Feb 12/GOLD RISES BY $12.00 TO $1324.00/SILVER UP A STELLAR 40 CENTS TO $16.60/SYRIAN ROCKETS DOWN AN ISRAELI FIGHTER JET INSIDE ISRAEL AND ISRAEL REACTS TAKING OUT A HUGE NUMBER OF SYRIAN/IRANIAN MILITARY POSITIONS/TRUMP DETAILS HIS 4 TRILLION DOLLAR BUDGET PLAN AND HIS HUGE SPENDING WILL BE GOOD FOR GOLD/MORE SWAMP STORIES FOR YOU TODAY/

 

 

GOLD: $1324.60 UP $12.00

Silver: $16.60 UP 40 cents

Closing access prices:

Gold $1323.00

silver: $16.56

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: $1331.29 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME: $1324.00

PREMIUM FIRST FIX: $7.90

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SECOND SHANGHAI GOLD FIX: $1326.24

NY GOLD PRICE AT THE EXACT SAME TIME: $1323.90

Premium of Shanghai 2nd fix/NY:$2.34

SHANGHAI REJECTS  NY /LONDON PRICING OF GOLD

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LONDON FIRST GOLD FIX: 5:30 am est $1321.70

NY PRICING AT THE EXACT SAME TIME: $1321.00

LONDON SECOND GOLD FIX 10 AM: $1322.30

NY PRICING AT THE EXACT SAME TIME. $1321.10

For comex gold:

FEBRUARY/

NUMBER OF NOTICES FILED TODAY FOR FEBRUARY CONTRACT: 50 NOTICE(S) FOR 5000 OZ.

TOTAL NOTICES SO FAR:1783 FOR 178300 OZ (5.458 TONNES),

For silver:

FEBRUARY

16 NOTICE(S) FILED TODAY FOR

80,000 OZ/

Total number of notices filed so far this month: 215 for 1,075,000 oz

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Bitcoin: BID $8692/OFFER $8763: up $381(morning)

Bitcoin: BID/ $8311/offer $8845: UP $463  (CLOSING/5 PM)

end

Let us have a look at the data for today\

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In silver, the total open interest ROSE BY A CONSIDERABLE SIZED 2828 contracts from 193,135  RISING TO 196,163 DESPITE  FRIDAY’S GOOD 18 CENT LOSS IN SILVER PRICING.  WE  HAD ZERO 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:  2694 EFP’S FOR MARCH AND AND 139 EFP’S FOR MAY AND ZERO FOR ALL  OTHER MONTHS  AND THUS TOTAL ISSUANCE OF 2833 CONTRACTS.  WITH THE TRANSFER OF 2833 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 2833 CONTRACTS TRANSLATES INTO 14.16 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:

30,392 CONTRACTS (FOR 9 TRADING DAYS TOTAL 30,392 CONTRACTS OR 151.960 MILLION OZ: AVERAGE PER DAY: 3376 CONTRACTS OR 16.884 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH:  151.96 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 21.7% OF ANNUAL GLOBAL PRODUCTION

ACCUMULATION IN YEAR 2018 TO DATE SILVER EFP’S:  381.9 MILLION OZ.

ACCUMULATION FOR JAN 2018: 236.879 MILLION OZ

RESULT: A GOOD SIZED GAIN IN OI SILVER COMEX DESPITE THE CONSIDERABLE  18 CENT LOSS IN SILVER PRICE.  WE HOWEVER HAD A GOOD SIZED EFP ISSUANCE OF 2833 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 2833 EFP’S  FOR  MONTHS MARCH AND MAY WERE ISSUED FOR MONDAY  FOR A DELIVERABLE FORWARD CONTRACT OVER IN LONDON WITH A FIAT BONUS.   WE GAINED  5523 OI CONTRACTS i.e. 2833 open interest contracts headed for London (EFP’s) TOGETHER WITH A INCREASE OF 2829  OI COMEX CONTRACTS. AND ALL OF THIS HAPPENED WITH THE CONSIDERABLE FALL IN PRICE OF SILVER OF  18 CENTS AND A CLOSING PRICE OF $16.20 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. 0.980 BILLION TO BE EXACT or 140% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT FEBRUARY MONTH/ THEY FILED: 16 NOTICE(S) FOR 80,000 OZ OF SILVER

In gold, the open interest FELL  BY ANOTHER CONSIDERABLE 6,968 CONTRACTS DOWN TO 510,740  WITH THE FAIR SIZED FALL IN PRICE OF GOLD WITH FRIDAY’S TRADING ($4.70). HOWEVER, IN ANOTHER DEVELOPMENT, WE RECEIVED THE TOTAL NUMBER OF GOLD EFP’S ISSUED FOR MONDAY AND IT TOTALED A FAIR SIZED  7526 CONTRACTS OF WHICH  APRIL SAW THE ISSUANCE OF 7526 CONTRACTS AND  JUNE SAW THE ISSUANCE OF 0 CONTRACTS AND THEN ALL OTHER MONTHS ZERO.    The new OI for the gold complex rests at 510,740. 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 658  CONTRACTS: 6968 OI CONTRACTS DECREASED AT THE COMEX AND A STRONG SIZED  7526 OI CONTRACTS WHICH NAVIGATED OVER TO LONDON.(658 oi gain in CONTRACTS EQUATES TO 2.046 TONNES)

FRIDAY, WE HAD 14,716 EFP’S ISSUED.

ACCUMULATION OF EFP’S/ GOLD(EXCHANGE FOR PHYSICAL) FOR THE MONTH OF FEBRUARY STARTING WITH FIRST DAY NOTICE: 98,896 CONTRACTS OR 9,889,600  OZ OR 307.60 TONNES (9 TRADING DAYS AND THUS AVERAGING: 10,988 EFP CONTRACTS PER TRADING DAY OR 1,098,800 OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS :   SO FAR THIS MONTH IN 9 TRADING DAYS: IN  TONNES: 307.60 TONNES

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

THUS EFP TRANSFERS REPRESENTS 307.6/2200 x 100% TONNES =  13.98% OF GLOBAL ANNUAL PRODUCTION SO FAR IN FEBRUARY ALONE.

ACCUMULATION OF GOLD EFP’S YEAR 2018 TO DATE:  941.12 TONNES

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

Result: A  CONSIDERABLE SIZED DECREASE IN OI AT THE COMEX DESPITE THE FAIR SIZED FALL IN PRICE IN GOLD TRADING FRIDAY ($4.70). 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: 7526 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 7526 EFP CONTRACTS ISSUED, WE HAD A NET GAIN IN OPEN INTEREST OF 658 contractON THE TWO EXCHANGES:

7526 CONTRACTS MOVE TO LONDON AND  6968 CONTRACTS DECREASED AT THE COMEX. (in tonnes, the GAIN in total oi equates to 2.045 TONNES).

we had: 50 notice(s) filed upon for 5000 oz of gold.

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

GLD

WITH GOLD UP $12.00 TODAY, THE CROOKS WITHDREW ANOTHER 5.6 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 820.71

Inventory rests tonight: 820.71 tonnes.

SLV/ (IN TOTAL CONTRAST TO GOLD)

NO CHANGES IN SILVER INVENTORY AT THE SLV/ AGAIN WITH TODAY’S HUGE RISE IN SILVER PRICE:   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 ROSE BY A CONSIDERABLE 2829  contracts from 193,135 UP TO 195,964 (AND now A LITTLE CLOSER TO THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) DESPITE  THE GOOD SIZED  FALL  IN PRICE OF SILVER  (18 CENTS WITH RESPECT TO  FRIDAY’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 GAIN AT THE COMEX OF  2829 CONTRACTS TO THE 2833 OI TRANSFERRED TO LONDON THROUGH EFP’S, SURPRISINGLY WE OBTAIN A GAIN OF  5523  OPEN INTEREST CONTRACTS DESPITE FRIDAY’S DRUBBING IN SILVER PRICE.  WE STILL HAVE A GOOD AMOUNT OF SILVER OUNCES THAT ARE STANDING FOR METAL IN JANUARY (SEE BELOW). THE NET GAIN TODAY IN OZ ON THE TWO EXCHANGES:  27.61 MILLION OZ!!!

RESULT: A GOOD SIZED INCREASE IN SILVER OI AT THE COMEX DESPITE THE CONSIDERABLE SIZED FALL OF 18 CENTS IN PRICE (WITH RESPECT TO FRIDAY’S TRADING ). BUT WE ALSO HAD ANOTHER GOOD 2833 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 SUNDAY night/MONDAY morning: Shanghai closed UP 24.27 points or 0.78% /Hang Sang CLOSED DOWN 47.79 or 0.16% / The Nikkei closed HOLIDAY/Australia’s all ordinaires CLOSED UP 0.30%/Chinese yuan (ONSHORE) closed DOWN at 6.3286/Oil DOWN to 60.26 dollars per barrel for WTI and 63.65 for Brent. Stocks in Europe OPENED DEEPLY IN THE GREEN .   ONSHORE YUAN CLOSED DOWN AGAINST THE DOLLAR AT 6.3286. OFFSHORE YUAN CLOSED DOWN AGAINST  THE ONSHORE YUAN AT 6.3346//ONSHORE YUAN A LOT WEAKER AGAINST THE DOLLAR/OFF SHORE A LOT WEAKER TO THE DOLLAR/. THE DOLLAR (INDEX) IS  MUCH WEAKER AGAINST ALL MAJOR CURRENCIES EXCEPT CHINA YUAN.  CHINA IS   HAPPY TODAY STRONGER MARKETS IN CHINA 

3a)THAILAND/SOUTH KOREA/NORTH KOREA

 i)North Korea

b) REPORT ON JAPAN

3 c CHINA

4. EUROPEAN AFFAIRS

GREAT BRITAIN

An excellent commentary from Alasdair Macleod as he correctly states that Great Britain should leave the EU at no cost to them and then have free trade with the rest of Europe.  He explains why:

(/Alasdir Macleod)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

A major escalation as Syria shoots down an F 16 jet on Israeli soil.  Israel launches a large scale attack inside Syria wiping out huge weapon facilities

( zerohedge)

6 .GLOBAL ISSUES

These 11 cities are most likely to run out of drinking water after Capetown

( zerohedge)

7. OIL ISSUES

8. EMERGING MARKET

9. PHYSICAL MARKETS

i)As I explained below, the Fed has only two choices, rates or stocks.  With Trump’s new spending initiate rates are heading higher and this will certainly cause stocks to flounder

( Eric Sprott/)

ii)Mike Kosares explains the meaning of volatility and how it usually presages a downward blast in the stockmarket and a rise in the price of gold

a must read..

( Michael Kosares/GATA)

iii)I wonder what gave this away: the Economist states that insider trading has been rife on Wall Steet

( the Economist/London)

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

i(So far investors are ignoring the rise in the 10 yr and 30 yr note as Trump will drop its target of balancing the budget in 10 years.  The dollar is falling along with bond prices (yields rise).  The higher bond yields will create havoc with valuations (derivatives).  Also the higher yield causes investors to think that they would rather have the sure yield than risk in the stock market

( zerohedge)

ii)And here is Trump’s $4 trillion budget proposal and its main highlights

( zerohedge)

iii)It is totally amazing: as soon as the 10 yr bond yield hits 2.88%, bang!!/the Dow begins to shake etcYou could either have a good stock market or a decent bond market, not both.  The higher yields forced mammoth selling

( zerohedge)

iv)Gold gets a boost with Trump’s huge infrastructure plan:  1 1.5 trillion spending boost:

( zerohedge)

v)Rand Paul over the weekend accuses correctly that many of the GOP of hypocrisy for agreeing to the bipartisan budget deal and the huge increase in spending.( zerohedge)

vi)It begins tonight:  a free for all debate on immigration..should be fun

(courtesy zerohedge)

vii)SWAMP STORIES

a)Trump blocks the Democratic memo on national security concerns and states that they should remove sources and methods of how surveillance of citizens is applied

( zerohedge)

b)Rachel Brand,  next in line after Rod Rosenstein at the Dept of Justice is leaving to become an executive at WalMart. It was also revealed that Rod Rosenstein signed one of the FISA warrants and thus the committee wants to speak to him again on this matter.

( zerohedge)

c)Is Counterintelligence chief Bill Priestap co-operating with the authorities and giving details on Comey, Strzok, Page,  Hillary et al? No question about it:  Bill Priestap is the deep throat and will down everyone associated with this mess!!

a must read..

(courtesy the ConservativeTreeHouse.com)

Let us head over to the comex:

The total gold comex open interest FELL BY A CONSIDERABLE 6968 CONTRACTS DOWN to an OI level 510,740  DESPITE THE FAIR SIZED FALL IN THE PRICE OF GOLD ($4.70 LOSS WITH RESPECT TO FRIDAY’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 7526 EFP’S ISSUED FOR APRIL  AND 0 EFP’s  FOR JUNE AND ZERO FOR ALL OTHER MONTHS:  TOTAL  7526 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: 658 OI CONTRACTS IN THAT 7526 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE LOST 6968 COMEX CONTRACTS.

NET GAIN ON THE TWO EXCHANGES: 658 contracts OR 65800  OZ OR 2.046 TONNES, AND THIS WAS ACCOMPLISHED WITH A FALL IN PRICE OF GOLD 

Result: A  HUGE SIZED DECREASE IN COMEX OPEN INTEREST DESPITE THE FAIR SIZED LOSS IN FRIDAY’S GOLD TRADING ($4.70.) WE HAD CONSIDERABLE COMEX GOLD LIQUIDATION.  TOTAL OPEN INTEREST GAIN ON THE TWO EXCHANGES: 658 OI CONTRACTS..

