Feb 9/HUGE VOLATILE DAY: YOUR KEY INDICATORS PREDICTING TROUBLE AHEAD: USA 10 YR TREASURY BOND YIELD: 2.85612/ CLOSING PRICE OF VIX: 28.85 BOTH AT DANGEROUS LEVELS/GOLD DOWN $4.70 TO $1312.60/SILVER DOWN 18 CENTS TO $16.20/USA PASSES A 2 YR BUDGET DEAL WHICH WILL ADD 2 TRILLION DOLLARS TO ITS DEFICIT/MOODY’S WARNS THE USE THAT IT MIGHT DOWNGRADE USA DEBT/CHINA ANNOUNCES THAT IT WILL COMMENCE ITS OIL YUAN CONTRACT SHORTLY AS WELL AS THE FUTURES CONTRACT WHICH WILL BEGIN ON MARCH 23./

 

 

GOLD: $1312.60 DOWN $4.70

Silver: $16.20 DOWN 18 cents

Closing access prices:

Gold $1316.80

silver: $16.36

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: $1329.50 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME: $1318.00

PREMIUM FIRST FIX: $9.80

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SECOND SHANGHAI GOLD FIX: $1329.52

NY GOLD PRICE AT THE EXACT SAME TIME: $1320.25

Premium of Shanghai 2nd fix/NY:$9.27

SHANGHAI REJECTS  NY /LONDON PRICING OF GOLD

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LONDON FIRST GOLD FIX: 5:30 am est $1316.05

NY PRICING AT THE EXACT SAME TIME: $1315.80

LONDON SECOND GOLD FIX 10 AM: $1314.10

NY PRICING AT THE EXACT SAME TIME. $1314.20

For comex gold:

FEBRUARY/

NUMBER OF NOTICES FILED TODAY FOR FEBRUARY CONTRACT: 141 NOTICE(S) FOR 14100 OZ.

TOTAL NOTICES SO FAR:1733 FOR 173300 OZ (5.3903 TONNES),

For silver:

jANUARY

0 NOTICE(S) FILED TODAY FOR

nil OZ/

Total number of notices filed so far this month: 199 for 995,000 oz

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Bitcoin: BID $8297/OFFER $8368: up $93(morning)

Bitcoin: BID/ $8311/offer $8381: UP $107  (CLOSING/5 PM)

end

FOR THOSE OF YOU WHO THINK THAT MARKETS ARE NOT MANIPULATED, I HAVE A WONDERFUL PIECE OF PROPERTY IN THE EVERGLADES TO SELL

TODAY, THE MANIPULATION WAS SO OBVIOUS.

Let us have a look at the data for today\

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In silver, the total open interest FELL BY A HUGE SIZED 9371 contracts from 202,505  FALLING TO 193,135 DESPITE  YESTERDAY’S SMALL 8 CENT GAIN IN SILVER PRICING.  WE  HAD CONSIDERABLE COMEX LIQUIDATION. HOWEVER, WE WERE AGAIN NOTIFIED THAT WE HAD ANOTHER HUGE SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP ROUTE:  3215 EFP’S FOR MARCH AND AND 0 EFP’S FOR MAY AND ZERO FOR ALL  OTHER MONTHS  AND THUS TOTAL ISSUANCE OF 3215 CONTRACTS.  WITH THE TRANSFER OF 3215 CONTRACTS, WHAT THE CME IS STATING IS THAT THERE IS NO SILVER (OR GOLD) TO BE DELIVERED UPON AT THE COMEX AS THEY MUST EXPORT THEIR OBLIGATION TO LONDON. ALSO KEEP IN MIND THAT THERE CAN BE A DELAY OF 24 HRS IN THE ISSUING OF EFP’S. THE 3215 CONTRACTS TRANSLATES INTO 16.08 MILLION OZ.  WITH THE HUGE DROP IN OPEN INTEREST AT THE COMEX. WE SHOULD EXPECT BIGGER GAINS IN EFP TRANSFERS IN THE NEXT FEW DAYS WITH THE LARGE LOSS AT THE COMEX AS LONGS GAVE UP SEEKING METAL AT THIS EXCHANGE.

ACCUMULATION FOR EFP’S/SILVER/ STARTING FROM FIRST DAY NOTICE/FOR MONTH OF FEBRUARY:

24,531 CONTRACTS (FOR 8 TRADING DAYS TOTAL 24,531 CONTRACTS OR 122.655 MILLION OZ: AVERAGE PER DAY: 3066 CONTRACTS OR 15.331 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH:  122.655 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 17.5% OF ANNUAL GLOBAL PRODUCTION

ACCUMULATION IN YEAR 2018 TO DATE SILVER EFP’S:  357.59 MILLION OZ.

ACCUMULATION FOR JAN 2018: 236.879 MILLION OZ

RESULT: A HUGE SIZED LOSS IN OI SILVER COMEX DESPITE THE SMALL  8 CENT GAIN IN SILVER PRICE.  WE HOWEVER HAD A GOOD SIZED EFP ISSUANCE OF 3215 CONTRACTS WHICH EXITED OUT OF THE SILVER COMEX AND TRANSFERRED THEIR OI TO LONDON AS FORWARDS. SPECULATORS CONTINUED THEIR INTEREST IN ATTACKING THE SILVER COMEX FOR PHYSICAL SILVER . FROM THE CME DATA 3214 EFP’S  FOR  MONTHS MARCH AND MAY WERE ISSUED FOR TODAY  FOR A DELIVERABLE FORWARD CONTRACT OVER IN LONDON WITH A FIAT BONUS.  WITH YESTERDAY’S TRADING WE LOST  6156 OI CONTRACTS i.e. 3215 open interest contracts headed for London (EFP’s) TOGETHER WITH A DECREASE OF 9371  OI COMEX CONTRACTS. AND ALL OF THIS HAPPENED WITH THE SMALL RISE IN PRICE OF SILVER OF  8 CENTS AND A CLOSING PRICE OF $16.38 WITH RESPECT TO YESTERDAY’S TRADING. YET WE STILL HAVE A FAIR AMOUNT OF SILVER STANDING AT THE COMEX.

In ounces AT THE COMEX, the OI is still represented by just UNDER 1 BILLION oz i.e. 0.965 BILLION TO BE EXACT or 138% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT FEBRUARY MONTH/ THEY FILED: 0 NOTICE(S) FOR NIL OZ OF SILVER

In gold, the open interest FELL  BY ANOTHER CONSIDERABLE 7,499 CONTRACTS DOWN TO 519,362  DESPITE THE GOOD SIZED RISE IN PRICE OF GOLD WITH YESTERDAY’S TRADING ($5.20). HOWEVER, IN ANOTHER DEVELOPMENT, WE RECEIVED THE TOTAL NUMBER OF GOLD EFP’S ISSUED FOR TODAY AND IT TOTALED A HUGE SIZED  14,716 CONTRACTS OF WHICH  APRIL SAW THE ISSUANCE OF 14,716 CONTRACTS AND  JUNE SAW THE ISSUANCE OF 0 CONTRACTS AND THEN ALL OTHER MONTHS ZERO.    The new OI for the gold complex rests at 517,708. ALSO REMEMBER THAT THERE WILL BE A DELAY IN THE ISSUANCE OF EFP’S.  THE BANKERS REMOVE LONG POSITIONS OF COMEX GOLD IMMEDIATELY.  THEN THEY ORCHESTRATE THEIR PRIVATE EFP DEAL WITH THE LONGS AND THAT COULD TAKE AN ADDITIONAL 48 HRS SO WE GENERALLY DO NOT GET A MATCH WITH RESPECT TO DEPARTING COMEX LONGS AND NEW EFP LONG TRANSFERS. DEMAND FOR GOLD INTENSIFIES GREATLY AS WE CONTINUE TO WITNESS A HUGE NUMBER OF EFP TRANSFERS TOGETHER WITH THE MASSIVE INCREASE IN GOLD COMEX OI  TOGETHER WITH  THE TOTAL AMOUNT OF GOLD OUNCES STANDING FOR FEBRUARY COMEX. EVEN THOUGH THE BANKERS ISSUED THESE MONSTROUS EFPS, THE OBLIGATION STILL RESTS WITH THE BANKERS TO SUPPLY METAL BUT IT TRANSFERS THE RISK TO A LONDON BANKER OBLIGATION AND NOT A NEW YORK COMEX OBLIGATION. LONGS RECEIVE A FIAT BONUS TOGETHER WITH A LONG LONDON FORWARD. THUS, BY THESE ACTIONS, THE BANKERS AT THE COMEX HAVE JUST STATED THAT THEY HAVE NO APPRECIABLE METAL!! THIS IS A MASSIVE FRAUD: THEY CANNOT SUPPLY ANY METAL TO OUR COMEX LONGS BUT THEY ARE QUITE WILLING TO SUPPLY MASSIVE NON BACKED GOLD (AND SILVER) PAPER KNOWING THAT THEY HAVE NO METAL TO SATISFY OUR LONGS. LONDON IS NOW SEVERELY BACKWARD IN BOTH GOLD AND SILVER (BIG RISE IN BOTH GOFO AND SIFO) AND WE ARE WITNESSING DELAYS IN ACTUAL DELIVERIES. IN ESSENCE TODAY DESPITE YESTERDAY’S TRADING IN GOLD,  WE HAVE A GAIN OF 7217  CONTRACTS: 7499 OI CONTRACTS DECREASED AT THE COMEX AND A STRONG SIZED  14,716 OI CONTRACTS WHICH NAVIGATED OVER TO LONDON.(7219 oi gain in CONTRACTS EQUATES TO 22.45 TONNES)

YESTERDAY, WE HAD 13,622 EFP’S ISSUED.

ACCUMULATION OF EFP’S/ GOLD(EXCHANGE FOR PHYSICAL) FOR THE MONTH OF FEBRUARY STARTING WITH FIRST DAY NOTICE: 91,370 CONTRACTS OR 9,137,000  OZ OR 284.19 TONNES (8 TRADING DAYS AND THUS AVERAGING: 11,421 EFP CONTRACTS PER TRADING DAY OR 1,142,100 OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS :   SO FAR THIS MONTH IN 8 TRADING DAYS: IN  TONNES: 284.19 TONNES

TOTAL ANNUAL GOLD PRODUCTION, 2017, THROUGHOUT THE WORLD EX CHINA EX RUSSIA: 2200 TONNES

THUS EFP TRANSFERS REPRESENTS 284.19/2200 x 100% TONNES =  12.91% OF GLOBAL ANNUAL PRODUCTION SO FAR IN FEBRUARY ALONE.

ACCUMULATION OF GOLD EFP’S YEAR 2018 TO DATE:  917.72 TONNES

ACCUMULATION OF GOLD EFP’S FOR JANUARY 2018: 653.22  TONNES

Result: A  HUGE SIZED DECREASE IN OI AT THE COMEX DESPITE THE GOOD SIZED RISE IN PRICE IN GOLD TRADING YESTERDAY ($5.20). IT IS WITHOUT A DOUBT THAT MANY OF THE DEPARTED COMEX LONGS  RECEIVED THEIR PRIVATE EFP CONTRACT  FOR EITHER  APRIL OR JUNE. HOWEVER, WE HAD ANOTHER GOOD SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 14,716 AS THESE HAVE ALREADY BEEN NEGOTIATED AND CONFIRMED.   THERE OBVIOUSLY DOES NOT SEEM TO BE MUCH PHYSICAL GOLD AT THE COMEX AND YET WE ALSO OBSERVED A HUGE DELIVERY MONTH FOR THE MONTH OF DECEMBER. I GUESS IT EXPLAINS THE HUGE ISSUANCE OF EFP’S…THERE IS HARDLY ANY GOLD PRESENT AT THE GOLD COMEX FOR DELIVERY PURPOSES. IF YOU TAKE INTO ACCOUNT THE 14,716 EFP CONTRACTS ISSUED, WE HAD A NET GAIN IN OPEN INTEREST OF 7217 contractON THE TWO EXCHANGES:

14,716 CONTRACTS MOVE TO LONDON AND  7499 CONTRACTS DECREASED AT THE COMEX. (in tonnes, the GAIN in total oi equates to 22.45 TONNES).

we had: 141 notice(s) filed upon for 14100 oz of gold.

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

GLD

WITH TODAY’S TURMOIL, THE CROOKS WITHDREW ANOTHER 2 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 826.31

Inventory rests tonight: 826.31 tonnes.

SLV/

NO CHANGES IN SILVER INVENTORY AT THE SLV/ AGAIN WITH TODAY’S TURMOIL   NO CHANGE IN INVENTORY

/INVENTORY RESTS AT 314.045 MILLION OZ/

can someone please explain why GLD behaves differently to SLV????

end

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

1. Today, we had the open interest in silver FELL BY A GIGANTIC 9371 contracts from 202,506 DOWN TO 193,135 (AND now A LITTLE FURTHER TO THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) DESPITE  THE GOOD SIZED  RISE  IN PRICE OF SILVER  (8 CENTS WITH RESPECT TO  YESTERDAY’S TRADING).   OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE ANOTHER GOOD 3215 PRIVATE EFP’S FOR MARCH AND 0 EFP CONTRACTS OR MAY  (WE DO NOT GET A LOOK AT THESE CONTRACTS AS IT IS PRIVATE BUT THE CFTC DOES AUDIT THEM) AND 0 EFP’S FOR ALL OTHER MONTHS .  EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. WE HAD SOME COMEX SILVER COMEX LIQUIDATION. IF WE TAKE THE  OI LOSS AT THE COMEX OF  9371 CONTRACTS TO THE 3215 OI TRANSFERRED TO LONDON THROUGH EFP’S, SURPRISINGLY WE OBTAIN A LOSS OF 6156  OPEN INTEREST CONTRACTS DESPITE YESTERDAY’S GAIN IN SILVER PRICE.  WE STILL HAVE A GOOD AMOUNT OF SILVER OUNCES THAT ARE STANDING FOR METAL IN JANUARY (SEE BELOW). THE NET LOSS TODAY IN OZ ON THE TWO EXCHANGES:  30.78 MILLION OZ!!!

RESULT: A HUMONGOUS SIZED DECREASE IN SILVER OI AT THE COMEX DESPITE THE GOOD SIZED RISE OF 8 CENTS IN PRICE (WITH RESPECT TO YESTERDAY’S TRADING ). BUT WE ALSO HAD ANOTHER GOOD 3215 EFP’S ISSUED TRANSFERRING COMEX LONGS OVER TO LONDON. TOGETHER WITH THE GOOD  SIZED AMOUNT OF SILVER OUNCES STANDING FOR FEBRUARY, DEMAND FOR PHYSICAL SILVER INTENSIFIES AS WE WITNESS MAJOR BANK SHORT COVERING ACCOMPANIED BY INCREASES IN GOFO AND SIFO RATES INDICATING SCARCITY.

(report Harvey)

.

