * *

It is a sunny day in late October and light streams through the large windows of a room on the Bundesbank’s executive floor. The views stretch across the city’s skyline and beyond to the forests that surround the south of the city. But my attention is fixed on the five gold bars before me.

Together they are worth E2.2 million, and I imagine all the fun — the exquisite food, the plush properties, the lavish holidays — one could buy with that or the jewellery one could make. It seems a shame to keep the wealth locked up, out of sight, in a form no one will use. Yet these bars — each with slight differences in shape and weight, some dating back to the 1950s — hold an allure.

Mr. Thiele remarks on the attention that surrounded the operation. When the move was completed earlier this year, it made front-page headlines and filled prime slots on evening news broadcasts. “There is a lot of public interest,” he says, with some understatement.

It is a strange sensation to pick up gold for the first time. The surfaces of the Bundesbank’s bars are unpolished, each with its own distinct branding and scratches — signs of the metal’s malleability. Its colour gives it a certain appeal, but it is not until you feel the weight of it — the bars are hard to hold for more than a few seconds — that you begin to understand why.

According to the pictures, the walls and shelves of the Bundesbank’s vaults are gray, in keeping with the design of the headquarters, a Brutalist 13-storey concrete slab built long and narrow like a ship. But we are denied access and the gold will remain out of public view — a decision that Mr. Thiele acknowledges will fuel suspicions about whether half of Germany’s gold has really come home.

“We’re the most transparent of all the central banks about our holdings of gold and there are still more questions. With gold there are always more questions.”

END

Greg Mannarino tells Greg Hunter that central banks with their cohort banks are rigging all markets and central to the rigging is gold and this prevents real market price discovery.

(courtesy Mannarino/Greg Hunter)

 

‘Nothing is real,’ analyst Mannarino tells USAWatchdog’s Hunter

 Section: 

10:10a ET Sunday, November 12, 2017

Dear Friend of GATA and Gold:

Market analyst and trader Greg Mannarino, interviewed by USAWatchdog’s Greg Hunter, says central banks and allied investment banks are rigging all markets, including the gold market, to prevent free-market price discovery.

Mannarino sees signs that the bond market is about to get away from them but for the moment, he says, “Nothing is real.”

Mannarino adds that he has filed with the U.S. Securities and Exchange Commission a complaint about gold market rigging and encourages his readers to copy his complaint and send it to the SEC as their own.

He encourages people to begin to transact financially outside the central bank-controlled system by using gold, silver, and bitcoin.

Hunter observes that central bank smashes to the gold price, like Friday’s, seem to be losing impact.

Mannarino’s interview is 35 minutes long and can be viewed at USAWatchdog here:

https://usawatchdog.com/running-straight-into-worst-case-scenario-gregor…

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

END

This is very scary for us:  the BIS use of gold swaps have been rising substantially throughout these past several months and it rose substantially in October.  It is now 570 tonnes a gain over 70 tonnes over September. This is the gold that bankers use in their raids.  It seems that the raiding of gold and silver is having less effect

(courtesy Robert Lambourne/GATA)

 

Robert Lambourne: BIS gold swaps rose substantially in October

 Section: 

By Robert Lambourne
Sunday, November 12, 2017

Disclosures in the October statement of account published by the Bank for International Settlements indicate that during October the bank increased substantially its use of gold swaps and other gold-related derivatives

See —

https://www.bis.org/banking/balsheet/statofacc171031.pdf

— or:

http://www.gata.org/files/BISStatementOfAccount-October-31-2017.pdf

The information provided in the BIS monthly statement of account is not sufficient to calculate a precise amount of gold-related derivatives, including swaps, but it appears that the total exposure has risen above 570 tonnes of gold as of October 31.

This compares to an estimate of close to 500 tonnes as of August 31 and an audited figure of 438 tonnes as of March 31.

This is the BIS’ highest level of gold swaps recorded since the bank began reporting the use of gold swaps in its annual report for the financial year ended March 31, 2010.

A review of the previous use of gold derivatives by the BIS reveals that the transactions in the year ending March 31, 2010, were far more substantial than anything done by the bank in the years immediately before.

The use of gold swaps reported by the BIS in recent years is summarized here:

March 2010: 346 tonnes

March 2011: 409 tonnes.

March 2012: 355 tonnes.

March 2013: 404 tonnes.

March 2014: 236 tonnes.

March 2015: 47 tonnes.

March 2016: 0 tonnes.

March 2017: 438 tonnes.

As the table shows, the use of gold swaps by the BIS fell from 2013 to zero in March 2016. In the financial year ending in March 2017 a new year-end peak of 438 tonnes was reported.

In addition, while the BIS has been making record use of gold derivatives, the bank’s traditional gold banking business has been in decline, with far less gold being deposited by central banks in BIS-controlled gold sight accounts.

In March 2010 gold swaps represented just 20 percent of the gold that the BIS had placed in gold sight accounts with central banks. By March this year 59 percent of the gold placed by the BIS in gold sight accounts with central banks had come from gold swaps and other gold derivatives.

From the BIS statement of account for October 2017 it appears that gold swaps and other gold-related derivatives accounted for 66 percent of the gold the BIS had placed in gold sight accounts at central banks.

Hence gold derivatives have become the dominant source of gold used in the BIS’ banking business. But the BIS has not highlighted or explained this change.

Indeed, the BIS has offered no explanation for its renewed use of gold swaps since March 2016. By contrast, on July 29, 2010, the BIS discussed its gold swaps with the Financial Times. BIS General Manager Jaime Caruana said then that the gold swaps were “regular commercial activities” for the bank:

http://www.ft.com/cms/s/0/3e659ed0-9b39-11df-baaf-00144feab49a.html

Here are excerpts from the article:

“Some analysts speculated that the swap deals were a surreptitious bailout of the European banking system ahead of last week’s publication of stress tests. But bankers and officials have described the transactions as ‘mutually beneficial.’ …

“‘The client approached us with the idea of buying some gold with the option to sell it back,’ said one European banker, referring to the BIS.

“Another banker said: ‘From time to time central banks or the BIS want to optimize the return on their currency holdings.'”

None of these comments in the FT article focused on the gold market itself but implicitly accepted that gold was being used as collateral to support dollar loans to commercial banks.

An alternative explanation — that the swap transactions were initiated by the BIS to place more unallocated gold in the hands of certain central banks — seemed plausible, since the gold market was tight at the time.

Perhaps not coincidentally, the BIS has renewed its use of gold swaps since March 2016 just when many commentators consider gold market conditions to be tightening again, as they were in 2010 and 2011.

—–

Robert Lambourne is a GATA consultant and a retired business executive in the United Kingdom who studies the activity of the Bank for International Settlements in the gold market.


Your early MONDAY 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

 
 i) Chinese yuan vs USA dollar/CLOSED UP AT 6.6412/shanghai bourse CLOSED UP AT 15.16 POINTS .44%   / HANG SANG CLOSED UP 61.26 POINTS OR 0.21% 

2. Nikkei closed DOWN 300.43 POINTS OR 1.32%   /USA: YEN FALLS TO 113.32

3. Europe stocks OPENED  RED  /USA dollar index RISES TO  94.50/Euro DOWN TO 1.1655

3b Japan 10 year bond yield: RISES TO  . +.050/ GOVERNMENT INTERVENTION    !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 114.07/ 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::  56.83 and Brent: 63.47

3f Gold UP/Yen UP

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund FALLS TO  +.391%/Italian 10 yr bond yield UP to 1.821%  /SPAIN 10 YR BOND YIELD UP TO 1.531%  

3j Greek 10 year bond yield FALLS TO  : 5.073???  

3k Gold at $1276.95 silver at:16.88:  6 am est)   SILVER NEXT RESISTANCE LEVEL AT $18.50 

3l USA vs Russian rouble; (Russian rouble DOWN 40/100 in  roubles/dollar) 59.56

3m oil into the 56 dollar handle for WTI and 63 handle for Brent/

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

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 113.32 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  0.9944 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1589 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  +0.391%

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 2.371% early this morning. Thirty year rate  at 2.848% /

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

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

From “BTFD” To “Sell The Rip”: Global Stocks Slide, Nikkei Tumbles, Pound Plunges

 

S&P futures gave up early gains and were trading down -0.2%, as Donald Trump completes his first Asian tour and as pressure mounts on U.K. Prime Minister Theresa May, sending the pound plunging. European stocks fell, tracking many Asian shares as the Nikkei plunge accelerated.

In Europe, the Stoxx 600 fell as much as 0.4%, resuming last week’s pull-back. 17 of 19 industry groups fall, with financial services, retail and banking shares leading the selloff; the broad European index is down 2.7% from the intraday high hit on Nov. 1. The Stoxx 600 drop also triggered a key technical level, with the Stoxx 600 sliding below the 50-DMA for first time since early September, while the Stoxx 600 Bank index dropped below the 200 DMA following a downgrade of European banks by Kepler Cheuvreux.

“Nothing has changed in the past few weeks in terms of fundamentals. Investors are just looking for excuses to book some profits after what has been a pretty strong year,” Fabrice Masson, head of equities at BFT Investment Managers, told Bloomberg: “Some of the stocks have risen 50% since the start of the year. If their earnings are good but don’t show a clear acceleration in the trend, it’s tempting to just sell.”

Well, something did change: earlier in the session, investment bank Kepler downgraded European stocks to underweight, saying last week’s pull-back marks the point at which equity markets shift from “buy-on-dip” to “sell-on-strength.”

In equities, the big mover overnight was Japan, where shares slumped and the Nikkei 225 tumbled by 1.3%, down to 22,380.99, its biggest drop since April 6, as investors found no new reasons to buy after driving benchmarks to their highest in a quarter century just one week ago. The Nikkei is now down 4.3% from the intraday high on Nov. 9. The Topix index slid for a third day and the Nikkei 225 retreated for a fourth session following gains last week that pushed them to levels unseen since 1991 and 1992 respectively. A combination of solid quarterly results, positive economic data and massive foreign buying had driven the rally. U.S. shares fell Friday after U.S. consumer sentiment data unexpectedly dropped by the most in a year amid expectations for faster inflation and higher interest rates.

“Investors who were hoping for the market to stage a rebound during the day may have sold in disappointment towards the end” exacerbating the decline, said Naoki Fujiwara, chief fund manager at Shinkin Asset Management Co. in Tokyo. “With corporate results behind us and no major economic data in sight, the market is in for a tussle between those waiting to buy and those trying to take profits.” The benchmark indexes finished at the day’s lows as declines accelerated in the last half hour of trading. “Stock futures, which started declining in late afternoon, dragged down stocks and the leveraged funds,” said Mitsuo Shimizu, deputy general manager at Japan Asia Securities. Next Funds Nikkei 225 Leveraged Index ETF, an exchange traded fund product managed by Nomura Holdings Inc., fell 2.7% , the most since April 6. As investors and market observers try to gauge the extent of a downward correction in domestic equities that begun late last week, optimism has yet to fade among some participants.