We have now entered the active contract month of FEBRUARY where we lost 110 contracts to 1199 contracts.  We had 141 notices filed upon yesterday, so we gained 31 contracts or an additional 3100 oz will  stand in this active contract month of February

March saw a GAIN of 94 contracts UP to 2091.  April saw a LOSS of 6967 contracts DOWN to 353,850. MARCH BECOMES THE FRONT MONTH FOR GOLD

We had 50 notice(s) filed upon today for 5000 oz

 PRELIMINARY COMEX VOLUME FOR TODAY: 207,408 contracts

CONFIRMED COMEX VOLUME FOR YESTERDAY: 366,130 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 ROSE  BY A CONSIDERABLE SIZED 2829  CONTRACTS FROM 193,135 UP TO  195,964 DESPITE FRIDAY’S GOOD SIZED 18 CENT DROP IN TRADING).   HOWEVER,WE WERE ALSO INFORMED THAT WE HAD ANOTHER LARGE SIZED 2694 EMERGENCY EFP’S FOR MARCH ISSUED BY OUR BANKERS (WITH 139 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: 2833.   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 ZERO LONG COMEX SILVER LIQUIDATION AND A GOOD SIZED GAIN 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 GAINED 5523  SILVER OPEN INTEREST CONTRACTS:

2829 CONTRACT GAIN AT THE COMEX COMBINING WITH THE ADDITION OF 2833 OI CONTRACTS NAVIGATING OVER TO LONDON.

NET GAIN TWO EXCHANGES: 5523 CONTRACTS DESPITE THE DRUBBING SILVER TOOK IN PRICE WITH RESPECT TO FRIDAY’S TRADING

We are now in the poor non active delivery month of FEBRUARY and here the front month GAINED 16 contracts UP TO  157 contracts.  We had 60 notices filed upon yesterday so we GAINED 76 contracts or 380,000 ADDITIONAL oz will stand for delivery at the comex as somebody was in urgent need of silver over at state side (NY)

The March contract lost 4696 contracts DOWN to 96,405

April lost 13 contracts down to 61 .

.

We had 16 notice(s) filed for 80,000 OZ for the FEBRUARY 2018 contract for silver

INITIAL standings for FEBRUARY

Feb 12/2018.

Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
 183,144.973 oz
Scotia
Delaware
I.Delaware
JPMorgan
Deposits to the Dealer Inventory in oz nil oz
Deposits to the Customer Inventory, in oz
 nil oz
No of oz served (contracts) today
50 notice(s)
 5000 OZ
No of oz to be served (notices)
1149 contracts
(114,900 oz)
Total monthly oz gold served (contracts) so far this month
1783 notices
178300 oz
5.5458 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 3 withdrawals out of the customer account:
i) out of Scotia
we had 5,369.05  oz of gold transferred out of Scotia
ii) Out of Delaware: 1411.500 oz
iii) out of I.Delaware: 27,226.710 oz
iv) Out of JPMorgan: 149,137.713 oz
total withdrawal: 183,144.973  oz
we had 0 customer deposit
total customer deposits: nil  oz
we had 1 adjustments
i) Out of Delaware:  2199.0000?? was transferred into the dealer from the customer account of Delaware
total registered or dealer gold:  386,417.559 oz or 12.08 tonnes
total registered and eligible (customer) gold;   9,098,312.033 oz 282.99 tones

For FEBRUARY:
Today, 0 notice(s) were issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 50 contract(s) of which 49 notices were stopped (received) by j.P. Morgan dealer and 1 notice(s) was (were) stopped/ Received) by j.P.Morgan customer account.

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To calculate the INITIAL total number of gold ounces standing for the FEBRUARY. contract month, we take the total number of notices filed so far for the month (1783) x 100 oz or 178,300 oz, to which we add the difference between the open interest for the front month of FEB. (1199 contracts) minus the number of notices served upon today (50 x 100 oz per contract) equals 293,200 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 (1783 x 100 oz or ounces + {(1199)OI for the front month minus the number of notices served upon today (50 x 100 oz )which equals 293,300 oz standing in this active delivery month of February (9.119 tonnes). THERE IS 12.08 TONNES OF REGISTERED GOLD AVAILABLE FOR DELIVERY SO FAR.

WE GAINED 31 CONTRACTS OR AN ADDITIONAL 3100 OZ WILL STAND IN THIS ACTIVE DELIVERY MONTH OF FEBRUARY.

THE COMEX IS NOW UNDER STRESS AS THE REGISTERED GOLD FALLS BELOW 13 TONNES AS WELL AS HUGE NUMBER OF TONNES LEAVING THE CUSTOMER ACCOUNT

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XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

IN THE LAST 17 MONTHS 71 NET TONNES HAS LEFT THE COMEX.

end

And now for silver

AND NOW THE DECEMBER DELIVERY MONTH

FEBRUARY FINAL standings

feb 12 2018
Silver Ounces
Withdrawals from Dealers Inventory nil oz
Withdrawals from Customer Inventory
 54,585.481 oz
DELAWARE
I.DELAWARE
Deposits to the Dealer Inventory
nil
oz
Deposits to the Customer Inventory
 1,202,371.700 OZ
 JPM
Delaware
No of oz served today (contracts)
16
CONTRACT(S
(80,000 OZ)
No of oz to be served (notices)
141 contracts
(705,000 oz)
Total monthly oz silver served (contracts) 215 contracts

(1,075,000 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 2 inventory deposits into the customer account

i) into J.P.MORGAN:1,201,401.200 oz

ii) into Delaware: 970.500 oz

total inventory deposits: 1,202,371.7000oz

we had 2 withdrawals from the customer account;

i Out of DELAWARE:  3965.500 OZ

ii) Out of International Delaware: 50,619.981 oz

total withdrawals;  54,585.481  oz

we had 0 adjustment

total dealer silver:  43.384 million

total dealer + customer silver:  251.417 million oz

The total number of notices filed today for the FEBRUARY. contract month is represented by 16 contract(s) FOR 80,000 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 215 x 5,000 oz = 1,075,000 oz to which we add the difference between the open interest for the front month of FEB. (157) and the number of notices served upon today (16 x 5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the FEB contract month: 215(notices served so far)x 5000 oz + OI for front month of FEBRUARY(157) -number of notices served upon today (16)x 5000 oz equals 1,780,000 oz of silver standing for the FEBRUARY contract month. 

WE GAINED 16 CONTRACTS OR AN ADDITIONAL 80,000 OZ WILL  STAND AT THE COMEX AS SOMEBODY WAS IN GREAT NEED OF SILVER STATE SIDE.

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ESTIMATED VOLUME FOR TODAY: 89,325 CONTRACTS

CONFIRMED VOLUME FOR YESTERDAY: 108,959 CONTRACTS

YESTERDAY’S CONFIRMED VOLUME OF 108,959 CONTRACTS EQUATES TO  544 MILLION OZ OR 77.8% 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 RISES TO -2.25% (FEB 12/2018)
2. Sprott gold fund (PHYS): premium to NAV FALLS TO -0.45% to NAV (FEB 8/2018 )
Note: Sprott silver trust back into NEGATIVE territory at -2.25%-/Sprott physical gold trust is back into NEGATIVE/ territory at -0.45%/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 -4.11%: NAV 13.68/TRADING 13.11//DISCOUNT 4.11%

END

And now the Gold inventory at the GLD/

Feb 12/STRANGE!!WITH GOLD RISING BY 12.00 DOLLARS, THE CROOKS DECIDED AGAIN TO WITHDRAW 5.6 TONNES OF GOLD FOR EMERGENCY USE ELSEWHERE/INVENTORY RESTS AT 820.71 TONNES

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 12/2018/ Inventory rests tonight at 820.71 tonnes

*IN LAST 323 TRADING DAYS: 120.44 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 257 TRADING DAYS: A NET 36.87 TONNES HAVE NOW BEEN ADDED INTO GLD INVENTORY.

end

Now the SLV Inventory

Feb 12/AGAIN, WITH TODAY’S HUGE RISE IN SILVER PRICE, IN TOTAL CONTRAST TO GOLD: NO CHANGE IN SILVER INVENTORY/INVENTORY RESTS AT 314.045 MILLION OZ/

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 12/2017:

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
+ 2.07%

end

Major gold/silver trading /commentaries for MONDAY

GOLDCORE/BLOG/MARK O’BYRNE.

GOLD/SILVER

“This Is Where They Completely Lost Their Minds” – Hussman

“This Is Where They Completely Lost Their Minds” – Hussman

– Hussman warns ‘the S&P 500 to lose approximately two-thirds of its value over the completion of this cycle’
– ‘the market has lost value, even since 2009, when overvalued, overbought, overbullish conditions were joined by divergent internals’
– Believes the market is going to learn lessons about the crash ‘the hard way’

In an almost prophetic blog post from John Hussman last week, we are warned about the bubble waiting to collapse in the US equity market and the hard lesson investors are about to learn.

Drawing on both his own experience and the work of the much revered Didier Sornette, Hussman looks at the current state of the US equity market, where it sits in its cycle and how it compares to history.

The prognosis is not good. Hussman warns that ” the market has lost value, even since 2009, when overvalued, overbought, overbullish conditions were joined by divergent internals…I expect the S&P 500 to lose approximately two-thirds of its value over the completion of this cycle.”

Of course, the lesson may have finally begun. On Monday February 5th the Dow Jones dropped over 1,000 points, the largest single day drop ever, on a points-basis. Meanwhile, also on the 5th,  the S&P500 went negative for 2018 closing down more than 7 percent from a record set in January. Similar action was repeated on the 8th February, with many traders declaring they’d never seen anything like it.

Gold performed well following the rout and we believe gold prices may rise further as the drama leads period of risk aversion and a new found appreciation by investors looking for gold’s hedging and safe haven attributes.

You can hear more about our bubble crash predictions in our Goldnomics podcast. Here we take a look at one of the important financial questions of our day – is this the greatest stock market bubble in history?

Excerpts taken from ‘Measuring the Bubble’ on 1st February 2018

Last week, the U.S. equity market climbed to the steepest valuation level in history, based on the valuation measures most highly correlated with actual subsequent S&P 500 10-12 year total returns, across a century of market cycles

As Didier Sornette correctly observed in Why Markets Crash,

“The collapse is fundamentally due to the unstable position; the instantaneous cause of the crash is secondary.”

My sense is that investors are going to learn this again the hard way.

On the accelerating slope of the current advance

Speaking of Didier Sornette, I’ve periodically discussed his concept of “log periodic power-law” price behavior, which has accompanied speculative episodes in numerous markets and often precedes inflection points or collapses. This structure is based on a purely mathematical fit to price behavior, and does not reflect any valuation considerations. It’s not part of our own investment discipline, but we occasionally fit the log-periodic structure to price behavior when market movements are particularly extreme.

In recent years, those structures have generally identified inflection points of flat or correcting prices, but certainly not crashes in the S&P 500. Given the increasingly steep slope of the current market advance, along with the most extreme valuations in history and the most lopsided bullish sentiment in more than three decades, it’s quite possible that this instance will be different. In any event, the underlying “arbitrage” considerations described by Sornette are worth reviewing here.

In 2000, as the tech bubble was peaking, Nobel laureate Franco Modigliani observed that the late stages of a bubble can be “rational” in a certain sense, provided that investors are inclined to self-reinforcing behavior.

Imagine a market that you fully believe to be overvalued and at risk of a market crash. Indeed, let’s say that there is a defined probability of a crash, which increases rapidly as the pitch of the market advance becomes more extreme. Should you sell? Well, it depends. Given that an immediate crash is not certain, a speculator must, in each period, weigh the potential gain from holding a bit longer against the potential loss from overstaying. Sornette uses a similar argument to describe a speculative bubble advancing toward its peak (italics mine):

“Since the crash is not a certain deterministic outcome of the bubble, it remains rational for investors to remain in the market provided they are compensated by a higher rate of growth of the bubble for taking the risk of a crash, because there is a finite probability of ‘landing smoothly,’ that is, of attaining the end of the bubble without crash.”

“This line of reasoning provides us with the following important result: the market return from today to tomorrow is proportional to the crash hazard rate. In essence, investors must be compensated by a higher return in order to be induced to hold an asset that might crash. As the price variation speeds up, the no-arbitrage conditions, together with rational expectations, then imply that there must be an underlying risk, not yet revealed in the price dynamics, which justifies this apparent free ride and free lunch. The fundamental logic here is that the no-arbitrage condition, together with rational expectations, automatically implies a dramatic increase of a risk looming ahead each time the price appreciates significantly, such as in a speculative frenzy or in a bubble. This is the conclusion that rational traders will reach.”

The chart below shows our current best-fit parameterization of Sornette’s log-periodic structure, applied to the S&P 500 Index. Notably, unless we allow for the slope of the current market advance to become quite literally infinite, it’s impossible to closely fit the current price advance without setting the “finite-time singularity” – the point at which instability typically emerges – within a few days of the present date. Notably, the singularity is not the date of a crash. Rather, it’s the point where the pitch of the advance reaches an extreme, which may simply be an inflection point (as has been the case for other structures in recent years) or a pre-crash peak.

The collapse is fundamentally due to the unstable position; the instantaneous cause of the crash is secondary.
– Didier Sornette

If you want my opinion (which we don’t trade on and neither should you), my opinion is that this singularity will prove to be more than an inflection point.

Though nearly every morning prompts the phrase “Yup, they’re actually going to do this again,” the steepening pitch of this ascent – coupled with record valuation extremes, record overbought extremes, and the most lopsided bullish sentiment in over three decades – now produces the most extreme “overvalued, overbought, overbullish” moment in history. In prior cycles across history, similar syndromes were either joined or quickly followed by deterioration in market internals. In this cycle, it has been essential to wait for explicit deterioration in market internals before establishing a negative outlook. Notably, the market has lost value, even since 2009, when overvalued, overbought, overbullish conditions were joined by divergent internals.

I expect the S&P 500 to lose approximately two-thirds of its value over the completion of this cycle.

My impression is that future generations will look back on this moment and say “… and this is where they completely lost their minds.”

As I’ve regularly noted in recent months, our immediate outlook is essentially flat neutral for practical purposes, though we’re partial to a layer of tail-risk hedges, such as out-of-the-money index put options, given that a market decline on the order of even 5% would almost certainly be sufficient to send our measures of market internals into a negative condition. It’s best not to rely on the ability to execute sales into a falling market, because the range-expansion we’ve recently seen on the upside may very well have a mirror-image on the downside. As usual, we’ll respond to new evidence as it emerges.

janskoyles

END

Bitcoin and Crypto Prices Being Manipulated Like Precious Metals?

Bitcoin and Crypto Prices Being Manipulated Like Precious Metals? – FSN Interview GoldCore


Listen on BlogTalkRadio

Kerry Lutz of the Financial Survival Network (FSN) interviewed GoldCore’s Mark O’Byrne about the outlook for crypto currencies, financial markets and precious metals.