2.a) The Shanghai and London gold fix report

(Harvey)

2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY: Bloomberg

3. ASIAN AFFAIRS

i)Late THURSDAY night/FRIDAY morning: Shanghai closed DOWN 132.19 points or 4.05% /Hang Sang CLOSED DOWN 943.85 or 3.10% / The Nikkei closed DOWN 508,24 POINTS OR 2.32%/Australia’s all ordinaires CLOSED DOWN 0.96%/Chinese yuan (ONSHORE) closed UP at 6.3041/Oil DOWN to 60.47 dollars per barrel for WTI and 64.30 for Brent. Stocks in Europe OPENED DEEPLY IN THE RED .   ONSHORE YUAN CLOSED UP AGAINST THE DOLLAR AT 6.3040. OFFSHORE YUAN CLOSED DOWN AGAINST  THE ONSHORE YUAN AT 6.3244//ONSHORE YUAN A LOT STRONGER AGAINST THE DOLLAR/OFF SHORE A LOT STRONGER TO THE DOLLAR/. THE DOLLAR (INDEX) IS  MUCH STRONGER AGAINST ALL MAJOR CURRENCIES EXCEPT CHINA YUAN.  CHINA IS NOT TOO  HAPPY TODAY.(INTERVENTION STRONGER CURRENCY AND WEAK MARKETS IN CHINA AND THROUGHOUT THE GLOBE

i

3a)THAILAND/SOUTH KOREA/NORTH KOREA

 i)North Korea

b) REPORT ON JAPAN

3 c CHINA

Asia crashes: China big cap companies crash over 7%/worst week since Lehman

( zerohedge)

4. EUROPEAN AFFAIRS

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

Russia slams the illegal USA presence in Syria

( zerohedge)

6 .GLOBAL ISSUES

i)Shiller reports on his 20 City Composite.  Landlords are having to offer good incentives to bring in renters.

( Shiller)

ii)Huge spike in Cdn unemployment as part time jobs crash (due to increase in minimum wage in Ontario).  This caused the Canadian dollar to falter to 1.2611

( zerohedge)

7. OIL ISSUES

Oil breaks the 60 dollar barrier

( zerohedge)

8. EMERGING MARKET

9. PHYSICAL MARKETS

Banks do not want to risk financing bitcoin as they ban the use of credit cards purchasing Bitcoin

( Surane/Keller)

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

i)This morning: suppression of VIX/stocks initially ramped higher

( zerohedge)

i b)Midday  dead cat bounce as the Dow turns a 200 point gain into losing territory with the VIX rising to:  32.96 and the 10 yr bond piercing 2.85% again

( zerohedge)

ii)It is now Moody’s turn to sound the alarm bell with respect to the huge increase in the uSA debt. They are threatening the USA with a downgrade.  With the new 2 year budget deal passed by both houses, the Debt Ceiling will be reset and the new “Debt to the Penny” will be close to 21 trillion dollars.

( zerohedge)

iii)No shutdown as the Congress passes a two year budget deal.  They will fund the government up to March 23.2018

( zerohedge)

iv)Knives come out against Kelly for domestic abuse.  Trump looks to Mulvaney to hold the Chief of Staff job along with his two other posts

( zerohedge)

v)UPS and Fed Ex sink badly on news that Amazon will be launching “Shipping with Amazon” where they will pick up parcels at facilities identical to our two major shipping operations

( zerohedge)

vi)A real problem for real estate companies in Illinois and home owners:  Illinois property taxes are going up but prices are lagging( Divounguy,Hill Tabor/Illinois policy)

vii)Wholesale sales and wholesale inventories both slow in December and this will be a further damper to Q4 GDP numbers,
(courtesy zerohedge)

viii)SWAMP STORIES

a)Judicial Watch sues the FBI asking for documents on Comey’s 2 million dollar book deal plus communications between the FBI and Comey prior to his testimony
( zerohedge)

b)The very reliable the Wall Street Journal questions why the media (outside of Fox) is ignoring the real bombshell FISA memo  ( the Grassley Memo)(courtesy Benson/Townhall.com)

Let us head over to the comex:

The total gold comex open interest FELL BY A CONSIDERABLE 7499 CONTRACTS DOWN to an OI level 517,708  DESPITE THE GOOD SIZED GAIN IN THE PRICE OF GOLD ($5.20 GAIN WITH RESPECT TO YESTERDAY’S TRADING).   WE HAD CONSIDERABLE COMEX GOLD LIQUIDATION. HOWEVER THE CME REPORTS THAT  THE BANKERS ISSUED ANOTHER STRONG COMEX TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS. WE HAD A HUGE SIZED 14,716 EFP’S ISSUED FOR APRIL  AND 0 EFP’s  FOR JUNE AND ZERO FOR ALL OTHER MONTHS:  TOTAL  14.716 CONTRACTS. THE OBLIGATION STILL RESTS WITH THE BANKERS ON THESE TRANSFERS. ALSO REMEMBER THAT THERE IS NO DOUBT A HUGE DELAY IN THE ISSUANCE OF EFP’S AND IT PROBABLY TAKES AT LEAST  48 HRS AFTER LONGS GIVE UP THEIR COMEX CONTRACTS FOR THEM TO RECEIVE THEIR EFP’S AS THEY ARE NEGOTIATING THIS CONTRACT WITH THE BANKS FOR A FIAT BONUS PLUS THEIR TRANSFER TO A LONDON FORWARD… THE COMEX IS NOW AN ABSOLUTE FRAUD!!

ON A NET BASIS IN OPEN INTEREST WE GAINED TODAY: 7217 OI CONTRACTS IN THAT 14,716 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE LOST 7499 COMEX CONTRACTS.

NET GAIN ON THE TWO EXCHANGES: 7217 contracts OR 721,700  OZ OR 22.91 TONNES, AND THIS WAS ACCOMPLISHED WITH A RISE IN PRICE OF GOLD BUT A SEVERE COMEX LIQUIDATION IN SILVER

Result: A  HUGE SIZED DECREASE IN COMEX OPEN INTEREST DESPITE THE GOOD SIZED GAIN IN YESTERDAY’S GOLD TRADING ($5.20.) WE HAD CONSIDERABLE COMEX GOLD LIQUIDATION.  TOTAL OPEN INTEREST GAIN ON THE TWO EXCHANGES: 7217 OI CONTRACTS..

We have now entered the active contract month of FEBRUARY where we lost 117 contracts to 1309 contracts.  We had 55 notices filed upon yesterday, so we lost 62 contracts or 6200 oz will not stand in this active contract month of February AND THESE WERE MORPHED INTO LONDON BASED FORWARDS.

March saw a GAIN of 41 contracts UP to 1997.  April saw a LOSS of 8230 contracts DOWN to 360,817. MARCH BECOMES THE FRONT MONTH FOR GOLD

We had 141 notice(s) filed upon today for 14100 oz

 PRELIMINARY COMEX VOLUME FOR TODAY: 384,541 contracts

CONFIRMED COMEX VOLUME FOR YESTERDAY: 362,184 CONTRACTS

comex gold volumes are RISING AGAIN

Here is a summary of the latest gold trading volumes at the Comex per year

certainly the introduction of EFP’s has certainly had an effect:

Trading Volumes on the COMEX

Meanwhile, gold-trading volumes on the COMEX have never been higher:

end

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And now for the wild silver comex results.

Total silver OI FELL  BY A HUMONGOUS SIZED 9371  CONTRACTS FROM 202,506 DOWN TO  193,135 DESPITE YESTERDAY’S GOOD SIZED 8 CENT GAIN IN TRADING)  HOWEVER,WE WERE ALSO INFORMED THAT WE HAD ANOTHER LARGE SIZED 3215 EMERGENCY EFP’S FOR MARCH ISSUED BY OUR BANKERS (WITH 0 EFP CONTRACTS FOR MAY AND ZERO FOR ALL OTHER MONTHS) TO COMEX LONGS WHO RECEIVED A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON: THE TOTAL EFP’S ISSUED: 3215.   THE SILVER BOYS HAVE STARTED TO MIGRATE TO LONDON FROM THE START OF DELIVERY MONTH AND CONTINUING RIGHT THROUGH UNTIL FIRST DAY NOTICE JUST LIKE WE ARE WITNESSING TODAY. USUALLY WE NOTED THAT CONTRACTION IN OI OCCURRED ONLY DURING THE LAST WEEK OF AN UPCOMING ACTIVE DELIVERY MONTH AS WE HAVE JUST SEEN IN GOLD TODAY. THIS PROCESS HAS JUST BEGUN IN EARNEST IN SILVER STARTING IN SEPTEMBER 2017. HOWEVER, IN GOLD, WE HAVE BEEN WITNESSING THIS FOR THE PAST 2 YEARS. NICK LAIRD WAS KIND ENOUGH TO SUPPLY US THE TOTAL FOR 2017 GOLD EFP’S AND IT WAS 6600 TONNES FOR THE ENTIRE YEAR.  WE OBVIOUSLY HAD CONSIDERABLE LONG COMEX SILVER LIQUIDATION AND A GOOD SIZED LOSS IN TOTAL SILVER OI. WE ARE ALSO WITNESSING A FAIR AMOUNT OF SILVER OUNCES STANDING FOR COMEX METAL IN THIS NON ACTIVE JANUARY AS WELL AS THAT CONTINUAL MIGRATION OF EFPS OVER TO LONDON. ON A PERCENTAGE BASIS THERE ARE MORE EFP’S ISSUED FOR GOLD THAN SILVER.  ON A NET BASIS WE LOST 6156  SILVER OPEN INTEREST CONTRACTS:

9371 CONTRACT LOSS AT THE COMEX COMBINING WITH THE ADDITION OF 3834 OI CONTRACTS NAVIGATING OVER TO LONDON.

NET LOSS TWO EXCHANGES: 6156 CONTRACTS DESPITE THE GAIN IN PRICE YESTERDAY

We are now in the poor non active delivery month of FEBRUARY and here the front month LOST 60 contracts DOWN TO  141 contracts.  We had 60 notices filed upon yesterday so we GAINED 0 contracts or NIL ADDITIONAL oz will stand for delivery at the comex

The March contract lost 7796 contracts DOWN to 101,101

April gained 31 contracts up to 74 .

.

We had 0 notice(s) filed for NIL OZ for the FEBRUARY 2018 contract for silver

INITIAL standings for FEBRUARY

Feb9/2018.

Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
 12,938.838 oz
Scotia
Brinks
Deposits to the Dealer Inventory in oz nil oz
Deposits to the Customer Inventory, in oz
 2225,057 oz
Brinks
Delaware
No of oz served (contracts) today
141 notice(s)
 14100 OZ
No of oz to be served (notices)
1168 contracts
(116,800 oz)
Total monthly oz gold served (contracts) so far this month
1733 notices
173300 oz
4.3902 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
we had 0 kilobar transaction/
We had 0 inventory movement at the dealer accounts
total inventory deposit into the dealer accounts:  nil oz
we had 2 withdrawals out of the customer account:
i) out of Scotia
we had 1929.0000  oz of gold transferred out of Scotia????
ii) Out of Brinks: 225.057 oz
total withdrawal: 2,225,057  oz
we had 2 customer deposit
i) Into brinks:  1,009.83 oz
ii) Into Scotia; 1929.0000 oz???
total customer deposits: 12,938.838  oz
we had 0 adjustments
total registered or dealer gold:  386,218.559 oz or 12.01 tonnes
total registered and eligible (customer) gold;   9,281457.005 oz 288.69 tones

For FEBRUARY:
Today, 0 notice(s) were issued from JPMorgan dealer account and 56 notices were issued from their client or customer account. The total of all issuance by all participants equates to 141 contract(s) of which 140 notices were stopped (received) by j.P. Morgan dealer and 0 notice(s) was (were) stopped/ Received) by j.P.Morgan customer account.

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To calculate the INITIAL total number of gold ounces standing for the FEBRUARY. contract month, we take the total number of notices filed so far for the month (1733) x 100 oz or 159,200 oz, to which we add the difference between the open interest for the front month of FEB. (1309 contracts) minus the number of notices served upon today (141 x 100 oz per contract) equals 290,100 oz, the number of ounces standing in this active month of FEBRUARY

Thus the INITIAL standings for gold for the FEBRUARY contract month:

No of notices served (1733 x 100 oz or ounces + {(1309)OI for the front month minus the number of notices served upon today (141 x 100 oz )which equals 290,100 oz standing in this active delivery month of February (9.023 tonnes). THERE IS 12.01 TONNES OF REGISTERED GOLD AVAILABLE FOR DELIVERY SO FAR.

WE LOST 62 CONTRACTS OR AN ADDITIONAL 6200 OZ WILL NOT STAND BUT THEY WILL JOIN OTHER LONGS AS THEY HAVE BEEN TRANSFERRED TO A LONDON BASED FORWARD THROUGH THE EFP ROUTE.

THE COMEX IS NOW UNDER STRESS AS THE REGISTERED GOLD FALLS BELOW 13 TONNES.

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XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

IN THE LAST 17 MONTHS 65 NET TONNES HAS LEFT THE COMEX.

end

And now for silver

AND NOW THE DECEMBER DELIVERY MONTH

FEBRUARY FINAL standings

feb 9 2018
Silver Ounces
Withdrawals from Dealers Inventory nil oz
Withdrawals from Customer Inventory
 443,771,360 oz
Brinks
Deposits to the Dealer Inventory
nil
oz
Deposits to the Customer Inventory
 599,038.290 OZ
 JPM
Delaware
No of oz served today (contracts)
0
CONTRACT(S
(NIL OZ)
No of oz to be served (notices)
141 contracts
(705,000 oz)
Total monthly oz silver served (contracts) 199 contracts

(995,000 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

we had no inventory movement at the dealer side of things

total inventory movement dealer: nil oz

we had 1 inventory deposits into the customer account

i) into J.P.MORGAN:598,011.000 oz

ii) into Delaware: 1027.29 oz

total inventory deposits: 599,038.290oz

we had 1 withdrawals from the customer account;

i Out of Brinks: 443,771.360 0z

total withdrawals;  443,771.360  oz

we had 0 adjustment

total dealer silver:  43.384 million

total dealer + customer silver:  250.269 million oz

The total number of notices filed today for the FEBRUARY. contract month is represented by 0 contract(s) FOR NIL oz. To calculate the number of silver ounces that will stand for delivery in FEBRUARY., we take the total number of notices filed for the month so far at 199 x 5,000 oz = 995,000 oz to which we add the difference between the open interest for the front month of FEB. (141) and the number of notices served upon today (0 x 5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the FEB contract month: 199(notices served so far)x 5000 oz + OI for front month of FEBRUARY(141) -number of notices served upon today (0)x 5000 oz equals 1,700,000 oz of silver standing for the FEBRUARY contract month. 

WE GAINED 0 CONTRACTS OR AN ADDITIONAL NIL OZ WILL  STAND AT THE COMEX

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ESTIMATED VOLUME FOR TODAY: 120,016 CONTRACTS

CONFIRMED VOLUME FOR YESTERDAY: 137,283 CONTRACTS

YESTERDAY’S CONFIRMED VOLUME OF 137,283 CONTRACTS EQUATES TO  685 MILLION OZ OR 97.8% OF ANNUAL GLOBAL PRODUCTION OF SILVER

COMMODITY LAW SUGGESTS THAT OPEN INTEREST SHOULD NOT BE MORE THAN 3% OF ANNUAL GLOBAL PRODUCTION. THE CROOKS ARE SUPPLYING MASSIVE PAPER TRYING TO KEEP SILVER IN CHECK.

