Feb 27/RAID ON GOLD AND SILVER DUE TO OPTIONS EXPIRY/GOLD DOWN $13.80/SILVER DOWN 17 CENTS/ATLANTA FED SURPRISES EVERYONE BY LOWERING ITS ESTIMATE OF FIRST QUARTER GDP TO 2.6%/MORE SWAMP STORIES/

 

 

GOLD: $1317.40 down $13.80

Silver: $16.43 down 17 cents

Closing access prices:

Gold $1318.60

silver: $16.43

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: $1342.38 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME: $1334.10

PREMIUM FIRST FIX: $8.28

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SECOND SHANGHAI GOLD FIX: $1341.75

NY GOLD PRICE AT THE EXACT SAME TIME: $1332.70

discount of Shanghai 2nd fix/NY:$8.05

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LONDON FIRST GOLD FIX: 5:30 am est $1332.75

NY PRICING AT THE EXACT SAME TIME: $1333.70

LONDON SECOND GOLD FIX 10 AM: $1325.75

NY PRICING AT THE EXACT SAME TIME. $1326.45

For comex gold:

FEBRUARY/

NUMBER OF NOTICES FILED TODAY FOR FEBRUARY CONTRACT: 124 NOTICE(S) FOR 12400 OZ.

TOTAL NOTICES SO FAR:2749 FOR 274900 OZ (8.5505 TONNES),

For silver:

FEBRUARY

0 NOTICE(S) FILED TODAY FOR

NIL OZ/

Total number of notices filed so far this month: 407 for 2,035,000 oz

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Bitcoin: BID $10,658/OFFER $10,728: up $378(morning)

Bitcoin: BID/ $10,750/offer $10,820: UP $471  (CLOSING/5 PM)

 

end

We are now entering options expiry week for the big gold and silver contracts for the LBMA/OTC contracts. Comex options expired on Friday.
AS FOR THE DATA TODAY, THE GOLD NUMBERS ARE FINAL
THE TOTAL SILVER OI NUMBERS ARE ACCURATE AND FINAL
BUT ALL OTHER SILVER NUMBERS ARE JUST PRELIMINARY
I WILL TRY AND UPDATE THEM AS SOON AS THE CROOKS FUDGE THE DATA PROPERLY.
H

Let us have a look at the data for today\

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In silver, the total open interest FELL BY A CONSIDERABLE SIZED 4438 contracts from 196,437  FALLING TO 191,999 DESPITE  YESTERDAY’S 8 CENT GAIN IN SILVER PRICING.  WE HAD CONSIDERABLE COMEX LIQUIDATION. HOWEVER, WE WERE AGAIN NOTIFIED THAT WE HAD ANOTHER GOOD SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP ROUTE:  872 EFP’S FOR MARCH AND AND 336 EFP’S FOR MAY AND ZERO FOR ALL  OTHER MONTHS  AND THUS TOTAL ISSUANCE OF 1208 CONTRACTS.  WITH THE TRANSFER OF 1208 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 1208 CONTRACTS TRANSLATES INTO 6.04 MILLION OZ DESPITE  WITH THE CONTINUAL DROP IN OPEN INTEREST IN SILVER AT THE COMEX.

ACCUMULATION FOR EFP’S/SILVER/J.P.MORGAN’S HOUSE OF BRIBES, / STARTING FROM FIRST DAY NOTICE/FOR MONTH OF FEBRUARY:

46,340 CONTRACTS (FOR 19 TRADING DAYS TOTAL 46,340 CONTRACTS OR 231.770 MILLION OZ: AVERAGE PER DAY: 2438 CONTRACTS OR 12.194 MILLION OZ/DAY

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH:  231.770 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 33.10% OF ANNUAL GLOBAL PRODUCTION

ACCUMULATION IN YEAR 2018 TO DATE SILVER EFP’S:  480.23 MILLION OZ.

ACCUMULATION FOR JAN 2018: 236.879 MILLION OZ

RESULT: A CONSIDERABLE SIZED LOSS IN OI SILVER COMEX DESPITE THE 8 CENT GAIN IN SILVER PRICE.  WE ALSO HAD A GOOD SIZED EFP ISSUANCE OF 1208 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 1208 EFP’S  FOR  MONTHS MARCH AND MAY WERE ISSUED FOR  A DELIVERABLE FORWARD CONTRACT OVER IN LONDON WITH A FIAT BONUS.   WE LOST  3230 OI CONTRACTS i.e. 1208 open interest contracts headed for London (EFP’s) TOGETHER WITH A DECREASE OF 4438  OI COMEX CONTRACTS. AND ALL OF THIS HAPPENED WITH THE RISE IN PRICE OF SILVER OF 8 CENTS AND A CLOSING PRICE OF $16.60 WITH RESPECT TO FRIDAY’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. 0.9635 BILLION TO BE EXACT or 141% of annual global silver production (ex Russia & ex China).

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

In gold, the open interest  ROSE BY A HUGE 6011 CONTRACTS RISING TO 532,649 DESPITE THE SMALL RISE IN PRICE OF GOLD WITH RESPECT TO YESTERDAY’S TRADING ($2.40). HOWEVER, IN ANOTHER DEVELOPMENT, WE RECEIVED THE TOTAL NUMBER OF GOLD EFP’S ISSUED FOR MONDAY AND IT TOTALED AN GOOD SIZED  7855 CONTRACTS OF WHICH  APRIL SAW THE ISSUANCE OF 7855 CONTRACTS AND  JUNE SAW THE ISSUANCE OF 0 CONTRACTS AND THEN ALL OTHER MONTHS ZERO.    The new OI for the gold complex rests at 532,649. 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 WE HAVE A GAIN OF 13,866  CONTRACTS: 6011 OI CONTRACTS INCREASED AT THE COMEX AND A GOOD SIZED  7855 OI CONTRACTS WHICH NAVIGATED OVER TO LONDON.(13,742 oi gain in CONTRACTS EQUATES TO 43.12TONNES)

YESTERDAY, WE HAD 2651 EFP’S ISSUED.

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF FEBRUARY STARTING WITH FIRST DAY NOTICE: 195,225 CONTRACTS OR 19,522,500  OZ OR 607.23 TONNES (19 TRADING DAYS AND THUS AVERAGING: 10,275EFP CONTRACTS PER TRADING DAY OR 1,027,500 OZ/ TRADING DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS :   SO FAR THIS MONTH IN 19 TRADING DAYS: IN  TONNES: 607.23 TONNES

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

THUS EFP TRANSFERS REPRESENTS 607.23/2200 x 100% TONNES =  27.60% OF GLOBAL ANNUAL PRODUCTION SO FAR IN FEBRUARY ALONE.

ACCUMULATION OF GOLD EFP’S YEAR 2018 TO DATE:  1240.61 TONNES

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

Result: A  STRONG SIZED INCREASE IN OI AT THE COMEX DESPITE THE SMALL RISE IN PRICE IN GOLD TRADING YESTERDAY ($2.40).  HOWEVER, WE HAD ANOTHER GOOD SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 7855 CONTRACTS 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 7855 EFP CONTRACTS ISSUED, WE HAD A NET GAIN IN OPEN INTEREST OF 13,866 contractON THE TWO EXCHANGES:

7855 CONTRACTS MOVE TO LONDON AND  6011 CONTRACTS INCREASED AT THE COMEX. (in tonnes, the GAIN in total oi equates to 43.12 TONNES).

we had: 124 notice(s) filed upon for 12400 oz of gold.

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

GLD

WITH GOLD DOWN $13.80 : NO CHANGES IN GOLD INVENTORY AT THE GLD OF GOLD INTO THE GLD

Inventory rests tonight: 831.03 tonnes.