– Are bitcoin and crypto prices being manipulated like precious metals?
– Is there a coordinated backlash against bitcoin from JPM and powerful interests?
– 95% of cryptocurrencies and ICOs will likely go to zero
– Good cryptos will thrive, most will disappear in “massive creative destruction”
– Ponzi like nature of financial markets and fiat monetary system
– Fundamentals do not justify the massive gains in US stocks in recent years (near parabolic rise of over 300% in the S&P 500 since 2009)
– Is Plunge Protection Team (PPT) active in supporting markets?
– Retail investors including millennials piling into markets near top
– Smart money is reducing allocations to stocks and bonds; diversifying into gold
– Bitcoin is just nine years old and not proven store of value
– Gold proven store of value as seen in data, history and experience
– Gold backed crypto, crypto bullion, “digital gold” and “gold on the blockchain” has huge potential
– Perth Mint, Royal Mint, Royal Canadian Mint, LBMA and many others looking at blockchain
– Important blockchain solutions have full backing, transparency, security, stop the fraud and have customers interest at heart
– Important to own hard assets including physical gold and silver outside our digital financial and banking systems

Listen/ Watch To FSN GoldCore Interview On YouTube Here

News and Commentary

Gold edges up as dollar eases; eyes on US inflation data (Reuters.com)

Asia Stocks Rise With S&P Futures; Dollar Declines (Bloomberg.com)

Holiday drives up Chinese gold demand (GlobalTimes.cn)

Gold prices remain up on sustained jewellers’ buying in India (Livemint.com)

Bitcoin Finds a Bottom as Risk Aversion Grips Global Markets (Bloomberg.com)

Moody’s Threatens US Downgrade Due To Soaring Debt, “Fiscal Deterioration” (ZeroHedge.com)


Source: Goldchartsrus via Goldseek

Eight signals to watch that the U.S. stock rout is over (Reuters.com)

What America’s Super Bowl says about Asia’s stocks (StansBerryChurcHouse.com)

Where Will The U.S. Get the Cash? – Mauldin (GoldSeek.com)

Except For Gold…The Big 6 Commodities Were Closed Lower Again – Ed Steer (GoldSeek.com)

Granddaddy of all Bubbles Has Been Pierced – Doug Noland (CreditBubbleBulletin.blogspot.ie)

How China Is About to Shake Up the Oil Futures Market (Bloomberg.com)

Gold Prices (LBMA AM)

12 Feb: USD 1,321.70, GBP 955.19 & EUR 1,077.45 per ounce
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

Silver Prices (LBMA)

12 Feb: USD 16.43, GBP 11.86 & EUR 13.39 per ounce
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


Recent Market Updates

– “This Is Where They Completely Lost Their Minds” – Hussman
– Brexit Risks Increase – London Property Market and Pound Vulnerable
– 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

Mark O’Byrne
end

As I explained below, the Fed has only two choices, rates or stocks.  With Trump’s new spending initiate rates are heading higher and this will certainly cause stocks to flounder

(courtesy Eric Sprott/)

Fed will have to choose between rates and stocks, Sprott says

 Section: 

5:23p ET Friday, February 9, 2018

Dear Friend of GATA and Gold:

Mining entrepreneur and Sprott Asset Management founder Eric Sprott, interviewed by the TF Metals Report’s Craig Hemke for the Sprott Money weekly wrapup, says the Federal Reserve soon may have to make a choice between letting interest rates rise or crashing the stock and housing markets. Under the circumstances this week, Sprott says, the monetary metals have not done badly. The interview is 12 minutes long and can be heard and read at Sprott Money here:

https://www.sprottmoney.com/Blog/the-natural-instinct-should-be-to-buy-g…

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

END

Mike Kosares explains the meaning of volatility and how it usually presages a downward blast in the stockmarket and a rise in the price of gold

a must read..

(courtesy Michael Kosares/GATA)

Mike Kosares: The anatomy of volatility and what it means for gold

 Section: 

6:19p ET Saturday, February 10, 2018

Dear Friend of GATA and Gold:

USAGold’s Mike Kosares today cites a Swiss Finance Institute study concluding that market crashes tend to follow a period of low volatility, that volatility can spike for months, and that “in recent history volatility has preceded upward movement in the gold price.”

Kosares adds that while volatility may not always spike before a crash, “it most certainly has surged in the past before an increase in the price of gold.”

Kosares’ commentary is headlined “The Anatomy of Volatility and What It Means for Gold” and it’s posted at USAGold here:

http://www.usagold.com/cpmforum/2018/02/10/the-anatomy-of-volatility-and…

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

END

I wonder what gave this away: the Economist states that insider trading has been rife on Wall Steet

(courtesy the Economist/London)

The Economist: Insider trading has been rife on Wall St., academics conclude

 Section: 

From The Economist, London
Saturday, February 10, 2018

Insider-trading prosecutions have netted plenty of small fry. But many grumble that the big fish swim off unharmed. That nagging fear has some new academic backing, from three studies. One argues that well-connected insiders profited even from the financial crisis. The others go further still, suggesting the entire share-trading system is rigged.

What is known about insider trading tends to come from prosecutions. But these require fortuitous tipoffs and extensive, expensive investigations, involving the examination of complex evidence from phone calls, e-mails, or informants wired with recorders. The resulting haze of numbers may befuddle a jury unless they are leavened with a few spicy details—exotic code words, say, or (even better) suitcases filled with cash.

The papers make imaginative use of pattern analysis from data to find that insider trading is probably pervasive. The approach reflects a new way of analysing conduct in the financial markets. It also raises questions about how to treat behaviour if it is systemic rather than limited to the occasional rogue trader. …

… For the remainder of the report:

https://www.economist.com/news/finance-and-economics/21736561-one-study-…

END

Interview of Bill Holter

Is Rothschild Going To Tank The Market To Punish Trump? — Bill Holter

Attachments area

Preview YouTube video Is Rothschild Going To Tank The Market To Punish Trump? — Bill Holter

Is Rothschild Going To Tank The Market To Punish Trump? — Bill Holter



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

 

i) Chinese yuan vs USA dollar/CLOSED DOWN AT 6.3246 /shanghai bourse CLOSED UP AT 24.27 POINTS 0.78% / HANG SANG CLOSED DOWN 47.79 POINTS OR 0.16%
2. Nikkei closed HOLIDAY /USA: YEN FALLS TO 108.68

3. Europe stocks OPENED DEEPLY IN THE GREEN   /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:: 60.26  and Brent: 63.65

3f Gold UP/Yen UP

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund RISES TO +.764%/Italian 10 yr bond yield UP to 2.039% /SPAIN 10 YR BOND YIELD UP TO 1.460%

3j Greek 10 year bond yield RISES TO : 4.167?????????????????

3k Gold at $1319.70 silver at:16.42     7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble UP 40/100 in roubles/dollar) 57.97

3m oil into the 60 dollar handle for WTI and 63 handle for Brent/

3n Higher foreign deposits out of China sees huge risk of outflows and a currency depreciation. 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 108.68 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 0.9383 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1504 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.

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

3r the 10 Year German bund now POSITIVE territory with the 10 year RISING to +0.764%

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 2.8803% early this morning (THIS IS DEADLY TO ALL MARKETS). Thirty year rate at 3.17610% /BOTH DEADLY

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

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

US Futures Surge After Sharp Rebound In Asia And Europe; China “Plunge Protectors” Activated

 

Despite a very explicit warning  by Goldman’s co-head of equity trading that the “regime has changed” and that instead of “buying the dip”, investors should be “selling-the-rip”, so far this morning a global BTFD relief rally from Asia to Europe has welcomed a rare respite from volatility as U.S. stock futures surged after a week that saw two of the biggest single-day percentage drops in seven years, with the Dow set to open some 300 points higher after Friday’s torrid last hour surge.

And as investors await today’s revised monthly budget statement, one which reportedly will no longer balance over the next 10 years, sending the dollar sliding in the process, S&P futures are about 30 handles higher, flirting with 2,650, some 100 points higher from the lows observed around noon on Friday.

S&P 500 futures jumped 1.2%, following a weekly decline that at one point was the largest since the financial crisis. Futures on the Dow Jones Industrial Average added 1.3 percent, while those on the Nasdaq 100 Index were up 1 percent. Meanwhile, the VIX fell 11% extending its drop to a second day after JPM wrote on Friday that the worst of the vol spike “unwind” by CTAs, risk parities and vol-targeting funds is behind us.

Traders have been on edge following tumultuous moves in equities last week, which saw the S&P 500 post its worst week in two years with a 5.2% decline on fears over interest rate hikes, ending a stretch of 588 days without a 5% drop.

However, what has been most surprising about today’s session is that Ten-year Treasury yields climbed on Monday, touching a fresh four-year high amid growing inflation fears, worries about the surging US deficit, and concerns the Federal Reserve may accelerate its rate-hike schedule even as it continues to shrink its balance sheet. The 10Y yield rose as high as 2.8930%, yet unlike last week this has – so far – not been enough to dent the equity enthusiasm.

The Treasury curve flattened, with futures edging further lower led by belly, EGB peripheral spreads see minor tightening given general  risk-on; iTraxx Crossover also tightens ~12bps. Germany’s 10-year yield increased three basis points to 0.77 percent, the highest in more than two years. Britain’s 10-year yield rose five basis points to 1.605 percent, the highest in almost 22 months.

European equities rebounded on Monday from the worst weekly sell-off in two years with share prices firming in opening trading. Europe’s Stoxx 50 index climbed some 1.9%, led by miners as European bourses catch up with the gains seen late on Wall Street on Friday with macro newsflow otherwise light in the region. Sector wise, material names outperform i nfitting with some of the price action seen in the complex during Asia-Pac trade, energy names are also higher as energy prices continue to retrace some of the losses seen on Friday. In terms of stock specifics, Heineken (-4.2%) are seen lower after their earnings report was clouded by currency effects, Akzo Nobel (+1.7%) have been in focus today after reports in the FT suggesting the Co.’s chemicals unit has been subject to PE interest, Barclays (+1%) have been charged by the SFO regarding their Qatari loans and Airbus (-1.2%) are lower amid reports that they have stopped delivering A320neo jets due to issues with Pratt &Whitney engines.

Asia similarly surged, with South Korean equities and the won rose after North Korean leader Kim Jong Un invited his counterpart to meet. Vice President Mike Pence told the Washington Post the U.S. is ready to engage in talks about North Korea’s nuclear program, signaling a shift in policy. The won outperformed major currencies. Japan’s markets are closed for a holiday. Elsewhere, Hang Seng (-0.2%) and Shanghai Comp. (+0.8%) were positive ahead of this week’s Lunar New Year celebrations, while most of the Asia peripheries traded with cautious gains amid a lack of drivers and with various holiday closures scheduled through to next week.

China’s ChiNext index of small-cap and tech shares jumped after the government was said to call on companies and mutual funds to boost the stock market. The ChiNext rose 3.5% in Shenzhen, its biggest gain since July 27, after falling to a three-year low Friday. “The news about government support eased some worries,” said Shen Zhengyang, Shanghai-based strategist with Northeast Securities Co. “People are hunting for bargains, especially smaller companies that fell too much in the recent rout”

Others were more cautious: “Futures can move around quite a bit, but what I will be watching for is a stable ‘green’ in the futures coming into tomorrow,” BB&T’s Walter “Bucky” Hellwig told Bloomberg. ““This will show that the S&P didn’t hold on to its 200-day moving average by accident, and this confidence is going to pull more buyers into the market.”

To be sure, with Japan closed for holiday, and virtually no economic events and market drivers so far on Monday (this will change with Wednesday’s CPI release) has led to an extremely muted European session.

Meanwhile, the USD is weaker across the board after Sunday reports that the Trump budget to be released today will not only increase the US deficit but – for the first time under a Republican president – won’t balance over 10 years.

Other major currencies were rangebound, USD/ZAR drifts lower in anticipation of Zuma departure, RUB rallies with crude. Some other pairs from Bloomberg:

  • EUR/USD rises as much as 0.4% to 1.2297 before paring as take-profit offers cap pair for now, volumes relatively muted amid Japan holiday
  • GBP/USD edges up as as U.K. Prime Minister Theresa May embarks this week on a push to bring her divided Cabinet together and flesh out a Brexit strategy
  • USD/JPY falls modestly
  • AUD/NZD rises as cross bounces off 1.0750 area for the fifth time in as many days helped by macro flows

The dollar’s decline supported commodities, with metals higher and crude oil halting a six-day selloff. Both WTI and Brent crude futures have continued to retrace Friday’s losses despite Friday’s Baker Hughes rig count showing a climb of 26 oil rigs. In terms of energy newsflow, UAE energy minister stated the energy market is to balance this year with shale oil output to be absorbed by rising 2018 demand. In metals markets, spot gold is seen higher alongside the softer USD, although gains are likely being capped by this morning’s risk environment. Elsewhere, copper prices have recovered from their two month lows during London trade while Chinese iron ore futures were seen lower overnight after recent rampant gains ahead of the Lunar New Year which kicks off this Thursday.

And while there are few notable economic releases today, looking ahead investors will await U.S. consumer-price data on Wednesday with some trepidation. Pressure on equities has been emanating from the Treasury market and in the outlook for inflation, and any upside surprises will likely resume the positive correlation between bond and stock prices.

In geopolitical developments, North Korea invited South Korean President Moon for talks in Pyongyang, while President Moon stated that they should make preparations to realize the meeting. At the same time, a US official stated that there is no differences between US, South Korea and Japan on need to isolate North Korea until it gives up its nuclear weapons program.

There were also some notable central bank comments overnight, with BoE’s Haldane saying that minor interest rate increases are likely to be introduced later this year, while he also stated that inflation is currently running above target and that’s one of the factors interest rates were hiked last year. BoE Vlieghe said that if there are less credit headwinds, this may signal that the UK is ready for higher rates, there is increased evidence that a tight labour market is having upward effects on wages, also stating that rise in UK debt burden not sustainable if continues for many years.

ECB’s Nowotny said that the ECB is concerned regarding US attempts to politically influence FX rates. Nowotny also added that said that EU inflation still has room to increase so the ECB is still on the careful side, although that certainly won’t last forever and that there will be a need for higher interest rates in the foreseeable future. ECB’s Visco said ECB will be patient on pursuit of its inflation goal and that it has been challenging to push up inflation
expectations.