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 

1. Sprott silver fund (PSLV): NAV FALLS TO -2.59% (FEB 9/2018)
2. Sprott gold fund (PHYS): premium to NAV RISES TO -0.41% to NAV (FEB 9/2018 )
Note: Sprott silver trust back into NEGATIVE territory at -2.59%-/Sprott physical gold trust is back into NEGATIVE/ territory at -0.41%/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)

3.SPROTT CEF.A FUND (FORMERLY CENTRAL FUND OF CANADA): NAV FALLS TO -4.14%: NAV 13.58/TRADING 13.00//DISCOUNT 4.14%

END

And now the Gold inventory at the GLD/

Feb 9/AGAIN WITH HUGE TURMOIL ON THE MARKETS, THE CROOKS WITHDREW 2 TONNES OF GOLD FROM THE GLD INVENTORY/INVENTORY RESTS AT 826.31 TONNES

Feb 8/DESPITE THE GOOD GAIN IN PRICE FOR GOLD TODAY/THE CROOKS REMOVED .96 TONNES FROM THE GLD INVENTORY/INVENTORY RESTS AT 828.31 TONNES

FEB 7/AN UNBELIEVABLE 12.08 TONNES WAS REMOVED BY THE CROOKED BANKERS AND THIS GOLD WAS USED IN THE ASSAULT THESE PAST FEW DAYS/INVENTORY RESTS AT 829.27 TONNES

Feb 6/AGAIN VERY STRANGE: WITH TODAY’S TURMOIL, THE CROOKS DID NOT ADD ANY GOLD INVENTORY INTO THE GLD/INVENTORY REMAINS AT 841.35 TONNES

Feb 5  Strange,with all of today’s turmoil, the crooks at the GLD decided to add zero ounces into GLD inventory/inventory rests at 841.35 tonnes

Feb 2/no change in gold inventory at the GLD/Inventory rests at 841.35 tonnes

Feb 1/with gold up by $8.00/the crooks decided not to add any new physical gold metal into the GLD./inventory rests at 841.35 tonnes

Jan 31/with gold up $3.15 today, GLD shed another 5.32 tonnes of gold from its inventory/inventory rests at 841.35 tonnes

jan 30/with gold down by $4.85/GLD shed another 1.47 tonnes of gold from its inventory/inventory rests at 846.67 tonnes

JAN 29/with gold down $11.25, the GLD shed 1.18 tonnes of gold/inventory rests at 848.14 tonnes

jan 26/2018/no changes in gold inventory at the GLD/inventory rests at 849.32 tonnes

jan 25/no changes in gold inventory at the GLD/inventory rests at 849.32 tonnes

Jan 24/A HUGE DEPOSIT OF 2.65 TONNES OF GOLD INTO GLD/INVENTORY RESTS AT 849.32 TONNES

Jan 23/NO CHANGE IN GOLD INVENTORY DESPITE GOLD’S RISE/INVENTORY RESTS AT 846.67 TONNES

Jan 22/a huge deposit of 5.71 tonnes of gold despite a drop in price/inventory rests at 846.67 tonnes. In 3 trading days, the GLD has added 17.71 tonnes/the bankers are now in trouble!!

Jan 19/no change in gold inventory at the GLD/Inventory rests at 840.76 tonnes

Jan 18/SHOCKINGLY A HUGE DEPOSIT OF 11.80 TONNES WITH GOLD DOWN ALMOST $12.00/INVENTORY RESTS AT 840.76

Jan 17/no changes in gold inventory at the GLD/inventory rests at 828.96 tonnes

Jan 16/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 828.96 TONNES

Jan 12/no changes in inventory at the GLD despite the rise in gold price/inventory rests at 828.96 tonnes

Jan 11/ANOTHER IDENTICAL WITHDRAWAL OF 2.95 TONNES FROM THE GLD INVENTORY/INVENTORY RESTS AT 828.96 TONNES

Jan 10/with gold up today, a strange withdrawal of 2.95 tonnes/inventory rests at 831.91 tonnes

Jan 9/no changes in gold inventory at the GLD/Inventory rests at 834.88 tonnes

Jan 8/with gold falling by a tiny $1.40 and this being after 12 consecutive gains, today they announce another 1.44 tonnes of gold withdrawal from the GLD/

Jan 5/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 836.32 TONNES

Jan 4/2018/no change in gold inventory at the GLD/Inventory rests at 836.32 tonnes

Jan 3/a huge withdrawal of 1.18 tonnes of gold from the GLD/Inventory rests at 836.32 tonnes

Jan 2/2018/no changes in gold inventory at the GLD/inventory rests at 837.50 tonnes

Dec 29/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 837.50 TONNES

Dec 28/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 837.50 TONNES

Dec 27/NO CHANGES IN GOLD INVENTORY AT THE GLD/ INVENTORY RESTS AT 837.50 TONNES

Dec 26/no change in gold inventory at the GLD

Dec 22/ A DEPOSIT OF 1.48 TONNES OF GOLD INTO GLD INVENTORY/INVENTORY RESTS AT 837.50 TONNES

Dec 21′ NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 836.02 TONNES

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Feb 9/2018/ Inventory rests tonight at 826.31 tonnes

*IN LAST 323 TRADING DAYS: 114.84 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 257 TRADING DAYS: A NET 42.47 TONNES HAVE NOW BEEN ADDED INTO GLD INVENTORY.

end

Now the SLV Inventory

Feb 9/AGAIN WITH TURMOIL ON THE MARKETS, STRANGELY IN TOTAL CONTRAST TO GOLD: NO CHANGE IN SILVER INVENTORY/INVENTORY RESTS AT 314.045 MILLION OZ/

Feb 8/DESPITE THE TURMOIL TODAY AND A PRICE RISE: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 314.045 MILLION OZ/

FEB 7/no change in silver inventory at the SLV/Inventory rests at 314.045 million oz/

Feb 6/WITH ALL OF TODAY’S TURMOIL/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 314.045 MILLION OZ/

Feb 5/ we had HUGE change in silver inventory at the SLV/ A DEPOSIT OF 1.131 MILLION OZ INTO THE SLV/Inventory rests at 314.045 million oz/

Feb 2/we lost 982,000 oz from the SLV inventory /inventory rests at 312.914 million oz/

Feb 1/no change in silver inventory at the SLV/Inventory rests at 313.896 million oz/

Jan 31/ no change in inventory at the slv in total contrast to gold/inventory rests at 313.896 million oz/

Jan 30/no change in inventory/SLV inventory rests at 313.896 million oz/

Jan 29/no change in inventory/SLV inventory rests at 313.896 million oz/

Jan 26.2018/inventory rests at 313.896  million oz

Jan 25/with silver up today and yesterday, the SLV could only muster a gain of 848,000 oz

Inventory rests at 313.896 oz

jan 24/NO CHANGE IN SILVER INVENTORY DESPITE THE GOOD ADVANCE IN PRICE/INVENTORY RESTS AT 313.048 MILLION OZ/

Jan 23/ANOTHER HUGE WITHDRAWAL OF 1.131 MILLION OZ OF SILVER DESPITE THE TINY LOSS/THE CROOKS ARE USING THE INVENTORY TO RAID ON SILVER.

JAN 22.2018/with silver down by 5 cents/ the crooks at the SLV liquidate 1.321 million oz of silver/inventory rests at 314.179 million oz/

Jan 19/ no changes in silver inventory at the SLV/inventory rests at 315.500 million oz/

jan 18/A WITHDRAWAL OF 848,000 OZ OF SILVER FROM THE SLV/INVENTORY RESTS AT 315.500 MILLION OZ/

Jan 17/no changes in silver inventory at the SLV/inventory rests at 316.348 million oz/

Jan 16/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 316.348  MILLION OZ

Jan 12/no changes in silver inventory at the SLV/inventory rests at 316.348 million oz/

Jan 11/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 316.348 MILLION OZ/

Jan 10/with silver up again, we had a huge withdrawal of 1.227 million oz from the SLV/inventory rests at 316.348 million oz

Jan 9/a withdrawal of 848,000 oz from the SLV/Inventory rests at 317.575 million oz/

jan 8/no change in silver inventory at the SLV/Inventory rests at 318.423 million oz/

Jan 5/DESPITE NO CHANGE IN SILVER PRICING, WE HAD A HUGE WITHDRAWAL OF 2.026 MILLION OZ/INVENTORY RESTS AT 318.423 MILLION OZ.

Jan 4.2018/a slight withdrawal of 180,000 oz and this would be to pay for fees/inventory rests at 320.449 million oz/

Jan 3/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 320.629 MILLION OZ.

Jan 2/WITH SILVER UP DRAMATICALLY THESE PAST 4 TRADING DAYS, THE FOLLOWING MAKES NO SENSE: WE HAD A WITHDRAWAL OF 2.83 MILLION OZ FROM THE SLV

INVENTORY RESTS AT 320.629 MILLION OZ/

Dec 29/no changes in silver inventory at the SLV/inventory rests at 323.459 million oz/

Dec 28/DESPITE THE RISE IN SILVER AGAIN BY 13 CENTS, WE LOST ANOTHER 1,251,000 OZ OF SILVER FROM THE SILVER.

Dec 27/WITH SILVER UP AGAIN BY 17 CENTS, WE LOST ANOTHER 802,000 OZ OF SILVER INVENTORY/WHAT CROOKS/INVENTORY RESTS AT 324.780 MILLION OZ/

Dec 26/no change in silver inventory at the SLV./Inventory rests at 325.582

Dec 21/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 326.227 MILLION OZ/

.

Feb 8/2017:

Inventory 314.045 million oz

end

6 Month MM GOFO
Indicative gold forward offer rate for a 6 month duration

+ 1.65%
12 Month MM GOFO
+ 2.09%

end

As many of you know, I find no use for the COT report for the simple reason that a mammoth number of longs leave coupled with the shorts as well.

However for completeness, I will provide the report to you and anything you can glean from it, will be a bonus

First our gold COT

Gold COT Report – Futures
Large Speculators Commercial Total
Long Short Spreading Long Short Long Short
273,828 82,951 60,557 158,650 364,101 493,035 507,609
Change from Prior Reporting Period
-24,499 -8,114 2,909 3,960 -15,665 -17,630 -20,870
Traders
170 91 81 48 57 260 192
 
Small Speculators  
Long Short Open Interest  
42,286 27,712 535,321  
-6,381 -3,141 -24,011  
non reportable positions Change from the previous reporting period
COT Gold Report – Positions as of Tuesday, February 6, 20

our large speculators

those large specs that have been long pitched (transferred to London) a huge 24,499 contracts on a net basis

those large specs that have been short in gold covered 8114 contracts from their short side

our commercials

those commercials who have been long in gold added 3960 contracts to their long side

those commercials who have been short in gold covered (transferred) a net 15,665 contracts their obligation rests in London

our small speculators

those small specs who have been long pitched (transferred) a net 6381 contracts from their long side

those small specs who have been short in silver covered (transferred) a net 3141 contracts from their short side

 our silver cot

Silver COT Report: Futures
Large Speculators Commercial
Long Short Spreading Long Short
63,729 47,189 38,732 75,255 105,896
-8,416 7,466 8,131 6,977 -9,673
Traders
97 60 48 44 36
Small Speculators Open Interest Total
Long Short 205,470 Long Short
27,754 13,653 177,716 191,817
420 1,188 7,112 6,692 5,924
non reportable positions Positions as of: 164 126

our large speculators

those large specs that have been long in silver pitched (transferred) a huge 8416 contracts (net) from their long side

those large specs that have been short in silver added 7466 contracts to their short side

our commercials

those commercials that have been long in silver added 6977 contracts to their long side

those commercials that have been short in silver transferred a net 9673 contracts over to London

our small speculators 

those small specs that have been long in silver pitched (transferred) a huge 8988 net contracts  from their long side

those small specs that have been short in silver added a huge 7169 contracts to their short side.

end

Major gold/silver trading /commentaries for FRIDAY

GOLDCORE/BLOG/MARK O’BYRNE.

GOLD/SILVER

Brexit Risks Increase – London Property Market and Pound Vulnerable

Brexit Risks Increases – London Property Market and Pound Vulnerable 

– Brexit uncertainty deepens as UK government in disarray
– BOE warns of earlier and larger rate hikes for Brexit-hit UK
– UK property prices fall second month in row, London property under pressure
– No deal Brexit estimated to cost UK £80bn according to government analysis
– Transition period causing major uncertainty for UK and pound
– Pound expected to fall as Brexit fears remain into 2018

Editor: Mark O’Byrne

Source: VoxEU.org

Brexit risks have increased in recent days. A Reuters poll published on 8th February shows the pound is expected to fall this year as uncertainty around Brexit grows. Meanwhile London property prices continue to fall.

The median view of more than 60 foreign exchange specialists asked by Reuters, concluded the pound will struggle as the UK heads towards its exit of from the trading bloc in 2019.

This will come as a shock to many who had thought sterling had seen the worst of times following the 2016 referendum. After all, the currency was one of the world’s best performing currencies in 2017 after the over 30% collapse versus gold in 2016.

Gold in GBP (5 Years) (Click to enlarge)

Much of the 6.5% gain since October 2016 has been thanks to a stable monetary policy expectations. This is likely to remain in the short term but long term the Bank of England will no doubt struggle to handle the fallout of the current bubblicious environment, the immediate impact of Brexit uncertainty and rapidly changing geopolitics.

Also last week a government analysis was published stating that £80 billion would be the cost to the UK should a Brexit result in a ‘no deal’. As well as costs to businesses, food and drink prices are predicted to climb by 21% and 17%, respectively.

The pound has been in a precarious position ever since the referendum result. It will continue to be as more unknowns rear their heads. Savers may be pleased to hear about the prospect of a rate hike as suggested by the MPC this week, but how much difference does it make when the currency is floundering, significantly devalued and the country appears vulnerable until post-Brexit?

Is the EU working against the UK?

Brexit has been a sore point since the referendum but since negotiations began the divisions and wounds have grown deeper and deeper.

Naturally the EU has to be seen working against an event such as Brexit as it questions the trading bloc’s very existence. Last week Michel Barnier managed to behave so anti-UK that he managed to do one thing Theresa May has so far failed to do – unite the British government.

Barnier brought up new demands for a Brexit transition agreement. He suggested that the UK be subject to sanctions if the EU believe laws have been infringed. The country could be fined, suggested Barnier, without the EU having to go through the usually lengthy court process.

In short, Barnier and the EU would like to be able to punish the UK as it deems fit, during the transition period. Sanctions might come about should the country be considered to be operating against the EU’s interests in say, trade deals.

This development further underlines why the most dangerous time for the UK is the 19-month transition period. It is the most dangerous as it is the most unknown. It appears to be negotiations surrounding this that are causing the most damage to the the pound and the future of the UK economy.

Is London ‘dying’?

The financial hub of London has long been revered as one of the most established and most respected in the world.

The City’s power was one of the rallying cries of both the remain and leave campaigners during the referendum. The leavers stating that the financial power of London would only be strengthened by Brexit, the remainers saying it would only be weakened.

Politico’s Capital Markets summit this week gained some interesting insights from EU finance bods.

Olivier Guersent, the director general of the EC’s financial services directorate told the UK’s financial services to be prepared to be treated ‘as a third country’ whilst Claudio Costamagna, chairman of Italy’s Cassa Depositi e Prestiti, said that London’s financial centre is ‘dying’.

This does not bode well for a capital and country which is seeing poor results on various fronts of late, most notably in housing and the property market.

Financial services companies are delaying setting up here, as are other international bodies, because of uncertainty surrounding Brexit. This has had a major impact on demand, which is one of many factors pushing down the capital’s much hyped-up property market.

January’s RICS survey showed London’s house prices remain firmly in the red as more participants reported falling rather than rising prices.

According to Business Insider, the outlook isn’t set to improve much either:

While prices are expected to flatline nationally in the next three months, London is once again the exception, with most respondents expecting prices to fall — although the net balance ticked up from -41% in December to -21%.

You can read more about the bursting London property bubble here.

Transition policy in place by March?

This week the MPC decided to keep interest rates on hold but warned hikes may come thicker and faster. Unsurprisingly Mark Carney was questioned at length about the impact of Brexit on the MPC’s decision.

Carney said that should there be no transition deal by the end of March the MPC will be forced to look at the impact on household and business confidence before deciding how this will affect the economy.