SLV/

WITH SILVER DOWN 17 CENTs TODAY: 

NO CHANGES IN SILVER INVENTORY AT THE SLV

/INVENTORY RESTS AT 316.590 MILLION OZ/

end

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

1. Today, we had the open interest in silver FELL BY 4438  contracts from 196,437 DOWN TO 191,999 (AND now A LITTLE FURTHER FROM THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) WITH THE RISE  IN PRICE OF SILVER  (8 CENT WITH RESPECT TO  YESTERDAY’S TRADING).   OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE ANOTHER GOOD 872 PRIVATE EFP’S FOR MARCH AND 336 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 CONSIDERABLE COMEX SILVER COMEX LIQUIDATION. IF WE TAKE THE  OI LOSS AT THE COMEX OF  4438 CONTRACTS TO THE 1208 OI TRANSFERRED TO LONDON THROUGH EFP’S, WE OBTAIN A  LOSS OF 3230  OPEN INTEREST CONTRACTS .  WE STILL HAVE A GOOD AMOUNT OF SILVER OUNCES THAT ARE STANDING FOR METAL IN FEBRUARY (SEE BELOW). THE NET LOSS TODAY IN OZ ON THE TWO EXCHANGES:  16.150 MILLION OZ!!!

RESULT: A CONSIDERABLE SIZED DECREASE IN SILVER OI AT THE COMEX WITH THE  RISE OF 8 CENTS IN PRICE (WITH RESPECT TO YESTERDAY’S TRADING ). BUT WE ALSO HAD ANOTHER GOOD 1208 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 TUESDAY MORNING/MONDAY NIGHT: Shanghai closed DOWN 37.51 POINTS OR 1.13% /Hang Sang CLOSED DOWN 229.94 POINTS OR 0.73% / The Nikkei closed DOWN 236.23 POINTS OR 1.07%/Australia’s all ordinaires CLOSED UP 0.21%/Chinese yuan (ONSHORE) closed UP at 6.3120/Oil UP to 63.61 dollars per barrel for WTI and 67.25 for Brent. Stocks in Europe OPENED DEEPLY IN THE RED  .   ONSHORE YUAN CLOSED UP AT 6.3120 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED UP ON THE DOLLAR AT 6.3030 /ONSHORE YUAN TRADING WEAKER AGAINST OFFSHORE YUAN/ONSHORE YUAN TRADING STRONGER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING MUCH STRONGER AGAINST THE DOLLAR AND ALL OTHER CURRENCIES. CHINA IS NOT  HAPPY TODAY (STRONGER CURRENCY BUT WEAKER MARKETS) 

3a)THAILAND/SOUTH KOREA/NORTH KOREA

 i)North Korea

b) REPORT ON JAPAN

3 c CHINA

4. EUROPEAN AFFAIRS

i)Surprise selling of Euros and higher demand for dollars as Weidmann expects interest rate rises next year. He is also contemplating how to curtail QE past September
( zerohedge)
ii)Mish Shedlock describes that the view of Theresa May and of Corbyn are totally opposite of each other and both of their views are viewed as negative to the interests of the EU. Mish believes that the Brexit talks might fail

( Mishtalk/Mish Shedlock)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

6 .GLOBAL ISSUES

Mexico

The Mexican Peso falls again on a record smashing 4.4 billion usa trade deficit

(courtesy zerohedge)

7. OIL ISSUES

i)OPEC will meet the shale boys hoping they will lower production levels

( zerohedge)

ii)LOSSES ARE EXTENDED AFTER A BIG CRUDE INVENTORY BUILD

(courtesy zerohedge)

8. EMERGING MARKET

9. PHYSICAL MARKETS

i)Newcrest is betting on Ecuador’s untapped metal deposits

( Bloomberg)

ii)Many of the media have stated that Russia has overtaken China in their official gold reserves.  This is nonsense due to the fact that China does not disclose its true holdings.  However what is true is the fact that both China and Russia are hoarding gold as official reserves in total contrast to the west which sells its gold eastbound

( zerohedge/GATA)

iii)James Turk on Kingworld news correctly states that silver is deeply backward..i.e. the spot price is higher than future prices. This highlights the fact that silver is scarce as well as experiencing a long price suppression

( James Turk/Kingworldnews/GATA)

iv)Quite a story.  We have detailed to you in the past Scotia’s dealing with Elemental.  Elemental has plead guilty of money laundering and as such nobody is allowed to receive their metal. It also means that Scotia was blackballed.

They had sought to be sold but nobody wanted the crooked operation at Scotia

(courtesy zerohedge)

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

i)Morning trading:

(zerohedge)

ii)Mnuchin is wrong in that investors should be worried about rising inflation.  Just take a look at rising transportation cost of goods
( zerohedge)

iii)Looks like the uSA economy turned on a time during January. This time it is durable good orders that have tumbled

( zerohedge)

iv)Powell’s first report to the House is hawkish as he ignores recent volatility.  He states that rate hikes will continue on course

( zerohedge)

iv b) this one takes the cake:  Fed’s Powell admits that the USA is not on a sustainable fiscal path due to the huge level of debt built up.  After the Dow initially plunged, it rebounded on that news( zerohedge)

v) a)Wholesale inventories show a huge build and this should signal a big Q1 boost for GDP.  Problem: how could inventories surge and orders plummet?( zerohedge)

v)   b)As promised, the Atlanta Fed forecasting for 1st quarter GDP has plunged. You will recall that it started at 5.4%. It is now at 2.6% and will falter again until the final numbers are released in June

(courtesy zerohedge)
 v)SWAMP STORIES
a)A joke:  Schiff hints that Mueller’s next indictment will implicate Trump’s team

( zerohedge)

b)Donald is not going to like this; Kushner loses access to top secret intelligence

(courtesy zerohedge)

Let us head over to the comex:

The total gold comex open interest ROSE BY  6011 CONTRACTS UP to an OI level 532,649  DESPITE THE SMALL RISE IN THE PRICE OF GOLD ($2.40 GAIN/ YESTERDAY’S TRADING).   WE HAD ZERO COMEX GOLD LIQUIDATION.  HOWEVER THE CME REPORTS THAT  THE BANKERS ISSUED A RATHER SMALL COMEX TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS. WE HAD A 7855 EFP’S ISSUED FOR APRIL  AND 0 EFP’s  FOR JUNE AND ZERO FOR ALL OTHER MONTHS:  TOTAL  7855 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: 13,866 OI CONTRACTS IN THAT 7855 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE GAINED 6011 COMEX CONTRACTS.

NET GAIN ON THE TWO EXCHANGES: 13,866 contracts OR 1,386,000  OZ OR 43.12 TONNES.

Result: A  GOOD SIZED INCREASE IN COMEX OPEN INTEREST DESPITE THE SMALL GAIN IN YESTERDAY’S GOLD TRADING ($2.40.)   TOTAL OPEN INTEREST GAIN ON THE TWO EXCHANGES: 13,866 OI CONTRACTS..

We have now entered the active contract month of FEBRUARY where we LOST 849 contracts DOWN to 124 contracts.  We had 825 notices filed upon yesterday, so we LOST 24 contracts or an additional 2400 oz will NOT stand in this active contract month of February AND NO DOUBT THAT THEY TRANSFERRED AS FORWARDS OVER TO LONDON.

March saw a LOSS of 263 contracts DOWN to 995.  April saw a GAIN of 1124 contracts UP to 353,731.  MARCH BECOMES THE FRONT MONTH FOR GOLD

We had 124 notice(s) filed upon today for  12,400 oz

THERE DOES NOT SEEM TO BE ANY GOLD AT THE COMEX TO BE SERVED UPON.

 

 PRELIMINARY COMEX VOLUME FOR TODAY: 270,955 contracts

CONFIRMED COMEX VOL. FOR YESTERDAY:  178,159 CONTRACTS

comex gold volumes are RISING AGAIN

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

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

Trading Volumes on the COMEX

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

end

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And now for the wild silver comex results.