This week earnings season continues in full swing with reports from Bunge, TripAdvisor, SunPower, Con Edison, Bombardier, Heineken, Loews, Michelin, PepsiCo, MetLife,Cisco, Japan Post Bank, Credit Suisse, Nestle, Airbus, Allianz, Telstra, Coca-Cola, Deere, Eni, Credit Agricole and Campbell Soup.

Bulletin Headline Summary from RanSquawk

  • European bourses catch up to the gains seen late Friday on Wall Street
  • A relatively quiet start to the week in FX, partly due to Japan’s market holiday, but also as many participants simply take some time out after the hectic sessions of late
  • Looking ahead, today sees a lack of tier 1 highlights

Market Snapshot

  • S&P 500 futures up 1.2% to 2,649.25
  • Brent Futures up 2.2% to $64.18/bbl
  • Gold spot up 0.4% to $1,321.31
  • U.S. Dollar Index down 0.3% to 90.21
  • STOXX Europe 600 up 1.6% to 374.31
  • MXAP up 0.4% to 171.13
  • MXAPJ up 0.6% to 557.88
  • Nikkei down 2.3% to 21,382.62
  • Topix down 1.9% to 1,731.97
  • Hang Seng Index down 0.2% to 29,459.63
  • Shanghai Composite up 0.8% to 3,154.13
  • Sensex up 1% to 34,329.57
  • Australia S&P/ASX 200 down 0.3% to 5,820.70
  • Kospi up 0.9% to 2,385.38
  • German 10Y yield rose 3.7 bps to 0.782%
  • Euro up 0.2% to $1.2271
  • Brent Futures up 2.2% to $64.18/bbl
  • Italian 10Y yield rose 5.4 bps to 1.779%
  • Spanish 10Y yield fell 0.4 bps to 1.476%

Top Overnight News from Bloomberg

  • President Trump will seek billions of dollars in new spending to build a border wall, improve veterans’ health care and combat opioid abuse in a budget proposal that’s likely to get little traction in a Republican Congress that has its own, very different spending priorities
  • OMB’s Mulvaney: U.S. will post a larger budget deficit this year and could see a “spike” in interest rates as a result
  • In a break from a longstanding Republican goal, the plan won’t balance the budget in 10 years, according to a person familiar with the proposal
  • The U.S. is ready to engage in talks about North Korea’s nuclear program even as it maintains pressure on Kim Jong Un’s regime, Vice President Mike Pence said, signaling a shift in American policy
  • The U.K. economy is ready for slightly higher rates, BOE’s Vlieghe says on a panel in London
  • Reports of Prime Minister Shinzo Abe’s plan to nominate Haruhiko Kuroda for another term as chief of the Bank of Japan is seen as easing pressure on the yen
  • BOE’s Vlieghe: U.K. economy ready for slightly higher rates
  • ECB’s Nowotny says euro-area inflation has room to move higher so ECB is still on the careful side; Visco says risk of deflation averted, forex volatility seen as main risk for inflation
  • German Chancellor Angela Merkel said she’s determined to serve another full term, rebuffing party critics who say she sold out to the Social Democrats to extend her 12 years in office
  • China Jan. M2 Money Supply: 8.6% vs 8.2% est; New Yuan Loans 2.9t vs 2.1t est; Agg. Financing 3.1t vs 3.2t est.

Asia equity markets began a holiday-quietened week mostly positive in which the region got a mild lift as US equity futures extended on Friday’s late rebound. However, upside was contained with Japan away in observance of National Founding Day, while the ASX 200 (-0.3%) was the laggard as energy names reeled from last week’s drop in crude prices and with financials subdued as the Royal Banking Commission started its inquiry into the industry. Elsewhere, Hang Seng (-0.2%) and Shanghai Comp. (+0.8%) were positive ahead of this week’s Lunar New Year celebrations, while most of the Asia peripheries traded with cautious gains amid a lack of drivers and with various holiday closures scheduled through to next week. PBoC skipped open market operations.

Top Asian News

  • China Is Said to Call on Companies, Mutual Funds to Boost Stocks
  • China New Loans Hit Record on Seasonal Boost, Shadow Bank Curbs
  • Chinese Tourists Are Taking Over the Earth, One Selfie at a Time
  • Singapore Seen Leading Race to Tax $38 Billion Shopping Boom
  • China’s Jan. New Loans 2.9T Yuan; Est. 2.05T Yuan

European equities have kicked the week off on the front foot (Eurostoxx 50 +1.9%) as European bourses catch up with the gains seen late on Wall Street on Friday with macro newsflow otherwise light in the region. Sector wise, material names outperform infitting with some of the price action seen in the complex during Asia-Pac trade, energy names are also higher as energy prices continue to retrace some of the losses seen on Friday. In terms of stock specifics, Heineken (-4.2%) are seen lower after their earnings report was clouded by currency effects, Akzo Nobel (+1.7%) have been in focus today after reports in the FT suggesting the Co.’s chemicals unit has been subject to PE interest, Barclays (+1%) have been charged by the SFO regarding their Qatari loans and Airbus (-1.2%) are lower amid reports that they have stopped delivering A320neo jets due to issues with Pratt &Whitney engines.

Top European News

  • Barclays Bank Unit Charged by SFO Over 2008 Qatar Loan Deal
  • ECB’s Nowotny Says Central Banks’ Task Isn’t to Satisfy Markets
  • TDC Withdraws Recommendation of MTG Transaction After Bid999
  • Kazakh Halyk Bank Weighs Dividend as CEO Predicts Excess Capital
  • Berlusconi Papers Over Cracks in Alliance: Italy Campaign Trail

In FX, a relatively quiet start to the week, partly due to Japan’s market holiday, but also as many participants simply take some time out after the hectic sessions of late. The Usd is modestly weaker vs all its G10 peers bar the Kiwi, and then only just as Nzd/Usd nestles around 0.7250 and Aud/Nzd remains below 1.0800 – Aud/Usd maintaining 0.7800+ status. Cable has ticked up towards the top of a 1.3810-1.3875 range on little obvious Sterling supportive news or factors aside from further BoE rhetoric underscoring more policy tightening (albeit gradual), while Eur/Usd is mid-way between 1.2245-95 parameters amidst more qualms registered by ECB’s Nowotny about the US exerting political influence on exchange rates. Usd/Jpy even more contained within a 108.50-108.95 band, as are Usd/Chf and Usd/Cad in 0.9370-0.9400 and 1.2600-1.2555 ranges awaiting more direction – via stock market developments and US CPI data for example. The Dollar index is keeping its head above the 90.000 level with the latest weekly CFTC reports on spec positioning showing a slightly less short Greenback base, along with the Jpy, while Eur and Gbp longs lighten up a bit and Loonie longs increase their Cad holdings. In terms of option expiries, nothing really of note or in  size for today’s NY cut.

In commodities, both WTI and Brent crude futures have continued to retrace Friday’s losses despite Friday’s Baker
Hughes rig count showing a climb of 26 oil rigs. In terms of energy newsflow, UAE energy minister stated the energy  market is to balance this year with shale oil output to be absorbed by rising 2018 demand. In metals markets, spot gold is seen higher alongside the softer USD, although gains are likely being capped by this morning’s risk environment. Elsewhere, copper prices have recovered from their two month lows during London trade while Chinese iron ore futures were seen lower overnight after recent rampant gains ahead of the Lunar New Year which kicks off this Thursday. North Sea Forties pipeline is now said to be in full operation, according to sources. Phillips 66 reports a unit upset at wood river, Illinois refinery; the refinery has a crude capacity of 314K bpd.

With data fairly thin on Monday all eyes will instead be on the White House with President Trump expected to release a $1.5tn infrastructure plan, along with his 2019 budget blueprint. Away from that the only data of note is the January monthly budget statement in the US.

US Event Calendar

  • 2pm: Monthly Budget Statement, est. $51.0b, prior $51.3b

DB’s Jim Reid concludes the overnight wrap

Are we potentially set for a Valentine’s Day sell-off on Wednesday for markets or will Cupid fire some dovish arrows for the market. Indeed we can’t remember a more eagerly anticipated number than the US CPI release on the most romantic day of the year. It’s near impossible to predict one number but our bias continues to be for higher inflation than expected in 2018. This number has been slightly complicated as the BLS have recently made some seasonal  adjustments. Before this, January’s print (i.e. this week’s number) had consistently exceeded expectations in the last 25 years and February’s had consistently missed. So all a bit uncertain. Our economists also think we should watch healthcare inflation which is due some upside surprise soon. We’ll fully preview on Wednesday but that’ll be the focal point for the week and the focal point for pretty much every month this year in our opinion.

Other data will pale into insignificance this week but you can see what’s in store at the end of this report. It’s also worth mentioning that today President Trump is expected to release a $1.5tn infrastructure plan (which will kick off the process for producing legislation) and also his 2019 budget blueprint. Given the tax reform, the recent budget concessions to keep the government open, and this infrastructure plan, it’s no surprise to see investors looking at whether government bond yields are too low regardless of inflation. It’s also worth noting that it’s a half-term week in the UK and parts of Europe so that could add to the liquidity fun and games in either direction. On a similar vein  Chinese New Year kicks off on Thursday, with mainland markets subsequently shut until February 21st.

Now recapping equities performance from Friday. European bourses were all lower after the negative leads from Asia, with key bourses down 1-1.5% (Stoxx 600 -1.45%; DAX -1.25%; FTSE -1.09%). Across the pond, the S&P exhibited large swings with a peak to trough intraday range of 4.1% before recovering throughout the day and closing 1.49% higher. The Dow (+1.38%) and Nasdaq (+1.44%) also advanced. Within the S&P, all sectors excluding energy were in the green, with gains led by the tech, real estate and utilities sectors. Elsewhere, the VIX also traded in a large range of c13pt (27.7 to 41.1) before closing 4.4pt lower to 29.06 (-13.2%).

Over the weekend, the Nikkei reported Japan’s PM Abe intends to nominate Kuroda for a second five year term as BOJ Governor. Our Japanese strategist Yamashita expect the near term market impacts to be limited, in part as consensus was broadly expecting a reappointment. Looking ahead, he expects the current monetary easing framework to remain in the short term, but a normalisation bias is more likely down the track, albeit with actual action likely to be made on the condition of inflation reaching +1% and the government declaring a victory over deflation. If normalisation occurs, he expects a hike in the 10y JGB yield target to be the BOJ’s first move towards normalization. ETF purchases are also likely to be scaled back sooner rather than later, although domestic stock prices will probably need to move back into an uptrend trend before that can happen. Refer to his note for more details.

Following on, Nick Burns from my team has examined the potential headwinds for HY credit due to the spike higher in equity market volatility. We believe there will likely be a reversal from the current levels of equity market volatility, but credit spreads will likely come under pressure unless equity market volatility falls towards the lows seen during 2017. Further, he has also looked at how the technicals seem to be less supportive in the early stages of 2018 than they have been in recent years. Refer to his note for more details.

This morning in Asia, markets are modestly higher. The Hang Seng (+0.58%), Kospi (+1.18%) and China’s CSI 300 (+0.81%) are all up while the ASX 200 is down 0.30% as we type. Elsewhere, the Japanese market is closed today for a holiday and WTI is rebounding c1%.

Now recapping other market’s performance from Friday. In government bonds, earlier risk aversion seemed to help core European 10y bond yields to fall 2-5bp (Bunds -1.8bp; Gilts -4.6bp) while peripherals yields rose 3-7bp. Turning to currencies, the US dollar index strengthened 0.24% while the Euro was broadly flat and Sterling fell 0.62%, weighed down by the softer than expected prints on IP and trade deficits. In commodities, WTI oil fell 3.19%, in part as the Baker Hughes US rig count posted its biggest weekly increase in more than year. Elsewhere, precious metals softened (Gold -0.16%; Silver -0.34%) and other base metals also weakened (Copper -1.41%; Zinc -0.69%;  Aluminium -0.81%).

Away from markets, the US Budget director Mulvaney noted that rising budgets deficits are “a very dangerous idea, but it’s the world we live in” and the “US will post a larger deficit this year and could see a spike in interest rates, but lower deficit are possible over time given sustained economic growth”. Elsewhere, Congress has officially passed the two year spending deal with our US economists expecting the c$300bln increase in spending to potentially add several tenths to their 2018 and 2019 growth forecasts of 2.6% and 2.1% (Q4/Q4) respectively, subject to more details from the deal.

Over in Germany, the BamS has reported the SPD leader Martin Schulz will be replaced on Tuesday when the SPD leadership meets. The BamS did not say how it got the information but noted Andrea Nahles will be appointed as acting party Head. Earlier on Friday, Mr Schulz has “declared his withdrawal from a (proposed) role in the federal government” but said he wanted party members to vote in favour of the coalition government with Ms Merkel’s bloc. Elsewhere, Ms Merkel noted that it’s acceptable to give the finance ministry post to the SPD and that “a finance minister can’t just do what he wants”.

Finally onto central banks commentaries. The ECB’s Nowotny noted the recent equities sell off as “a normalisation” and that “…the task of central banks isn’t to satisfy markets but to ensure economic stability. So if necessary, rates will have to rise and markets will have to adapt to that”. On QE, he said “…I don’t think we will need it (after September), at least not in its current form”. On inflation, he noted it still has room to move higher, so the ECB is still on the careful side, but that won’t last forever, as “in the foreseeable future there will be a need for the ECB to raise rates…”

In the UK, the BOE’s Haldane said “some further tightening of policy might be needed over the period ahead”, but the BOE is “in no rush” to do so. He added rates in the UK “won’t remotely go back to levels we’ve seen in the past, but nonetheless keeping the cost of living under control is….the single best and most  important thing we can do to help the economy”.

We wrap up with other  data releases from Friday. In the US, the final reading of the December wholesale inventories was revised upward to 0.4% mom (vs. 0.2% expected). Overall,the Atlanta Fed’s GDPNow model now estimate that the US economy will grow 4.0% saar in 1Q, while the NY Fed’s estimate is c3.4% saar. In Europe, both France and Italy’s December IP was above market, at 4.5% yoy (vs. 3.5% expected) and 4.9% (vs. 1.9% expected) respectively. Conversely, a fall in output in the oil and gas and mining sectors contributed to a lower than expected December IP in the UK, at -1.3% mom (vs. -0.9%) and 0% yoy (vs 0.4%), while its December trade deficit widened to -£4.9bln (vs. -£2.4bln expected). Exports for the month rose 0.8% mom, while imports rose an even stronger 3.0% mom.