The BofE forecast is predicted on the assumption that there will be a smooth transition, which Carney believes will be the case. Secondly, it is based on the view that the MPC has no further information than anyone else does. Carney hopes that we will be better informed by the end of the year and asks markets to consider how ‘nimble’ monetary policy can be.

Buy gold sovereigns at 4% loco London and Zurich – Call for special rate

This does not bode well for a country that has seen a fall in the value of its currency recently. Much of this is thanks to ‘nimble’ monetary policy.

So far, markets have reacted well to the latest announcement that the MPC may hike rates sooner than expected. How will this work out for those who are participating in the London housing market?

Many homeowners are practically mortgaged up-to-the-eyeballs having only ever lived with low-interest rates. Combine this with the uncertainty of jobs due to Brexit, plus increased living costs…the future is not looking bright for the property market and those exposed to it.

Expensive: Uncertainty is the only certainty of Brexit

It certainly seems as though the country and its government are distracted with the transition deal, sticking to the course of the UK’s departure by March 2019.

The problem is that distraction is creating a frothiness in the daily news cycle, surrounding all things Brexit. Rumours are swirling, papers are being leaked and MPs are throwing tantrums at every opportunity.

What does all this mean for the average UK and EU citizen? Major uncertainty. Ultimately nothing has been decided. For now the Brexit negotiations rage on, with very little achieved since they began.

Sadly markets don’t wait to see what the final outcome will be. They operate on news today and expected outcomes. The real news is that British citizens are more in the lurch than ever.

At the moment the expected outcome is unknown and wholly uncertain when it comes to how the UK will fare. Those who diversify away from sterling and other fiat currencies and into gold will be hedged. The price of gold in sterling will rise in the medium and long term, as we saw with the collapse of the pound following the Brexit referendum.

Gold thrives in environments such as these. UK investors would be prudent to pound cost average into gold while prices remain relatively depressed.

Recommended reading

Brexit Budget – Grim Outlook As UK Economy Downgraded

Brexit UK Vulnerable As Gold Bar Exports Distort UK Trade Figures

Sterling Gold Rises 1.3% as Sterling Slumps On ‘Hard Brexit’ Concerns, Up 36% YTD

News and Commentary

Digital assets have much higher risk levels than the traditional safe haven asset” said @GoldCore (Express.co.uk)

European Stocks Slide as Global Selloff Continues (Bloomberg.com)

Stocks Enter Correction as Rate-Hike Fears Return: Markets Wrap (Bloomberg.com)

US stock funds suffer record outflows of $23.9 billion (CNBC.com)

Senate votes to approve massive spending increase and end government shutdown (CNBC.com)


Source: Bloomberg

Jim Rogers Says Next Bear Market Will Be Worst in His Life (Bloomberg.com)

House prices to fall again in 2018 as buyers struggle to save for a deposit (CityAM.com)

Are house prices about to follow shares down? (DailyReckoning.com)

This Will Not Be A Soft Landing – Reality Returns To Wall Street – Rickards Warns (ZeroHedge.com)

Get Ready for Most Cryptocurrencies to Hit Zero, Goldman Says (Bloomberg.com)

Gold Prices (LBMA AM)

09 Feb: USD 1,316.05, GBP 945.58 & EUR 1,072.84 per ounce
08 Feb: USD 1,311.05, GBP 944.87 & EUR 1,071.13 per ounce
07 Feb: USD 1,328.50, GBP 956.12 & EUR 1,075.95 per ounce
06 Feb: USD 1,344.65, GBP 962.50 & EUR 1,083.52 per ounce
05 Feb: USD 1,337.10, GBP 947.20 & EUR 1,072.49 per ounce
02 Feb: USD 1,345.00, GBP 946.48 & EUR 1,077.61 per ounce
01 Feb: USD 1,341.10, GBP 941.99 & EUR 1,077.98 per ounce

Silver Prices (LBMA)

09 Feb: USD 16.36, GBP 11.83 & EUR 13.37 per ounce
08 Feb: USD 16.35, GBP 11.70 & EUR 13.36 per ounce
07 Feb: USD 16.69, GBP 12.02 & EUR 13.52 per ounce
06 Feb: USD 16.81, GBP 12.07 & EUR 13.59 per ounce
05 Feb: USD 16.88, GBP 12.01 & EUR 13.56 per ounce
02 Feb: USD 17.14, GBP 12.05 & EUR 13.72 per ounce
01 Feb: USD 17.19, GBP 12.09 & EUR 13.82 per ounce


Recent Market Updates

– Peak Gold: Global Gold Supply Flat In 2017 As China Output Falls By 9%
– Crypto Currency Backlash Sees Flight From Cryptos and Bitcoin
– Gold Rises As Global Stocks Plunge and Bitcoin Crashes 70%
– Shrinkflation Intensifies – Stealth Inflation As Thousands of Food Products Shrink In Size, Not Price
– U.S. Debt Is “Extraordinarily High” and Are Stock And Bond Bubbles – Greenspan
– Gold Bullion Price Suppression To End? Bullion Bank Traders Arrested For Manipulating Market
– ATMs Hit By Malware “Jackpotting” Attacks That Dispense All Cash In Minutes
– London Property Market Tumbles As Glut of Luxury Apartments Grows To 3,000
– Silver Bullion: Once and Future Money
– Greatest Stock Bubble In History? GoldNomics Podcast Transcript
– Davos – My Personal Experience of the $100,000 Event, $60 Burgers, Massive Inequality and the Blockchain Revolution
– Is This The Greatest Stock Market Bubble In History? Goldnomics Podcast
– Cyber War Coming In 2018?

janskoyles

-END-

Banks do not want to risk financing bitcoin as they ban the use of credit cards purchasing Bitcoin

(courtesy Surane/Keller)

Bitcoin Ban Expands Across Credit Cards as Big U.S. Banks Recoil

By Jennifer Surane and Laura J Keller

 Updated on 

A growing number of big U.S. credit-card issuers are deciding they don’t want to finance a falling knife.

JPMorgan Chase & Co.Bank of America Corp. and Citigroup Inc. said they’re halting purchases of Bitcoin and other cryptocurrencies on their credit cards. JPMorgan, enacting the ban Saturday, doesn’t want the credit risk associated with the transactions, company spokeswoman Mary Jane Rogers said.

Bank of America started declining credit card transactions with known crypto exchanges on Friday. The policy applies to all personal and business credit cards, according to a memo. It doesn’t affect debit cards, said company spokeswoman Betty Riess.

And late Friday, Citigroup said it too will halt purchases of cryptocurrencies on its credit cards. “We will continue to review our policy as this market evolves,” company spokeswoman Jennifer Bombardier said.

For more on cryptocurrencies, check out the Decrypted podcast:

Allowing purchases of cryptocurrencies can create big headaches for lenders, which can be left on the hook if a borrower bets wrong and can’t repay. There’s also the risk that thieves will abuse cards that were purloined or based on stolen identities, turning them into crypto hoards. Banks also are required by regulators to monitor customer transactions for signs of money laundering — which isn’t as easy once dollars are converted into digital coins.

Bitcoin has lost more than half its value since Dec. 18, falling below $8,000 on Friday for the first time since November. The drop occurred amid escalating regulatory threats around the world, fear of price manipulation and Facebook Inc.’s ban on ads for cryptocurrencies and initial coin offerings.

Now, cutting off card purchases could exacerbate those pressures by making it more difficult for enthusiasts to buy into the market. Capital One Financial Corp. and Discover Financial Services previously said they aren’t supporting the transactions.

Mastercard Inc. said this week that cross-border volumes on its network — a measure of customer spending abroad — have risen 22 percent this year, fueled partly by clients using their cards to buy digital currencies. The firm warned that the trend already was beginning to slow as cryptocurrency prices fell.

Discover Chief Executive Officer David Nelms was dismissive of financing cryptocurrency transactions during an interview last month, noting that could change depending on customer demand. For now, “it’s crooks that are trying to get money out of China or wherever,” he said of those trying to use the currencies.

end




Your early FRIDAY morning currency, Asian stock market results,  important USA/Asian currency crosses, gold/silver pricing overnight along with the price of oil Major stories overnight/9 AM EST

 

i) Chinese yuan vs USA dollar/CLOSED UP AT 6.3040 /shanghai bourse CLOSED DOWN AT 132.19 POINTS 4.05% / HANG SANG CLOSED DOWN 943.85 POINTS OR 3.10%
2. Nikkei closed DOWN 508.24 POINTS OR 2.32% /USA: YEN RISES TO 108.97

3. Europe stocks OPENED DEEPLY IN THE RED   /USA dollar index RISES TO 90.45/Euro FALLS TO 1.2236

3b Japan 10 year bond yield: FALLS TO . +.066/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 108.97/ 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:: 60.47  and Brent: 64.30

3f Gold DOWN/Yen DOWN

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

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

3h Oil DOWN for WTI and 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 +.741%/Italian 10 yr bond yield UP to 2.015% /SPAIN 10 YR BOND YIELD UP TO 1.452%

3j Greek 10 year bond yield RISES TO : 4.067?????????????????

3k Gold at $1316.10 silver at:16.36     7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble UP 12/100 in roubles/dollar) 58.29

3m oil into the 60 dollar handle for WTI and 64 handle for Brent/

3n Higher foreign deposits out of China sees huge risk of outflows and a currency depreciation. This can spell financial disaster for the rest of the world/

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 108.97 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 0.9386 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1485 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 +0.741%

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 2.8403% early this morning (THIS IS DEADLY TO ALL MARKETS). Thirty year rate at 3.1390% /BOTH DEADLY

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

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

Asia Crashes, Europe Slides, US Rebounds But Yields Resume Ominous Rise

“$5 trillion was wiped out from global stocks this week.”

After yesterday’s violent last hour plunge in US stocks, which also sent the VIX surging back to the mid-30s, the overnight session was somewhat muted, with European stocks falling further on Friday morning, but at a slower pace than the sharp sell offs in Asia and New York.

Europe’s 600 Index, down -1% as of this moment and back to session lows after a modest rebound earlier, was set for its worst week since 2016 as banks and financial-services stocks led most industry sectors lower. The drop, however, was relatively modest and followed a sheer plunge in Asia, where stocks tumbled across the region, wiping out most of their gains from the previous two sessions. The Shanghai Composite recouped some gains to close down “only” 4.1% – in what has now been a two-week selloff without the Chinese National Team making an appearance and buying stocks – the Hang Seng was down 3.1% with losses across all sectors. Tokyo’s Topix closed down 1.9 per cent.

The renewed slide followed Thursday’s drop in the S&P 500, which pushed the index to a 10 per cent decline from its January high – officially, a correction – stirred renewed concerns over the future of the long bull market that followed the 2008 financial crisis, and whether the selloff that was catalyzed by systematic quant funds would spill over to retail investors. And, as we highlighted overnight, that’s precisely what happened following the single biggest weekly outflow from equity funds on record.

And while we look forward to today’s session to see if the retail liquidation continues, S&P 500 futures little changed, after earlier rising as much as 0.9%, while Dow contracts reverse advance to slide 0.3%, even as Congress passed a delayed budget deal, after the government was briefly shut down.

The premarket calm may not last: in what has become a vicious Catch 22, as futures rise, so do 10Y yields, and as the last few days have demonstrated, once the 10Y rises above 2.85%, it leads to an almost immediate selloff.

Some perspective: what was until recently the best start since 1987, has turned into a global selloff that has wiped $5 trillion from global stocks since January while the MSCI World Index is set for its biggest weekly drop since 2011.


Meanwhile over in macro, FX traders have one eye on the stock markets and another on positioning and central bank developments. While in earlier trading the dollar stayed under pressure as U.S. futures pointed to a higher open and Treasuries slipped, the entire move has quickly reversed as futures started to sink as yields rebounded, sending the BBG Dollar index (BBDXY) to session highs.

“A reassessment of the inflation outlook at this point in the cycle is natural and markets are adjusting for this,” Kerry Craig, a Melbourne-based global market strategist at JPMorgan Asset management, said in a note. “But given that U.S. markets are now in correction territory it’s likely that the most severe gyrations will hopefully have passed. Volatility may remain for a while longer, but the strong economic backdrop and sustained earnings outlook means we continue to prefer equities.”

Meanwhile, days after Goldman came out with a glowing endorsement of the commodity sector in general, and crude in particular, oil headed toward its worst week in almost a year as the global risk-asset rout further rankled investors already concerned over growing U.S. supply. Gold declined along with most industrial metals. South Africa’s rand strengthened as speculation intensifies that President Jacob Zuma will soon resign. Russia’s ruble was among the best-performing emerging-market currencies after the country’s central bank cut its policy rate.

Bulletin headline summary from RanSquawk

  • Partial government shutdown stopped after US Senate and House passes spending bill.
  • European bourses showing some resilience to the sell-off seen in the US and Asia.
  • Looking ahead, highlights include Canadian Jobs report and a slew of central bank speakers.

Top Headline News from BBG

  • Congress passed a two-year budget agreement early Friday that will boost federal spending by almost $300 billion and suspend the debt ceiling for a year, ending a brief partial government shutdown that began at midnight when lawmakers missed a funding deadline
  • Fed’s Esther George says three rate hikes this year and about the same number next year is a “reasonable baseline unless the outlook changes materially”; she also said that last week’s report of higher wages is a “welcome development” and that she expects inflation to begin to rise as labor markets tighten further and global demand pushes up import prices
  • Investors pulled $30.6b out of global equity funds, the most on record, analysts at BofAML says in research note citing EPFR Global data for week ending Feb. 7
  • Hedge funds investing only in Europe received about $6 billion in 2017, reversing a funding exodus in the previous 12 months, according to eVestment data; money pools targeting the U.S. and Asia suffered combined outflows last year of about $24 billion
  • RBA said in its quarterly policy statement that it will be some time before the economy reaches current estimates of full employment and inflation returns to the midpoint of the target. It left inflation and economic growth forecasts unchanged from three months earlier
  • U.K. PM Theresa May is adamant that Britain must aim high in its demands for an ambitious free-trade deal, just as she’s determined to make the most of her time in office, however long that lasts, officials said

Market Snapshot

  • S&P 500 futures up 0.6% to 2,608.50
  • STOXX Europe 600 down 0.4% to 372.4
  • MSCI Asia Pacific down 1.9% to 170.20
  • MSCI Asia Pacific ex Japan down 1.9% to 554.21
  • Nikkei down 2.3% to 21,382.62
  • Topix down 1.9% to 1,731.97
  • Hang Seng Index down 3.1% to 29,507.42
  • Shanghai Composite down 4.1% to 3,129.85
  • Sensex down 1.4% to 33,937.75
  • Australia S&P/ASX 200 down 0.9% to 5,837.97
  • Kospi down 1.8% to 2,363.77
  • Brent Futures down 0.5% to $64.48/bbl
  • Gold spot down 0.3% to $1,315.09
  • U.S. Dollar Index up 0.02% to 90.25
  • German 10Y yield unchanged at 0.763%
  • Euro up 0.2% to $1.2266
  • Brent Futures down 0.5% to $64.48/bbl
  • Italian 10Y yield rose 4.3 bps to 1.725%
  • Spanish 10Y yield fell 1.6 bps to 1.434%

Asia stocks traded negative across the board with global sentiment lambasted after the return of the market turmoil on Wall St, where the major indices closed in correction territory and the DJIA (-4.2%) tumbled over 1000 points on the day with the move accelerating heading into the close. Furthermore, political uncertainty in the US also added to the downbeat tone with the government officially in a shutdown after Senator Rand Paul blocked to fast track the Senate vote on the 2-year budget deal, other commentators have also paid credence to the continued upside in US yields adding pressure to equities. As such, ASX 200 (-0.9%) was weaker with energy names dampened after Brent crude prices fell to a near 2-month low, while losses in the Nikkei 225 (- 2.7%) were magnified by recent JPY strength. Elsewhere, underperformance in China resumed in which Hang Seng (-3.7%) and Shanghai Comp (-5.3%) slumped as the large cap energy and financials dragged, while the PBoC remained steadfast in its efforts to keep interbank liquidity stable and refrained from open market operations for a 12th day. However, the central bank instead announced it released nearly CNY 2tln in temporary liquidity through the Contingent Reserve Allowance which will allow banks to temporarily utilize deposit reserves to satisfy cash demand ahead of the Lunar New Year. Finally, 10yr JGBs were higher on safe-haven bids and with the BoJ also present in the market for JPY 850bln in JGBs across the curve. PBoC skips open market operations, for the 12th consecutive day, while it said it released temporary liquidity valued nearly CNY 2tln as it seeks to satisfy cash demand before the Lunar New Year.