Total silver OI FELL  BY A LARGE 4438  CONTRACTS FROM 196,437 DOWN TO 191,999 WITH YESTERDAY’S 8 CENT RISE IN TRADING).   HOWEVER,WE WERE ALSO INFORMED THAT WE HAD ANOTHER GOOD SIZED 872 EMERGENCY EFP’S FOR MARCH ISSUED BY OUR BANKERS (WITH 336 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: 1208.   THE SILVER BOYS HAVE STARTED TO MIGRATE TO LONDON FROM THE START OF DELIVERY MONTH AND CONTINUING RIGHT THROUGH UNTIL FIRST DAY NOTICE JUST LIKE WE ARE WITNESSING TODAY. USUALLY WE NOTED THAT CONTRACTION IN OI OCCURRED ONLY DURING THE LAST WEEK OF AN UPCOMING ACTIVE DELIVERY MONTH AS WE HAVE JUST SEEN IN GOLD TODAY. THIS PROCESS HAS JUST BEGUN IN EARNEST IN SILVER STARTING IN SEPTEMBER 2017. HOWEVER, IN GOLD, WE HAVE BEEN WITNESSING THIS FOR THE PAST 2 YEARS. NICK LAIRD WAS KIND ENOUGH TO SUPPLY US THE TOTAL FOR 2017 GOLD EFP’S AND IT WAS 6600 TONNES FOR THE ENTIRE YEAR.  WE OBVIOUSLY HAD CONSIDERABLE LONG COMEX SILVER LIQUIDATION WITH A SMALL SIZED LOSS IN TOTAL SILVER OI. WE ARE ALSO WITNESSING A FAIR AMOUNT OF SILVER OUNCES STANDING FOR COMEX METAL IN THIS NON ACTIVE JANUARY AS WELL AS THAT CONTINUAL MIGRATION OF EFPS OVER TO LONDON. ON A PERCENTAGE BASIS THERE ARE MORE EFP’S ISSUED FOR GOLD THAN SILVER.  ON A NET BASIS WE LOST  3230  SILVER OPEN INTEREST CONTRACTS

4438 CONTRACT LOSS AT THE COMEX COMBINING WITH THE ADDITION OF 1208 OI CONTRACTS NAVIGATING OVER TO LONDON.

NET LOSS ON THE TWO EXCHANGES: 3230 CONTRACTS 

We are now in the poor non active delivery month of FEBRUARY and here the front month LOST 20 contracts FALLING TO  0 contracts.  We had 20 notice filed upon yesterday so we GAINED 0 contracts or NIL ADDITIONAL  oz will stand for delivery at the comex

The March contract lost 15,460 contracts DOWN to 15,460

April gained 46 contract up to 387 .

FIRST DAY NOTICE IS ON WEDNESDAY, FEB 28.2018

.

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

INITIAL standings for FEBRUARY

Feb 27/2018.

Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
 nil oz
Deposits to the Dealer Inventory in oz nil oz
Deposits to the Customer Inventory, in oz  nil
No of oz served (contracts) today
124 notice(s)
 12400 OZ
No of oz to be served (notices)
0 contracts
(NIL oz)
Total monthly oz gold served (contracts) so far this month
2749 notices
274900 oz
8.5509 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 nil withdrawal out of the customer account:
total withdrawal: nil  oz
we had 0 customer deposit
total customer deposits: nil  oz
we had 1 adjustment(s)
i) out of HSBC:
70,171,984 oz was adjusted out of the customer and this landed into the dealer account of HSBC
total registered or dealer gold:  536,866.472 oz or 16.698 tonnes
total registered and eligible (customer) gold;   9,132,954.478 oz 284.07 tones

For FEBRUARY:
Today, 0 notice(s) were issued from JPMorgan dealer account and 9 notices were issued from their client or customer account. The total of all issuance by all participants equates to 124 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 98 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 (2749) x 100 oz or 274,900 oz, to which we add the difference between the open interest for the front month of FEB. (124 contracts) minus the number of notices served upon today (124 x 100 oz per contract) equals 274,900 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 (2749 x 100 oz or ounces + {(124)OI for the front month minus the number of notices served upon today (124 x 100 oz )which equals 274,900 oz standing in this active delivery month of February (8.5509 tonnes). THERE IS 16.698 TONNES OF REGISTERED GOLD AVAILABLE FOR DELIVERY SO FAR.

WE LOST 24 CONTRACTS OR AN ADDITIONAL 2400 OZ WILL NOT  STAND IN THIS ACTIVE DELIVERY MONTH OF FEBRUARY AND THEY MORPHED INTO LONDON BASED FORWARDS. THERE DOES NOT SEEM TO BE MUCH PHYSICAL GOLD AVAILABLE FOR OUR LONGS AT THE COMEX

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XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

IN THE LAST 17 MONTHS 70 NET TONNES HAS LEFT THE COMEX.

end

And now for silver

AND NOW THE DECEMBER DELIVERY MONTH

FEBRUARY FINAL standings

feb 27 2018
Silver Ounces
Withdrawals from Dealers Inventory nil oz
Withdrawals from Customer Inventory
 316,138.140oz
 Delaware
CNT
HSBC
Malca
Deposits to the Dealer Inventory
303,546.09
oz
brinks
Deposits to the Customer Inventory
1,449,633.330 oz
CNT
HSBC
JPM
No of oz served today (contracts)
0
CONTRACT(S
(NIL OZ)
No of oz to be served (notices)
0 contracts
(NIL oz)
Total monthly oz silver served (contracts) 407 contracts

(2,035,000 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 1 inventory movement at the dealer side of things

we had 1 inventory deposits into the dealer account

i) Into Brinks: 303,546.09  oz

total inventory deposits into dealer: 303,546.09 oz

we had 3 deposits into the customer account

i) into CNT:  599,592.930 oz

ii) into HSBC: 599,887.300 oz

iii) into JPMorgan: 250,153.100 oz

*** JPMorgan for most of 2017 and in 2018 has adding to its inventory almost every single day.

JPMorgan now has 135 million oz of  total silver inventory or 54% of all official comex silver.

we had 3 withdrawals from the customer account;

i) Out of Delaware:: 3063.700 oz

ii) Out of Malca:: 34,700.210  oz

iii) Out of HSBC: 250,153.100 0z

iv) out of CNT: 28,211.13 oz

total withdrawals;  316,138.140  oz

we had 2 adjustments

i) Out of Scotia:  980,135.160 oz was adjusted out of the customer account and this landed into the dealer account of Scotia

ii) out of HSBC:  1,317,590.000  oz  was adjusted out of the customer is this landed into the dealer account of HSBC

total dealer silver:  50.460 million

total dealer + customer silver:  248.480 million oz

The total number of notices filed today for the FEBRUARY. contract month is represented by 0 contract(s) FOR NIL oz. To calculate the number of silver ounces that will stand for delivery in FEBRUARY., we take the total number of notices filed for the month so far at 407 x 5,000 oz = 2,035,000 oz to which we add the difference between the open interest for the front month of FEB. (0) and the number of notices served upon today (0 x 5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the FEB contract month: 407(notices served so far)x 5000 oz + OI for front month of FEBRUARY(0) -number of notices served upon today (0)x 5000 oz equals 2,035,000 oz of silver standing for the FEBRUARY contract month. 

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

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ESTIMATED VOLUME FOR TODAY: 123,404 CONTRACTS

CONFIRMED VOLUME FOR YESTERDAY: 88,180 CONTRACTS

YESTERDAY’S CONFIRMED VOLUME OF 88,180 CONTRACTS EQUATES TO  440 MILLION OZ OR 62.89% OF ANNUAL GLOBAL PRODUCTION OF SILVER

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

The record level of silver open interest is 234,787 contracts set on April 21./2017 with the price at that day at $18.42
The previous record was 224,540 contracts with the price at that time of $20.44

end

NPV for Sprott 

1. Sprott silver fund (PSLV): NAV FALLS TO -2.03% (FEB 27/2018)
2. Sprott gold fund (PHYS): premium to NAV FALLS TO -0.43% to NAV (FEB 27/2018 )
Note: Sprott silver trust back into NEGATIVE territory at -2.03%-/Sprott physical gold trust is back into NEGATIVE/ territory at -0.43%/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 RISES TO -3.71%: NAV 13.61/TRADING 13.11//DISCOUNT 3.71.