“I don’t want to use the word ‘correction’ — it’s too tough to predict these markets,” Chris Ailman, chief investment officer of the California State Teachers’ Retirement System, said in a Bloomberg Television interview. Markets have gotten ahead of themselves and “I’ll call it a pause to refresh.” The yen is a concern, but the fund is very optimistic about Abenomics and in favor of Japan’s corporate governance overhauls, he added.

Elsewhere in Asia, equities also retreated, with industrial and material shares leading declines, after tax-cut pessimism weighed on U.S. equities Friday. The MSCI Asia Pacific Index declined 0.6% to 170.25, falling for a second trading day. Industrial stocks led losses, dropping the most in almost a year. Hyundai Heavy Industries Co. fell the most among South Korean shipyards after losing an offshore order to a Singapore rival. Iida Group Holdings Co. plunged by record in Tokyo after first-half results missed the company’s targets. “Uncertainties over U.S. tax cuts are prompting investors to take profit after big rallies in the last few weeks,” said Linus Yip, Hong Kong-based strategist at First Shanghai Securities.South Korea’s Kospi lost 0.5%. Hong Kong’s Hang Seng Index climbed 0.3% to close at its highest in almost a decade after reversing an earlier loss.

Curiously, the Shanghai Composite ignored the noise from its neighbors, and staged an impressive comeback, closing up 0.4% at 3,447, the highest level in 22 months, led by banks, steelmakers and chipmakers.

More interesting, however, was the plunge in China’s government bonds: the 10Y yield rose to the highest level in 3 years, while 10-yr treasury futures plunged 0.67%, the biggest since the end of October, as bond yields kept climbing and the curve kept inverting with the 5-year yield breaking 4% at one point this morning, while the 10-yr yield approaches 4%.

In FX, the big mover was the pound, which came under heavy selling pressure as the U.K.’s political and Brexit troubles mount (see below); the dollar inched modestly higher, shrugging off stronger Treasuries; Gilts pushed higher from the open, providing support as European bonds gained across the board; the euro and the yen steadied on gamma trading.

The UK Brexit drama reached new heights over the weekend. As discussed earlier, 40 Conservative MP’s are reportedly calling for UK PM May to step down. This number is 8 short of the amount required to trigger a leadership challenge Other sources also suggest that UK PM May is facing a rebellion from pro-European Tory MPs who have vowed to vote against her “crass” plans to enshrine the date the Britain leaves the European Union in law. Sources suggest that a menacing secret memo from Boris Johnson & Michael Gove to UK PM May dictating terms for a hard Brexit has triggered a new Cabinet rift. Britain must not cave in to EU demands for a bigger Brexit divorce bill after Brussels set a two-week deadline for the UK to concede, allies of Boris Johnson have warned. Brexit Secretary Davis stated that he still believes that a trade deal with the EU can be negotiated within the given timeframe. However, separately, Chief EU Brexit Negotiator Barnier noted that the EU is preparing for possible collapse of Brexit talks. 

The U.K. data won’t be the only numbers on investors’ minds. U.S. inflation and growth numbers are also on the docket, and they could be key to the Federal Reserve’s determination to lift rates next month. Talks on tax legislation may also play into market thinking; pessimism over the likelihood of successful reforms helped drag global equities down from this month’s record high late last week. Measures of equity-market volatility have risen, albeit from low levels.

Over in Catalonia, Spain PM Rajoy visited the region for the first time since the government retook control. He called on “the silent or silenced majority” voters that oppose secessionism to “convert its voices into votes” in the upcoming 21 December regional election. Further, he noted “it’s urgent to return a sense of normality to Catalonia” and that he “ask all companies that have worked in Catalonia not to leave”.

In geopolitical updates, over the weekend, President Trump tweeted that “President Xi of China has stated that he is upping the sanctions against North Korea. Said he wants them to denuclearize. Progress is being made.” North  Korea noted that US President Trump’s rhetoric will never stop North Korea from pursuing nuclear programme, as South Korea’s Foreign Minister said that North Korea needs to show signs of change before any talks occur.

Trump also says “we’ve made a lot of progress on trade” following meeting with Japanese PM Abe & Australian PM Turnbull. Trump is to issue a statement from the White House on Wednesday on his Asia trip, trade & North Korea. Reports suggest that Trump has offered to mediate over the South China sea dispute, while it was also reported that Trump & Putin have agreed to continue joint efforts in order to defeat Islamic State, and agreed
that there is no military solution for the Syrian conflict. Reports suggested that the two did not discuss north Korea.

Bloomberg reported that the Saudi King is not going to be stepping down, while on Sunday Lebanon’s PM withdrew his resignation conditional on Hezbollah committing to remaining neutral, but reports have suggested
that he is to resign in Beirut.

n rates, the yield on 10Y TSY dropped two bps to 2.37%, the largest drop in more than a week. Germany’s 10Y yield fell two basis points to 0.39 percent, also the biggest fall in a week. Britain’s 10Y gilt fell three basis points to 1.309 percent.

In commodities, gold and most industrial metals rose, and West Texas oil dropped below $57 a barrel.

Market Snapshot

  • S&P 500 futures down 0.1% to 2,578.20
  • MXAP down 0.6% to 170.26
  • MXAPJ down 0.3% to 558.68
  • Nikkei down 1.3% to 22,380.99
  • Topix down 0.9% to 1,783.49
  • Hang Seng Index up 0.2% to 29,182.18
  • Shanghai Composite up 0.4% to 3,447.84
  • Sensex down 0.8% to 33,061.20
  • Australia S&P/ASX 200 down 0.1% to 6,021.77
  • Kospi down 0.5% to 2,530.35
  • STOXX Europe 600 down 0.4% to 387.11
  • German 10Y yield fell 2.2 bps to 0.388%
  • Euro down 0.1% to $1.1649
  • Brent Futures down 0.1% to $63.43/bbl
  • Italian 10Y yield rose 3.0 bps to 1.58%
  • Spanish 10Y yield fell 2.4 bps to 1.552%
  • Gold spot up 0.3% to $1,278.27
  • U.S. Dollar Index up 0.2% to 94.58

Top Overnight News

  • Trump attends two days of meetings on regional security affairs hosted by the Association of Southeast Asian Nations before heading home
  • Sterling fell for the first time in three days; May has a bad start to the week following a Sunday Times report saying 40 of her own Conservative lawmakers have agreed to sign a letter of no confidence in her, nearly enough to trigger a leadership challenge, just days after the EU gave the U.K. two weeks to make “clarifications” so Brexit talks can advance
  • The U.K. Labour Party offered May a cross-party Brexit deal saying she’s lacking the support within her Conservative Party to deliver the Brexit she aims for
  • AT&T’s Merger Fight Is Said to Head Toward Thanksgiving Showdown
  • China Credit Growth Trails Estimates as Deleveraging Prioritized
  • Tesla Model 3 Depositors Staying Put as Wait in Line Lengthens
  • Noble Group Is Said to Lose Key Bank Prop as DBS Cuts Loans
  • Trump Hails ‘Great’ Ties With Duterte, Skirts Human Rights
  • Trump Is Shattering His Own Tweet Records With Non-Stop Barrage
  • Russian President Vladimir Putin meets Turkish counterpart Recep Tayyip Erdogan in Sochi, Russia
  • It prompted the opposition Labour Party to question her ability to deliver the Brexit transition period she’s proposed
  • Fed Bank of Philadelphia President Harker said he’s looking for another rate increase this year and the balance sheet unwind will be “boring”
  • “With a labor market this tight, inflation is likely to reassert itself at some point,” he says in text of speech in Tokyo
  • There’s been a marked turnaround in Europe’s economy. The 19-nation euro-zone bloc is already enjoying the strongest growth in a decade; economists at Credit Suisse Group AG and Oxford Economics are declaring that it’s heading toward a golden period of low- inflationary expansion
  • ECB Vice President Constancio said on Monday the recovery was broad-based, robust and resilient

Asian indices were mixed, with no fresh catalyst for a decisive move. Japan’s Nikkei 225 (-0.1%) continued to edge away from the multi decade highs set last week. Elsewhere Australia’s ASX (-0.1%) ebbed lower, while China’s Shanghai Comp. (+0.4%) and Hong Kong’s Hang Seng (+0.2%) tiptoed higher supported by a record breaking Singles’ Day event at the end of last week. Fixed income dealing was rangebound with Treasuries edging away from worst levels in a modest bull flattening move, despite FOMC voter Harker reiterating that he had pencilled in a December hike and three further hikes in 2018, inflation dependent. JGB’s moved lower as the BoJ refrained from engaging in Rinban operations today, with the long end experiencing a degree of mild underperformance. PBoC sets the CNY mid-point at 6.6347 vs. Prev. 6.6282. RBA Deputy Governor Debelle said that there is a risk that wages will stay lower for longer, although he did concede that some pockets of the economy are exhibiting wage pressure, and that he expects the recent uptick investment to last a while.

Top Asian News

  • Alibaba’s Rise Creates 10 Billionaires Not Named Jack Ma
  • Widening Citizenship Fiasco Threatens Aussie Confidence
  • Hong Kong Stocks Rise to 10-Year High as AAC Tech and AIA Jump
  • Noble Group Shares Extend Slump to 16% as DBS Said to Cut Loans

European bourses have kicked the week off modestly higher/flat (Eurostoxx 50 +0.1%) with outperformance in the FTSE 100 amid the softer GBP. In terms of sector specific moves, health care names have seen a modest bout of outperformance with Novartis at the top of the SMI following a positive drug update. Elsewhere, financial names underperform after Italian banks have seen little benefit from news on Friday that ECB can only impose capital requirements on banks to provide for bad loans on a case-by-case basis. Bunds and Gilts have slowly extended their respective recoveries from last Friday’s closes and intraday lows, the former finding traction when intraday tech support at 162.18 held, and gathering a bit of momentum when 162.34 (resistance and 50% retrace of the previous session sell-off) was surpassed. The next upside objective on some charts is the 162.50-56 area vs a  162.49 high so far, and if that is achieved then 162.73 will close a gap. Market contacts suggest that longs may not get twitchy unless Friday’s 162.13 low is breached. The 10 year UK debt future has traded up to 124.66 for a  35 tick gain on the day, and aside from short covering after the pre-weekend there has been plenty of incentive for bulls to step back in on the latest PM May/Government turmoil. US Treasuries also stabilising following recent bear-steepening that was deemed to be at least partly due to re-positioning (ie flatteners unwound).