With data fairly thin on Monday all eyes will instead be on the White House with President Trump expected to release a $1.5tn infrastructure plan, along with his 2019 budget blueprint. Away from that the only data of note is the January monthly budget statement in the US. Heineken will report earnings.

3. ASIAN AFFAIRS

i)Late SUNDAY night/MONDAY morning: Shanghai closed UP 24.27 points or 0.78% /Hang Sang CLOSED DOWN 47.79 or 0.16% / The Nikkei closed HOLIDAY/Australia’s all ordinaires CLOSED UP 0.30%/Chinese yuan (ONSHORE) closed DOWN at 6.3286/Oil DOWN to 60.26 dollars per barrel for WTI and 63.65 for Brent. Stocks in Europe OPENED DEEPLY IN THE GREEN .   ONSHORE YUAN CLOSED DOWN AGAINST THE DOLLAR AT 6.3286. OFFSHORE YUAN CLOSED DOWN AGAINST  THE ONSHORE YUAN AT 6.3346//ONSHORE YUAN A LOT WEAKER AGAINST THE DOLLAR/OFF SHORE A LOT WEAKER TO THE DOLLAR/. THE DOLLAR (INDEX) IS  MUCH WEAKER AGAINST ALL MAJOR CURRENCIES EXCEPT CHINA YUAN.  CHINA IS   HAPPY TODAY STRONGER MARKETS IN CHINA 

3 a NORTH KOREA/USA

/NORTH KOREA

end
 

3 b JAPAN AFFAIRS

c) REPORT ON CHINA

4. EUROPEAN AFFAIRS

GREAT BRITAIN

An excellent commentary from Alasdair Macleod as he correctly states that Great Britain should leave the EU at no cost to them and then have free trade with the rest of Europe.  He explains why:

(courtesy/Alasdair Macleod)

8. EMERGING MARKET

 end
END

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

Euro/USA 1.2264 UP .0015/ 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  GREEN 

USA/JAPAN YEN 108.68 DOWN  0.0777 (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 1.3852 UP .0029 (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 1.2573 DOWN .0004 (CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA)

Early THIS MONDAY morning in Europe, the Euro ROSE by 15 basis points, trading now ABOVE the important 1.08 level RISING to 1.2352; / Last night Shanghai composite CLOSED UP 24.27 POINTS OR 0.78   Hang Sang CLOSED DOWN 47.79 POINTS OR  0.16% /AUSTRALIA CLOSED UP 0.30% / EUROPEAN BOURSES DEEPLY IN THE RED  

The NIKKEI: this MONDAY morning CLOSED HOLIDAY

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

2/ CHINESE BOURSES / : Hang Sang CLOSED DOWN 47.79 POINTS OR 0.16% / SHANGHAI CLOSED UP 24.27 POINTS OR 0.78% /

Australia BOURSE CLOSED UP 0.30% /

Nikkei (Japan)CLOSED HOLIDAY

INDIA’S SENSEX  IN THE GREEN

Gold very early morning trading: 1318.80

silver:$16.41

Early MONDAY morning USA 10 year bond yield: 2.8803% !!! UP 3 IN POINTS from FRIDAY 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 3.1761 UP 1 IN BASIS POINTS from FRIDAY night. (POLICY FED ERROR)/DEADLY

USA dollar index early MONDAY morning: 90.21 DOWN 23  CENT(S) from FRIDAY’s close.

This ends early morning numbers MONDAY MORNING

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And now your closing MONDAY NUMBERS \1 PM

Portuguese 10 year bond yield: 2.076% UP 6  in basis point(s) yield from FRIDAY/

JAPANESE BOND YIELD: +.0.066% DOWN  0   in basis points yield from FRIDAY/JAPAN losing control of its yield curve/

SPANISH 10 YR BOND YIELD: 1.481% UP 1/10  IN basis point yield from FRIDAY/

ITALIAN 10 YR BOND YIELD: 2.037 DOWN 7 POINTS in basis point yield from FRIDAY/

the Italian 10 yr bond yield is trading 56 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: +.757%  UP 1 IN BASIS POINTS ON THE DAY

END

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IMPORTANT CURRENCY CLOSES FOR MONDAY

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

Euro/USA 1.2263 UP.0015 (Euro UP 15 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 108.73 DOWN 0.02 Yen UP 2 basis points/

Great Britain/USA 1.3812 DOWN .0012( POUND DOWN 12 BASIS POINTS)

USA/Canada 1.2615 UP  .0038 Canadian dollar DOWN 38 Basis points AS OIL FELL TO $59.74

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This afternoon, the Euro was UP 15 to trade at 1.2263

The Yen ROSE to 108.73 for a GAIN of 2 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 12 basis points, trading at 1.3812/

The Canadian dollar FELL by 38 basis points to 1.2615/ WITH WTI OIL FALLING TO : $59.74

The USA/Yuan closed AT 6.3275
the 10 yr Japanese bond yield closed at +.066% DOWN O  BASIS POINTS / yield/
Your closing 10 yr USA bond yield UP 1/2 IN basis points from FRIDAY at 2.856% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 3.141  DOWN 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, 90.28 DOWN 40 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 MONDAY: 1:00 PM EST

London: CLOSED UP 84.63 POINTS OR 1.19%
German Dax :CLOSED UP 175,29 POINTS OR 1.45%
Paris Cac CLOSED UP 60.85 POINTS OR 1.20%
Spain IBEX CLOSED UP 131.50 POINTS OR 1.36%

Italian MIB: CLOSED UP 170.03 POINTS OR 0.77%

The Dow closed UP 410.37 POINTS OR 1.70%

NASDAQ WAS UP 107.47 Points OR 1.56% 4.00 PM EST

WTI Oil price; 59.74 1:00 pm;

Brent Oil: 63.22 1:00 EST

USA /RUSSIAN ROUBLE CROSS: 57.80 DOWN 57/100 ROUBLES/DOLLAR (ROUBLE HIGHER BY 57 BASIS PTS)

TODAY THE GERMAN YIELD RISES TO +.757% 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:$59.39

BRENT: $62.66

USA 10 YR BOND YIELD: 2.8570%   THIS RAPID ASSENT IN YIELD IS VERY DANGEROUS/DERIVATIVES START TO BLOW UP/very dangerous

USA 30 YR BOND YIELD: 3.1422%/BROKE GUNDLACH’S KEY 3.00% AGAIN WHERE ALL VALUATIONS ON STOCKS BLOW UP/DEADLY

EURO/USA DOLLAR CROSS: 1.2292 up.0045  (UP 45 BASIS POINTS)

USA/JAPANESE YEN:108.64 DOWN 0.123/ YEN UP 12 BASIS POINTS/ THIS GOOSED THE DOW HIGHER IN THE LAST HR TODAY.

USA DOLLAR INDEX: 90.13 DOWN 30 cent(s)/

The British pound at 5 pm: Great Britain Pound/USA: 1.3836 : UP 0.0013  (FROM FRIDAY NIGHT UP 13 POINTS)

Canadian dollar: 1.2581 DOWN 4 BASIS pts

German 10 yr bond yield at 5 pm: +0.757%


VOLATILITY INDEX:  25.61  CLOSE  DOWN   3.45

END

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

TRADING IN GRAPH FORM FOR THE DAY

Markets ‘Not’ In Turmoil: Dow Jumps Over 400 Points Amid Record Low Liquidity

If you chose “Tradeable Bottom” as you CNBC-Bingo word-of-the-day… You Won!!

Having been up almost 400 points from its Friday cash close, Dow futures plunged back into the red,perhaps accelerated by Ray Dalio’s dismal diatribe, amid chaotic swings and the lowest market liquidity ever seen. But that did not last as the machines dragged stocks back up – The Dow up over 500 points to a 50% retrace of its Volocaust losses… before running out of steam…

As Nanex’s Eric Scott Hunsader notesthe last week has seen liquidity levels for S&P futures – the most liquid equity security in the world – collapse to record lows, far worse than during the peak of the crisis in 08…

The initial gap open was sold, then panic-bid after going red but an ugly MoC picture sparked some selling late on…

Futuress show the overnight pump and dump…

The S&P 500 broke back above its 100DMA…

Notably, The Dow and S&P remain in the red YTD (Nasdaq green)…

VIX fell back below 25…

But Small Cap vol is coming back fastest…

While “The Fear Index” faded, the Fear-and-Greed Index remains stuck at Extreme Fear…

It seems ‘buybacks’ were back in vogue as AAPL soared almost 5%!! the most since Feb 2017… In fact the mega tech firms are up 6 to 9% off the Friday lows…

As stocks sink, bond yields and the dollar are notably lower…

Bonds & Stocks were bid today – 2nd best day for aggregate since March 2017…

The question is – has the old bond-stock correlation regime returned?

Which suggests those who are betting on CPI printing light this week and expecting bonds to rally and stocks to rally in relief, may be disappointed.

Treasuries were mixed today with the long-end lower in yield (30Y -1.5bps) and rest of the curve very modestly higher in yield…

Despite the exuberance in stocks, the yield curve managed a barely positive steepening…

Commodities all managed gains, led by a surge in copper, amid dollar weakness…

While WTI was up, it tumbled back below the $60 level and RBOB kept sliding…

Cryptos extended gains off the JPMorgan Bitcoin Bible from Friday’s close…

Finally, on the heels of Ray Dalio’s warnings about the rising possibility of recession in the short-term, NYFed’s Recession Indicator is also on the march…

Which seemed appropriate to note with this…

Of course it’s possible that the 2nd longest bull market in history will live to become the longest, but to ignore the high probability that its finally come to a long-overdo end is the hight of journalistic irresponsibility.

Bonus Chart: Probably nothing…

 

end

So far investors are ignoring the rise in the 10 yr and 30 yr note as Trump will drop its target of balancing the budget in 10 years.  The dollar is falling along with bond prices (yields rise).  The higher bond yields will create havoc with valuations (derivatives).  Also the higher yield causes investors to think that they would rather have the sure yield than risk in the stock market

(courtesy zerohedge)

“A Historic Reversal”: Dollar, Treasurys Slide As Trump Drops Target For “Balanced Budget”

Following last week’s torrid surge in the dollar on the back of a panicked flight to safety, the greenback has weakened for a second day amid concerns President Donald Trump’s budget proposal – to be released later today – will drop a longstanding Republican Party goal to balance the budget in 10 years in a “historic reversal”, as we first reported  last night. As a result, the Bloomberg Dollar Spot Index fell 0.3% amid muted trading in Asia after dropping 0.1% Friday.

Among other spending measures, Trump will seek billions of dollars in new spending to build a border wall, improve veterans’ health care and combat opioid abuse, according to a White House statement.

The U.S. budget plan “has raised some concern that we could see a rising fiscal deficit at the time when the current-account deficit in the U.S. is also weakening,” Khoon Goh, head of Asia research at Australia & New Zealand Banking Group told Bloomberg. “That could point to further U.S. dollar weakness.”

Commenting on the Trump budget, Cowen’s Jaret Seiberg writes that the President’s budget, due to be released this morning, will likely be “a disappointing document” for those seeking policy blueprints, with fewer-than-usual headlines on GSE reform, student lending and deregulation. Cowen keeps expectations low about housing finance; budget may include broad call to end Fannie, Freddie conservatorships rather than detailed path forward for GSEs

As a result, Seiberg urges caution regarding any potential news about student lending (like consolidating federal loan programs, capping amounts students may borrow) as Democrats aren’t on board with curbing federal loan programs; HEA reauthorization would need 60 votes in Senate; sees no path forward in this Congress for changes that would benefit private student lenders. “Wouldn’t read too much into anything regarding financial deregulation, which is in regulators’ hands.”

More importantly, Cowen writes that it will be closely watching how markets react to news Trump will abandon the traditional GOP call to balance the budget; that may reinforce market concerns about deficits, need to issue debt, which may lead to higher interest rates.

* * *

Meanwhile, the JPMorgan Global FX Volatility Index rose to the highest since April as investors awaited US CPI data on Wednesday to assess the outlook for Federal Reserve policy tightening. As discussed yesterdayU.S. inflation probably quickened to 0.3% m/m in Jan. from 0.2% in Dec., according to economist estimates before this week’s data

“Should U.S. CPI print very strong, it will lead to expectations of a faster Fed tightening, which will in turn hit stocks and spur buying of the yen,” says Satoshi Okagawa, senior analyst at Sumitomo Mitsui Banking Corp. in Singapore

And while growing budget deficit – and how it is funded  – concerns have pressured the 10Y, whose yield rose to 2.88% as 10-year note futures fall 15/32, the real action has been in the 30Y, where the yield is back to March highs, rising to 3.18%.

So far, equity algos are ignoring the renewed bond rout, perhaps focusing more on the curve steepending, which however will soon flatten as the Fed continues with its 3-4 rate hikes over the course of the year.

end

And here is Trump’s $4 trillion budget proposal and its main highlights

(courtesy zerohedge)

Trump’s $4 Trillion Budget Proposal Unveiled: Here Are The Main Highlights

As previewed last night, President Donald Trump has proposed to Congress a $4 trillion-plus budget for next year that projects a $1 trillion or so federal deficit and in the biggest surprise leaked last night, and unlike the plan he released last year, never comes close to promising a balanced federal ledger even after 10 years. On, and that was before last week’s $300 billion budget pact is added this year and next, showering both the Pentagon and domestic agencies with big increases. The spending spree, along with last year’s tax cuts, has the deficit moving sharply higher, and spooking interest rates.

Ironically, the original plan was for Trump’s new budget to slash domestic agencies even further than last year’s proposal, but instead it will land in Congress three days after he signed a two-year spending agreement that wholly rewrites both last year’s budget and the one to be released Monday. The 2019 budget was originally designed to double down on last year’s proposals to slash foreign aid, the Environmental Protection Agency, home heating assistance and other nondefense programs funded by Congress each year.

Trump will again spare Social Security retirement benefits and Medicare as he promised during the 2016 campaign. And while his plan would reprise last year’s attempt to scuttle the “Obamacare” health law and sharply cut back the Medicaid program for the elderly, poor and disabled, Trump’s allies on Capitol Hill have signaled there’s no interest in tackling hot-button health issues during an election year.