Top Asian News

  • China Ends 25-Year Wait as Yuan Oil Futures Set to Start Trading
  • Citic Bank to Offer HNA Group 20B Yuan Credit Line
  • Bank Indonesia Intervenes to Stabilize Rupiah at 20-Month Low
  • Shenzhen Stocks Enter Bear Market as New Economy Dreams Fade

European traders were closely watching events in the US on Thursday: The fresh sell-off late yesterday saw US equities (DJIA and S&P 500) move into correction territory amid the surge higher in yields in which the US 10yr yield made a high of 2.88%, matching the post NFP high. This also transpired into a sell-off in the Asia-Pac region with Chinese bourses seeing its largest weekly decline in 2yrs, prompting Chinese authorities to announce a  CNY2tln temporary liquidity package. However, despite this, losses in Europe have been somewhat contained, European bourses showing a relatively mixed picture (EuroStoxx 50 -0.4%). On a stock specific basis, M&A talk has been doing the rounds with the L’Oreal CEO hinting that they may acquire a EUR 23bln stake in Nestle. Umicore shares the best performer following their strong trading update.

Top European News

  • BOE’s Broadbent Says Rate Path Now Slightly Higher Than in Nov.
  • U.K. PM Is Mulling Trip to Northern Ireland Next Week, BBC Says
  • Maersk Drops as Company Misses Estimates After an ‘Unusual’ Year
  • Flow Traders Shares Soar as Volatility Drives 1Q

In FX, Usd/Jpy is now bouncing further from overnight lows (around 108.50 where decent domestic bids were reported) through 109.00 and offers at 109.20 to a 109.30 peak so far. Similarly, Usd/Chf is firmer up towards 0.9400 vs 0.9350 at one stage and the DXY is deriving some underlying support ahead of the 90.000 level despite Greenback losses against other G10 counterparts. Cable has lost grip of the 1.4000 handle and a degree of its bullish/hawkish BoE impetus, but remains firm ahead of 1.3900, as Eur/Gbp continues to trade below 0.8800 and Eur/Usd is capped by 1.2289 resistance (55 DMA) in front of supply at 1.2300. Usd/Cad is still pivoting around 1.2600 and now awaiting Canadian jobs data amidst the ongoing NAFTA impasse, while Aud/Usd stays on the backfoot after the RBA’s dovish SOMP and weaker than forecast mortgage data within a 0.7795-60 range – 200 DMA at 0.7755 providing support and big 0.7800 option expiry (2.75 bn) also exerting some influence. Nzd/Usd is holding just above 0.7200 in wake of this week’s RBNZ meeting, which opened the door to further easing alongside central guidance for tightening in mid-2019, but Usd/Cnh has retreated from its post-capital control related spike highs.

In commodities, across the commodities complex, WTI and Brent crude futures continue to hover near recent lows, however prices have seen a slight pull back amid source reports that the Forties pipeline system is still running at a restricted rate. China plans to launch crude oil futures on March 26th.

Looking at the day ahead, the only data of note is December wholesale trade sales. The Fed’s George is also due to speak early morning.

US event calendar

  • 10am: Wholesale Inventories MoM, est. 0.2%, prior 0.2%; Wholesale Trade Sales MoM, est. 0.4%, prior 1.5%

DB’s Jim Reid concludes the overnight wrap

The Winter Olympics in Pyeongchang starts today and if markets this week were an event I think they’d probably be the Ski Cross. If you haven’t seen this crazy race it consists of wild jumps, fast bends, spectacular crashes, terrifying falls, and jutting elbows. Just like the VIX this week.

The ups and downs continued yesterday with the eventual emphasis on the down with another very poor US close seeing the S&P 500 down -3.75% and 104 points lower than the day’s early highs. Given how sensitive markets were to a slightly hawkish BoE yesterday, one can only imagine the turmoil on Wednesday next week if US CPI comes in ahead of expectations. Obviously a softer/in-line number would be greatly received at the moment. To put the BoE in perspective their forecasts only imply three quarter point hikes over the next three years. So hardly a traditional rate cycle let alone an aggressive one. Initially the sell-off was focused on Government bonds but it spread with a lag of a couple of hours to equities with equity vol spiking again.

Now delving into equities a bit more, US bourses were down c4% yesterday with all sectors in the red and losses led by the financials, tech and discretionary consumer stocks (S&P: -3.75%; Dow -4.15%; Nasdaq -3.90%). Relative to their recent highs two weeks ago, the S&P and Dow are now officially in correction territory with the index down -10.2% and -10.4% respectively, while the Nasdaq is not far behind at -9.7%. European bourses were also lower yesterday, with the Stoxx (-1.60%), DAX (-2.62%) and FTSE (-1.49%) all down.

Over in government bonds, the UST 10 bond yield traded up to 2.882% following a weaker 30y treasury auction but closed -1.2bp lower to 2.825%, in part boosted by the flight to safety that has been absent most of this week. Elsewhere, 10y Bunds yields rose 1.7bp while Gilts rose 6.6bp following the hawkish BOE statements (more below). In credit markets, spreads on IG credit indices widened 4-5bp and the US CDX HY widened 20bp back to December 16 levels. Another focus yesterday was the volatility measures. The VSTOXX jumped c50% to 32.04, now back near the Brexit vote high in 2016 while the VIX traded within a c12pt range before closing c21% higher to 33.46 (+5.7 pt).

This morning in Asia, markets are extending the US sell off. The Nikkei (-2.93%), Hang Seng (-3.56%), Kospi (-1.62%) and China’s CSI 300 (-5.0%) are all down as we type. If these levels hold into close, all indices excluding the Kospi will be down >11% since their recent highs. Datawise, China’s January CPI and PPI both slowed mom but were in line with expectations at 1.5% yoy and 4.3% yoy respectively. In the US, the government may be partially shut down for a few hours. Earlier, Senator Rand argued against the proposed two year spending bill, leaving the Senate to wait till 1am Friday morning (as we go to print) to pass a procedural vote, then the House is expected to pass it sometime between 3am-6am, if not earlier. Elsewhere, the Senate banking committee has narrowly approved (13-12) Trump’s Fed nominee Marvin Goodfriend. His confirmation will now be voted in the full senate where approval may not be certain.

Now recapping other markets performance from yesterday. In currencies, the US dollar index was marginally higher (+0.03%) and rose for the fifth consecutive day, while the Euro dipped 0.14% and Sterling gained 0.23% following the BOE commentaries. In commodities, WTI oil retreated for the fifth straight day to be down 1.04% to $61.15/bbl (-6.6% cumulative). Elsewhere, precious metals strengthened slightly (Gold +0.03%; Silver +0.30%) and other base metals were mixed but little changed (Copper -0.35%; Zinc +0.55%; Aluminium +0.07%).

Turning back to the BOE, as expected the MPC members voted unanimously to keep rates on hold at 0.5%. However the outlook comments seemed more hawkish. The BOE Governor Carney said “it will be likely to be necessary to raise rates to a limited degree in a gradual process but somewhat earlier and…greater extent than what we had thought in November”. A stronger than expected global economy, improving wages and the continuing weak outlook for the UK’s potential supply underpinned the Bank’s more hawkish position. The bank has also upgraded its GDP growth forecasts for 2018 to 1.8% (+0.2ppt) while 2019 was steady at 1.7%. Overall, the meeting was broadly in line with our UK team’s expectations that the MPC would endorse tighter market pricing, without wanting to pre-commit to a May hike. They maintain their view that the BOE will keep rates on hold in May, as they expect demand to slow. For more details, refer to our UK economists’ note. Bloomberg’s implied odds for a May cash rate hike has increased 20ppt to 67%.

Now onto the three Fed speakers overnight. On the recent US equity sell off, similar to their peers, they all seemed to be taking it in their stride. The Fed’s Dudley said “…so far, I’d say this is small potatoes”. The Fed’s Kaplan said “… having a little more volatility, may be a healthy thing”, in part as the recent low  volatility was “historically unusual”. Then the Fed’s Harker said “stock market volatility hasn’t changed his economic outlook” and that if you believe the long end of the curve is going up, then “it makes sense that equities would have an adjustment”. That said, he does not think the changes will materially impact business investment and consumer spending.

Moving onto rates and inflation. Mr Dudley noted three rate hikes “still seems like a very reasonable projection” and that “monetary policy around the world is going to become less accommodative”. However, he didn’t put too much weight on the 2.9% yoy wage growth beat last week as it was a single data point and the “question is what’s the trend looking through many months”. Following on, Mr Kaplan noted “my base case right now is the same (3 hikes in 2018)….but it’s a dynamic process”, that is subject to the incoming data and prevailing conditions. He added he “will continue to be vigilant for looking at financial conditions and any spillovers to the economy”, but he is not seeing that at this point. Elsewhere, Mr Harker noted “I’m glad we’re seeing some firming (in inflation)”, but “it’s not obvious that inflation…will absolutely reach our 2% target”, with one of the swing factors being the dollar.

Turning back to the Euro, the ECB’s Weidmann noted “we will monitor closely any impact FX rate movements might have on our primary target of stability”, but should not “allow ourselves to become unsettled by the decline in (the recent) fall in equity prices”. On QE, he reiterated his views that “if the expansion progresses as expected, substantial net purchases beyond the announced amount do not seem to be required”. The ECB’s Praet also noted policy normalisation will be a “long complex” process.

Onto some of the Brexit headlines. Senior EU figures have told Reuters that Britain will not be ready to make a full break from the EU by the end of 2020 and the EU side is bracing for a longer goodbye. Conversely, senior UK officials told Bloomberg that the UK is planning for an instant break from existing EU regulations, such as some rules on financial services to benefit more from Brexit.

Elsewhere, after more talks between the EU and UK counterparts over the past two days, the UK Brexit Secretary Davis said the meeting was “very constructive”, but “…there are still things incomplete”.

Finally, this morning, Michal Jezek in our team published a report “Credit Spread & Vol. Repricing as Equities Go from Melt-Up to Melt-Down”. He reviews the price action in CDS index spreads and their implied volatility during the current market turmoil and shows how their future direction is linked to equity volatility products. The report concludes that the recent vol. shock as a learning event for most market participants is likely to lead to a new, higher regime for both spread levels and their volatility. You can download the report here.

Before we take a look at today’s calendar, we wrap up with other data releases from yesterday. In the US, the weekly initial jobless claims (221k vs. 232k expected) and continuing claims (1,923k vs. 1,940k expected) were both moderately lower than expectations – the former is near mid-January’s c44 year low. The January Bank of France industrial sentiment index eased back to a still solid level of 105 (vs. 110 expected). In Germany, the December trade surplus was smaller than expected at €18.2bln (vs. €21bln), with stronger than expected growth in imports (1.4% mom vs. -0.7%) outpacing exports (0.3%). For 2017, Germany’s annual trade surplus fell for the time since 2009, albeit modest (€244.9bln vs. €248.9bln).

Looking at the day ahead, in Europe we get the December industrial production data out of the UK and France, with trade numbers also due in the former, while across the pond in the US the only data of note is December wholesale trade sales. The Fed’s George is also due to speak early morning.

3. ASIAN AFFAIRS

i)Late THURSDAY night/FRIDAY morning: Shanghai closed DOWN 132.19 points or 4.05% /Hang Sang CLOSED DOWN 943.85 or 3.10% / The Nikkei closed DOWN 508,24 POINTS OR 2.32%/Australia’s all ordinaires CLOSED DOWN 0.96%/Chinese yuan (ONSHORE) closed UP at 6.3041/Oil DOWN to 60.47 dollars per barrel for WTI and 64.30 for Brent. Stocks in Europe OPENED DEEPLY IN THE RED .   ONSHORE YUAN CLOSED UP AGAINST THE DOLLAR AT 6.3040. OFFSHORE YUAN CLOSED DOWN AGAINST  THE ONSHORE YUAN AT 6.3244//ONSHORE YUAN A LOT STRONGER AGAINST THE DOLLAR/OFF SHORE A LOT STRONGER TO THE DOLLAR/. THE DOLLAR (INDEX) IS  MUCH STRONGER AGAINST ALL MAJOR CURRENCIES EXCEPT CHINA YUAN.  CHINA IS NOT TOO  HAPPY TODAY.(INTERVENTION STRONGER CURRENCY AND WEAK MARKETS IN CHINA AND THROUGHOUT THE GLOBE )

3 a NORTH KOREA/USA

/NORTH KOREA

end
 

3 b JAPAN AFFAIRS

c) REPORT ON CHINA

Asia crashes: China big cap companies crash over 7%/worst week since Lehman

(courtesy zerohedge)

US Contagion Accelerates – China Big Caps Crash Over 7%, Worst Week Since Lehman

Update 0950ET: Things went from bad to worst very fast…

  • *CHINA H-SHARE INDEX SLIDES 5%
  • *SHANGHAI COMPOSITE INDEX DROPS 5.3%
  • *CHINA SSE 50 INDEX OF BIG CAPS DROPS 7.5%
  • *TENCENT DROPS 5.1% TO TRADE BELOW HK$400

This is the big caps worst day since the Aug 2015 devaluation crash, and the worst week (unless The National Team steps in) since Lehman..

*  *  *

After an insane winning streak in December and January, the Hang Seng has plummeted in the last few days and along with the rest of the major mainland China equity markets – has entered correction.

2018 started off so well in China…

But after an almost incessant ramp, China and Hong Kong stocks have crashed back to reality in the last few days…

Shanghai Composite is now at 7-month lows…

And Hang Seng is down 12% from its highs, back below 30,000…

The Yuan remains on edge as it tumbles most since the Aug 2015 devaluation…

And across the water, Japanese stocks are down 13% from their highs…

end

4. EUROPEAN AFFAIRS

8. EMERGING MARKET

 end
END

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

Euro/USA 1.2236 DOWN .0025/ REACTING TO MERKEL’S FAILED COALITION/ 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/JAPAN TAPERING BOND PURCHASES /USA FALLING INTEREST RATES AGAIN/HOUSTON FLOODING/EUROPE BOURSES DEEPLY IN THE  RED 

USA/JAPAN YEN 108.97 UP  0.427 (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 1.3818 DOWN .01194 (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 1.2610 UP .0022 (CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA)

Early THIS FRIDAY morning in Europe, the Euro FELL by 25 basis points, trading now ABOVE the important 1.08 level RISING to 1.2352; / Last night Shanghai composite CLOSED DOWN 132.19 POINTS OR 4.05 %   Hang Sang CLOSED DOWN 943.85 POINTS OR  3.10% /AUSTRALIA CLOSED DOWN 0.96% / EUROPEAN BOURSES DEEPLY IN THE RED  

The NIKKEI: this FRIDAY morning CLOSED DOWN 508.24 POINTS OR 2.32%

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

2/ CHINESE BOURSES / : Hang Sang CLOSED DOWN 943.85 POINTS OR 3.10% / SHANGHAI CLOSED DOWN 132.19 POINTS OR 4.05% /

Australia BOURSE CLOSED DOWN 0.96% /

Nikkei (Japan)CLOSED DOWN 508.34 POINTS OR 2.32%

INDIA’S SENSEX  IN THE RED

Gold very early morning trading: 1315.00

silver:$16.34

Early FRIDAY morning USA 10 year bond yield: 2.8403% !!! UP 2 IN POINTS from THURSDAY night in basis points and it is trading WELL ABOVE resistance at 2.27-2.32%. (POLICY FED ERROR)/DEADLY

The 30 yr bond yield 3.1390 UP 1 IN BASIS POINTS from THURSDAY night. (POLICY FED ERROR)/DEADLY

USA dollar index early FRIDAY morning: 90.45 UP 22  CENT(S) from THURSDAY’s close.