Top European News

  • Ultra Electronics Drags Defense Stocks on CEO Ouster, Forecast
  • Four in 10 London Homesellers Cutting Prices in Tough Market
  • U.K. Labour Says May Lacks Power to Deliver Brexit Transition
  • European Stocks Downgraded, Seen as Vulnerable Zone at Kepler

In FX markets, GBP has been the main mover overnight with pressure mounting on UK PM May amidst reports of a rising rebellion within the Conservative Party ranks. Cable has now retreated through 1.3100 and bears will be targeting the post-BoE rate hike low of 1.3040, if 1.3050 is breached on the downside (reportedly an objective for one major bank). Elsewhere, the EUR is firmer vs the Greenback as the pair consolidates recent gains above 1.1650, but a confirmed topside break of the 1.1550-1.1170 range only seen if 1.1690 (21 DMA) near term chart resistance is breached. Comments from ECB’s Constancio this morning have come in on the dovish side, stating that “Much-feared inflationary pressures have not materialised, nor can they be foreseen in the immediate future”. AUD is currently capped below 0.7700 after dovish or bearish on balance comments from RBA deputy Governor Debelle (wages to remain low for some time).

In energy markets, WTI and Brent crude futures trade modestly lower with reports of an earthquake in Iraq and tensions in the Gulf
region ultimately doing little for oil prices. Additionally, press reports from over the weekend suggested that the Saudi King has no
plans to step down while the Iraqi oil minister has ordered an acceleration of repair works at the Bai Hasan and Avana oilfields near
Kirkuk; exports remain at a halt. In metals, gold prices have ticked higher in recent trade in a mild retracement of Friday’s losses.
Elsewhere, Chinese steel rebar futures were supported overnight amid output reductions in some of the nation’s lager steelmaking
cities. Finally, Chinese iron ore demand is forecast to fall by 6mln tonnes in November as China plans to curb steel production
during the winter to meet air pollution targets, according to the CISA (China Steel & Iron Association)
Oman Oil Minister says does not believe there will be deeper production cuts. (Newswires)
The Iraqi oil minister has ordered an acceleration of repair works at the Bai Hasan and Avana oilfields near Kirkuk. However,
exports remain at a halt

US Event Calendar

  • Nov. 13-Nov. 17: MBA Mortgage Foreclosures, prior 1.29%
  • Nov. 13- Nov. 17: Mortgage Delinquencies, prior 4.24%
  • 2pm: Monthly Budget Statement, est. $58.0b deficit, prior $45.8b deficit

DB’s Jim Reid concludes the overnight wrap

It’s almost a pleasure to get back to work to see what happens next after a fascinating last couple of days for markets (ok it’s all relative). Although 2016 marked a turning point for our structural view on rates and inflation (higher) due to populism (more fiscal), peak QE, demographics (peak labour supply around middle of this decade), and perhaps peak regulation, we must admit that the dovish taper from the ECB over two weeks ago made us wonder whether the next leg to our trade might delayed for a few months. We still felt the unfunded US tax cut was under-priced by markets which was still the main avenue for higher yields. However up until Wednesday evening everything was becalmed – equities continued to hit new record or multi-year highs, bonds were moving towards multi-month lows in yields and volatility was low again with the VIX back below 10 and the MOVE index (Treasury vol) back down around all-time lows. Then Thursday started with a wild (in today’s terms) swing in the Nikkei and we then saw a rare simultaneous sell-off in equities, rates and spreads.

Just for ease, below we’ll detail the 2-day sell off in a number of assets with Friday’s move in brackets. All bond market moves are 10yr yields. USTs +6.4bp (+5.7bp), Bunds +8.4bp (+3.5bp), Gilts +11.7bp (+7.9bp) and BTPs +9.9bp (+3bp). In equities, DAX -1.91% (-0.42%), CAC -1.66% (-0.50%), FTSE -1.28% (-0.68%), FTSE-MIB -1.18% (-0.36%), and the Bovespa -2.96% (-1.05%). In credit, Crossover +10.6bp (+1.4bp) and CDX HY +8.2bp (+1.1bp).
Obviously these moves are still relatively small in the greater scheme of things and only bring us back to levels days before rather than months before in most indices (HY US ETFs an exception as back to March levels) but the suddenness of the move without warning or catalyst has provoked a lot of attention. The blame has been placed on the following factors, none of which fully explain the reversal but are worth highlighting. Weak EMFX and (US) HY over the last few weeks, continuous flattening of global yield curves since the ECB meeting, difficulties in the tax reform plan, and Saudi tensions from last weekend and the associated rise in Oil that this has encouraged.

Indeed Oil is up 9.3% over the last three weeks and up 30.4% since the lows in June. Maybe with this rise in Oil, 10 year Bunds shouldn’t be flirting with 30bps as they did on Wednesday regardless of the ECB. Given these moves, this week’s inflation numbers are the perfect opportunity for things to calm down or volatility to continue to pick up. The most significant is the October CPI report in the US on Wednesday. The consensus is for a small +0.1% mom lift in the headline and +0.2% mom lift in the core. Remember though that the latter has missed relative to market expectations in six out of the last seven months. We think we may see more positive surprises in 2018 but not necessarily yet. Also due this week will be final October CPI revisions for Germany and the UK tomorrow, France on Wednesday and the Euro area on Thursday. In the UK the older inflation measure RPI is expected to go above 4% for the first time since December 2011. Looking further back, since May 1992 we’ve only seen RPI above this level for 42 months (13.8% of the time) out of the last c25 years. Meanwhile even with the late week Gilt sell off, 10-year yields remain at a lowly 1.34%. Not a brilliant real return potential in our opinion!

So inflation is the big thing this week but we’ll also see Euroarea Q3 GDP tomorrow although no change from the +0.6% qoq flash print is expected. Also tomorrow China sees its monthly bulk activity numbers and US retail sales is out on Thursday. As you’ll see in the week ahead at the end its a packed week for central bank speakers with the highlight being tomorrow’s ECB policy panel discussion in Frankfurt which includes a star studded line up with the ECB’s Draghi, Fed’s Yellen, BoE’s Carney and BoJ’s Kuroda all participating. Elsewhere Mr Trump’s Asia tour comes to an end in the first half of the week where he will attend the East Asia Summit to discuss strategic political and security issues in the region and tomorrow Mrs May’s Brexit legislation is the subject of two days of examination in the House of Commons. The full day-by-day week ahead is available at the end and a reminder that our  new “Next Week… This Week” document from Friday includes all this and an easy to read cut-out and keep of all upcoming events.

Now on to the US tax plan, the House’s version of the tax bill is expected to go to a full House vote this week (either Thursday or Friday), while the Senate’s plans will begin its mark-up process today with an expectation for a full senate vote before 23 November. Over the weekend, there was more rhetoric across the spectrum. The House and Means Committee Chairman Brady noted he will not budge on certain things, noting that “I’m committed to” a compromise that would preserve the deduction for state and local proper taxes vs. the Senate’s plans which expect a full elimination. Elsewhere, President Trump’s top economic adviser Gary Cohn said he expects the tax bills go to a conference committee that reconciles differences between the House and Senate versions before returning a report to both chambers for final passage. He noted that the conferees “will decide what stays and what goes” and they’ll pick and choose the different parts that they think are important”. Indeed, it feels like both versions of the tax plans are opening gambits and the hard work begins when the bills are reconciled. Our US economist believes there is a decent chance that some version of tax reform can be achieved, but this is likely to be a Q1 event with potential stumbling blocks along the way.

In the UK, the Sunday Times reported that 40 Conservative MPs have agreed to sign a letter of no confidence in the UK PM, almost enough to trigger a leadership challenge (need eight more MPs). This morning, Sterling is down 0.56% against the USD and as mentioned earlier, PM May’s Brexit legislation will be debated in the House of Commons this week.

This morning in Asia, markets are mixed. The Nikkei (-0.68%), Kospi (-0.45%) and ASX 200 (-0.24%) are down modestly, while Hang Seng is up 0.17% as we type. Elsewhere, Bitcoin has dropped -10.21% this morning (c17% in two days), in part as Bloomberg reports that traders are buying its alternative instead (Bitcoin cash). Over in Japan, the October PPI was above expectations at 0.3% mom (vs. 0.1% expected) and 3.4% yoy (vs. 3.1% expected).

Now briefly recapping other markets performance on Friday. US bourses softened and posted its first down week since September (-0.21%) amid uncertainty over US tax reforms. The S&P (-0.09%) and Dow (-0.17%) fell slightlywhile Nasdaq was virtually flat. Within the S&P, modest gains in the consumer staples and telco sector were more than offset by losses from energy and healthcare names. The US dollar index dipped 0.06%, while Euro and Sterling gained 0.20% and 0.39% respectively. The VIX jumped 7.52% and was up 23.5% for the week at 11.29.

Despite the pull back in US equities last week, our global asset strategists remain bullish. They note the duration of the equity rally “without” a typical 3-5% pullback has been very unusual. Further the speed and the size of the current rally have not been unusual and that while multiples are high relative to their historical averages, they are in line with their historical drivers. Overall, they see S&P 500 EPS growth of 11% in 2018, supported by stable robust US growth, a pickup in global growth and assuming a range bound dollar. At 19.5x PE, they have an S&P target of 2850 for 2018 but expect more regular (3%-5%) pullbacks to resume next year. Refer to the link for more details.

Over in Catalonia, Spain PM Rajoy visited the region for the first time since the government retook control. He called on “the silent or silenced majority” voters that oppose secessionism to “convert its voices into votes” in the upcoming 21 December regional election. Further, he noted “it’s urgent to return a sense of normality to Catalonia” and that he “ask all companies that have worked in Catalonia not to leave”.

Back to China’s financial sector liberalisation measures announced back on Friday, including: i) foreign investors can own controlling stakes (51%) in local securities JVs, ii) removing restriction that foreign companies can only own less than 20% of a Chinese bank and iii) allowing foreign insurance companies to own up to 51% of local individual insurance company 3 years from now (100% in 5 yrs). Our China Chief economist notes that this is a big step toward opening up the service sector to the world and consistent with the message from the 19th Party Congress. They expect the reform will help to promote FDI inflows and offset some of the capital outflows. Refer to the link for more details.

Before we take a look at the calendar, we wrap up with other data releases from Friday. In the US, the November University of Michigan consumer confidence was lower than expectations at 97.8 (vs. 100.8). At the end of last week, the Atlanta Fed’s GDPNow estimate of 4Q GDP growth was 3.3% saar while the NY Fed’s Nowcast estimate sits at 3.2% saar.