Here are some of the details:

While we await the full release, Bloomberg has noted that Trump’s FY19 budget proposal calls for $1.7t in cuts to mandatory spending and receipts and a 2% yearly reduction in non-defense discretionary budget after 2019.  As part of the mandatory spending, the budget projects $237 billion in savings from Medicare over 10 years.

More from Bloomberg:

The document says that the budget will propose cutting spending on Medicare, the health program for the elderly and disabled, by $237 billion but doesn’t specify other mandatory programs that would face reductions, a category that also includes Social Security, Medicaid, food stamps, welfare and agricultural subsidies.

The Medicare cut wouldn’t affect the program’s coverage or benefits, according to the document. The budget will also call for annual 2 percent cuts to non-defense domestic spending beginning “after 2019.’

* * *

Trump will urge an increase in defense spending to $716 billion and a 2.6 percent pay raise for troops. He will request $18 billion to build a wall on the Mexican border, the summary indicates.

The White House also seeks $200 billion for the infrastructure proposal the administration plans to unveil alongside the fiscal year 2019 budget, as well as new regulatory cuts.

Or summarized:

  • Budget request calls for $716b for defense and includes a 2.6% pay raise for troops
  • $80b in IT and cyber- funding as well as $210m for a technology modernization fund
  • Nearly $17b in opioid-related spending in 2019, including $10b in new funding for HHS
  • Requests $18b for border wall construction

In a strange twist, the White House said in a statement without explanation “that its plan would cut the federal deficit by $3 trillion over 10 years and reduce debt as a percentage of gross domestic product.”

Mick Mulvaney, the former tea party congressman who runs the White House budget office, said Sunday that Trump’s new budget, if implemented, would tame the deficit over time, only it wasn’t exactly clear how.

“The budget does bend the trajectory down, it does move us back towards balance. It does get us away from trillion-dollar deficits,” Mulvaney said on “Fox News Sunday.” “Just because this deal was signed does not mean the future is written in stone. We do have a chance still to change the trajectory. And that is what the budget will show tomorrow.”

And the punchline: last year, Trump’s budget projected a slight surplus after a decade, but critics said it relied on an enormous accounting gimmick — double counting a 10-year, $2 trillion surge in revenues from the economic benefits of “tax reform.” Now that tax reform has passed, the math trick can’t be used, and the Trump plan doesn’t come close to balancing.

As a result, Trump’s budget no longer even comes close to balancing over 10 years.

Meanwhile, critics say this year’s Trump plan, which promises 3% growth, continuing low inflation, and low interest yields on U.S. Treasury bills despite a flood of new borrowing, underestimates the mounting cost of financing the government’s $20 trillion-plus debt.

* * *

Then again, none of the above matters: as Bloomberg points out, Trump’s budget is unlikely to gain traction on Capitol Hill.

end
And this was what the debt will look like going forward from today:
(courtesy zerohedge)

US Launching Crisis Level Spending

In all the rhetoric over the proposed Trump budget, the Congressional spending bill, and so forth, it is easy to lose track of both the forest and the trees.

So here, courtesy of of Oxford Economics, is just one chart that shows what is really taking place: starting next fiscal year, the US is unleashing nothing short of “crisis level” spending, with the US deficit in 2019 set to top $1 trillion for the first time since 2012, and approaching the record deficit hit in 2009, when the US was hit by the worst economic crisis since the Great Depression.

But wait, there’s more: it will only get worse from there.

As Oxford Economics reports, after deficit rise sharply in 2019, topping $1 trillion, it gets even worse: “The tax cuts passed late last year, combined with the spending bill Congress passed last week will push deficits sharply higher.”

Furthermore, Trump’s own budget anticipates that US debt will hit $30 trillion by 2028: an increase of $10 trillion…

… as a result of $1+ trillion debt (and thus deficit) increases for at least the next 5 years.

To which one wonders: have the words “fiscal conservative” lost all meaning if the US is launching what is clearly crisis level deficits and crisis level spending at a time when the US economy is – allegedly -growing at a healthy pace, and what will happen if said economy were to actually enter a recession in the coming 24 months, which as a reminder, KKR sees as a 100% certainty.

Early morning
It is totally amazing: as soon as the 10 yr bond yield hits 2.88%, bang!!/the Dow begins to shake etcYou could either have a good stock market or a decent bond market, not both.  The higher yields forced mammoth selling

(courtesy zerohedge)

Dow Futures Tumble Back Below Friday’s Highs

After a modest gap up opening on Sunday evening, and a sudden mysterious panic-bid as Europe opened, US equity futures are now tumbling, back below Friday’s highs, in what appears to be a delayed reaction to the renewed spike in Treasury yields…

China got a hand up from The National Team..

And someone panic-bid US equities as Europe opened…

But spiking US rates are back at ‘spooky’ levels for stocks…

We’re gonna need more PPT…

end

Noon time;  Dow spikes up 450 points/10 yr bond rate 2.856

S&P Spikes Above Overnight Highs, Dow Up 450 Points

The Dow has surged past overnight highs, shrugged off the opening tumble and is now up over 400 points from Friday’s close. The S&P just ran the stops from its overnight highs, breaking above its 100DMA once again…

Stop Hunt – mission accomplished…

(The question is – is that the end of the ramp ammo?)

As Friday’s melt-up continues…

Thanks to Short VIX ETNs…

And as VIX tumbles so Bitcoin is bid…

The Dow is up 1300 points from Friday’s lows, but remains just short of a 50% retracement from the last two weeks’ tumble…

And bond-stock (price) correlations are back in the ‘normal’ negative…

 
 end

Rand Paul over the weekend accuses correctly that many of the GOP of hypocrisy for agreeing to the bipartisan budget deal and the huge increase in spending.

(courtesy zerohedge)

Rand Paul Accuses GOP Critics Of “Hypocrisy” For Agreeing To Bipartisan Budget Deal

After Rand Paul’s “principled stand’ against a budget bill that would add nearly $300 billion to the deficit over two years forced his colleagues in the House and Senate to stay up all night Thursday, just to pass an essentially unchanged bill that could’ve easily passed 12 hours earlier if it weren’t for the Kentucky Senator’s dedication to libertarian principles compulsive need for media attention, it seemed like his colleagues were rushing to be the first to issue an insulting quote about Paul to any reporter who’d listen.

One of Paul’s colleagues said he sympathized with a neighbor of Paul’s who famously tackled the senator while he was mowing his lawn, cracking a few of his ribs. Another dryly noted that “there aren’t a lot of books written about the great political points of history” – a jab at Paul, who voted for the White House’s $4.5 trillion budget resolution and then supported Trump’s deficit-expanding tax package.

Already one of the most ubiquitous guests on the so-called Sunday Shows, Paul took to Face the Nation this weekend to explain and defend his decision to hold up the vote and trigger another government shutdown – even if it only lasted a few hours.

During his interview with Major Garrett, Paul said Republicans need to reconcile their commitment to limit government spending and cut down on the deficit with their tendency to overspend on the military. Paul added that the US has accomplished about all it possible can in Afghanistan, and that now is the time to bring our troops home. The US is actively at war in about seven countries, Paul said. Yet none of those interventions were authorized by Congress.

MAJOR GARRETT: And now we have deficits projected to be a trillion dollars again and yet they’re growing non-recessionary economy or are you troubled by that?

SENATOR RAND PAUL: Yeah, I’m very worried and I think one of the questions the Republicans I think are not willing to ask themselves is can you be fiscally conservative and be for unlimited military spending. There’s sort of this question, “Is the military budget too small or maybe is our mission too large around the world?” And because Republicans are unwilling to confront that they want more, more, more for military spending. And so to get that they have to give the Democrats what they want which is more and more and more for domestic spending and the compromise while some are happy with bipartisanship. Well if the bipartisanship is exploding the deficit I’m not so sure that’s the kind of bipartisanship we need.

MAJOR GARRETT: From your point of view, Senator, on the defense side of the equation is the spending and the mission, are they reckless?

SENATOR RAND PAUL: I think the mission is- is beyond what we need to be we’re actively in war in about seven countries. And yet the Congress hasn’t voted on declaring or authorizing the use of military force in over 15 years now. So I’ve been one that’s been bugging the Senate and Congress to say how can we be at war without ever voting on it don’t the American people through their representatives get a chance to say when we go to war. I think the Afghan war is long past its mission. I think we killed and captured and disrupted the people who attacked us on 9/11 long ago. And I think now it’s a nation building exercise. We’re spending 50 billion dollars a year. And if the president really is serious about infrastructure, a lot of that money could be spent at home. Instead of building bridges and schools and roads in Afghanistan or in Pakistan. I think we could do that at home and the interesting thing is I think the president’s instincts lean that way but –

But when confronted about inconsistencies in his own voting record – such as his decision to support both the budget agreement and the Trump tax plan – Paul insisted he could “only control how I vote”.

MAJOR GARRETT: And that’s sort of the way, Senator, because you know where the votes are. You know the votes are there for tax cuts. You know they’re not there for spending cuts. So, isn’t there any part of your voting pattern that is irresponsible?

SENATOR RAND PAUL: I don’t think so because you know I can only control how I vote. So I voted for the tax cuts and I voted for spending cuts. The people who voted for tax cuts and spending increases. I think there is some hypocrisy there and it shows they’re not serious about the debt. But all throughout my career I’ve always voted for spending cuts and I’m happy to offset cuts in taxes with cuts in spending. So no I think that I’ve had a consistent position in being very concerned about the debt and I want to shrink the size of government. So, the reason I’m for tax cuts is I to return more of the money to the people who own that who- who actually deserve to have their money returned to them. But it also shrinks the size of government by cutting taxes or should if you cut spending at the same time.

This, of course, begs the question: Was Paul in some sort of fugue state when he voted for the Trump tax bill last year?

If so, he might want to get that checked out.

end

Early this morning, the 10 yr yield jumped to 2.88 and the 30 yr to 3.17 on Budget director Mulvaney’s interview where he warned that the USA will post a much larger budget deficit of 1.2 trillion dollars this year. An increase in the debt of 1.2 trillion dollars will put the total usa debt at 1.8 trillion or a rise of 5.8%.   GDP is rising by less than 3% so this is not good:

(courtesy zerohedge)

Treasury Yields Jump After Trump Budget Director Admits Interest Rates May “Spike” On Soaring Deficit

In a bizarre warning coming from president Trump’s own budget director, one that could accelerate the sharp market selloff which so infurated Trump last week he tweeted about it on several occasions, lashing out against those who sell stocks on “good news” claiming it is a “big mistake“, Mick Mulvaney warned that the U.S. will post a larger budget deficit this year and could see a “spike” in interest rates as a result.


White House budget director Mick Mulvaney.

Of course, traders have already experienced the spike, or at least a part of it: it’s one of the key catalysts that moved the 10Y from 2.60% to 2.90% since payrolls Friday (coupled with the inflationary impulse from the jump in hourly wages).

Earlier in the day, Mulvaney spoke on “Fox News Sunday,” a day before the White House is expected to release 2019 spending proposals – and after weeks in which financial markets have been spooked by prospects for rising inflation tied to higher deficits and lower taxes.

“This is not a fiscal stimulus; it’s not a sugar high,” Mulvaney said on of the president’s economic program, including the $1.5 trillion tax cut passed in late 2017. “If we can keep the economy humming and generate more money for you and me and for everybody else, then government takes in more money and that’s how we hope to be able to keep the debt under control,” Mulvaney said.

In a separate interview on CBS News’s “Face the Nation,” Mulvaney said rising budget deficits are “a very dangerous idea, but it’s the world we live in.”

As Bloomberg notes, his comment echoed Trump’s Feb. 9 tweet that Republicans “were forced to increase spending on things we do not like or want” to secure Democratic votes for the sharp buildup in military spending wanted by the White House and the Pentagon.

“What they said was they would not give us a single additional dollar for defense unless we gave them dollars for social programs,” he said. “They held the Defense Department hostage, and we had to pay that ransom.”

Shockingly, Mulvaney also acknowledged he would “probably not” have voted for the deal when he served in the House of Representatives and was known as a fiscal hawk. “Keep in mind I’m not Congressman Mick Mulvaney anymore,” he said. “My job as the director of the Office of Management Budget is to try to get the President’s agenda passed.”   

* * *

The next set of numbers – and potential catalyst for further rate upside – will be unveiled on Monday, when Mulvaney’s OMB will updating the 2018 budget released last year and its 2019 request, due Monday, in response to the two-year budget deal the president signed into law on Friday morning. That agreement, which ended an hours-long partial government shutdown, will boost government spending by another $300 billion, which will have to be directly funded with more debt. Mulvaney said that in his previous job as a fiscally-conservative congressman representing South Carolina, he would “probably not” have voted for the bill.

The additional spending could increase the deficit to about $1.2 trillion in 2019, and there’s a risk that interest rates “will spike” as a result, Mulvaney said.

And while Mulvaney said that lower deficits are possible over time based on sustained economic growth, in an even more bizarre development, the WaPo reported that Trump’s Budget to be unveiled tomorrow won’t project a balance in 10 years, and instead Trump’s request will abandon the long-held Republican goal of eliminating deficit in budget projections, even over a decade.

In other words, those concerned that yields may spike further tomorrow – and slam stocks – have good reason: the OMB may unveil the first republican non-balancing budget. Actually, one look at the 30Y Treasury shows that the selling has already begun.

end
Gold gets a boost with Trump’s huge infrastructure plan:  1 1.5 trillion spending boost:
(courtesy zerohedge)

White House Releases 55-Page, $1.5 Trillion Infrastructure Plan

Just like Trump promised during his State of the Union address late last month, the White House has released an infrastructure package Monday that hopes to raise $1.5 trillion to help rebuild American roads, bridges and airports.

Since the initial draft was leaked last month, Trump has raised his fundraising goal to $1.5 trillion from $1 trillion.

Most of the 55-page plan’s most salient details were leaked overnight.

At its core, the proposal will use the $200 billion, to be disbursed over a decade, as seed money to incentivize states, localities and the private sector to commit to spending the balance of the headline number…

It will also streamline the permitting process and improve training to get qualified workers ready to work on rural infrastructure projects…

However, Democrats have complained the plan relies too heavily on municipalities and states, and doesn’t provide enough federal funding to have much of an impact. Some have described it as a “bait-and-switch” since it’s unclear if the White House will be able to raise the headline number.