END

And now the Gold inventory at the GLD/

feb 27/WITH GOLD DOWN $13.80 WE HAD NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 831.03 TONNES

FEB 26/WITH GOLD UP $2.40/WE HAD ANOTHER INVENTORY GAIN/THIS TIME 1.77 TONNE ADDITION TO THE GLD INVENTORY/INVENTORY RESTS AT 831.03 TONNES/WE HAVE HAD 5 INCREASES IN THE PAST 6 TRADING GOLD SESSIONS/

FEB 23/WITH GOLD DOWN $1.15, WE HAD A GOOD INVENTORY GAIN OF 1.47 TONNES OF GOLD INTO THE GLD/INVENTORY RESTS AT 829.26 TONNES

FEB 22/WITH GOLD UP 90 CENTS AGAIN TODAY, WE HAD NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 827.79 TONNES

FEB 21/ WITH THE 90 CENT GAIN WE HAD ANOTHER DEPOSIT OF 3.15 TONNES OF GOLD INTO THE GLD INVENTORY/INVENTORY RESTS TONIGHT AT 827.79 TONNES

Feb 20/WITH GOLD DOWN BY $24.25, THE CROOKS DECIDED THAT THEY HAD BETTER RETURN (DEPOSIT) 3.34 TONNES OF GOLD INTO THE GLD/INVENTORY RESTS TONIGHT AT 824,64 TONNES

Feb 16/WITH GOLD UP BY 25 CENTS, THE CROOKS DECIDED AGAIN TO RAID THE COOKIE JAR BY WITHDRAWING 2.36 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 821.30 TONNES

Feb 15/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 823.66 TONNES

Feb 14/AN ADDITIONAL OF 2.95 TONNES OF GOLD INTO GLD WITH THE HUGE GAIN OF 27.40 IN PRICE/INVENTORY RESTS AT 823.66 TONNES

Feb 13/WITH GOLD UP $3.40 WE HAD NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY REMAINS AT 820.71 TONNES

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

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Feb 278/2018/ Inventory rests tonight at 831.03 tonnes

*IN LAST 330 TRADING DAYS: 110.12 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 260 TRADING DAYS: A NET 47.19 TONNES HAVE NOW BEEN ADDED INTO GLD INVENTORY.

end

Now the SLV Inventory

feb 27/WITH SILVER DOWN 17 CENTS/NO CHANGE IN SILVER INVENTORY/INVENTORY RESTS AT 316.590 MILLION OZ

FEB 26/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 316.590 MILLION OZ/

FEB 23/WITH SILVER DOWN 10 CENTS TODAY, WE HAD ANOTHER HUGE ADDITION OF 1.315 MILLION OZ/INVENTORY RESTS AT 316.590 MILLION OZ/

fEB 22.2018/WITH SILVER DOWN  1 CENT TODAY, WE HAD NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 315.271 MILLION OZ/

FEB 21/WITH SILVER UP 15 CENTS TODAY, WE HAD A GOOD SIZED INVENTORY ADDITION OF 1.226 MILLION OZ/INVENTORY RESTS AT 315.271 MILLION OZ/

Feb 20/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 314.045 MILLION OZ

Feb 16/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 314.045 MILLION OZ/

Feb 15/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 314.045 MILLION OZ/

Feb 14./NO CHANGE IN SILVER INVENTORY DESPITE THE HUGE RISE IN PRICE/INVENTORY RESTS AT 314.045 MILLION OZ

Feb 13./NO CHANGE IN SILVER INVENTORY TODAY/INVENTORY RESTS AT 314.045 MILLION OZ/

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/

Feb 27/2017: NO CHANGES TO SILVER INVENTORY/

Inventory 316.590 million oz

end

6 Month MM GOFO 1.86/ and libor 6 month duration 2.181

Indicative gold forward offer rate for a 6 month duration/calculation:

G0FO+ 1.91%

libor 2.20 FOR 6 MONTHS/

GOLD LENDING RATE: .290%

12 Month MM GOFO
+ 2.47%

LIBOR FOR 12 MONTH DURATION: 2.290

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = .180

end

Major gold/silver trading /commentaries for TUESDAY

GOLDCORE/BLOG/MARK O’BYRNE.

GOLD/SILVER

 GoldCore

Digital Gold Prov

Andrew Maguire’s Kinesis money which is a “bitcoin” but backed 100% by allocated gold and silver is set to go.

it think it would be a great idea to look at this!

please read at:  https://kinesis.money/#/

(Andrew Maguire)

Andrew Maguire

2:57 PM (1 hour ago)
to me

Harvey

Here It is my friend!  https://kinesis.money/#/ Please let everyone know.

Let catch up on Monday if you have time. We have billions in the hopper ready to be allocated on the 1st day of trading. The paper market days are over.

Warm regards

Andy

end

Newcrest is betting on Ecuador’s untapped metal deposits

(courtesy Bloomberg)

Australia’s top gold miner boosts bets on Ecuador’s riches

 Section: 

By David Stringer
Bloomberg News
Sunday, February 25, 2018

Australia’s largest gold producer, Newcrest Mining Ltd., will invest $250 million for a stake in Lundin Gold Inc. to boost its presence in Ecuador, which is attracting a slate of mining giants hunting for major untapped metals deposits.

Newcrest will take 27.1 percent of Vancouver-based Lundin Gold, which expects to bring the Fruta del Norte gold and silver mine in southeastern Ecuador into production by the end of next year. The companies will explore eight other concessions to the north and south of the project under the deal, and Newcrest can earn up to a 50 percent interest in that joint venture by spending $20 million over five years, the Melbourne-based producer said in a statement.

The world’s biggest miner BHP Billiton Ltd. and billionaire Gina Rinehart’s Hancock Prospecting Pty are among firms that have raced into Ecuador seeking major copper and gold deposits. Latin America saw the largest rise in exploration spending in 2017, according to S&P Global Market Intelligence. …

… For the remainder of the report:

https://www.bloomberg.com/news/articles/2018-02-25/australia-s-top-gold

end

Many of the media have stated that Russia has overtaken China in their official gold reserves.  This is nonsense due to the fact that China does not disclose its true holdings.  However what is true is the fact that both China and Russia are hoarding gold as official reserves in total contrast to the west which sells its gold eastbound

(courtesy zerohedge/GATA)

Russia overtakes China in gold reserves race to end U.S. dollar dominance

 Section: 

From Russia Today, Moscow
Monday, February 26, 2018

The Central Bank of Russia boosted its holdings of gold by almost 20 metric tons last month, with reserves reaching 1,857 tons. It has increased its holdings every month since March 2015.

Russia is now among the top five gold holders after surpassing China, which reportedly holds 1,843 tons. Over the last 15 years Moscow and Beijing have been aggressively accumulating gold reserves to cut their dependence on the U.S. dollar.

“Interestingly, both Russia and China publicize and promote their accumulations of gold and publicly refer to gold as a strategic monetary asset. They make no secret of this. But on the flip side, the U.S. does the opposite, and constantly downplays the strategic role of gold,” Singapore’s Bullion Star precious metals expert Ronan Manly told RT in December. …

… For the remainder of the report:

https://www.rt.com/business/419820-russia-outpaces-china-gold/


end

Sprott states that mining companies value is not being reflected due to the manipulation of both gold and silver.