In the UK, the macro data was above expectations. The September IP was 0.7% mom (vs. 0.3% expected) – the 6th consecutive month gain, leading to annual growth of 2.5% yoy (vs. 1.9% expected). Elsewhere, manufacturing production also beat at 0.7% mom (vs. 0.3% expected) and 2.7% yoy (vs. 2.4% expected). In France, the September IP slightly beat at 0.6% mom (vs. 0.5% expected) and 3.2% yoy (vs. 3.1% expected), but manufacturing production was lower than expected at 0.4% mom (vs. 0.8%) and 3.1% yoy (vs. 3.4% expected). Italy’s September IP also disappointed, at -1.3% mom (vs. -0.3% expected) and 2.4% yoy (vs. 4.8% expected).

3. ASIAN AFFAIRS

i)Late SUNDAY night/MONDAY morning: Shanghai closed UP 15.16 points or .44% /Hang Sang CLOSED UP 61.26 pts or 0.21% / The Nikkei closed DOWN 300.43 POINTS OR 1.32%/Australia’s all ordinaires CLOSED DOWN 0.12%/Chinese yuan (ONSHORE) closed UP  at 6.6412/Oil DOWN to 56.83 dollars per barrel for WTI and 63.47 for Brent. Stocks in Europe OPENED  RED  .  ONSHORE YUAN CLOSED UP AGAINST THE DOLLAR AT 6.6412. OFFSHORE YUAN CLOSED WEAKER TO THE ONSHORE YUAN AT 6.6533  //ONSHORE YUAN  STRONGER AGAINST THE DOLLAR/OFF SHORE STRONGER TO THE DOLLAR/. THE DOLLAR (INDEX) IS STRONGER AGAINST ALL MAJOR CURRENCIES. CHINA IS NOT  VERY HAPPY TODAY.

3a)THAILAND/SOUTH KOREA/NORTH KOREA

NORTH KOREA//SOUTH KOREA

As a show of force for the first time in 10 years, the USA has put 3 carriers next to the North Korean/Soth Korean peninsula

(courtesy zerohedge)

For The First Time In A Decade, US Puts On 3 Carrier “Show Of Force” Next To North Korea

Three US nuclear-powered Nimitz-class aircraft carriers representing nearly $30 billion of advanced military hardware put on show of force in the Western Pacific Ocean over the weekend, the first time three of the 100,000-ton behemoths have sailed together in a decade. Amidst heightened tensions with North Korea the USS Ronald Reagan, USS Nimitz, and the USS Theodore Roosevelt are currently engaged in a four day war games exercise which will link up with allies Japan and South Korea, who are also participating.

The last time three US aircraft carrier strike groups worked together in the Western Pacific was off the US island of Guam in 2007, according to a Navy statement.

The USS Ronald Reagan, USS Theodore Roosevelt and USS Nimitz and their multi-ship strike groups are participating in the four days of exercises, which are expected to end Tuesday.  A South Korean Defense Ministry official said the three US carriers held drills on either side of the waters separating the Korean Peninsula and Japan. Exercises closest to the Korean coast involved US and South Korean ships, while those closest to Japan involved US and Japanese ships, the official said.


Image source: US Navy

“Multiple carrier strike force operations are very complex, and this exercise in the Western Pacific is a strong testament to the US Pacific Fleet’s unique ability and ironclad commitment to the continued security and stability of the region,” Adm. Scott Swift, the commander of the US Pacific Fleet, said in a statement.

“We sent three of the largest aircraft carriers in the world (to the Korean Peninsula) and a nuclear submarine is also positioned,” US President Donald Trump said after his arrival in South Korea last week.


Images dated November 12 and posted by the US Navy’s 7th Fleet.

Though the Navy says the drills are meant to showcase its “unique capability to operate multiple carrier strike groups as a coordinate strike force effort,” the three-carrier strike force is no doubt meant to send a signal of overwhelming military might to North Korea’s Kim Jong-Un.  


Image source: US Navy

The full deployment of US naval forces around the globe is shown in the following map courtesy of Stratfor:

Ironically, on the very day the drills were formally launched President Trump tweeted the following from Vietnam where he was attending the APEC Summit while in the midst of a 12-day, five-nation trip to Asia:

Why would Kim Jong-un insult me by calling me “old,” when I would NEVER call him “short and fat?” Oh well, I try so hard to be his friend – and maybe someday that will happen!

As we’ve observed many time before, the possibility of a war between the US and North Korea seems just one harshly worded tweet away, and the window of opportunity for a diplomatic solution, as well as for the US stopping Kim Jong-Un from obtaining a nuclear-armed ICBM closing fast, analysts have started to analyze President Trump’s military options, what a war between the US and North Korea would look like, and what the global economic consequences would be.

The rarity of seeing this many Nimitz-class supercarriers at once – especially at this moment of extreme tension – is perhaps a sign that we are inching toward such an unthinkable and unpredictable war. The drill constitutes the first time in a decade that a three-carrier strike force has been deployed to the region and various reports have acknowledged the build-up of this many carriers as “unusual”.


The USS Ronald Reagan maneuvers along the coast toward the port at Busan, Republic of Korea in October. Image source: US Navy

South Korea’s role in the drills are summarized as follows:

Following the bilateral JMSDF-US Navy exercise, the carriers strike groups linked up with seven Republic of Korea Navy (ROKN) warships including two Aegis guided missile destroyers for war games meant to deter North Korea. “The combined drills are to present our resolve and will to deter North Korea’s provocations and retaliate if provoked,” Yonhap news agency quoted a South Korean official as saying.

Meanwhile, the Korean Central News Agency, North Korea’s official media outlet, issued a statement on November 11, accusing the United States of an unnecessary provocation which could trigger an arms race. “The U.S. efforts to expand its military influence in Asia-Pacific and the movement of big neighboring powers to contain it escalate the military tension and increase arms race in the region with each passing day,” it said.

KCNA also said that the presence of the three carriers was part of Washington’s “sinister intention to maintain military hegemony in the region.”

North Korean government officials told CNN’s Will Ripley in Pyongyang last week that the US was increasingly taking action that could “ignite another Korean War.”

“Nobody knows when and how the ‘war maniac’ Trump will ignite the ‘wick of war,'” the officials said, referring to the presence of the carriers near the peninsula.

One hopes that the only time the world witnesses such a rare group deployment of three nuclear-powered US carrier is during drills, especially since the next sighting could mean the world has already plunged into war… even if it means providing the enemy with the most convenient target possible, one that would inflict more military damage on the US than any in history.

3b) REPORT ON JAPAN

3C   CHINA REPORT.

 

SUNDAY/BARCELONA SPAIN

We are going to see more of this:  750,000 protesters line the streets of Barcelona as they demand the release of those political prisoners that tried for Catalonia to secede from Spain

(courtesy zerohedge)

(courtesy zerohedge)

Pound Tumbles As Theresa May Faces Leadership Challenge Over Brexit Chaos

It might be a modest exaggeration it to say that Theresa May’s position as Prime Minister is doomed, but that is the general direction as the newsflow for the British PM remains overwhelmingly bad. Scandals aside, May seems to be falling into the growing gulf between Conservative MPs who are pushing more strongly for a “hard” Brexit as negotiations with the EU founder and those who are increasingly alarmed at the prospect, making them more desperate to ensure a softer Brexit.

After Theresa May delivered her “disastrous” conference speech in Manchester on 5 October 2017, there was press speculation that between 30-35 MPs in her party were prepared to sign a letter supporting a no confidence vote in the Prime Minister. Since then, we’ve seen the resignation of two of her ministers due to different scandals, continued party infighting and lack of progress on Brexit negotiations. And, according to articles in the weekend press, this number of party rebels has risen to forty, leaving her eight short of facing a potential leadership challenge if she lost a no confidence vote. From Sky News:

Forty Conservative MPs are reportedly prepared to sign a letter of no confidence in Theresa May, amid claims she is being held “hostage” by two members of her top team. The disclosure in the Sunday Times will pile the pressure on the Prime Minister as she enters a crucial period in the Brexit negotiations and comes as she attempts to steady the ship following the resignations of two Cabinet ministers. The total is eight short of the number needed to trigger a leadership contest under Conservative Party rules. There was a mixed reaction to the news from prominent Tory MPs. “I have not heard this”, one told Sky News, while another said the 40 figure “doesn’t sound right”. But others said it was “around that number” and it “probably is (accurate)”.

A report in the Independent quoted a “senior Tory MP” who told the newspaper.

“Patience is wearing very thin and in some cases, it has snapped.”

Compounding May’s woes, a “secret” letter from two of her most senior (and controversial) ministers seeming to instruct her on how to pursue a “hard” Brexit was published in the press. The letter is titled “EU Exit – Next Steps” and ironically marked “For your and Gavin’s eyes only”, which refers to May’s Chief of Staff, Gavin Barwell. The letter is being characterised as a “soft coup” attempt by the ministers, whose falling out after the Brexit referendum paved the way for May to become prime minister. According to The Independent.

A secret letter from Boris Johnson and Michael Gove giving Theresa May instructions on how to orchestrate a hard Brexit has emerged. The memo demands the Prime Minister, who looks increasingly fragile following the departure of two of her Cabinet ministers in as many weeks, “underline her resolve” for leaving the European Union, according to The Mail on Sunday. The letter also sets out a date for transition arrangements between the EU and UK to end of 30 June 2021, the newspaper said. Mr Johnson and Mr Gove are also said to have urged the Prime Minister to ensure members of her top team fall behind their Brexit plans by “clarifying their minds” and called for them to “internalise the logic”.

The leaked letter appears to make a thinly veiled attack on Chancellor Philip Hammond, who backed remain and wants a softer Brexit, for lacking the “sufficient energy” in preparing to the UK’s future outside the bloc. A senior Government source told the Mail the Foreign Secretary and Environment Secretary had conducted a “soft coup” and described Ms May as “their Downing Street hostage”.

It states: “Your approach is governed by sensible pragmatism. That does not in any way dilute our ambition to be a fully independent self-governing country by the time of the next election. If we are to counter those who wish to frustrate that end, there are ways of underlining your resolve. We are profoundly worried that in some parts of Government the current preparations are not proceeding with anything like sufficient energy. We have heard it argued by some that we cannot start preparations on the basis of ‘No Deal’ because that would undermine our obligation of ‘sincere co-operation’ with the EU. If taken seriously, that would leave us over a barrel in 2021. We all want you to push your agenda forward with confidence and have your Government articulate the following…” The letter suggests both men have set aside their differences following last year’s Tory leadership contest, when Mr Johnson dramatically ruled himself out of the race after Michael Gove’s shock entry into the contest.