The White House’s updated proposal was released Monday ahead of an 11 am meeting between Trump and mayors of cities and other l The $200 billion in federal spending will also be included in the White House’s budget map, also to be released Monday, following a bipartisan deal last week that eliminated years-old spending caps, setting the stage for a two-year budget agreement.

And as CBS points out, Trump’s plan leaves a little something to be desired…

But there’s one major hole in the White House’s proposal — Mr. Trump’s plan relies almost entirely on funding from entities outside the control of the federal government. Only $200 billion of the $1.5 trillion proposal would come from new federal funding. The White House would offset the new spending with unspecified cuts in other areas of the budget. The rest is expected to come from state and local governments and private investment.

According to the Washington Post, the plan has plenty of details (unlike the early drafts of Trump’s tax-reform package) but few guarantees about how it will all be paid for. In one particularly galling section, it even suggests cutting money from existing infrastructure plans and reallocating it to the Trump plan.

For now, the White House is suggesting that lawmakers cut money from elsewhere in the budget, including some existing infrastructure programs. That prospect seems unlikely given that Congress just last week reached a bipartisan deal to spend significantly more funds over the coming two years.

Per Politico, the plan is a statement of principles that Congress will have to translate into legislation, potentially leaving the fate of Trump’s proposal in the hands of 11 House and Senate committees that oversee slices of the policies in play. The kickoff will include a Monday briefing with state and local officials.

While light on federal money the proposal “could inspire a wave of toll roads, ease decades-old regulations and permanently change cities’ and states’ expectations for assistance from Washington. …

Some critics have also blasted the plan’s lack of funding to rebuild the tunnels beneath the Hudson River used to ferry commuters from New Jersey to New York City’s Penn Station.

Several lawmakers said they don’t expect the plan to pass in its current form since it would need 60 votes to clear the Senate. Without more commitments of federal funding, the plan is likely “dead on arrival”, one lawmaker said.

Read the 55-page plan in its entirety below:

Infrastructure 211 by zerohedge on Scribd

https://www.scribd.com/embeds/371349222/content?start_page=1&view_mode=scroll&access_key=key-0YOPDAGwYZclESSpHJ2d&show_recommendations=true

end
It begins tonight:  a free for all debate on immigration..should be fun
(courtesy zerohedge)

And So It Begins: Mitch McConnell Kicks Off Free-For-All Senate Immigration Debate

Tonight is the night that all 535 of America’s lawmakers have been dreading…

In keeping with his promise to call an open-ended debate on an immigration compromise bill should lawmakers fail to reach a compromise on their own, the Senate tonight will begin arguing about a bill that has no clear form or substance…

Senators are predicting a chaotic debate, according to the Hill. Tonight, Majority Leader Mitch McConnell will call for debate on a shell bill that basically will allow lawmakers to bringing up any and every topic they’d like. And predictably, several different factions are working out their own plans, all hoping to be the leaders of the eventual compromise bill that makes it to President Trump’s desk.

“It sounds like Senator McConnell’s just going to pull up a shell bill and let people have at it. … It ought to be pretty fascinating,” said Senate Majority Whip John Cornyn (R-Texas), McConnell’s top deputy.

Sen. Dick Durbin (Ill.), Cornyn’s Democratic counterpart, predicted: “You’re going to hear as many variations as the fertile minds of my colleagues can produce.”

McConnell made his promise to secure the necessary Democratic votes to pass the bipartisan agreement to keep the government funded through March 23 while raising the debt limit and suspending spending caps that will open the door toward negotiations for a two-year budget deal.

* * *

So far, lawmakers have complained that the White House – which is ostensibly pro-DACA – has repeatedly shifted its position, making it impossible to negotiate or arrive at anything even remotely resembling a compromise that would be acceptable to Democrats.

For example, the so-called “Gang of Six” famously put forward a bipartisan proposal that included enshrining DACA protections in exchange for increased funding for border security – but crucially, it didn’t include money for the wall, and so was panned by President Trump.

McConnell

Another group led by Maine moderate Susan Collins is calling itself the “Common Sense Coalition”. They’re focusing on a narrower solution than the “four pillars” that Trump and a group of bipartisan lawmakers reportedly agreed upon a few weeks ago. Those include: Wall funding, changes to family-based immigration and the visa lottery system, funding for border security and DACA protections.

But in a deliciously ironic twist, the Common Sense group says it has already begun drafting legislation, even though it hasn’t finished working out the compromise. All Collins could say was that they’ve agreed to focus exclusively on two of Trump’s coveted four pillars…

This group of more than 20 senators, led by Susan Collins (R-Maine), has begun drafting legislative text. But it still hasn’t reached a consensus about what it could support.

“I think we’re getting pretty close on coming up with a proposal that may or may not be offered next week,” Collins told reporters after the group’s last closed-door session. “There will probably be more than one [amendment offered] but it’s too early to tell right now.”

Senators in the group have focused on a narrower solution that would break from the “four pillars” strategy that Trump and a bipartisan group of lawmakers initially agreed to.

Some members would like to issue a broader proposal – but they worry the more they try to tack on, the harder it will be to pass.

Members haven’t ruled out trying to broaden their proposals, but warn that the more they try to tack on the harder it could be to get a bill that can pass the Senate.

“If we can stay focused on those two, I think we can get to 60. The challenge is there are lots of other problems that both the White House and other members want to do,” said Sen. Christopher Coons (D-Del.), a member of the group.

Another divide is that some Democrats are continuing to fight for protections to be extended to the parents of so-called “Dreamers.” Many GOP lawmakers are wary of granting protected status for people who entered the country illegally, which could give them an advantage over immigrants who entered the United States at the same time.

Amidst the chaos, Trump has continued to blame Democrats over the weekend for the the inability to get a DACA deal, saying they would rather “use it as a campaign issue.”

Despite the flurry of closed-door meetings and the variety of plans that are gestating, lawmakers remain divided and there’s still unclear how the Senate will manage to pass a bill before the March 5 deadline – to say nothing of the House, per Politico.

That’s because Speaker Paul Ryan has insisted he will only bring up a bill that is supported by Trump, who has repeatedly shot down compromise plans. That stirs up uncomfortable memories of a 2013 comprehensive immigration bill passed the Senate only to die in the House without ever receiving a vote.

Given that the debate over a permanent solution is so fraught, at least one lawmaker – Sen. Jeff Flake – is working on a backup that will extend DACA protections for three years while also increasing border security funding.

Indeed, in a rare burst of honesty, Sen. Lindsey Graham joked that he hopes Congress can pull a “white rabbit out of its hat” but predicted that the most likely outcome is kicking the fight down the road.

“If I were betting man … I’d always bet on Congress to punt,” he said. “I just hope we don’t punt on first down. I hope we at least go to fourth down before we punt.”

We wouldn’t take the other side of that bet…

SWAMP STORIES

Trump blocks the Democratic memo on national security concerns and states that they should remove sources and methods of how surveillance of citizens is applied

(courtesy zerohedge)

Trump Blocks Democratic Counter-Memo Over “National Security Concerns”

President Trump declined to release the Democrat rebuttal to a GOP-authored “FISA memo,” following the advice of the Department of Justice and the Director of National Intelligence, the White House announced.

a

President Trump is “inclined to declassify” the Democratic memo, however there are several sections which would create “especially significant concerns” for “national security and law enforcement interests,” wrote White House counsel Don McGahn in a letter to House Intelligence Committee chairman Devin Nunes (D-CA).

While the White House ignored FBI requests to redact the names in the GOP-authored memo, the Democratic response is said to reveal sources and methods which must be concealed.

In a separate letter to FBI Director Christopher Wray and Deputy Attorney General Rod Rosenstein, McGahn highlighted the problematic information. The White House says it will work with the House Intelligence Committee if it wants to revise the Democratic memo and resubmit it for White House review.

“The president encourages the Committee to undertake these efforts,” the letter states. “The Executive Branch stands ready to review any subsequent draft of the Feb. 5th memorandum for declassification at the earliest opportunity.”

https://www.scribd.com/embeds/371176806/content?start_page=1&view_mode=scroll&access_key=key-x2LrgPzJw0Cd4BTGa06J&show_recommendations=false

Democrats on the House Intel Committee can now make the requested changes, or submit their memo to the full house to seek a vote to override the President’s decision.

The House Intelligence Committee voted earlier this week to release the 10-page Democratic memo authored by ranking minority Committee member Rep. Adam Schiff (D-CA) following the declassification and public release of a four-page “FISA memo” authored by staffers for Chairman Devin Nunes.

In response to Trump blocking the Democratic rebuttal, Nunes said on Friday that he was not surprised that the DOJ and FBI advised against its release.

a
Rep. Devin Nunes (R-CA)

“Ranking Member Schiff pledged to seek the input of the Department of Justice and FBI regarding the memo’s public release, and it’s no surprise that these agencies recommended against publishing the memo without redactions,” said Nunes.

Nunes suggested that the Democrats make the “appropriate technical changes and redactions” as recommended by the justice department “so that no sources and methods are disclosed and their memo can be declassified as soon as possible.”

Democrats Cry Foul

After the GOP-authored memo was released, Democrats cried foul – calling it “inaccurate” and claiming its sole purpose was to derail and obstruct the ongoing investigations into Russian interference in the 2016 election.

Democrats were outraged at the President’s decision. In a Friday night statement, Schiff said that Democrats had provided their memo to the F.B.I. and the Justice Department for review before it was approved for release by the committee, and that the Democrat rebuttal was drawn from the same underlying documents as the Republican one.

a
Rep. Adam Schiff (D-CA)

“We will be reviewing the recommended redactions from D.O.J. and F.B.I., which these agencies shared with the White House,” Mr. Schiff said, “and look forward to conferring with the agencies to determine how we can properly inform the American people about the misleading attack on law enforcement by the G.O.P. and address any concerns over sources and methods.”

After ignoring urging of FBI & DOJ not to release misleading Nunes memo because it omits material facts, @POTUS now expresses concerns over sharing precisely those facts with public and seeks to send it back to the same Majority that produced the flawed Nunes memo to begin with:

Rep Terri Sewell – a Democratic member of the committee, tweeted: “Republicans and Democrats on the Intelligence Committee voted UNANIMOUSLY to release this memo. @realDonaldTrump is not interested in transparency, he is interested in protecting himself and derailing the Russia investigation.”

Republicans and Democrats on the Intelligence Committee voted UNANIMOUSLY to release this memo. @realDonaldTrump is not interested in transparency, he is interested in protecting himself and derailing the Russia investigation. http://www.chicagotribune.com/news/nationworld/politics/ct-trump-democratic-memo-20180209-story.html 

Despite Democrats’ anger, McGhan said – in addition to the fact that Trump was “inclined to declassify” the document – that “The executive branch stands ready to review any subsequent draft of the Feb. 5 memorandum for declassification at the earliest opportunity.”

 END
Rachel Brand,  next in line after Rod Rosenstein at the Dept of Justice is leaving to become an executive at WalMart. It was also revealed that Rod Rosenstein signed one of the FISA warrants and thus the committee wants to speak to him again on this matter.
(courtesy zerohedge)

DOJ’s #3 Official Quitting After Just Nine Months

Update: U.S. JUSTICE DEPARTMENT NO. 3 OFFICIAL RACHEL BRAND TO BECOME EXECUTIVE AT WAL-MART: SOURCE

… where Hillary Clinton was on the board of directors.

***

The number 3 official at the Department of Justice plans to leave the agency after just nine months on the job, the NYT reported citing two people briefed on her decision.

a

Rachel L. Brand was appointed as Associate Attorney General on May 22, 2017, making her next in the line of succession after Deputy Attorney General Rod J. Rosenstein, who is currently overseeing Robert Mueller’s special counsel probe into Russian interference in the 2016 election. Attorney General Jeff Sessions has recused himself from the investigation due to his involvement with the Trump campaign.

Prior to her appointment to the DOJ last year, Brand held several politically appointed positions for the last few administrations. From 2012-2017, she served as one of five Senate-confirmed Members of the Privacy and Civil Liberties Oversight Board, appointed by President Obama.

Before that, Brand worked at the DOJ between 2003-2007, first as the Principal Deputy Assistant Attorney General for the Office of Legal Policy, and then as the Senate-confirmed Assistant Attorney General for Legal Policy, appointed by President George W. Bush.

Brand is also an Associate Professor of law at George Mason University’s Antonin Scalia Law School. She clerked for Associate Supreme Court Justice Anthony M. Kennedy from 2002-2003 after graduating from Harvard Law – where she was deputy editor-in-chief of the Harvard Jourrnal of Law and Public Policy.

According to OpenSecrets.org, Brand has contributed heavily to Republicans – including George W. Bush, John McCain, Ted Cruz, Tom Cotton and Ed Gillespie.

What about Rosenstein?

The release of the declassified GOP-authored “Nunes memo” earlier this month revealed that Rosenstein signed off on at least one questionable FISA surveillance warrant application in connection with spying on the Trump campaign.

Rep. Ron DeSantis (R-FL), thinks Rosenstein will likely have to appear before Congress to explain his actions:

I think Rosenstein is going to have to come to the Congress and explain his role in extending it, Mr. DeSantis said on Fox News. I mean, did he go back and review it and was satisfied, or he just extended? And is he going to be able to justify this as a proper use of FISA?

When a reporter asked President Trump whether the Nunes memo makes it more likely that he will fire Rosenstein, Trump responded: “You figure it out.”

Democrats responded to the Nunes memo with a threat to unleash holy hell if Trump fires the Deputy AG:

“We are alarmed by reports that you may intend to use this misleading document as a pretext to fire Deputy Attorney General Rod Rosenstein, in an effort to corruptly influence or impede Special Counsel Bob Mueller’s investigation.

“We write to inform you that we would consider such an unwarranted action as an attempt to obstruct justice in the Russia investigation. Firing Rod Rosenstein, DOJ Leadership, or Bob Mueller could result in a constitutional crisis of the kind not seen since the Saturday Night Massacre!’