This ends early morning numbers FRIDAY MORNING

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And now your closing FRIDAY NUMBERS \1 PM

Portuguese 10 year bond yield: 2.0101% UP 7  in basis point(s) yield from THURSDAY/

JAPANESE BOND YIELD: +.0.066% DOWN 1  1/2   in basis points yield from THURSDAY/JAPAN losing control of its yield curve/

SPANISH 10 YR BOND YIELD: 1.48% UP 3  IN basis point yield from THURSDAY/

ITALIAN 10 YR BOND YIELD: 2.049 UP 5  POINTS in basis point yield from THURSDAY/

the Italian 10 yr bond yield is trading 57 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: +.745%  DOWN 2 IN BASIS POINTS ON THE DAY

END

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IMPORTANT CURRENCY CLOSES FOR FRIDAY

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

Euro/USA 1.2222 DOWN.0038 (Euro DOWN 38 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 108.39 DOWN 0.153 Yen UP 15 basis points/

Great Britain/USA 1.3795 DOWN .01400( POUND DOWN 140 BASIS POINTS)

USA/Canada 1.2605 UP  .0017 Canadian dollar DOWN 17 Basis points AS OIL FELL TO $59.68

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This afternoon, the Euro was DOWN 38 to trade at 1.2222

The Yen ROSE to 108.39 for a GAIN 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 140 basis points, trading at 1.3795/

The Canadian dollar FELL by 17 basis points to 1.2605/ WITH WTI OIL FALLING TO : $59.68

The USA/Yuan closed AT 6.3032
the 10 yr Japanese bond yield closed at +.066% DOWN 1 & 1/2 BASIS POINTS / yield/
Your closing 10 yr USA bond yield DOWN 1/ 2 IN basis points from THURSDAY at 2.817% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 3.131  UP 2  in basis points on the day /DEADLY

THE RISE IN BOTH THE 10 YR AND THE 30 YR ARE VERY PROBLEMATIC FOR VALUATIONS

Your closing USA dollar index, 90.46 UP 23 CENT(S) ON THE DAY/1.00 PM/

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

London: CLOSED DOWN 78.26 POINTS OR 0.61%
German Dax :CLOSED DOWN 152.81 POINTS OR 1.24%
Paris Cac CLOSED DOWN 72.47 POINTS OR 1.41%
Spain IBEX CLOSED DOWN 116.70 POINTS OR 1.20%

Italian MIB: CLOSED DOWN 299.85 POINTS OR 1.13%

The Dow closed UP 330.44 POINTS OR 1.38%

NASDAQ WAS UP 97.33 Points OR 1.44% 4.00 PM EST

WTI Oil price; 59.68 1:00 pm;

Brent Oil: 62.95 1:00 EST

USA /RUSSIAN ROUBLE CROSS: 58.48 DOWN 7/100 ROUBLES/DOLLAR (ROUBLE HIGHER BY 7 BASIS PTS)

TODAY THE GERMAN YIELD RISES TO +.745% 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:$59.22

BRENT: $62.77

USA 10 YR BOND YIELD: 2.8512%   THIS RAPID ASSENT IN YIELD IS VERY DANGEROUS/DERIVATIVES START TO BLOW UP/very dangerous

USA 30 YR BOND YIELD: 3.1612%/BROKE GUNDLACH’S KEY 3.00% AGAIN WHERE ALL VALUATIONS ON STOCKS BLOW UP/DEADLY

EURO/USA DOLLAR CROSS: 1.2243 DOWN.0018  (DOWN 18 BASIS POINTS)

USA/JAPANESE YEN:108.76 UP 0200/ YEN DOWN 20 BASIS POINTS/ THIS GOOSED THE DOW HIGHER IN THE LAST HR TODAY.

USA DOLLAR INDEX: 90.41 UP 18 cent(s)/

The British pound at 5 pm: Great Britain Pound/USA: 1.3825 : DOWN 0.01107  (FROM LAST NIGHT DOWN 110 POINTS)

Canadian dollar: 1.2587 UP 1 BASIS pts

German 10 yr bond yield at 5 pm: +0.762%


VOLATILITY INDEX:  28.85  CLOSE  DOWN   4.61/THIS WAS ALSO GOOSED BY THE CROOKED BANKERS TODAY.) 

END

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

TRADING IN GRAPH FORM FOR THE DAY

Goldilocks’ Is Dead – Stocks Plunge Most Since Lehman Before Sudden Buying-Panic

Remember January’s “Goldilocks” market?

Well it’s gone…

The Short-Vol trade implosion has now spread to the rest of the world and all other asset classes.

China had one of its ugliest weeks ever…

Europe was ugly…

But US equities were a bloodbath…even wuith the sudden mysterious buyer of last resort who panic-bid stocks up (after the S&P broke below its 200DMA)…

We’ve seen this pattern before.

Dow futures were lifted 1000 points off the lows today

Also of note is that this panic-bid lifted the major equities out of correction…

Stocks were on target for their worst week for US equities since Lehman in Oct 2008… (worst 2-week drop since Feb 2009)

But after the S&P hit its 200DMA, everything bounced miraculously…

All major indices remain red in 2018…

The Dow saw well over 12,000 points worth of intraday swings this week…

This the worst swing in momentum… ever…

And the biggest swing in equity flows ever…record inflow 2 weeks ago to record outflow from equity funds this week

VIX was notably higher on the week…

Tagging 40 today before dumping…

Risk started to spread to other asset classes too…

The biggest drawdowns so far:

  • XIV (Inverse VIX ETF) -96.5%
  • Bitcoin -65% (from Jan highs)
  • China ‘Big Caps’ SSE50 -15%
  • Shanghai Composite -14.6%
  • EM Stocks -13.5%
  • WTI Crude -12.9%
  • Nikkei 225 -12.6%
  • Dow -12.2%
  • S&P -11.8%
  • Nasdaq -11.7%
  • DAX -11.6%
  • FANG Stocks -11.1%
  • EM Debt -9.9%
  • EU Stocks (BE500) -8.7%
  • Mexico Stocks -8.1%
  • 30Y UST Futures -7.7%
  • Brazilian Real -6.3%
  • Risk Parity Fund proxy -6.2%
  • HY Bonds (HYG) -4.5%
  • Gold -4.2%
  • Euro -2.5%
  • Offshore Yuan -1.9%

This is the worst 10-day drop for aggregate bond and stocks returns since Feb 2009…

Credit markets started to scream today as spreads spiked…

Flashing another big red flag that this is far from over…

Lots of chatter about how “bonds are blowing out” and driving equities lower… well no! only the 30Y is wider on the week! and the short-end is well lower in yield on the week…

The key that is crushing stocks is the 2.85% region…

The Dollar Index was up most in 2 months this week, hovering at pre-Mnuchin Massacre levels…

Some crazy moves this week in Offshore Yuan…

Dollar strength sent commodities lower on the week with crude and copper the biggest laggards…

(NOTE WTI futures were hit every day this week around the US cash open)

WTI dropped below $60 and broke below its 50DMA…

Cryptos actually rebounded notably in the second half of the week after the US regulatory hearings went better than expected, with Litecoin leading…

Interestingly Bitcoin and VIX decoupled as the stress remained in equity markets…

CNBC’s Bob Pisani is “very encouraged” by today’s action.

END

This morning: suppression of VIX/stocks initially ramped higher

(courtesy zerohedge)

Seriously!

end

Midday  dead cat bounce as the Dow turns a 200 point gain into losing territory with the VIX rising to:  32.96 and the 10 yr bond piercing 2.85% again

(courtesy zerohedge)

Another Dead-Cat-Bounce Dies – Stocks Tumble Below Yesterday’s Lows

XIV’s ramp into the open offered some hope, but just like yesterday, that hope is gone as stocks tumble back into the red and below yesterday’s lows…

XIV is fading…  (VIX is rising)

Rate spiked back above 2.85%…

And so stocks faded back into the red…

Futures show the same trend yesterday…

end

At 1 pm est:

Dow Down 350Pts, VIX Tops 35, Nasdaq Enters Correction

Still not over…

The Dow is back below yesterday’s lows, down 350 points on the day

And NAsdaq is down 11% from its highs – entering correction…

end

2:50 pm

Dow Jumps 500 Points In 20 Minutes Back To Green

Bwuahahaha…

As XIV rips higher so The Dow jumps 500 points into the green..

As The S&P bounces off the 200DMA…

end
It is now Moody’s turn to sound the alarm bell with respect to the huge increase in the uSA debt. They are threatening the USA with a downgrade.  With the new 2 year budget deal passed by both houses, the Debt Ceiling will be reset and the new “Debt to the Penny” will be close to 21 trillion dollars.

(courtesy zerohedge)

Moody’s Threatens US Downgrade Due To Soaring Debt, “Fiscal Deterioration”

Back in 2011, Standard & Poors’ shocked the world, and the Obama administration, when it dared to downgrade the US from its vaunted AAA rating, something that had never happened before (and led to the resignation of S&P’s CEO and a dramatic crackdown on the rating agency led by Tim Geithner).

Nearly seven years later, with the US on the verge of another government shutdown and debt ceiling breach (with the agreement reached only after the midnight hour, literally) this time it is Warren Buffett’s own rating agency, Moody’s, which on Friday morning warned Trump that he too should prepare for a downgrade form the one rater that kept quiet in 2011. The reason: Trump’s – and the Republicans and Democrats – aggressive fiscal policies which will sink the US even deeper into debt insolvency, while widening the budget deficit, resulting in “meaningful fiscal deterioration.

In short: a US downgrade due to Trumponomics is inevitable. And incidentally, with today’s 2-year debt ceiling extension, it means that once total US debt resets at end of day – unburdened by the debt ceiling – it will be at or just shy of $21 trillion.

We expect if not a full downgrade, then certainly a revision in the outlook from Stable to Negative in the coming  months.

Here’s Moodys:

The stable credit profile of the United States (Aaa stable) is likely to face downward pressure in the long-term, due to meaningful fiscal deterioration amid increasing levels of national debt and a widening federal budget deficit. However, the US economy is very strong, wealthy, dynamic and well diversified, and its role in the global financial system is unmatched. These factors help compensate for the impending fiscal weakness, Moody’s Investors Service says in a new report.

Moody’s has already indicated that rising entitlement costs and rising interest rates will cause the US’s fiscal position to further erode over the next decade, absent measures to reduce those costs or to raise additional revenues. The recently-agreed tax reform will exacerbate and bring forward those pressures.

Moody’s current baseline forecast is that the sovereign balance sheet will continue to weaken over the coming decade. Absent corrective fiscal measures, the US’s Aaa rating will rely increasingly on its unparalleled economic base and the central role it plays in the global financial system.

The US economy’s dynamism, competitiveness, rich resource endowment, high income levels and relatively supportive demographic trends underpin its economic strength. While evidence of declining growth potential, coupled with emerging aversion to open trade and foreign labor during a period of rising global competition, suggest that this level of relative strength could erode over time, we expect the US’ broad economic strength to support its credit profile for the foreseeable future.

Moreover, the role of the US dollar in global financial markets and the depth and liquidity of the US treasury market remove all but the most extreme government liquidity and balance of payment risks. They insulate the US from external shocks and shifts in financing conditions in a way not seen with other sovereigns.

Moody’s research subscribers can access this report, “Preeminent financial, economic position offsets weakening government finances”, at http://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBM_1108357

 end

No shutdown as the Congress passes a two year budget deal.  They will fund the government up to March 23.2018

(courtesy zerohedge)

No Shutdown: Congress Passes Two-Year Budget Deal

Update: just before 6am ET on Friday, the House joined the Senate in passing the budget deal that would fund the government through March 23, sending legislation to President Trump that would end a brief shutdown of the government that began at midnight.

The bill passed in a 240-186 vote despite opposition from most Democrats, who had sought a firmer commitment from Speaker Paul Ryan (R-Wis.) that he will bring immigration legislation to the floor for a vote that would protect immigrants who came to the United States as children from deportation.  House Democrats just barely made up for the defections on the GOP side. A total of 73 Democrats voted for the legislation, while 67 Republicans voted against it.

As The Hill reports, Democrats tried to make GOP leaders sweat. They held out their votes until the final minutes, until it was clear that a majority of the GOP conference supported it. At first, Republicans were the only ones casting votes as Democrats sat largely in silence. Then the “no” votes ominously began piling up, only for enough Democrats to eventually neutralize the GOP defections.

Gamesmanship from both parties was repeatedly on display, with Democrats warning Republicans they could not count on the minority delivering votes. Republicans, for their part, repeatedly played it cool in public, offering confidence the measure would pass despite opposition from conservative Republicans who said the new spending added too much to the deficit.

In his closing remarks, Ryan noted the bipartisan 71-28 Senate tally, and said that 75 percent of Senate Democrats and 68 percent of Senate Republicans had voted for it.

Before Ryan spoke, Nancy Pelosi again called on him to commit to a vote on immigration, saying he acts more as a Speaker of the White House than a Speaker of the House. The early vote took place because of Sen. Rand Paul who blocked action in the Senate for must of Thursday with a demand on an amendment leaving previous ceilings on federal spending in place.

* * *

The Senate approved a bipartisan two-year budget deal early Friday morning after the government technically shut down due to a midnight deadline which was missed due to Rand Paul – who held up the vote while insisting on an amendment which would keep budget caps in place in order to reign in out-of-control spending.

a

I ran for office because I was very critical of President Obama’s trillion-dollar deficits,” said the Kentucky senator. “Now we have Republicans hand in hand with Democrats offering us trillion-dollar deficits. I can’t in all honesty look the other way.”

I have been offering all day to vote. I would like nothing more than to vote. But it’s the other side. It’s the leadership that has refused to allow any amendments,” he said.

The new legislation contains roughly $400 billion in new spending for the Pentagon, various agencies, disaster relief and the extension of several healthcare provisions.

Minority Leader Chuck Schumer (D-NY) implored Paul to allow the vote to pass. “Frankly, there are lots of amendments on my side,” Schumer said. “And it’s hard to make an argument that if one gets an amendment, that everybody else won’t want an amendment, and then we’ll be here for a very long time.”

a

After the GOP left Paul hanging and the Senate recessed at around 11pm, the Kentucky Senator conceded as senators shuffled back into the Capitol, passing the measure 71-28 at around 1:45 a.m.