Sensing an opportunity to capitalize on May’s increasingly weak position within her own party, the opposition Labour Party offered to work with the Prime Minster to achieve a softer Brexit. From Bloomberg.

The U.K. Labour Party accused Theresa May of lacking the support within her Conservative Party to deliver a Brexit that will protect jobs, offering her a cross-party deal that will only add to pressure on the embattled prime minister. Keir Starmer, the party’s Brexit spokesman, wrote to May on Monday telling her there was a “sensible majority” in Parliament to secure a two-year transition deal for after Brexit. That would allow Britain to stay inside the European Union’s single market and customs union after 2019 while it completes trade talks with the bloc. He said the opposition to such an arrangement came from Conservatives. “Over recent weeks, it has become increasingly clear that you alone do not have the authority to deliver a transitional deal with Europe and to take the necessary steps to protect jobs and the economy,” Starmer wrote in the letter, which was released by his office. May is unlikely to welcome Labour’s offer, which highlights the fragility of her position.

To make matters worse, the debate on Brexit legislation – a.k.a. the EU Withdrawal Bill – kicks off again in Parliament tomorrow. The debating process will be agonizingly slow, taking eight days to discuss hundreds of proposed amendments, many from May’s own party who are trying to maintain close links with the EU.

The threat to May’s leadership has trickled down through to the markets, and seen Sterling fall by as much as 1.0%, below 1.3070 against the dollar, in early trade, sliding the most in a week on concern May’s authority was at risk from a potential leadership challenge with only a fortnight before the government needs to show “sufficient progress” on Brexit.

According to Bloomberg, which cited to traders in London, leveraged accounts were aggressively selling the pound. The yield on 10-year U.K. government bonds fell 2bps to 1.32%. The FTSE 100 rose marginally as Sterling assets were re-priced.

Aside from May suddenly offering a sweetened deal to the EU – and she must be tempted – we would be surprised if the number of Conservative MPs prepared to sign a declaration of no confidence isn’t closing in on the critical threshold of forty-eight by the end of the debate.

 

end

A must read..

David Stockman explains the global bond bubble including the Junk bond yields at 2.42%. The bubble must burst and it will leave those holding the bag enormous losses

(courtesy David Stockman/ContraCorner)

 

 

5. RUSSIA AND MIDDLE EASTERN AFFAIRS

On Friday, Bahrain experienced  a huge fireball explosion in its  major oil pipeline.  Bahrain blamed Iran as the Bahranian dollar plummets. Bahranian may have to declare bankruptcy.

(courtesy zerohedge)

 

“This Is A Dangerous Iranian Escalation”: Bahrain Blames Pipeline Explosion On Iran, Terrorists

There was something odd about Friday’s night’s explosion of an oil pipeline belonging to Bahrain’s state-run oil company BAPCO, which local authorities initially said was the result of an accident: as we said, the giant fireball had all the hallmarks of either sabotage or a terrorist event, the only question is whether it was real or staged, and who would ultimately be blamed for it.

This video circulating on social media shows an  pipeline explosion in Bahrain. It look Nms Bahrain to Saudi Arabia

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

 : Huge  resulted in a gas pipeline explosion in  while ago. (exact cause yet to be confirmed)

We didn’t have long to wait for the answer: on Saturday Bahrain government claimed the blast was a “terorrist act” directed by Iran.

In a statement on Twitter, the Bahrain Ministry of Interior said that “evidence gathered by the inspection team confirms that this was an intentional act undertaken by terrorists intending to undermine the security of the Kingdom” with Bahrain’s interior minister, Sheikh Rashid bin Abdullah Al Khalifa, adding that the blast was “the latest example of a terrorist act performed by terrorists in direct contact with & under instruction from, Iran.

PT: Evidence gathered by the inspection team confirms that this was an intentional act undertaken by terrorists intending to undermine the security of the Kingdom

PT: HE Minister stressed this is latest example of a terrorist act performed by terrorists in direct contact with & under instruction from, Iran. Reaffirmed MOI’s utmost priority is the safety & security of all citizens, & MOI will spare no effort to maintain public safety

Bahrain’s Foreign Minister Khalid bin Ahmed Al Khalifa later tweeted that the explosion had targeted a pipeline running between the island nation and neighboring Saudi Arabia, which provides financial and security support to the kingdom.

“This is a dangerous Iranian escalation aimed at terrorizing citizens and damaging the world’s oil industry,” the minister tweeted.

محاولة تفجير أنبوب النفط السعودي البحريني هو تصعيد إيراني خطير هدفه ترويع المواطنين و الاضرار بصناعة النفط في العالم 

In a carefully orchestrated escalation, one largely staged for public consumption purposes, also on Saturday Saudi Arabia said it was suspending pumping oil to Bahrain following the pipeline blast. The Saudi energy minister also said it had increased security precautions at all facilities following the Bahrain blast. Which, for the cynics out there, means a “pipeline explosion” in Saudi Arabia, one which will also be blamed on Iran-guided terrorists, is likely imminent.

While Iran had no immediate comment Saturday, it has long denied being behind Bahrain’s militant groups.

The explosion damaged cars and nearby buildings, forcing firefighters to evacuate those close to the flames in Buri, just outside of the capital, Manama. Authorities later extinguished the blaze on the pipeline belonging to the state-run Bahrain Petroleum Co. While no one was injured in the explosion late Friday night near the Shiite village of Buri and no militant group immediately claimed the blast, Bahrain’s reaction which was the latest to scapegoat Iran for the plethora of problems to hit the Gulf region, opened a new front in the low-level insurgency plaguing Bahrain since its 2011 Arab Spring protests.

Bahrain, which is a critical Gulf nation to regional US strategic interests as it is home to the U.S. Navy’s 5th Fleet, faces occasional attacks from local Shiite militant groups as the kingdom ruled by the Sunni Al Khalifa family continues a crackdown on all dissent, imprisoning or forcing politicians and activists into exile. Independent news gathering there has grown more difficult, with the government refusing to accredit two AP reporters and others .

However, as AP notes, that previous campaign of bombings and shootings had not seen the island’s oil infrastructure targeted, even immediately after Emirati and Saudi forces helped Bahrain put down its 2011 Arab Spring protests. As such Friday’s pipeline attack could be a sign of a far more dangerous escalation – whether real or “false flagged” – one which seeks to scapegoat Iran.

Unlike its oil export powerhouse neighbors, Bahrain produced only 64,000 barrels of crude oil a day in 2016, far lower than the other oil-producing nations of the Persian Gulf, according to the EIA. Additionally, due to ongoing budget difficulties, Bahrain’s foreign currency reserves had plunged to levels not seen in over a decade.

Bahrain has faced increasing financial pressure in recent years: the IMF estimates that Bahrain needs oil prices at $99 a barrel to balance its budget this year, compared with $73.1 a barrel for Saudi Arabia, which is overhauling its economy. While Brent crude is trading at the highest level in more than two years, it’s still almost $40 below Bahrain’s breakeven price.

Things took a turn for the worse last week, when we observed the plunge in the Bahrain Dinar forward market…

… following a Bloomberg report that Bahrain had requested a bailout from Saudi Arabia and the UAE.  And judging by the surge in reserves immediately after…

… Bahrain may have received it.

“Most people are fully expecting the other Gulf countries to come to Bahrain’s aid,” said Jason Tuvey, a London-based economist at Capital Economics. “If Bahrain was forced to devalue its currency it would probably start to raise questions about other currency pegs.”

True, but Saudi Arabia – which itself is facing a dire financial situation – would not have given Bahrain billions with no strings attached. And as may be the case, one of the conditions appears to have been to blame any “imminent terrorist attacks” on Iran. That’s precisely what happened overnight. As to whether this will be the tipping point that launches what now appears to be inevitable war between Iran/Lebanon and Saudi Arabia and the Gulf Cooperation Council – in addition to Israel – we’ll just have to wait and see…

 

end

 

IRAN/IRAQ

A huge earthquake on the border between Iraq and Iran

(courtesy zerohedge)

Over 61 Dead, 300 Injured After Huge Quake Strikes Iran-Iraq Border

Update: AP reports that Iranian officials raise death toll to at least 61, more than 300 injured during earthquake on Iran-Iraq border region.

Iranian state TV said Iraqi officials had reported six deaths and 200 injuries inside Iraq, though there was no official comment from Iraq’s government.

The U.S. Geological Survey said the quake was centered 19 miles (31 kilometers) outside the eastern Iraqi city of Halabja.

The Islamic Republic of Iran News Network quoted the head of the country’s emergency medical services, Pirhossein Koulivand, as saying at least 61 had been killed and 300 injured on Iran’s side of the border.

Iranian state TV also said Iraqi officials reported at least six people dead inside Iraq, along with more than 50 people injured in Sulaymaniyah province and about 150 in Khanaquin city. No reports were immediately available from Iraq’s government.

Koulivand earlier told a local television station that the earthquake knocked out electricity in Iran’s western cities of Mehran and Ilam. He also said 35 rescue teams were providing assistance.

The semi-official Iranian ILNA news agency said at least 14 provinces in Iran had been affected by the earthquake.

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

 Call; there are over 500 injured people& deaths recorded.Urgent medical assistance; Medical First aid kits & surgical equipment & medicine, medical teams are needed to support the local hospitals to treat the injured civilians in  governorate;  Earthquake

*  *  *

 

Update: Iranian Student News Association (ISNA) reports that officials are saying “so far, 30 people were killed and 200 people injured with more expected to be added to this number as first responders being excavation to fix the problem, we are delivering water and electricity to the people.”

*  *  *

As we detailed earlier, a 7.6 magnitude earthquake just struck near the Iran-Iraq border (in Iraq, southeast of the city of As-Sulaymaniyah, according to US Geological Survey). Initial reports of damage in Baghdad and that the tremor was felt in Qatar, UAE, Bahrain, and Saudi Arabia.

Prelim M7.2 earthquake Iran-Iraq border region Nov-12 18:18 UTC, updates https://go.usa.gov/xnD7q 

M7.6  () strikes 204 km NE of () 15 min ago. Effects reported by witnesses:

Eye witnesses recount:

“Terrible… Extremely horrible”

 

“The swaying was significant, I stood up and tried to get to a doorway and stumbled a little bit. It lasted nearly 5 minutes with the first 2 minutes being the strongest.”