(Sprott/GATA/Hemke)

Manipulation keeping markets from doing what they ordinarily would, Sprott says

 Section: 

9:31a ET Monday, February 26, 2018

Dear Friend of GATA and Gold:

The profitability of gold mining companies is not being reflected in the price of their shares, mining entrepreneur Eric Sprott says in his weekly reflection on the markets for Sprott Money News. Interviewed by Craig Hemke of the TF Metals report, Sprott notes that because they are being manipulated by powerful entities, markets are not doing what they ordinarily are supposed to do. The discussion is 13 minutes long and can be heard at Sprott Money here:

https://www.sprottmoney.com/Blog/you-cant-explain-most-markets-anymore-t…

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

end

James Turk on Kingworld news correctly states that silver is deeply backward..i.e. the spot price is higher than future prices. This highlights the fact that silver is scarce as well as experiencing a long price suppression

(courtesy James Turk/Kingworldnews)

Silver deeply in backwardation and on verge of breakout, Turk tells KWN

 Section: 

8:47p ET Monday, February 26, 2018

Dear Friend of GATA and Gold:

GoldMoney founder and GATA consultant James Turk, interviewed today by King World News, says silver is deeply in backwardation and seems to be on the verge of breaking up and out against the longstanding price suppression. The interview is posted at KWN here:

https://kingworldnews.com/james-turk-war-raging-silver-market/

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

end

Quite a story.  We have detailed to you in the past Scotia’s dealing with Elemental.  Elemental has plead guilty of money laundering and as such nobody is allowed to receive their metal. It also means that Scotia was blackballed.

They had sought to be sold but nobody wanted the crooked operation at Scotia

(courtesy zerohedge)

World’s Oldest Gold Trader Fails To Find A Buyer

Last October, we reported that the world’s oldest gold trader was for sale after a massive money laundering scandal may have terminally crippled one of the most iconic names in the business. According to the Financial Times, Canada’s Bank of Nova Scotia was exploring options for its gold business ScotiaMocatta, including a possible sale of Canada’s most popular precious metals trader. As reported at the time, Scotiabank made the decision to sell ScotiaMocatta following a massive money laundering scandal centered on a U.S. refinery that involved smuggled gold from South America.

The ScotiaMocatta business, a mainstay in PM trading, is one of London’s main gold trading banks and is being sold by JPMorgan.

As the FT further reported, while physical gold trading has been in a cyclical decline in recent years, the “straw that broke the camel’s back” in prompting the sale was Scotiabank’s lending to Elemetal, a precious metals refinery in Dallas. Scotiabank was one of its biggest lenders, they said. The problem emerged in March, when US prosecutors accused workers at a subsidiary of Elemetal, NTR Metals in Florida, of a money laundering scheme using “billions of dollars of criminally derived gold” mostly from Peru.

This is where the story took a turn into a slightly surreal detour.

NTR imported more than $3.6bn of gold from Latin America between 2012 and 2015, the court documents allege. Two of the accused, Samer Barrage and Juan Granda, pleaded guilty to a charge of money laundering in plea deals. After the story came to light in March, Elemetal was kicked off the London Bullion Market Association’s “Good Delivery List” of gold refiners.

To be sure, this was an almost instant death sentence for the company as buyers will usually only buy gold from a refiner on the list. Indeed, in the same month, New York’s Comex futures exchange said it was no longer taking gold from Elemetal for delivery against futures contracts in the world’s biggest gold futures market.

And this is where the scourge of gold rehypothecation emerged, as in the scandal surrounding Elemetal, it became impossible for holders of Elemetal gold to sell the gold bars on, leaving them sitting in bank vaults, according to traders quoted by the FT. Buyers are reluctant to take the gold, given the investigations.

This means that hundreds of millions in loans made to Elemetal by ScotiaMocatta are suddenly stuck in limbo. It also means that one of five bullion banks that settle gold trades in the London market, the world’s largest, has effectively been blackballed. It was built on the 1997 purchase by Scotiabank of Mocatta Bullion, which traces its roots back to 1671. And with Mocatta crippled, Scotiabank, which has the biggest foreign presence of any Canadian bank, is focusing its international strategy on the Pacific Alliance, a Latin American trade bloc comprising Mexico, Peru, Chile and Colombia. It will also hope to find a willing Chinese buyer for the gold trading operation.

Well, fast forward 4 months later, when the sale process of the terminally tainted Scotia Mocatta appears to have failed, because according to Bloomberg, Bank of Nova Scotia “plans to keep” its ScotiaMocatta metals trading business, ending months of speculation on a potential sale.

The Canadian bank wasted no time to give the failed sale process a favorable spin:

“We recently concluded a strategic review of this business and I’m pleased to confirm that most of our key services and our key markets and key clients will be continuing,” Dieter Jentsch, group head of global banking and markets, said Tuesday on a conference call with analysts.

The bad news: Scotia Mocatta will now see massive layoffs: “We will be exiting some markets, we will be simplifying our product suite, and we’ll be much more judicious about our allocation of capital and liquidity.”

As Bloomberg reminds us, Scotiabank acquired the London Metal Exchange gold-dealing unit from Standard Chartered Plc two decades ago.

The business has more than 160 employees and 10 offices worldwide, including New York, London, New Delhi, Mumbai, Hong Kong, Shanghai and Singapore, according to the bank’s website.

And so the chapter on the world’s oldest gold traders comes to a close: ScotiaMocatta traces its origins to 1671 and is one of a dozen firms behind the London gold fix. It’s also part of a group of nine banks that sets the silver price in London. And, in light of the ongoing scandal that may have permanently tainted Scotia, preventing it from winning new warehousing business, the fabled history of one of the most venerable precious metal traders is likely to come to an end in the very near future.

end



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

 

i) Chinese yuan vs USA dollar/CLOSED UP 6.3120  /shanghai bourse CLOSED DOWN 37.51 POINTS OR 1.13%  / HANG SANG CLOSED DOWN 229.94 POINTS OR 0.73%
2. Nikkei closed DOWN 226.23 POINTS OR 1.07% /USA: YEN FALLS TO 106.96/ STILL DEADLY AS YEN CARRY TRADERS DISINTEGRATE

3. Europe stocks OPENED DEEPLY IN THE RED    /USA dollar index FALLS TO 89.59/Euro RISES TO 1.2335

3b Japan 10 year bond yield: FALLS TO . +.047/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 106.79/ 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:: 63.61  and Brent: 67.26

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 UP for WTI and UP FOR Brent this morning

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund RISES TO +.668%/Italian 10 yr bond yield DOWN to 2.017% /SPAIN 10 YR BOND YIELD UP TO 1.566%

3j Greek 10 year bond yield FALLS TO : 4.347?????????????????

3k Gold at $1332.75 silver at:16.64     7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble UP 29/100 in roubles/dollar) 55.93

3m oil into the 63 dollar handle for WTI and 67 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 106.96 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 0.9373 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1543 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 +0.668%

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 2.8715% early this morning (THIS IS DEADLY TO ALL MARKETS). Thirty year rate at 3.1613% /BOTH VERY DEADLY

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

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

Dollar, Futures In Limbo Ahead Of Powell Testimony

After euphoric premarket spikes for two consecutive days in global stocks, this morning S&P futures point to a modestly lower open, while trading in Asia is mixed and Europe is down modestly.

Following yesterday’s closing burst in the S&P500, which was reminiscent of the late January meltup, and which resulted in the February correction, S&P futures were down 7 points, trading near sessions lows, if in a modest range after yesterday’s 33 point move higher in the cash index.

The dollar, like S&P futures, was stuck in narrow ranges as investors await Jerome Powell’s first public comments in the role of Federal Reserve chairman on Tuesday. The Bloomberg Dollar Spot Index recouped earlier losses, while the Treasury 10-year yield held steady at 2.86% after declining 9bps in the past three days.

As previewed yesterday, Fed Chair Powell will appear before the House Financial Services Committee Tuesday at 1030am ET (testimony released at 830am ET) to discuss the Fed’s Semi-Annual Monetary Policy Report and the state of the economy. Investors will look for any clues on whether four 25bps rate hikes in 2018 are likely. Back in his testimony ahead of getting confirmed as Fed Chair, Powell said that risks to the economy appeared to be balanced

The Fed Chairman should stick to the current forecast of three hikes this year as he will be cautious not to shake up expectations until the FOMC comes up with its updated projections in March, Credit Agricole strategists including David Forrester write in a note. “We don’t believe any ‘sell the fact’ attempt to sell the USD will prove lasting, especially if data continues to support higher yields.”