“I think it’s irresponsible,” said Senator John Cornyn of Texas, the No. 2 Senate Republican, lamenting what he described as “the act of a single senator who just is trying to make a point but doesn’t really care too much about who he inconveniences” (Poor Mr. Cornyn had to stay up past his bedtime while another legislator defended the values his constituency elected him to uphold).

The bipartisan spending bill now moves to the House, where passage may prove difficult amid fierce arguments brewing between staunch conservatives and Democrats who are upset that the deal does nothing for “Dreamer” children in the Obama-era Deferred Action for Childhood Arrivals program (DACA).

Nancy Pelosi even shared a strange anecdote during an eight hour Wednesday floor speech about a Guatamalan boy with “beautiful tan skin” and “beautiful brown eyes” that her grandson wished he looked like.

Representative Nancy Pelosi of California, the Democratic leader, told a closed-door meeting of House Democrats that she would oppose the deal, and said that Democrats would have leverage if they held together to demand a debate on immigration legislation. But she suggested that she would not stand in the way of lawmakers who wanted to vote their conscience.

Pressing the issue further, Ms. Pelosi and the next two highest-ranking House Democrats sent a letter to Speaker Paul D. Ryan of Wisconsin noting their desire for the government to remain open and imploring him to make a public statement about the scheduling of a vote on legislation to protect young immigrants brought illegally to the country as children who are now shielded by the Obama-era Deferred Action for Childhood Arrivals program, or DACA. –NYT

a

In January, Senate Democrats led by Chuck Schumer (D-NY) sparked a three-day partial government shutdown when they filibustered a spending bill over a lack of “Dreamer” provisions, while President Trump insisted that there would be no bill without an agreement to fund his much promised wall.

Cryin’ Chuck Schumer fully understands, especially after his humiliating defeat, that if there is no Wall, there is no DACA. We must have safety and security, together with a strong Military, for our great people!

During the shutdown, Speaker Paul Ryan ignored pleas from his fellow Republicans to include DACA provisions.

We will effectively shut down the federal government for no good reason,” said Senator John Cornyn (R-TX), who was repeatedly ignored by Paul. “I didn’t come up here to be part of somebody’s club. I didn’t come up here to be liked,” said the Speaker.

The over 600 page deal was released Wednesday night, revealing several provisions which go far beyond the basic budget.

The accord would raise strict spending caps on domestic and military spending in this fiscal year and the next one by about $300 billion in total. It would also lift the federal debt limit until March 2019 and includes almost $90 billion in disaster relief in response to last year’s hurricanes and wildfires.

Critically, it would also keep the government funded for another six weeks, giving lawmakers time to put together a long-term spending bill that would stretch through the rest of the fiscal year, which ends Sept. 30. The previous temporary funding measure, which was passed to end the last shutdown, expired at midnight on Thursday. –NYT

We eagerly await glorious clips of Nancy Pelosi arguing to help hundreds of thousands of future Democrat voters Dreamers. We’re sure she’ll have the full support of her activist daughter Christine who disrupted the peaceful transition of power with a failed Electoral College “coup” after the 2016 election.

END
Wholesale sales and wholesale inventories both slow in December and this will be a further damper to Q4 GDP numbers,
(courtesy zerohedge)

Wholesale Sales & Inventory Growth Slow In December

Despite headline month-over-month data beating expectations, year-over-year growth in Wholesale Sales and Wholesale Inventories slowed notably.

Wholesale Inventories rose 0.4% MoM in December, better than the expected 0.2% growth and preliminary print but below November’s 0.6% growth.

Wholesale Sales rose 1.2% MoM in December, better than the expected 0.4% growth and preliminary print but well below November’s  upwardly revised 1.9% growth.

However, on a YoY basis, things were notably weaker.

This is the 3rd monthly decline in annual inventory growth and the biggest slowdown in annual wholesale sales since June.

Knives come out against Kelly for domestic abuse.  Trump looks to Mulvaney to hold the Chief of Staff job along with his two other posts
(courtesy zerohedge)

Trump Floats Idea Of Handing Chief Of Staff Job To Mulvaney As Kelly Domestic Abuse Scandal Worsens

In one of the most spectacular ironies of the Trump era, it may be the words of Omarosa Manigault Newman – a staffer of questionable utility, who was reportedly dragged kicking and screaming away from the West Wing – that prophesied the downfall of General John Kelly – a man who, thanks to his reputation as a faithful disciplinarian, has earned a level of popularity and respect as Trump’s chief of staff that has eluded many of his colleagues.

In an administration where career-ending scandals are an almost weekly occurrence, many observers initially believed that Kelly would weather the storm when the Washington Post last night published a report last night that White House Counsel Donald McGahn and Kelly knew one year ago about complaints that staff secretary Rob Porter’s ex-wives were prepared to make allegations that he was physically abusive, but ignored them, and instead elevated Porter into an influential gatekeeper to the president.

Yet this morning, the New York Times  reported that President Donald Trump is considering replacing Kelly with Mick Mulvaney, the head of both the OMB and the CFPB.

Trump Is Said to Float Idea of Mulvaney as Chief of Staff: NYT

The chief of staff job would mean Mulvaney is holding three jobs that require more than full-time dedication. It’ll be hard to spill with that many plates in the air.

And to add insult to injury, the Times reported that, after the scandal broke, Trump – who has a habit of soliciting advice from former advisers depending on his mood – called up Reince Preibus, Kelly’s predecessor, to commiserate

Just as he did with the “Lazy” comment, Kelly made the situation worse for himself when he defended Porter in public comments, saying he was an “honorable and upright” man, and that Kelly believed his denial. Porter was reportedly one of Kelly’s proteges, and a rumored candidate to fill a long-vacant deputy chief of staff job.

Porter denied the accusations, but promptly handed in his resignation.

Chief of Staff John F. Kelly learned this fall about the allegations of spousal abuse and that they were delaying Porter’s security clearance amid an ongoing FBI investigation. But Kelly handed Porter more responsibilities to control the flow of information to the president.

Kelly

Porter, who denied the “vile” allegations, resigned Wednesday after the ex-wives’ accounts of years of verbal and physical abuse were published, along with graphic pictures of Colbie Holderness, his first wife, bruised from what she said was a punch to the face.

Kelly has had brushes with scandal before – he recently drew a twitter rebuke from the president went he said during an interview that Trump’s views on the wall had “evolved” – and he also was called out for lying about a story involving Florida Rep. Federica Wilson. Most recently, he was soundly mocked by the media for describing some immigrants as “lazy”. But he has never been embroiled in something like this, and now, it appears Kelly’s enemies in the West Wing – a place famous for its factions and internecine squabbling – are seizing the opportunity to push him out once and for all.

Readers may recall a few months ago Omarosa during an interview on Good Morning America accused John Kelly of playing favorites and of adding her to his “no fly” list of staffers who weren’t invited to “serious” meetings.”

Kelly

Of course, Mulvaney’s job in the West Wing, if this does indeed come to pass, would probably be his paramount priority.

And he’s also someone with a reputation for having a steady hand.

Still, losing the general would probably lead to even more upheaval – at least in the short term.

end

UPS and Fed Ex sink badly on news that Amazon will be launching “Shipping with Amazon” where they will pick up parcels at facilities identical to our two major shipping operations
(courtesy zerohedge)

UPS, FedEx Sink As Bezos Launches “Shipping With Amazon”

Putting Jeff Bezos in a Super Bowl ad isn’t the only major material business risk Amazon is taking in Q1…

After more than a year of anticipation as Amazon has expanded the number of its distribution centers, partnered with landlords to install designated Amazon lockers in mailrooms in millions of apartments across the US, creating a system to allow couriers to deliver packages inside customers’ homes and experimented with delivery from third-party warehouses in some test markets, the e-commerce behemoth announced today that it will launch a “Shipping with Amazon” service that will entail picking up packages from businesses and shipping them to consumers, according to the Wall Street Journal, which cited unnamed sources familiar with the matter (ie AMZN’s comms department).

The service will compete with ground carriers with UPS and FedEx

*AMAZON PLANS TO LAUNCH ‘SHIPPING WITH AMAZON’ IN U.S. THIS YEAR, SOURCES SAY

*NEW AMAZON SHIPPING OPTION WOULD COMPETE WITH UPS AND FEDEX, SOURCES SAY

*’SHIP WITH AMAZON’ TO START IN LOS ANGELES FIRST, THEN GO NATIONWIDE, SOURCES SAY

Amazon expects to roll out the new delivery service in Los Angeles in coming weeks, partnering with third-party merchants that sell goods via its website, according to the people. Amazon then aims to expand the service to more cities as soon as this year, some of the people say.

The first stirrings of the eventual launch first emerged last October when Amazon announced it would begin “experimenting” with a new program called “seller flex” that would allow them to take over the process of shipping from third-party warehouses. That program was first tested in the Los Angeles area.

as WSJ reminds us, this is the latest step by Amazon to create its own parcel network. In the last two years, Amazon has expanded into ocean freight while building a network of its own drivers who can now deliver inside homes and leased up to 40 aircraft while establishing an air cargo hub.

To be sure, the company already delivers orders from its own warehouses (these are the items that typically qualify as “Prime”) in 37 different US cities.

“We’re always innovating and experimenting on behalf of customers and the businesses that sell and grow on Amazon to create faster lower-cost delivery choices,” a spokeswoman said in a statement.

For deliveries outside of its reach, the company will use the Postal Service and other carriers to take care of the so-called last mile to customers’ doorsteps.

Unsurprisingly, the stocks of private shipping companies FedEx and UPS are sinking pre-market on the news, with UPS down 7.1% and Fedex off 5.4%, while Amazon shares inched higher…

Of course, whether any of this will be successful remains to be seen: Amazon is starting from a significant disadvantage – FedEx and UPS have massive networks built up throughout the country – and UPS is spending $7 billion this year alone on maintenance and upgrades. But Amazon has a pretty solid track record of accomplishing what it sets out to do.

A spokesman said that UPS continues to support Amazon and other customers and doesn’t comment on customers’ business strategies or decisions regarding using UPS services.

FedEx didn’t have an immediate comment. On the company’s December earnings call, executives were asked about what would happen if Amazon started competing for its shipping business, to which they said they don’t comment on hypothetical situations. They added that Amazon was a longstanding customer, but that no customer represented more than 3% of revenue or volume.

Amazon’s push into logistics reflects its growing ambitions across a wide range of new businesses beyond online retail. The company runs a dominant cloud-computing services division, a Hollywood studio and a massive marketplace and logistics operation for sellers. Last year, it acquired Whole Foods for roughly $13.5 billion, transforming it into a brick-and-mortar grocer overnight.

In addition to the delivery service, Amazon is also launching a new logistics service that will allow third-party warehouses to qualify for prime and ship goods from their own warehouses directly to customers instead of sending them to an Amazon Warehouse first for processing through its “Fulfillment by Amazon” program, using software provided by Amazon…

Amazon will exert a measure of control over these third party deliveries, allowing it to fill space on its trucks with extra third party items, adding valuable revenue. Though, for now, it will continue to use third party carriers like FedEx and UPS.

end

A real problem for real estate companies in Illinois and home owners:  Illinois property taxes are going up but prices are lagging

(courtesy Divounguy,Hill Tabor/Illinois policy)

and special thanks to Robert H for sending this to us.

HOUSE OF PAIN: ILLINOIS PROPERTY TAXES UP, BUT HOME PRICES LAG

By Orphe Divounguy, Bryce Hill, Joe Tabor

Skyrocketing property taxes, a sluggish state economy and Illinois’ outmigration crisis could spell trouble for the housing market.

Most people view their decision to buy a home at least in part as an investment. For most households, the net equity in their home represents the bulk of their net worth. But it’s more than just a financial decision – it’s a sign of trust and certainty in the future of a given community.

Unfortunately, government data suggest home prices in Illinois are still down 10 percent compared with 2006. And over the same time, property tax bills have gone up more than 51 percent.

That doesn’t inspire confidence or certainty for prospective homeowners.

Illinois housing prices are 10% below their pre-recession peak

Although home prices in Illinois have started to increase again since 2013, home prices are still down 10 percent compared with 2006, according to research by the Federal Housing Finance Agency. This weak recovery is prevalent across the state.

Despite the decrease in home prices over the decade, the average household property tax bill in Illinois rose 51 percent, according to the U.S. Census Bureau’s American Community Survey, or ACS.1

Meanwhile, Illinois’ nonfarm personal income (adjusted for inflation) grew by just 10 percent over that time, according to the Bureau of Economic Analysis.

Compared with the nation, Illinois has been a laggard in terms of housing appreciation.

Illinois housing price growth lags the nation

ARE GROWING PROPERTY TAX BURDENS BEHIND THE DECLINE IN ILLINOIS HOME VALUES?

Illinoisans have seen their property tax bills grow six times faster than household incomes. Are those bills driving down home values?

The dependence of local governments on property taxes has been justified traditionally with the claim that an increase in the tax rate has little to no effect on the tax base. One explanation offered for why property taxes may not lead to changes in property values is that taxes are used to finance public services that may benefit homeowners and businesses.

When property ownership is related to individuals’ use of goods provided by local governments, such as schools or parks, then property taxes can be justified as user fees, implying that it is the provision of amenities – not property taxes – that lead to changes in property values.

However, research shows that an increase in the property tax rate has a negative effect on property values, even after accounting for local public services.

WHAT TO EXPECT IF THE STATE’S ECONOMIC TROUBLES CONTINUE IN 2018

From 2006 to 2016, nearly 276,000 households left the state on net, according to IRS tax data.

A reduction in the number of households in Illinois could have serious negative consequences for the housing market. A decrease in housing demand is expected to cause housing prices to decrease.

But the relationship between population and housing is complex.

On the one hand, population change leads to a changing demand for housing. Population growth – and the growth in the number of households – leads to growth in housing demand.

Population decline might lead to a decrease in housing demand. This will, however, only happen in the long run, after not only the number of people but also the number of households has started to decline. The danger of population decline is greatest in rural areas and in areas with lower-quality housing.

On the other hand, an increase in the supply of housing that puts downward pressure on home prices stimulates population growth through migration. Adequate housing supply might attract migrants or influence where they choose to live.

Economists Dragana Cvijanovic, Jack Favilukis and Christopher Polk found empirical evidence that predictable demographic changes related to fertility and mortality rates have no effect on housing values. However, it’s the non-natural component of population growth – growth due to new migrant households – that causes home prices to rise.

Economist Albert Saiz found that a migrant household inflow equal to 1 percent of a city’s population is associated with a 1 percent increase in average rents and housing values. New migrant households push up rents and housing values in cities.

And recent economic research highlights links between regional labor and housing markets. Researchers found a strong negative correlation between an area’s housing prices and the area’s unemployment rate.

The authors found that after a negative economic shock – the last recession, for example – areas where housing prices declined the most also experienced the highest decline in employment.

This means that if Illinois’ economy continues on its current path, areas with large decreases in housing prices would also experience large decreases in employment. This is because a large decline in housing prices leads to a large decline in local spending that further depresses the economy.

TURNING THE SHIP AROUND

Fewer people are looking to plant roots in Illinois because of tax hikes that have reduced investment flows, causing the quantity and quality of jobs to decrease.

Employment growth in Illinois is lagging the rest of the nation and could actually get worse. If home prices begin to decline, the labor market could take another hit.

In order to move Illinois back from the edge of disaster, the right policy prescriptions would be to reduce property taxes across the state in order to make buying a home in Illinois a worthwhile investment again. To make that realistic, lawmakers must address the main cost-drivers of government. A good place to start is consolidating the state’s nearly 7,000 units of local government, which fuel high property tax bills.

Enacting long-term property tax relief would gift greater certainty to homeowners residing in the Land of Lincoln, not to mention homeowners-to-be.