 

Moments after the quake strikes Erbil people are rushing into the streets…

Everyone is standing outside in Kuwait…

 

 

Developing story…

ISRAEL/SYRIA/IRAN/HEZBOLLAH
more tension as Israel shoots down a Syrian drone flying over the key Golan heights. if Hezbollah had anything to do with the drone that would certainly escalate the situation
(courtesy zerohedge)

israel Shoots Down Syrian Recon Drone Over Golan Heights

Early this morning, Reuters reported that Israel has intercepted and downed a Syrian reconnaissance drone approaching its northern border over Golan Heights.

The drone was shot down by the US-MIM-104 Patriot surface-to-air missile (SAM) system…

Over the Golan demilitarized zone that has separated Israeli and Syrian forces since the ceasefire after the 1973 war.

Lauren Izso, news anchor, correspondent for i24NEWS in Jaffa Port provides footage of this mornings incident…

The official Israel Defense Forces (IDF) Twitter confirmed…

Moments ago, the IDF used a Patriot Missile to intercept a UAV that attempted to infiltrate Israeli airspace in the Golan Heights

In another report, the IDF initially told Reuters it was a ‘Russian-manufactured’ UAV, but offered no evidence.

The military initially told Reuters the UAV was Russian-manufactured but offered no evidence. A military source later said it was unclear whether the UAV was indeed Russian-made.

Lieutenant-Colonel Jonathan Conricus, told Reuters “it was a reconnaissance UAV (unmanned aerial vehicle) and not an attack UAV and we are checking whether there is any connection to Iran and Hezbollah”.

In response to the incident, “the State of Israel regards with utmost seriousness any violation of its sovereignty and will respond with force to any provocation,” made in a statement by Israeli Defense Minister Avigdor Liebermam.

Sputnik provides the backdrop of why tensions are high in ‘disputed Golan Heights’ between Israel and Syria,

Israel and Syria have attacked each other on numerous occasions over the disputed Golan Heights, which were partly seized by Israel during the Six-Day War in 1967; further gains were made by Israel as a result of the Yom Kippur War in 1973.

 

Meanwhile, the United Nations has repeatedly categorized Israel’s presence in the Golan Heights as an occupation, and called for the return of the territory to Syria.

 

The latest IDF attack on Syria occurred in September 2017, when the IDF attacked Syrian Arab Army forces in the province of Hama. However, the Israeli Defense Forces refused to comment on that incident.

This morning’s incident is not the first time. Back in September, Israel’s military shot down what it said was an ‘Iranian-made drone’ operated by Hezbollah over Golan. With the conflict in Syria, a spillover in fighting has occurred by both sides. Israel has carried out missions to stop Hezbollah from resupplying in Syria.

Bottomline: The complex web of who supports whom is starting to make sense. Israel is fighting Hezbollah, a Lebanese militant group who supports Syrian President Bashar Assad. As the Saudis declare war on Lebanon and the Israeli-Saudi alliance grows, it seems as the Golan Heights region – is one area you should watch.

END

 

This is good!. Russia, the uSA and Jordan agree on a “Iran free zone” in southern Syria.  Israel is adamant that the Golan Heights must be Iranian free!!

(courtesy zerohedge)

US, Russia Agree On “Iran-Free Zone” In Syria

Multiple Israeli news outlets reported Saturday that the US, Russia, and Jordan have reached a ceasefire agreement over southern Syria which proposes to expel Iran-backed militias from the border with Israel in the Golan Heights. The reports came on the same day presidents Trump and Putin issued a joint statement on Syria after meeting on the sidelines of the APEC conference in Danang, Vietnam, which reaffirmed de-confliction efforts as both countries fight ISIS and underscored willingness to keep Syria’s territorial integrity intact while pursuing the Geneva process.

Though the joint statement references the “Memorandum of Principles concluded in Amman, Jordan”, it doesn’t make explicit reference to Iran or Hezbollah, but more broadly to efforts for “the reduction, and ultimate elimination of foreign forces and foreign fighters from the area to ensure a more sustainable peace.”


Image source: Getty images

But according to The Times of Israel, the Amman agreement is geared toward preventing a continuing Iranian presence in Syria:

Under the agreement apparently inked Saturday, all non-Syrian fighters, including Iranian proxies fighting on behalf of Syrian President Bashar Assad’s regime, would be required to leave the border area and eventually Syria, Hebrew media reports said Sunday, citing an American official.

Currently, there’s been no confirmation of whether or not the deal actually singles out “Iranian proxies” or if Israel had any influence within the negotiations. The deal is based on a previous ceasefire agreement reached in July in Astana, Kazakhstan – a deal which Israel blasted at the time as being too tolerant of Iran’s presence in Syria.

As part of the Astana talks, Trump agreed to a southwest Syria ‘de-escalation zone’ with Russia, which would necessarily involve Iranian cooperation. The agreement implicitly acknowledged Iran’s troop presence in Syria as legitimate, and as reported at the time further “ignored Israel’s positions almost completely.” But analysts have been in general agreement that the US-Russia brokered deal has been relatively successful and a step in the right direction.

A subsequent Reuters report covering a contentious Netanyahu-Putin meeting in August bluntly acknowledged Israel’s willingness to see the Iranian and Shia allies of Assad expelled from the region, even if that should mean the ascendancy of ISIS. According to the Reuters report:

In parallel to lobbying Moscow, Israel has been trying to persuade Washington that Iran and its guerrilla partners, not Islamic State, pose the greater common threat in the region.

For this reason, Israel has blamed – seemingly without any pretense of an investigation – each and every border incident on Syria and its allies, to the point that even when anti-Assad groups fire mortars in the direction of Israeli territory, the Israeli military response targets Syrian government forces.

This phenomenon has been long recorded by United Nations investigative reports. For example, in October 2014 the UN Disengagement Observer Force (UNDOF), which at that time still had a significant presence in the Golan area, reported to the UN Security Council:

On 23 June [2014], Israel targeted nine Syrian army positions with tank fire and air strikes after mortar fire from the Syrian side the previous day killed an Israeli civilian. Israel’s assessment is that most of these incidents are due to errant fire resulting from fighting in Syria. Israel said that armed opposition groups were probably responsible but that its forces fired on Syrian military positions to stress that Syria was responsible for security on its side of the ceasefire line.

Since then Israel has repeatedly struck targets inside Syria deemed to be Hezbollah weapons storage locations – and over the past year such airstrikes have occurred almost weekly – with Israeli jets often firing from over Lebanese airspace.

And again over the weekend Israel Defense Forces (IDF) reportedly shot down a drone above the Golan Heights, which the IDF claimed was a “Syrian Spy drone” which originated with either Iran or Hezbollah. The incident prompted Israeli defense minister Avigdor Lieberman to once again threaten Syria. “The Syrian regime is responsible for every attack and violation of our sovereignty, and we will not allow the Shiite axis to be established in Syria as a base for action,” Liberman said.

On Friday Israel continued to escalate its rhetoric after a dubious report published by the BBC claimed that Iran has established a military base at a site used by the Syrian army outside El-Kiswah, 14 km (8 miles) south of Damascus. For Israel this would constitute the crossing of a “red line” by Iran: Israeli PM Benjamin Netanyahu recently warned that Iran wanted to establish itself militarily in Syria. “Israel will not let that happen,” he said.

Though Israeli media appears to be reporting the latest ‘deescalation agreement’ in southern Syria which would force the exit of Iranian proxies as an Israeli diplomatic victory, it is unlikely that Israel’s heightening war rhetoric will cease.

end

We reported last week the blockade of all airports and sea ports in Yemen by the Saudi’s This is causing starvation as no food or medicines can get into the country.  The rebel Houthis which controls most of Yemen have now threatened to sink only Saudi Oil tankers and Saudi battleships which are orchestrating the blockade

(courtesy zerohedge)

 

Houthi Rebels Threaten To Sink Saudi Battleships And Oil Tankers

Houthi rebels in civil-war torn Yemen have threatened to start attacking oil tankers and warships sailing under Saudi coalition flag, unless Riyadh lifts its naval blockade of Yemen which threatens the lives of millions in the war-torn country.

The threat of a military response to the ongoing blockade was made after Houthi leader Maj. Gen. Yousef al-Madani met leaders of the naval, coastal defense and coast guard forces Saturday. On that day, Houthi leader Abdel-Malek al-Houthi posted a message on Facebook assuring that “international navigation will remain safe as it was before,” making clear that “only those who attack our country” will be targeted.

“Battleships and oil tankers of the aggressor and its movements will not be immune from the fire of Yemeni naval forces if directed by the senior leadership,” Al Masirah news cited the country’s navy and coast guard as saying Sunday. A military spokesman for the Houthi rebels, Gen. Sharaf Ghalib Luqman, said that “systematic crimes of aggression” and the “closure of ports” compels the Houthi forces “to target all sources of funding” of the aggressor. He added the country is ready to “respond to the escalation of the Saudi-US aggression promptly.”

The Saudi-led military coalition announced last week that it was temporarily shutting all of Yemen’s land border crossings as well as its air and sea ports in response to a ballistic missile that targeted Riyadh on November 4. The kingdom accused Houthis of launching an Iran-supplied ballistic missile at the Saudi capital last weekend, and responded with bombing raids on the Yemeni capital, Sana’a. Iran has denied allegations that it supplies weapons to the Houthis, but concedes it backs the rebels’ cause. The Houthis, which are loyal to Yemen’s former president, are currently in control of most of Yemen, despite the two-year war with the Saudi Arabian-led coalition that began in defense of the exiled incumbent, Abd-Rabbu Mansour Hadi.

Following the November 6 closure of all ports of entry into Yemen, a range of UN bodies expressed concern over the fate of civilians in the country, where nearly 7 million people are starving while others depend on humanitarian assistance amidst a deadly cholera epidemic. According to the United Nations, the blockade could result in the death of millions from famine. Although Saudi Arabia says access of aid workers to the crisis-stricken country is open, aid agencies, according to Reuters, have claimed that they have not been able to enter it.

“The recent closure of the Yemen’s airspace, sea and land ports has worsened the already shrinking space for the lifesaving humanitarian work. It is blocking the delivery of vital humanitarian assistance to children in desperate need in Yemen. And it is making a catastrophic situation for children far worse,” Meritxell Relano, the UNICEF Representative in Yemen said Friday. Also describing the situation in Yemen as “catastrophic,” a spokesperson for the UN Office for the Coordination of Humanitarian Affairs (OCHA) urged the Saudis to lift the blockade, as up to 90 percent of Yemen’s daily needs are served through humanitarian aid. “That lifeline has to be kept open and it is absolutely essential that the operation of the United Nations Humanitarian Air Service (UNHAS) be allowed to continue unhindered,” Jens Laerke said.