Our sense is that he is unlikely to scare the horses,” said Rodrigo Catril, a currency strategist at National Australia Bank Ltd. in Sydney. “If so, the risk is that bond yields could track a bit lower and equities could remain supportive. Under such an environment, the dollar probably trades weaker.”

The market is a little bit cautious ahead of this speech, but we think he (Powell) is likely to stress the continuity of monetary policy…because it wouldn’t be in his interest to have any major market reactions – that would make his job more difficult,” said Commerzbank currency strategist Anje Praefcke.

“What he’s likely to state is what we’ve seen in the FOMC (Federal Open Markets Committee) minutes: that the outlook for the U.S. economy has improved considerably, short-term, and that both wages and consumer price inflation have recently surprised on the upside.”

Meanwhile, stocks have already priced in a dovish (or at worst neutral) Fed, as the S&P is already back to the level where it was before the February selloff’s worst day. Though the S&P down over 2% for February, it has recovered more than two thirds of the losses sustained in the wake of a drastic selloff early this month.

Europe’s Stoxx 600 extended declines this morning to 0.3%, with 2 stocks down for every one that rises; most industry groups in the index declined, led by real estate and telecoms companies.  All but two industry groups are in the red, with telecom and chemical shares leading losses. Offsetting the drop was the Stoxx 600 Media Index which jumped 1.6% as Sky surges after the Comcast overbid. Consumer discretionary is the notable outperformer, lifted by Sky (+21%) after Comcast made an offer of GBP 12.50/shr for the Co., subsequently posing a threat to FOX’s (FOXA) offer for the Co. Elsewhere, UK homebuilders are firmer this morning following the latest earnings update from Persimmon (+11%) which has lifted some of its competitors higher in sympathy; Berkeley Group (BKG LN) +2.3%, Barratt Developments (+2.1%) and Taylor Wimpey (+1.7%).

Earlier, Asian equities edged modestly higher, with Japanese stocks climbing to the highest in more than three weeks. ASX 200 (+0.2%) and Nikkei 225 (+1.1%) were both higher with the top performers in Australia underpinned by earnings releases, while the Japanese benchmark led the region and briefly surmounted the 22500 level. Elsewhere, Chinese markets were mixed in which the Hang Seng (-0.7%) was choppy and Shanghai Comp. (-1.1%) was the laggard after the PBoC refrained from open market operations. Furthermore, press reports also noted that China is facing tight liquidity conditions in March and that the PBoC could raise rates on open market o perations next
month following an anticipated Fed hike.

Earlier in the session, the MSCI All-Country World Index, was up 0.1% and set for its third straight day of gains after hitting its highest level since Feb. 5, although if Europe continues to sink, and if futures fail to rebound, the streak will soon be broken.

Elsewhere in currencies, G10 currencies traded in narrow ranges against the dollar ahead of Powell’s appearance, with 21-DMAs seen as next hurdles for several pairs. The Sweden’s krona slides to a fresh eight-year low of 10.0903 against the euro; Sweden earlier saw a weaker-than- forecast economic tendency survey, followed by comments by Riksbank First Deputy Governor af Jochnick who expressed worry over the weak underlying inflation pressures. The USD/JPY traded in narrow 31-pip range as it continues to consolidate under 108 handle. The NZD/USD sold on disappointing trade data; nearing test of initial support at 0.7271, last week’s low. The euro traded at $1.2334, up 0.1 percent, but off its three-year high of $1.2556 hit earlier this month.

Fed funds rate futures were almost fully pricing in a rate hike at the Fed’s next policy meeting on March 20-21.

“Expectations that Powell will be sensitive to financial markets appear to be running high. But he hasn’t said he will sacrifice policy normalization for the sake of financial markets. I feel there is room for disappointment in markets,” said Hiroko Iwaki, senior bond strategist at Mizuho Securities.

The 10-year Treasury yield edged higher after falling to a two-week low, rising to 2.870% if well below the recent four-year peak of 2.957% touched on Feb. 21, driven by month-end buying as well as position adjustments ahead of Powell’s testimony; German bunds and U.K. gilts led a retreat in European bonds.

In other overnight news, Treasury Secretary Mnuchin said US does not set policy to impact the USD, reiterates strong USD good for the economy.

ECB’s Weidmann said if economic upswing continues and prices rise there should be no reason not to end QE this year. Evidence that movements in FX are having a smaller impact on inflation than previously. Bigger QE reduction and clear end date to the bond buying programme would have been justifiable.

In the latest Brexit news, UK Foreign Secretary Boris Johnson stated that UK will not remain subject to ECJ rulings.Reports stated the EU will threaten UK PM May’s Brexit plan by rejecting British compromises and will warn that Northern Ireland must sign up to Brussels regulations; draft Brexit treaty is to be published on Wednesday. In related news, Brussels is expected to demand the UK remain under European Court of Justice oversight indefinitely post-Brexit under divorce agreement. French President Macron says a customs union agreement with the UK after Brexit is possible, however would not give full access to single market.

Oil prices erased earlier gains as investor concerns about rising U.S. oil output offset signs of stronger demand and faith in the ability of OPEC production curbs to curtail supply. U.S. West Texas Intermediate futures fetched $63.68, down 0.3 percent, after hitting a three-week high of $64.24 the previous day.

In addition to Powell’s market-moving testimony, the market is set to receive a number of macro data, including the house price index. Marriott and Live Nation are among the more than a hundred companies that will report quarterly numbers

Market Snapshot

  • S&P 500 futures down 0.2% to 2,778
  • STOXX Europe 600 down 0.2% to 382.36
  • MSCI Asia Pacific up 0.2% to 179.65
  • MSCI Asia Pacific ex Japan down 0.2% to 586.04
  • Nikkei up 1.1% to 22,389.86
  • Topix up 0.9% to 1,790.34
  • Hang Seng Index down 0.7% to 31,268.66
  • Shanghai Composite down 1.1% to 3,292.07
  • Sensex down 0.2% to 34,390.05
  • Australia S&P/ASX 200 up 0.2% to 6,056.86
  • Kospi down 0.06% to 2,456.14
  • German 10Y yield rose 1.9 bps to 0.671%
  • Euro up 0.1% to $1.2333
  • Brent Futures down 0.2% to $67.38/bbl
  • Italian 10Y yield fell 4.9 bps to 1.748%
  • Spanish 10Y yield rose 0.6 bps to 1.562%

Bulletin Headline Summary from RanSquawk

  • European bourses trade with little in the way of firm direction as markets await Fed Chair Powell’s testimony
  • Above average Dollar demand for end of February FX portfolios seems to be keeping the broader Usd afloat as the DXY meanders around the mid-point of a tight 89.690-830 range
  • Looking ahead, highlights nation German CPI, US durables, APIs and a slew of speakers

Top overnight news from BBG

  • EU Said to Stoke Brexit Tensions With 100-Page Draft Exit Deal
  • Comcast Offers to Buy Sky in $30 Billion Challenge to Fox
  • Traders Unfazed by Italy Election, But Some Warn of Complacency
  • Federal Reserve Chairman Jerome Powell’s embrace of his predecessor’s gradual approach to tightening monetary policy is about to be tested as he delivers his first congressional testimony on Tuesday.
  • The European Union will challenge Theresa May on Wednesday when it publishes a draft Brexit treaty that ignores some of the U.K. prime minister’s most important demands.
  • Mario Draghi largely skirted the Latvia crisis affecting the European Central Bank and stuck to his plans to keep adding stimulus as he addressed European Parliament lawmakers on Monday.
  • Xi Jinping’s decision to cast aside China’s presidential term limits is stoking concern he also intends to shun international rules on trade and finance, even as he champions them on the world stage.
  • It doesn’t make sense for the U.S. to impose steel and aluminum tariffs on other NATO members in the name of national security, according to a senior European Union official.
  • China plans to reduce its annual budget-deficit target to just under 3 percent of total economic output, people familiar with the matter said