So with a “compromised” Rosenstein overseeing the Mueller / Russia probe, and his successor apparently heading for the hills, one has to wonder what’s actually going on behind the scenes at the DOJ.

end

Barbs are flying:  A White House official has stated that Adam Schiff has intentionally sabotaged the Democartic rebuttal to the FISA memo.

(courtesy zerohedge)

White House Official: Schiff Intentionally Sabotaged Democratic Rebuttal To FISA Memo

A senior White House official accused Rep. Adam Schiff (D-CA) of intentionally sabotaging the House Intel Committee’s Democratic response to the four-page “FISA memo” prepared by staffers for Committee chairman Devin Nunes.

Appearing on NBC’s Meet The Press,” White House legislative director Marc Short said that Schiff included confidential sources and methods in his 10-page rebuttal which he knew would require redaction – setting the stage for Democrats to cry foul.

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We believe Congressman Schiff intentionally put in there methods and sources that he knew would need to be redacted. And if we redacted it, there would be an outcry that says the White House is trying to edit it,” Short said. “So, we said take it back, work with the FBI, clean it up and we’ll release it.”

Democrats will likely point to the fact that the White House ignored DOJ warnings not to release the Nunes memo without redactions, calling it “extraordinarily reckless” without a DOJ review. That said, the FBI reportedly wanted names redacted from the Nunes memo, while the White House claims that sources and methods are divulged in the Schiff memo.

The Democrats sent a very political and long response memo which they knew, because of sources and methods (and more), would have to be heavily redacted, whereupon they would blame the White House for lack of transparency. Told them to re-do and send back in proper form!

Rep. Schiff responded, tweeting “Mr. President, what you call “political” are actually called facts, and your concern for sources and methods would be more convincing if you hadn’t decided to replease the GOP memo (“100%”) before reading it and over the objections of the FBI.

Mr. President, what you call “political” are actually called facts, and your concern for sources and methods would be more convincing if you hadn’t decided to release the GOP memo (“100%”) before reading it and over the objections of the FBI. https://twitter.com/realdonaldtrump/status/962330457886076928 

In fact, the FBI did review the Nunes memo and only wanted names redacted, according to journalist Sara Carter:

BREAKING: @FBI Director Christopher Wray and DOJ wants all names redacted from putting pressure on White House and House Intelligence Committee, Government officials say … is releasing names a threat to national security?

Marc Short effectively confirmed this on “Meet The Press,” telling the panel that the FBI’s concern over the Republican memo wasn’t over sources and methods, rather, the agency didn’t want the names of its agents involved in “FISAgate” exposed.

“There were not sources and methods of concern in that memo. There was concern of us releasing it because they didn’t want the same transparency,” Short said of the FBI.

Democrats say that the four-page memo released by GOP members of the House Intelligence Committee paints an incomplete picture of the FBI’s conduct while engaging in counterintelligence operations against then-candidate Donald Trump during the 2016 election.

A few relevant points in the timeline…

Recall that Donald Trump was considered a joke when he announced his run for presidency. In fact, WikiLeaks emails reveal that the DNC elevated Trump to help Clinton win – thinking there’s no way he would win in a final runoff vs. Hillary.

In April, 2016, the FBI is contacted by the DNC to report that they had been hacked. They hire cybersecurity firm CrowdStrike, which determines it was Russian intelligence who conducted the breach

Perhaps sensing that the DNC and Clinton were about to be majorly exposed, and that Trump actually had a chance of winning the White House, Fusion GPS begins working for the Clinton campaign and the DNC in April, 2016 to provide opposition research on then-candidate Donald Trump. The deal between Clinton, the DNC and Fusion GPS is sealed by Marc Elias, a lawyer representing the DNC and Clinton.

Two months later…

June 15, 2016, Hacker “Guccifer 2.0” takes credit for the DNC hack. Later analysis would disprove this, as the CrowdStrike failed (or chose not) to catch that the DNC files were copied at 22.6 MB/s, all but confirming that the files had to have been copied locally by an inside source. Many have speculated that DNC IT staffer Seth Rich, whose murder is still unsolved, was the source of the emails provided to WikiLeaks.

Five days later…

June 20, 2016, former UK spy Christopher Steele – commissioned by Fusion GPS, (which was commissioned by Clinton and the DNC), files “The Dossier” – the first of 17 memos which relies on senior Kremlin officials and makes salacious and unverified claims against Donald Trump.

Of note – the FBI had worked with Steele for many years, however they severed their relationship after Steele went to the press with allegations contained within his dossiers.

On October 19, 2016, the FBI used Steele’s unverified dossier to obtain a Foreign Intelligence Surveillance Act (FISA) warrant to spy on one-time Trump campaign advisor Carter Page. The warrant allowed the agency to also surveil anyone page was in communication with – including members of the Trump campaign.

January 11, 2017 – with Trump having won the election, BuzzFeed publishes the Steele memo, and the country has been steeped in “Russiagate” ever since.

We now know: 

– Steele’s unverified dossier played a critical role in obtaining approval from the FISA court to carry out surveillance of Carter Page and “unmask” members of the Trump campaign

– The FBI used a Yahoo News article written by Michael Isikoff to support the FISA application – however the Isikoff article contained information provided by Steele. In other words, the FBI made it appear to the FISA court that two separate sources supported their application, when in fact they both came from Steele

(interestingly, Isikoff also wrote a hit piece  to discredit an undercover FBI informant who testified to Congress last week about millions of dollars in bribes routed to the Clinton Foundation by Russian nuclear officials. Small world!)

– Steele was paid by Clinton, the DNC and the FBI for the same information

– The FBI and DOJ made minimal disclosures to the FISA court about the dossier’s political origins – mentioning in a footnote that a law firm paid for it

“FBI noted to a vaguely limited extent the political origins of the dossier. In footnote 8 the FBI stated that the dossier information was compiled pursuant to the direction of a law firm who had hired an “identified U.S. person” — now known as Glenn Simpson of Fusion GPS.” –Grassley Memo

– Despite terminating their relationship with Steele over leaking to the media, the FBI vouched for Steele’s reputation in the FISA application in order to overcome the fact that most of the dossier’s contents were unable to be verified.

– Signing off on the FISA applications for the FBI were James Comey (three times) and Andrew McCabe. Signing off for the DOJ were Sally Yates, Data Boente and current Deputy AG Rod Rosenstein

We look forward to the eventual release of the Schiff memo – however it’s clear that the Democrats are simply going to point to the redactions and say “see, they covered up our proof!”

Let’s see if Schiff’s gambit pays off…

end

Is Counterintelligence chief Bill Priestap co-operating with the authorities and giving details on Comey, Strzok, Page,  Hillary et al? No question about it:  Bill Priestap is the deep throat and will down everyone associated with this mess!!

a must read..

(courtesy the ConservativeTreeHouse.com)

 

‘Russiagate’ Delusion Dies – Who Is ‘Bill’ Priestap?

Via TheConservativeTreehouse.com,

The game is over. The jig is up. Victory is certain… the trench was ignited… the enemy funneled themselves into the valley… all bait was taken… everything from here on out is simply mopping up the details.  All suspicions confirmed.

Why has Devin Nunes been so confident?  Why did all GOP HPSCI members happily allow the Democrats to create a 10-page narrative?  All questions are answered.

Fughettaboudit.

House Permanent Select Committee on Intelligence member Chris Stewart appeared on Fox News with Judge Jeanine Pirro, and didn’t want to “make news” or spill the beans, but the unstated, between-the-lines, discussion was as subtle as a brick through a window.  Judge Jeannie has been on the cusp of this for a few weeks.

Listen carefully around 2:30, Judge Jeanine hits the bulls-eye; and listen to how Chris Stewart talks about not wanting to make news and is unsure what he can say on this…

…Bill Priestap is cooperating.

When you understand how central E.W. “Bill” Priestap was to the entire 2016/2017 ‘Russian Conspiracy Operation‘, the absence of his name, amid all others, created a curiosity.  I wrote a twitter thread about him last year and wrote about him extensively, because it seemed unfathomable his name has not been a part of any of the recent story-lines.

E.W. “Bill” Priestap is the head of the FBI Counterintelligence operation.  He was FBI Agent Peter Strozk’s direct boss.  If anyone in congress really wanted to know if the FBI paid for the Christopher Steele Dossier, Bill Priestap is the guy who would know everything about everything.

FBI Asst. Director in charge of Counterintelligence Bill Priestap was the immediate supervisor of FBI Counterintelligence Deputy Peter Strzok.

Bill Priestap is #1. Before getting demoted Peter Strzok was #2.

The investigation into candidate Donald Trump was a counterintelligence operation. That operation began in July 2016. Bill Priestap would have been in charge of that, along with all other, FBI counterintelligence operations.

FBI Deputy Peter Strzok was specifically in charge of the Trump counterintel op. However, Strzok would be reporting to Bill Priestap on every detail and couldn’t (according to structure anyway) make a move without Priestap approval.

On March 20th 2017 congressional testimony, James Comey was asked why the FBI Director did not inform congressional oversight about the counterintelligence operation that began in July 2016.

FBI Director Comey said he did not tell congressional oversight he was investigating presidential candidate Donald Trump because the Director of Counterintelligence suggested he not do so. *Very important detail.*

I cannot emphasize this enough. *VERY* important detail. Again, notice how Comey doesn’t use Priestap’s actual name, but refers to his position and title. Again, watch [Prompted]

FBI Director James Comey was caught entirely off guard by that first three minutes of that questioning. He simply didn’t anticipate it.

Oversight protocol requires the FBI Director to tell the congressional intelligence “Gang of Eight” of any counterintelligence operations. The Go8 has oversight into these ops at the highest level of classification.  In July 2016 the time the operation began, oversight was the responsibility of this group, the Gang of Eight:

Obviously, based on what we have learned since March 2017, and what has surfaced recently, we can all see why the FBI would want to keep it hidden that they were running a counterintelligence operation against a presidential candidate.   After all, as FBI Agent Peter Strzok said it in his text messages, it was an “insurance policy”.

REMINDER – FBI Agent Strzok to FBI Attorney Page:

“I want to believe the path you threw out for consideration in Andy’s office that there’s no way he gets elected – but I’m afraid we can’t take that risk. It’s like an insurance policyin the unlikely event you die before you’re 40.”

So there we have FBI Director James Comey telling congress on March 20th, 2017, that the reason he didn’t inform the statutory oversight “Gang of Eight” was because Bill Priestap (Director of Counterintelligence) recommended he didn’t do it.

Apparently, according to Comey, Bill Priestap carries a great deal of influence if he could get his boss to NOT perform a statutory obligation simply by recommending he doesn’t do it.

Then again, Comey’s blame-casting there is really called creating a “fall guy”.  FBI Director James Comey was ducking responsibility in March 2017 by blaming FBI Director of Counterintelligence Bill Priestap for not informing congress of the operation that began in July 2016. (9 months prior).

At that moment, that very specific moment during that March 20th hearing, anyone who watches these hearings closely could see FBI Director James Comey was attempting to create his own exit from being ensnared in the consequences from the wiretapping and surveillance operation of candidate Trump, President-elect Trump, and eventually President Donald Trump.

In essence, Bill Priestap was James Comey’s fall guy.  We knew it at the time that Bill Priestap would likely see this the same way.  The guy would have too much to lose by allowing James Comey to set him up.

Immediately there was motive for Bill Priestap to flip and become the primary source to reveal the hidden machinations.  Why should he take the fall for the operation when there were multiple people around the upper-levels of leadership who carried out the operation.

Our suspicions were continually confirmed because there was NO MENTION of Bill Priestap in any future revelations of the scheme team, despite his centrality to all of it.

Bill Priestap would have needed to authorize Peter Strzok to engage with Christopher Steele over the “Russian Dosssier”; Bill Priestap would have needed to approve of the underlying investigative process used for both FISA applications (June 2016, and Oct 21st 2016). Bill Priestap would be the person to approve of arranging, paying, or reimbursing, Christopher Steele for the Russian Dossier used in their counterintelligence operation and subsequent FISA application.

Without Bill Priestap involved, approvals, etc. the entire Russian/Trump Counterintelligence operation just doesn’t happen. Heck, James Comey’s own March 20th testimony in that regard is concrete evidence of Priestap’s importance.

Everyone around Bill Priestap, above and below, were caught inside the investigative net.

Above him: James Comey, Andrew McCabe and James Baker.

Below him: Peter Strzok, Lisa Page, Jim Rybicki, Trisha Beth Anderson and Mike Kortan.

Parallel to Priestap in main justice his peer John P Carlin resigned, Sally Yates fired, Mary McCord quit, Bruce Ohr was busted twice, and most recently Dave Laufman resigned.  All of them caught in the investigative net…. Only Bill Priestap remained, quietly invisible – still in position.

The reason was obvious.

Likely Bill Priestap made the decision after James Comey’s testimony on March 20th, 2017, when he realized what was coming.  Priestap is well-off financially; he has too much to lose.  He and his wife, Sabina Menschel, live a comfortable life in a $3.8 million DC home; she comes from a family of money.

While ideologically Bill and Sabina are aligned with Clinton support, and their circle of family and friends likely lean toward more liberal friends; no-one in his position would willingly allow themselves to be the scape-goat for the unlawful action that was happening around them.

Bill Priestap had too much to lose… and for what?

With all of that in mind, there is essentially no-way the participating members inside the small group can escape their accountability with Mr. Bill Priestap cooperating with the investigative authorities.

Now it all makes sense.  Devin Nunes interviewed Bill Priestap and Jim Rybicki prior to putting the memo process into place.  Rybicki quit, Priestap went back to work.

(page 5 pdf)

Bill Priestap remains the Asst. FBI Director in charge of counterintelligence operations.

It’s over.

I don’t want to see this guy, or his family, compromised.  This is probably the last I am ever going to write about him unless it’s in the media bloodstream. I can’t fathom the gauntlet of hatred and threats he is likely to face from the media and his former political social network if they recognize what’s going on.  BP is Deep-Throat x infinity… nuf said.

The rest of this entire enterprise is just joyfully dragging out the timing of the investigative releases in order to inflict maximum political pain upon the party of those who will attempt to excuse the inexcusable.

Then comes the OIG Horowitz report.

Then the grand jury empaneled (if not already); and while Democrats attempt to win seats in the 2018 election, arrests and indictments will hit daily headlines.

Oh, lordy…

end

I will  see you TUESDAY night

HARVEY

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