UN spokesman Stephane Dujarric warned that the Saudi-led blockade “has had a tremendously negative impact on a situation that is already catastrophic.” While Mark Lowcock, the UN under-secretary-general for humanitarian affairs, said that unless Saudi Arabia lifts the blockade, “it will be the largest famine the world has seen for many decades, with millions of victims.”

Last week, the UN Security Council demanded that the Saudi-led coalition keep Yemen’s air and sea ports open to aid deliveries into the country following a session discussing Riyadh’s draconian measures.

To date, no UN warnings and threats have had any impact. The Saudi-led coalition has been waging a military campaign against Shiite Houthi rebels in Yemen since March 2015. According to the latest UN figures, the three-year-old conflict has so far claimed the lives of over 5,000 civilians, in addition to nearly 9,000 people that have been injured.

END

 

The Arab league, headquartered in Cairo is holding an emergency meeting on Iranian dominance in the region. Saudi Arabia has mobilized fighter jets in anticipation of war.

(courtesy zerohedge)

 

6 .GLOBAL ISSUES

7.OIL ISSUES

OPEC reports on a considerable October crude output and they raise demand for 2018

(courtesy zerohedge)

8. EMERGING MARKET

VENEZUELA

 

END

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

Euro/USA   1.1655 DOWN .0007/ 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  RED

USA/JAPAN YEN 113.32 DOWN 0.149(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 1.3098 DOWN .0089 (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 1.2703 UP .0025(CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA)

Early THIS MONDAY morning in Europe, the Euro FELL by 9 basis points, trading now ABOVE the important 1.08 level  FALLING to 1.1655; / Last night the Shanghai composite CLOSED UP 15.16 POINTS OR .44%      / Hang Sang  CLOSED UP 61.26 POINTS OR 0.21%  /AUSTRALIA  CLOSED DOWN 0.12% / EUROPEAN BOURSES OPENED  RED 

The NIKKEI: this MONDAY morning CLOSED DOWN 300,43 POINTS OR 1.32% 

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

2/ CHINESE BOURSES / : Hang Sang CLOSED UP 61.26 POINTS OR 0.21%  / SHANGHAI CLOSED UP 15.16 POINTS OR .44%    /Australia BOURSE CLOSED DOWN 0.12% /Nikkei (Japan)CLOSED DOWN 300.43 POINTS OR 1.32%

INDIA’S SENSEX IN THE RED

Gold very early morning trading: 1277.95

silver:$16.89

Early MONDAY morning USA 10 year bond yield:  2.371% !!! DOWN 3 IN POINTS from FRIDAY night in basis points and it is trading JUST BELOW resistance at 2.27-2.32%. (POLICY FED ERROR)

The 30 yr bond yield  2.848 DOWN 4 IN BASIS POINTS  from FRIDAY night. (POLICY FED ERROR)

USA dollar index early MONDAY morning: 94.50 UP 11 CENT(S) from YESTERDAY’s close. 

This ends early morning numbers  MONDAY MORNING

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And now your closing MONDAY NUMBERS  \1 PM

Portuguese 10 year bond yield:1.992% DOWN 6 in basis point(s) yield from FRIDAY 

JAPANESE BOND YIELD: +.050%  UP 1  in   basis point yield from FRIDAY/JAPAN losing control of its yield curve/

SPANISH 10 YR BOND YIELD: 1.532% DOWN 4  IN basis point yield from FRIDAY 

ITALIAN 10 YR BOND YIELD: 1.834 DOWN 1 POINTS  in basis point yield from FRIDAY 

the Italian 10 yr bond yield is trading 30 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: +.417% UP 1 IN  BASIS POINTS ON THE DAY

END

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IMPORTANT CURRENCY CLOSES FOR MONDAY 

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

Euro/USA 1.1657 DOWN ,0005 (Euro DOWN 5 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 113.63 UP 0.150(Yen DOWN 15  basis points/ 

Great Britain/USA 1.30990 DOWN  0.0088( POUND DOWN 88 BASIS POINTS)

USA/Canada 1.2733 UP.0056 Canadian dollar DOWN 56 Basis points AS OIL FELL TO $56.62

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This afternoon, the Euro was DOWN 5 to trade at 1.1655

The Yen FELL to 113.63 for a LOSS of 15  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 FELL BY 88 basis points, trading at 1.3099/ 

The Canadian dollar FELL by 56 basis points to 1.2733  WITH WTI OIL FALLING TO :  $56.63

The USA/Yuan closed AT 6.641
the 10 yr Japanese bond yield closed at +.05% UP 1  IN  BASIS POINTS / yield/ 

Your closing 10 yr USA bond yield UP 0  IN basis points from FRIDAY at 2.393% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic  USA 30 yr bond yield: 2.864 DOWN 1 in basis points on the day /

Your closing USA dollar index, 94.57  UP 17 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 MONDAY: 1:00 PM EST

London:  CLOSED DOWN  17.81 POINTS OR 0.24%
German Dax :CLOSED DOWN 53.05 POINTS OR 0.40%
Paris Cac  CLOSED DOWN 39.09 POINTS OR 0.73% 
Spain IBEX CLOSED DOWN 42.80 POINTS OR 0.42%

Italian MIB: CLOSED DOWN 123.15 POINTS OR 0.55% 

The Dow closed UP 17.49 POINTS OR .07%

NASDAQ WAS closed up 6.66 Points OR 0.10%  4.00 PM EST

WTI Oil price;   56.62   1:00 pm; 

Brent Oil: 63.26  1:00 EST

USA /RUSSIAN ROUBLE CROSS:  59.45 UP  29/100 ROUBLES/DOLLAR (ROUBLE LOWER BY 29 BASIS PTS)

TODAY THE GERMAN YIELD RISES TO  +.417%  FOR THE 10 YR BOND  1.00 PM EST EST

END

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:$56.73

BRENT: $63.09

USA 10 YR BOND YIELD: 2.405%  (ANYTHING HIGHER THAN 2.70% BLOWS UP THE GLOBE)

USA 30 YR BOND YIELD: 2.871% 

EURO/USA DOLLAR CROSS:  1.1666 UP .0004

USA/JAPANESE YEN:113.62   up  0.151

USA DOLLAR INDEX: 94.50 UP 12 cent(s)/

The British pound at 5 pm: Great Britain Pound/USA: 1.3112 : DOWN 75 POINTS FROM LAST NIGHT  

Canadian dollar: 1.2731 down 53 BASIS pts 

German 10 yr bond yield at 5 pm: +0.417%

END

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

TRADING IN GRAPH FORM FOR THE DAY

Dow Closes Green: GE Crashes, Bitcoin Bounces, & Junk Bonds Suffer Record Outflows

Baahhhhh…

 

The day started off with the 4th down day in a row for Japanese stocks…the biggest drop since April.

 

It was quite a day for a few key assets…

GE collapsed...

Chipotle crashed then ripped back...

 

EM Debt has been pummeled…

 

Biotechs puked…

 

Bitcoin was battered then bounced…

 

And then there’s Roku… $18.42 to $47.49 in 3 days…

 

But none of that matters silly – the Dow was green

 

VIX ended higher on the day but was clubbed likje a baby seal at the US open…

 

Small Caps lagged but are glued to their 50DMA…

 

Futures show the ramp at the US equity open…

 

Thanks to an epic rip at the open in USDJPY…

 

JNK (HY Bond ETF) has seen outflows for 5 days straight with Friday among the biggest outflows on record… (HYG has seen outflows on 10 of the last 12 days)

 

And HY remains entirely decoupled from stocks…

HYG held at its lows…

 

Treasury yields were mixed with the long-end outperforming (30Y -1.5bps) and the short-end weak (2Y +3bps)…

 

10Y ramped back to the 2.40% Maginot Line…

 

With a reversion to the flattening trend…

 

The Dollar Index rebounded modestly today but was trendless…

 

Crude flatlined on the day but copper and silver saw a panic-buying algo strike around 0830ET

 

Gold never jumped on Silver’s surge…

 

And Copper’s outperformance continues to signal 3.00% 10Y yield…

 

end

 

According to zero hedge, the Podesta Group has run out of money and will not exist by the end of the year. The former head Tony Podesta is facing possible indictment as he failed to register as foreign lobbyist

(courtesy zerohedge)

Podesta Group “Will Not Exist At The End Of The Year”

While all eyes (from the left and the establishment right) remain on Trump  (daring to shake Putin’s hand this weekend), the mainstream media appears to be missing the news that the lobbying firm founded by longtime Democratic operative Tony Podesta is reportedly on the verge of shuttering after being swept up in special counsel Robert Mueller’s Russia probe.

Just three weeks after we reported that special counsel Mueller was targeting lobbying firm Podesta Group. and just two weeks after Tony Podesta resigned from his position at the firm he founded, The Hill reports that Kimberley Fritts, the Podesta Group’s chief executive, told employees on Thursday that the firm would not exist at the end of the year and that they would likely not be paid through the end of November, sources told CNN.

Fritts announced her resignation from the top Washington lobbying group after Podesta left the company amid ties to indictments filed in the Russia investigation. Fritts is beginning work on launching a new firm. Her last day at the company Friday created new uncertainty for the Podesta Group after the departure of Podesta on Oct. 30.

Multiple employees who spoke to The Hill said the mood at the firm was mostly optimistic, though they said many of the firm’s dozens of employees could be in limbo as Fritts sets up the new firm and brings Podesta Group talent and clients with her.

As a reminder, Mueller is now investigating whether the Podesta Group properly identified to U.S. authorities its foreign work on behalf of a Ukrainian advocacy group in Europe, CNN reported.

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.

And here is one reason why we suspect more than a few on the left are now concerned…

It goes without saying, that Podesta’s brother, John, is arguably one of the top figure 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.

end

 

Kevin Brady, Ways and Means chairman declares that the House will not accept total elimination of the SALT deductions  (state and local taxes)

(courtesy zerohedge)

 

Kevin Brady: “House Will Not Accept Total Elimination Of SALT Deduction”

Three days after the Senate Finance Committee shocked many of their colleagues in the House this week by unveiling a tax reform proposal that featured more than a few notable deviations from the House plan, Ways and Means Chairman Kevin Brady told Chris Wallace on “Fox News Sunday” that he would not accept the total elimination of the state and local tax deduction, a provision that has become one of the most – if not the most – controversial elements of the Trump tax reform package.

“We want people to keep more of what they earn regardless of where they live, including in these high-tax states,” he said.

Brady’s doubling-down on preserving at least some of the SALT deduction – a position he has maintained since 20 blue-state Republicans voted against the GOP budget to protest the planned removal of the SALT deduction – comes as the House plans to bring its plan for a vote this week. If the bill passes, it would mark an important milestone in the Trump administration’s battle to push through the first “comprehensive” tax reform legislation in 30 years. The vote could come as soon as Thursday or Friday, what would be a week since Brady’s influential committee approved the bill.