Asian equity markets traded mixed following yesterday’s US gains where declining yields eased some concerns of steep rate increases and the majors rallied to their best levels in over 3 weeks. ASX 200 (+0.2%) and Nikkei 225 (+1.1%) were both higher with the top performers in Australia underpinned by earnings releases, while the Japanese benchmark led the region and briefly surmounted the 22500 level. Elsewhere, Chinese markets were mixed in which the Hang Seng (-0.7%) was choppy and Shanghai Comp. (-1.1%) was the laggard after the PBoC refrained from open market operations. Furthermore, press reports also noted that China is facing tight liquidity conditions in March and that the PBoC could raise rates on open market operations next month following an anticipated Fed hike. Finally, 10yr JGBs were relatively flat despite the upside in riskier assets, with prices contained at the 151.00 level while today’s 2yr auction results were also encouraging with b/c and accepted prices higher than previous. PBoC skipped open market operations and cited relatively high liquidity in the banking system. PBoC set CNY mid-point at 6.3146 (Prev. 6.3378). PBoC may increase Open Market Operation rates in March after an expected Fed rate hike with the increases in repo rates will likely be around 5bps, while reports added that China is to face a tight balance in liquidity during next month.

Top Asian News

  • China Is Said to Plan First Budget Deficit Target Cut Since 2012
  • Alibaba Said to Buy Out Baidu in China’s Top Takeout App
  • Bank Fraud Fallout in India Spreads to Market for Trade Finance
  • Guinigundo Doesn’t See Need to Raise Policy Rate ‘At this Point’
  • Chinese Investors Yank Record Funds From Hong Kong Stocks

More European stocks fall, trading near session lows, (Stoxx 600 down -0.3%), after the Sky overbid and post-Asia-Pac opening gains were trimmed. Taking a look at the sectors, consumer discretionary is the notable outperformer, lifted by Sky (+21%) after Comcast made an offer of GBP 12.50/shr for the Co., subsequently posing a threat to FOX’s (FOXA) offer for the Co. Elsewhere, UK homebuilders are firmer this morning following the latest earnings update from Persimmon (+11%) which has lifted  some of its  competitors higher in sympathy; Berkeley Group (BKG LN) +2.3%, Barratt Developments (+2.1%) and Taylor Wimpey (+1.7%). Finally, Provident Financial (+74%) tops the Stoxx 600 after announcing its rights issue and settlement with the FCA.

Top European News

  • EU Said to Stoke Brexit Tensions With 100-Page Draft Exit Deal
  • World’s Biggest Wealth Fund Returned $131 Billion in 2017
  • Business Gauge Picks up in Italy Shortly Before Election
  • Provident Surges on Better-Than-Feared FCA Pact, Dividend Plan

In currencies, above average Dollar demand for end of February FX portfolios seems to be keeping the broader Usd afloat as the DXY meanders around the mid-point of a tight 89.690-830 range. Currency markets also erring on the side of caution ahead of Fed chair Powell’s House testimony and (potentially) any further clues about risks around the FOMC consensus for 3 hikes in 2018. Indeed, individual G10 pairs are equally restrained within narrow bands, with Eur/Usd holding between 1.2300-50 amidst mixed EZ inflation data (German states soft, so far vs firmer Spanish headline and harmonised prints) and Cable not deviating outside 1.3950-1.4000 despite some Gbp negative Brexit reports. Perhaps Sterling deriving some support from latest M&A developments and Comcast’s mega Gbp22 bn bid for Sky. Usd/Jpy looks even more tethered to the 107.00 level, with export supply capping the upside and buying interest supporting ahead of 106.50. Elsewhere, some further movement in Eur/Sek after Swedish trade data and more dovish-sounding Riksbank rhetoric with the cross inching above the circa 10.0800 high from 2016 to 10.0900.

In the commodities complex, both WTI and Brent crude futures have continued to pull back from recent highs despite the softer USD as concerns over mounting US production remains a key theme with IEA Chief Birol stating that the US is to be largest oil producer by next year and sees US output exceeding 11mln bpd by late this year. In metals markets, spot gold is relatively steady at this stage of the session with markets awaiting Fed Powell’s testimony later today. Elsewhere, Chinese steel futures saw another session of gains overnight amid speculation over further extensions to output curbs. Iraqi oil production is around 4.35mln bpd, according to Iraq oil ministry official.

US Event Calendar

  • 8:30am: Advance Goods Trade Balance, est. $72.3b deficit, prior $71.6b deficit, revised $72.3b deficit
  • 8:30am: Wholesale Inventories MoM, est. 0.4%, prior 0.4%; Retail Inventories MoM, prior 0.2%, revised 0.2%
  • 8:30am: Durable Goods Orders, est. -2.0%, prior 2.8%; Durables Ex Transportation, est. 0.4%, prior 0.7%
  • 8:30am: Cap Goods Orders Nondef Ex Air, est. 0.5%, prior -0.6%; Cap Goods Ship Nondef Ex Air, est. 0.3%, prior 0.4%
  • 9am: House Price Purchase Index QoQ, prior 1.4%; FHFA House Price Index MoM, est. 0.4%, prior 0.4%
  • 9am: S&P CoreLogic CS 20-City NSA Index, prior 204.2; CS 20-City MoM SA, est. 0.6%, prior 0.75%
  • 10am: Richmond Fed Manufact. Index, est. 15, prior 14
  • 10am: Conf. Board Consumer Confidence, est. 126.5, prior 125.4; Present Situation, prior 155.3; Expectations, prior 105.5

Central Banks

  • 8:30am: Fed Powell’s Congressional Testimony is Released
  • 10am: Fed’s Powell Testifies to House Financial Services Committee

DB’s Jim Reid concludes the overnight wrap

The highlight today will be German inflation (1.3% yoy expected) and new Fed Chair Powell’s testimony at 3pm GMT. Mr Powell will be speaking on behalf of the FOMC, and our economists fully expect him to reiterate that a “gradual” path of policy normalization remains the order of the day. However, he will also likely discuss emerging upside risks to the growth outlook in the wake of recent fiscal policy changes. In this respect, the minutes of the January 31 FOMC meeting provide a good template for Powell’s prepared remarks. Recall that last week’s minutes indicated that “Most members noted that recent information on inflation along with prospects for a continued solid pace of economic activity provided support for the view that inflation on a 12-month basis would likely move up in 2018 and stabilize around the Committee’s 2% objective in the medium term.” In short, Powell will likely convey the message that with an improving growth and labor market outlook, the Fed continues to gain confidence that the inflation side of its dual mandate will soon be met. Outside of this the market will be fascinating to see how he handles his first big public appearance in the new role.

Staying in the US, Mr Quarles who became a Fed Governor last October seemed reasonably upbeat last night. He noted “it has been quite some time since the (US) economic environment looked as favourable as it does now” and  that “some of the factors that have been holding back growth…could shift, moving the economy onto a higher growth trajectory”. On rates, he reiterated the Fed’s view of “further gradual increases in rates will be appropriate…”, while noting the Fed will be “looking at Volcker rule recalibrations over the next few months”.

Elsewhere, the Fed’s Bullard reiterated his dovish views that the Fed should avoid an aggressive pace of rate hikes unless incoming macro data surprise to the upside. He added “these are good times for the US economy, but not as good as they’ve been at other junctures”.

This morning in Asia, markets have broadly followed the positive US lead last night with the Nikkei (+0.95%) and Kospi (+0.21%) both up, while the Hang Seng is marginally down (-0.15%) and China’s CSI 300 -1.35% lower as we type.