APPENDIX: MEASURING HOME VALUES

Researchers have relied on two main types of data sources to investigate housing price movements. Both have serious issues that limit their usefulness in a variety of applications.

The first category consists of value measures such the American Community Survey, the decennial census or Zillow’s home value index, which all confound price and quantity changes.

Unfortunately, median or average sales prices are not a good measure of appreciation. Movements in sales prices should not be interpreted as measuring changes in the value of a home. Prices are influenced by changes in costs and also by changes in the characteristics and size of homes actually sold. For example, if for some reason in a given year a disproportionately high number of high priced homes were sold, the median price would rise even if no single property appreciated at all.

The second category consists of proprietary price index data such as Black Knight, CoreLogic or Case-Shiller, which are produced using limited transactions data prior to the late 1980s or early 1990s, forcing reliance on geographic pooling of transactions, smoothing of series over space or time, or limiting coverage.

To address this gap in the availability of constant-quality house price measures, economists at the Federal Housing Finance Agency used data from nearly 100 million transactions to construct a comprehensive set of annual house price indices over four decades for cities, counties, 3-digit ZIP codes (ZIP3s) and 5-digit ZIP codes (ZIP5s).

ENDNOTES

1IPUMS USA collects, preserves and harmonizes U.S. census microdata and provides easy access to this data with enhanced documentation. Data include decennial censuses from 1790-2010 and American Community Surveys from 2000 to the present. IPUMS show the average property tax bill per homeowner-head of household in Illinois increased 51.4 percent from 2006-2016.

end

Ray Dalio reveals the companies biggest ever short: it has amassed a sizable 713 million short on Italian financial shorts.

(courtesy zerohedge)

Dalio’s $13 Billion Short: Bridgewater Unveils Its Biggest Ever Short Position

Last October, Italy’s government was angry when the world’s largest hedge fund, Ray Dalio’s Bridgewater unveiled it had amassed a sizable  $713 million short against Italian financial stocks, its biggest disclosed bearish bet in Europe.

Then last week, and just one month before Italy’s March 4 elections – which the broader market stubbornly refuses to acknowledge are a risk factor – Bridgewater tripled down on its bearish bets against Italian banks and insurers, making the position the largest thematic short carried by the world’s biggest hedge fund.

As we reported last Thursday, Bridgewater boosted its bearish bets against Italian companies to $3 billion and 18 firms, up four-fold from just over $713 million in early October, further infuriating Italian authorities. As Bloomberg added, Bridgewater’s bearish bets against European companies as a whole totaled $3.3 billion, spread among 20 names.  In addition to his previous negative exposure, Dalio disclosed a short position in transport-infrastructure provider Atlantia and added to its largest short bet, against lender Intesa Sanpaolo SpA.

The growing short comes just days after Dalio told a Davos audience that “holding cash is now stupid”… and literally days before the biggest market crash since Lehman.

Fast forward to today, when Dalio’s bearish fascination is starting to get a little concerning, because according to the latest Bloomberg summary, Bridgewater now has at least $13.1 billion in European Union shorts, quadrupling the $3.2 billion short from last week, and over 18 times more than the fund’s original position last October.

In the past week, Bridgewater put more than $1 billion to work betting against oil giant Total SA – making it the firm’s largest disclosed short holding in Europe. 

As Bloomberg notes, Europe’s energy titan has been riding out the biggest industry downturn in a generation by selling assets and cutting spending. The hedge fund also started a bearish Airbus SE position, investing about $381 million against the aircraft maker. Among other short positions, it disclosed wagers against BNP Paribas SA, ING Groep NV and Banco Santander SA.

Amusingly, since the Feb. 8 regulatory filings were made public, Total fell 1% as markets slumped, while Dalio’s other shorts, Airbus, BNP Paribas, ING Groep and Banco Santander sank roughly 2%.

A list of Bridgewater’s top 10 shorts is shown below:

At the risk of repeating ourselves – which we think under these circumstances is worth it – we will remind readers that on January 24, Dalio told a naive, fawning Davos audience that:

“We are in this Goldilocks period right now. Inflation isn’t a problem. Growth is good, everything is pretty good with a big jolt of stimulation coming from changes in tax laws. If you’re holding cash, you’re going to feel pretty stupid.”

And as Dalio was dissembling, he was quietly assembling Bridgewater’s biggest ever thematic short in his fund’s history.

So yes, perhaps if you’re holding cash, you will feel pretty stupid eventually, but not after last week’s global market plunge; however, you will certainly feel much dumber if you actually believed Dalio.

SWAMP STORIES
Judicial Watch sues the FBI asking for documents on Comey’s 2 million dollar book deal plus communications between the FBI and Comey prior to his testimony
(courtesy zerohedge)

FBI Sued Over Docs Related To Comey’s $2 Million Book Deal

Watchdog group Judicial Watch has filed a Freedom of Information Act (FOIA) lawsuit against the DOJ in order to obtain records from the FBI connected to former Director James Comey’s $2 million book deal, after the agency failed to respond to an August 14, 2017 FOIA request.

In particular, the FOIA request concerns communications between Comey and the FBI leading up to his controversial June 2017 testimony before the Senate Intelligence Committee. The group seeks:

  • All records of communications between the FBI and Comey prior to and regarding Comey’s testimony before the Senate Select Committee on Intelligence on June 8, 2017.
  • All records of communications between the FBI and Comey relating to an upcoming book to be authored by Comey and published.
  • All records, including but not limited to forms completed by Comey, relating to the requirement for prepublication review by the FBI of any book to be authored by Comey with the intent to be published or otherwise publicly available.

Comey reportedly received an advance in excess of $2 million for his bookHigher Loyalty: Truth, Lies, and Leadership, reportedly set for publication on April 17th. Former FBI agents and officials intending to write books concerning their tenure are customarily required to submit the entire transcript for pre-publication review.” – Judicial Watch

Following Comey’s firing on May 9, 2017, the former FBI director sat down with Senate Select Committee investigators for a highly controversial testimony which covered, among other things, the circumstances surrounding his dismissal.

Also covered in testimony was the ongoing investigation into alleged Russian interference in the 2016 election, as well as Comey’s handling of the Hillary Clinton email investigation.

Comey admitted to leaking his “memos” to the Senate Select Committee in order to kick off the Special Counsel headed by former FBI Director Robert Mueller III.

a

“Mr. Comey seems to have protected status for any misconduct and we want to know if he had a special deal for his book from his friends in the FBI,” said Judicial Watch President Tom Fitton.

“The Deep State is in cover-up mode. The FBI, DOJ, and the Special Counsel are stonewalling our requests for Comey documents.”

Comey moved up the date of his memoir “Higher Loyalty: Truth, Lies, and Leadership,” from May 1 to April 17, according to publisher Flatiron Books – due to the FBI coming under “intense scrutiny.”

Flatiron president Bob Miller and publisher Amy Einhorn said there was demand for Comey to be heard amid an “urgent conversation” about the FBI, just one week after Comey blasted “weasels and liars” for pushing for the release a memo which alleges that top officials in the FBI and Department of Justice (DOJ) misled a federal surveillance court in order to obtain a spy warrant against a former Trump campaign adviser. –Daily Caller

The book is said to feature “yet-unheard anecdotes from his long and distinguished career,” according to Flatiron Books, which describes the book as an exploration of, get this: “what good, ethical leadership looks like and how it drives sound decisions.”

“Throughout his career, James Comey has had to face one difficult decision after another as he has served the leaders of our country,” Flatiron Books publisher Bob Miller said, who added that the book will be an “unprecedented entry into the corridors of power, and a remarkable lesson in leadership itself.”

As the House and Senate home in on bad actors in the FBI and DOJ, and career officials peel out of the agencies left and right – we eagerly await the blind boyscout’s book..

END

The very reliable the Wall Street Journal questions why the media (outside of Fox) is ignoring the real bombshell FISA memo  ( the Grassley Memo)

(courtesy Benson/Townhall.com)

WSJ Asks: Why Is The Media Ignoring The Real Bombshell FISA Memo?

Authored by Guy Benson via Townhall.com,

We’ll bring you Wall Street Journal columnist Kimberly Strassel’s tweetstorm in a moment, but I’ll take a stab at answering her question about the media right out of the gate. 

Three possibilities:

(1) The GOP hyped the Nunes memo, which quickly became the center of this whole firestorm — replete with counter-memos, FBI objections, etc.  The press followed the spotlight.

(2) As we’ve been saying, there are so many complex pieces of this larger puzzle, following the plot is difficult.  It’s not just news consumers wondering, “which memo is this now?” — it’s many of the people trying to cover this drama, too.  The document in question here is a second, less redacted, version of a Senate memo that few people have even heard of. 

(3) The Senate memo, produced by non-bomb-throwers Chuck Grassley and Lindsey Graham, is substantially more disruptive to the Democrats’ narrative than the Nunes document.  And the press generally prefers Democratic narratives to Republican ones because most journalists are liberals.

My guess is that some blend of all three factors helps explain why the Grassley/Graham memo has barely registered on the national radar, even after we’ve endured multiple high-octane news cycles starring Nunes and Schiff.  But on the substance, does Strassel have a point, or is this just the latest shiny object the right-wing is waving around to distract from “the real story,” now that the Nunes memo was arguably a bit of a dud?  Here’s her case:

1) Why isn’t the (mostly) unredacted Grassley memo front page news? Here’s why: Because it confirms the Nunes memo and blows up the Schiff talking points (which the media ran with).

2)It is confirmation that the FBI’s FISA application relied on the dossier and a news article, and worse, on the credibility of a source in the employ of the Clinton campaign.

3) It is proof that the FBI did not tell the Court the extraordinarily partisan provenance of the dossier.

4) It provides evidence that the FBI presented the FISA Court with materially false evidence, in the claim that Steele had not talked to the press. And then shows that even after Steele admitted under oath that he had, the FBI did not tell the FISA Court in its renewal.

5) It provides evidence that Steele was getting information from the Clinton team itself! Via the State Department! So now, not only do we have a dossier based on unnamed shady Russians, but on Sidney Blumenthal. How much of this was engineered by the Clinton campaign from start?

Does that all of check out?  Allahpundit digs into the document (a much more redacted version had been released previously) and seems to agree that Grassley/Graham is a significantly bigger deal than Nunes.  In our analysis of the latter document last week, we wrote that a major question was how much the DOJ relied on the Steele dossier itself to gain a FISA warrant against former Trump adviser Carter Page.  According to Grassley/Graham, the answer is a lot.  I posited that if investigators had used the unverified dossier as a starting point from which to chase down leads and produce more solid evidence to present to a FISA judge, that’d be one thing.  But if they leaned heavily on Steele’s file itself as the “evidence,” that would be sketchier.  According to the two GOP Senators, the FBI did the latter.  From AP’s excellent summary (the relevant bits of the memo itself are here and here):

…“The bulk of the application” against Page was dossier material…

“The application appears to contain no additional information corroborating the dossier allegations against Mr. Page.”

In other words, they seem to have treated the dossier as evidence, not as a lead. That’s big news.

But that’s not all. Grassley/Graham allege, based on intelligence, that the man behind the anti-Trump dossier was known to be unreliable by the FBI (they eventually severed ties with him) because he was caught lying either to US law enforcement or to British courts, telling each entity different stories about a key fact. Either way, FISA judges who approved and renewed the Page warrants weren’t told about the proven unreliability of the foreign agent whose work product was (apparently) the central basis for said warrants. The FBI might counter that Steele seemed credible at first, then they dumped him when he burned them, but that doesn’t mean their hands are clean, Allahpundit writes:

(a) that doesn’t solve the problem that the original FISA application against Page evidently relied “heavily” on information passed from a not-very-credible foreign agent and

(b) that doesn’t explain why the Bureau allegedly failed to tell the FISA Court in later applications to renew their surveillance of Page that Steele’s info maybe hadn’t been so credible…Grassley and Graham make another good point about Steele’s chattering to the press while his investigation was still ongoing: Once bad actors were aware that he was digging for dirt on Trump, they could have sought him out and fed him any amount of BS in hopes of it trickling through to the FBI and deepening the official suspicion surrounding Team Trump. That’s how Clinton cronies — maybe even Sid Blumenthal — got involved in this clusterfark. Because Steele was supposedly willing to accept even unsolicited tips about Trump, the Clinton team may have fed him rumors to help fill a dossier for which their boss was paying.

Two big points there:

Even after the FBI recognized Steele was an established liar, his dishonesty was not disclosed to judges deciding whether to keep the warrants active during renewal applications, which were largely predicated on Steele’s credibility.

And the topic about which he apparently lied was whether he blabbed to folks in the media about his work, which could have opened up the floodgates for disinformation from shady characters eager to make the anti-Trump case as juicy and brimming with salaciousness as possible.

That’s where Blumenthal and company, whom I wrote about here, may have come in. What a mess. Also, speaking of not revealing pertinent information to the courts, it looks like Nunes was technically incorrect that the judges weren’t made aware that the Steele dossier was paid political oppo research. But he was more broadly correct that the judges didn’t have even close to the full picture of who was behind the unverified partisan document upon which they were primarily basing the surveillance of a US citizen — who happened to be a former aide to a major presidential campaign from the out-of-power party.

“As Nunes himself later admitted, the Bureau apparently did disclose in a footnote that the material was paid political research. It just didn’t mention who, precisely, had paid for it,” AP writes.  The memo reads, “in footnote 8, the FBI stated that the dossier information was compiled pursuant to the direction of a law firm that had hired an “identified US person” — now known as Glenn Simpson of Fusion GPS…the application failed to disclose that the identities of Mr. Simpson’s ultimate clients were the Clinton campaign and the DNC.”

So the disclosure came in a footnote and didn’t mention that the parties who paid for the unverified dossier were the Trump campaign’s explicit opposition.  Maybe there was no misconduct in any of this, but even as someone who believes neither that suspicion of Carter Page was unreasonable, nor that this is all part of a grand anti-Trump conspiracy (remember, the Trump angle of the Russia probe started earlier, for an unrelated reason), there’s enough in the Grassley/Graham memo to make me uncomfortable with the standards by which Page was surveilled by the US government.

 end
Let us close out the week with this excellent commentary from Greg Hunter
(courtesy Greg Hunter)

Bombshell Testimony of FBI Informant Implicates Many for Treason

By Greg Hunter On February 9, 2018 In Weekly News Wrap-Ups

Bombshell Testimony of FBI Informant Implicates Many for Treason

WNW 321 2.9.18)

William Campbell was undercover for the FBI and CIA for six years gathering evidence of a grand Russian scheme to “dominate” the uranium industry. There are charges of espionage, bribery and extortion (just to name a name a few) coming from Russian agents trying to take control of U.S. uranium interests. Who knew? It’s clear the FBI and CIA knew, along with the Department of Justice, the State Department and, most likely, the IRS because, after all, the Clinton Foundation was a global charity fraud. Campbell documents real Russian collusion and treason in the Obama Administration, which has connections right up to President Obama. This story is just getting started. I predict many will be charged with multiple crimes, including treason, before this is all finished. Sometime in March, the DOJ Inspector General, Michael Horowitz, will release his report on the FBI/DOJ handling of the Clinton private email server where Clinton was exonerated behind the scenes months before the FBI investigation was finished. Tsunamis of truth waves are coming, and then arrests and prosecutions.

Join Greg Hunter as he looks at the many aspects of this story and more in the Weekly News Wrap-Up.

Video Link

https://usawatchdog.com/bombshell-testimony-of-fbi- informant-implicates-many-for-treason/

I will  see you MONDAY night

HARVEY

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