The House bill would eliminate existing federal tax breaks for state and local income or sales taxes, but it would preserve a deduction for property taxes, capped at $10,000. Combined with a new family tax credit and a deduction for mortgage interest for new purchases that would be capped at $500,000 of debt, the House bill “gets the job done,” Brady said, adding “I’m committed to it.”

The Senate Finance Committee is scheduled to begin considering its version of the bill – which also departs from the House version by delaying a corporate tax cut until 2019 – on Monday.

Blue-state Republicans are fiercely protective of the SALT deduction since its elimination would disproportionately impact residents in states like California and New York that tend to pay higher taxes. And seeing as passing tax reform would be impossible without their support, Brady says the Senate will need to accept that at least some deductions for state and local taxes need to be included in the final bill.

“I am convinced that this is where we’re going to end up.”

With only 11 days left until Thanksgiving, Brady says he’s confident the House will meet its self-imposed deadline of passing its version of the tax reform plan before the national holiday. The Senate has also committed to passing its version of the bill by the Thanksgiving deadline, though, with at least four senators saying they wouldn’t support the bill in its current form, it’s odds of passing are slim.

To be sure, whether the House passes its plan, or doesn’t, by the deadline won’t make much of a difference in the bill’s long-term trajectory if Republicans ultimately can’t agree on a final plan during the reconciliation process.

And already, President Donald Trump is stoking rivalries between the two plans, a potentially divisive strategy, by telling Senate Democrats that he prefers the Senate version to its counterpart in the House.

As a reminder, here’s a summary of some of the key differences between the House and Senate plans:

  • 20% permanent corporate tax cut delayed by 1 year
  • Complies with the $1.5 trillion cost (will cost $1.44 trillion)
  • Preserves 7 tax brackets: top tax bracket is 38.5%, down from 39.6%
  • Doubles standard deduction from $12,700 to $24,000 (married couples)
  • Ends state and local tax (SALT) deduction; keeps business deduction
  • Keeps the mortgage Interest deduction cap at $1 million
  • Preserve the estate tax, doubling the current $5.49 million exemption for individuals
  • Raises the child tax credit to $1,650 from $1,000
  • Sets 10% tax rate for US companies with IP in foreign low-tax jurisdictions
  • Full expensing of capital investments for five years
  • Preserves 401(k)s IRAs,
  • Sets repatriation rate at 12% for liquid assets, 5% for illiquid assets
  • Carried interest loophole unchanged
  • Electric Vehicle tax credit is spared (good news for Elon Musk)
Here is the latest update on the GPO tax bill and why (as I promised) will be impossible to pass.  Here are the differences:
(courtesy zero hedge)

Here’s The Latest On The GOP Tax Bill As The Senate Starts Debate

Much like the Obamacare repeal and replace effort earlier this year, the past couple of weeks have been an invariable roller coaster ride for GOP representatives as Congressional leaders have tried to form some level of consensus within a fractured party with competing interests.   This week will undoubtedly be no different.

In light of that, we’ve taken a look at some of the key differences between the Senate and House tax bills as they currently stand.  As of now the biggest difference is the treatment of the State and Local Tax (SALT) deduction.  While the Senate has called for a full repeal of the SALT deduction, House members have drawn a hard line, even though almost all political “hard lines” become flexible under the right circumstances, demanding at least $10,000 worth of property tax deductions be allowed.  Per Bloomberg:

The House and Senate are on a collision course over one of the most prized individual breaks in the tax code.

 

The Senate Finance Committee will start debating late Monday afternoon the 247-page tax proposal released last week by Chairman Orrin Hatch. As of now, the “conceptual” mark has some significant differences with the tax bill the House Ways and Means Committee approved last week — chief among them the Senate’s call for repealing the state and local tax deduction entirely.

 

Ways and Means Chairman Kevin Brady took a hard-line approach during a “Fox News Sunday” interview, saying the House won’t accept a tax bill that eliminates the deduction entirely. The House bill retains the deduction for property taxes up to $10,000.

 

House Speaker Paul Ryan has promised that the differences will be settled in a conference between the two chambers, but some House lawmakers are concerned they’ll just be forced into a take-it-or-leave-it vote for a bill that looks much closer to the Senate version.

 

“There are going to be things that we absolutely object to” in the bill that comes out of conference, said Scott Perry, a Pennsylvania Republican and member of the conservative Freedom Caucus. “But we’re going to have to look at it in its totality and say, ‘Yeah I don’t like it,’ but you have a binary choice” to vote for or against the tax bill, Perry said.

Other divisive issues between the House and Senate could include the top individual income tax rate, the estate tax, the effective start date of a corporate rate and levies for companies that bring offshore profits back to the U.S.

McConnell

Of course, in the end, a final bill is more likely to resemble the Senate proposal simply because that chamber has a slim majority and can only afford to lose two votes. The House has a wider majority and can afford up to 22 defections.

Meanwhile, another complicating factor is that the tax plans are each proceeding on parallel tracks with the Senate beginning debate on their version of a tax bill before the House has even passed their version.

House GOP members may not want to take a politically painful vote when the bill is on the House floor if Senate tax writers have taken some provisions off the table.

 

Still, House Majority Leader Kevin McCarthy says the two-track approach is needed to get a bill completed before 2018.

 

“The Senate’s near simultaneous action shows how seriously this Congress is to get tax reform done this year,” McCarthy said in an emailed statement. He confirmed that the House plans to vote on the tax bill this week.

With that, here are a couple more things to watch this week courtesy of Bloomberg:

  • The Senate Finance Committee will begin debating the tax bill at 3 p.m. Monday, in a markup that is expected to stretch out for several days and could feature votes on numerous amendments.

 

  • Potential amendment related to the tax treatment of carried interest. The break for investment managers is likely to change in the Senate, even though the chamber’s current tax proposal doesn’t call for it, according to Pat Toomey of Pennsylvania and Chuck Grassley of Iowa.

 

  • On the House side, Majority Whip Steve Scalise said that GOP leaders would work to win over rank-and-file Republicans Monday evening. More changes to the House bill could still come before the planned floor vote this week. If GOP leaders need to make last-minute changes to guarantee enough Republican “yes” votes, they could stick in a manager’s amendment in the Rules Committee, which is scheduled to consider the bill on Wednesday.

Of course, the most important consideration for this new week of tax debate is precisely where to set the over/under on how many times the tax bill will be declared officially dead by the mainstream media before being brought back to life with new amendments.

end

 

A good bellwether of things to come.  GE is crashing today:

(courtesy zerohedge)

GE Is Crashing

The pre-market buyers of last resort, hoping that GE just kitchen-sinked by slashing its dividend by 50%... are in trouble.

Everything was fine until CEO Flannery started speaking…

  • *GE TO BORROW $6 BILLION FOR PENSION CONTRIBUTION, CEO SAYS
  • *GE CEO: ALSTOM ACQUISITION PERFORMING BELOW EXPECTATIONS
  • *GE CEO: GE POWER EXACERBATED ITS PROBLEMS W/POOR EXECUTION
  • *GE CEO SEES `LIMITED’ M&A IN THE NEAR TERM
  • *GE CEO: NEW, SIMPLER EARNINGS METRICS TO FOCUS ON CASH

The company also announced that it expects adjusted earnings of $1.00 to $1.11 per share for 2018, which was lower than Wall Street’s expected $1.18.

And shareholders pulled the plug…

Sell the rumor, sell the news?

end

JPMorgan went to court in Texas asking the court to lower its stunning 8 billion dollar verdict again an heir due to criminal fraud committed by the company
(courtesy zerohedge)

“This Is Unprecedented”: JPMorgan Slams “Stunning” $8 Billion Damage Verdict Against It

Here’s a live transmission from the Texas courtroom where JP Morgan Chase & Co’s lawyers are asking a judge to throw out one of the largest punitive judgments in legal history…

…Instead, the bank’s lawyers say the $8 billion judgment should be reduced to zero.

“The law and evidence do not support any claim against JPMorgan, much less the unprecedented multi-billion-dollar punitive damage award, which the heirs have already admitted is unconstitutionally excessive,” the bank said in a filing in Dallas probate court according to Bloomberg.

Back in September, the bank was ordered to pay at least $4 billion in punitive damages, approximately $4.7 million in actual damages, and $5 million in attorney fees after a six-person jury found that the bank committed fraud, breached its fiduciary duty and broke a fee agreement, according to court papers in its handling of the $20 million estate of former airline executive Max Hopper, who died suddenly in 2010 without a will.

And – confirming that much of America does not hold Wall Street in high regard – the jurors awarded a total $8 billion in punitive damages against the bank.

Hopper, who pioneered the SABRE reservation system for American Airlines, died in 2010 with assets of more than $19 million but without a will and testament, according to the statement. JPMorgan was hired as an administrator to divvy up the assets among family members. “Instead of independently and impartially collecting and dividing the estate’s assets, the bank took years to release basic interests in art, home furnishings, jewelry, and notably, Mr. Hopper’s collection of 6,700 golf putters and 900 bottles of wine,” the family’s lawyers said in the statement. “Some of the interests in the assets were not released for more than five years.”

The bank’s incompetence caused more than just unacceptably long timelines; bank representatives failed to meet financial deadlines for the assets under their control. In at least one instance, stock options were allowed to expire. In others, Mrs. Hopper’s wishes to sell certain stock were ignored. The resulting losses, the jury found, resulted in actual damages and mental anguish suffered by Mrs. Hopper. With respect to Mr. Hopper’s adult children, the jury found that they lost potential inheritance in excess of $3 million when the Bank chose to pay its lawyers’ legal fees out of the estate account to defend claims against the Bank for violating its fiduciary duty.

Two of Hopper’s children, who died without a will, have already asked that the damages for them and their father’s estate be reduced to about $74 million, while his widow has yet to weigh in with any adjustment.

JPMorgan said the jury “accepted to the penny, the extraordinary invitation” of the family’s legal team to award the $8 billion without doing any “independent analysis,” according to Thursday’s filing. The bank previously said it was “highly confident” the verdict wouldn’t stand under Texas law.

JPMorgan denied any wrongdoing, saying it acted in good faith on the Hopper estate.

“The crux of the lawsuit is whether sparring survivors of a decedent may blame an independent administrator for seeking judicial guidance on a distribution issue about which the survivors disagree,” the bank said in Thursday’s filing.

The $8 billion award is the largest jury verdict of 2017 so far.

end

Well that about does it for tonight

I WILL SEE YOU ON TUESDAY NIGHT

HARVEY

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