Earlier the S&P was up for the third consecutive day (+1.18%) and now +7.7%  above its recent lows while only -3.2% below its all-time high. Within the S&P, all sectors but utilities were up with gains led by the telco, tech and financial stocks. In tech, an equally weighted market cap index on the FANG stocks is now back at its record highs and 12.1% higher than its recent lows. The Dow (+1.58%) and Nasdaq (+1.15%) also rallied yesterday. Back in Europe, all markets were higher, with the Stoxx 600 (+0.50%), DAX (+0.35%) and FTSE (+0.62%) modestly up. The VIX fell for the fourth straight day to 15.80 (-4.2%).

In government bonds, core 10y bond yields were little changed (UST 10y -0.5bp; Gilts -1.2bp; Bunds flat) while peripherals outperformed with yields down 4-5bp. Gains were led by Italy, in part as the governing Democratic Party leader Renzi noted “we’ll never form any government with extremists” as per the La Stempa newspaper. Turning to currencies, the US dollar index and Sterling both dipped marginally, while the Euro rose 0.18%. In commodities, WTI oil was up for the third straight day (+0.57%). Elsewhere, precious metals gained c0.5% (Gold +0.37%; Silver +0.77%) and other base metals were mixed but little changed (Copper -0.21%; Aluminium -0.70%; Zinc +0.51%).

Away from markets and onto Mr Draghi’s Parliamentary address where he seemed slightly dovish and broadly stuck to prior commentaries. On QE, he noted “the possible extension of QE has not been discussed by the Governing Council”. On inflation, he said “we’re generally more confident that it is proceeding towards our target”, but we also “have to be persistent and patient because the underlying inflation has yet to show more convincing signs of a sustained upward adjustment”. Further, “the evolution of inflation remains crucially conditional on an ample degree of monetary stimulus provided by the full set of our monetary policy measures….” On the outlook, he noted that the “…economic situation is improving constantly”, but “uncertainties continues to prevail”, so “we need the right blend” of measures. Finally on FX, he reiterated that the recent volatility in the Euro deserves close monitoring.

Tuning to Brexit headlines. The UK opposition leader Corbyn has confirmed what had been well flagged namely that the Labour party’s supports staying in a customs union with the EU post Brexit and is calling for cross party support. This is contrary to the government’s position, which issued a statement later to indicate “the government will not be joining a customs union…we want to have the freedom to sign our trade deals”. Elsewhere, Mr Corbyn reiterated there was no need for a second referendum on Brexit but does want a meaningful vote in Parliament at the end of the Brexit negotiations. Looking ahead, the EU is expected to publish a draft Brexit treaty on Wednesday and PM May will outline her vision of Brexit this Friday. Staying in Europe and delving into Italian credits a bit more, Michal Jezek in

my team published a report “IG Strategy: Credit Pricing Ahead of the Italian Elections”. He notes that sovereign credit has outperformed corporates YTD and hedging flows have turned CDS indices into major underperformers, pushing the CDS-bond basis to the extreme. The report also analyses the relative performance of Italian corporate credit. It concludes that iTraxx Europe indices now trade too cheap to be efficient hedges around the event and given the strong hedging flows, it suggests that current levels offer an attractive entry point for the strategic CDSbond basis compression trade recommended earlier. Refer to the full report here.

Finally, our US economists have built on their recent work on procyclical and acyclical inflation. Their new estimates of r-star (neutral funds rates) derived from procyclical inflation are about 20bps higher than estimates derived from core inflation, as is standard with r-star estimates. This implies that the Fed has even further to hike before getting to neutral than commonly assumed. That said, they view their analysis as evidence which makes them more confident in their current outlook for four rate hikes in 2018 and a terminal rate above 3%.

Before we take a look at today’s calendar, we wrap up with other data releases from yesterday. In the US, the February Dallas Fed manufacturing index was above market at 37.2 (vs. 30 expected) and the highest since December 2005. The January Chicago Fed National activity index was below expectations but still above 0 at 0.12 (vs. 0.25 expected). Elsewhere, the January new home sales fell 7.8% mom to the lowest since August (593k vs. 647k  expected). In the UK, the January Finance loans for housing was 40.1k (vs. 37k expected).

Looking at the day ahead, Germany’s flash February CPI and the Euro area’s January money supply prints are due. Then a range of February confidence indicators are due for the Euro area, France and Italy. In the US, the February Richmond Fed and CB consumer confidence index will be out. Further, a deluge of data including: January advanced goods trade balance, wholesale and retail inventories, durable and capital goods orders along with the December FHFA and S&P corelogic house price index are also due. Onto other events, the Fed’s Powell testifies in front of the House Financial services committee. Elsewhere, the ECB’s Weidmann and Mersch as well as BOE’s Sam Woods will speak. The Brookings Institution will host a conversation with the former Fed Governor Yellen and Bernanke. Finally, the EU negotiator Barnier will brief European affairs ministers.

3. ASIAN AFFAIRS

i)Late TUESDAY MORNING/MONDAY NIGHT: Shanghai closed DOWN 37.51 POINTS OR 1.13% /Hang Sang CLOSED DOWN 229.94 POINTS OR 0.73% / The Nikkei closed DOWN 236.23 POINTS OR 1.07%/Australia’s all ordinaires CLOSED UP 0.21%/Chinese yuan (ONSHORE) closed UP at 6.3120/Oil UP to 63.61 dollars per barrel for WTI and 67.25 for Brent. Stocks in Europe OPENED DEEPLY IN THE RED  .   ONSHORE YUAN CLOSED UP AT 6.3120 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED UP ON THE DOLLAR AT 6.3030 /ONSHORE YUAN TRADING WEAKER AGAINST OFFSHORE YUAN/ONSHORE YUAN TRADING STRONGER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING MUCH STRONGER AGAINST THE DOLLAR AND ALL OTHER CURRENCIES. CHINA IS NOT  HAPPY TODAY (STRONGER CURRENCY BUT WEAKER MARKETS) 

3 a NORTH KOREA/USA

/NORTH KOREA

end
 

3 b JAPAN AFFAIRS

c) REPORT ON CHINA

4. EUROPEAN AFFAIRS

8. EMERGING MARKET

 end

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

Euro/USA 1.2316 UP .0092/ 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 ALL IN THE RED 

USA/JAPAN YEN 106.96 DOWN  0.109 (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/DEADLY UNWINDING OF YEN CARRY TRADE

GBP/USA 1.3948 DOWN .0015(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 1.2695 UP .0010 (CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA)

Early THIS TUESDAY morning in Europe, the Euro ROSE by 2 basis points, trading now ABOVE the important 1.08 level RISING to 1.2316; / Last night Shanghai composite CLOSED DOWN 37.51  OR 1.13% /   Hang Sang CLOSED DOWN 229.94 POINTS OR 0.73%  /AUSTRALIA CLOSED UP 0.21% / EUROPEAN BOURSES DEEPLY IN THE RED  

The NIKKEI: this TUESDAY morning CLOSED DOWN 236.23 POINTS OR 1.07%

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

2/ CHINESE BOURSES / : Hang Sang CLOSED DOWN 229.94 POINTS OR 0.73%  / SHANGHAI CLOSED DOWN 37.51 OR 1.15%   /

Australia BOURSE CLOSED UP 0.21% /

Nikkei (Japan)CLOSED DOWN 236.23 POINTS OR 1.07%

INDIA’S SENSEX  IN THE RED

Gold very early morning trading: 1332.60

silver:$16.62

Early TUESDAY morning USA 10 year bond yield: 2.8715% !!! UP 1  IN POINTS from MONDAY night in basis points and it is trading WELL ABOVE resistance at 2.27-2.32%. (POLICY FED ERROR)/ VERY DEADLY

The 30 yr bond yield 3.1613 UP 1 IN BASIS POINTS from MONDAY night. (POLICY FED ERROR)/DEADLY

USA dollar index early TUESDAY morning: 89.88 UP 3  CENT(S) from MONDAY’s close.

This ends early morning numbers TUESDAY MORNING

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And now your closing TUESDAY NUMBERS \1 PM

Portuguese 10 year bond yield: 2.015% UP2  in basis point(s) yield from MONDAY/

JAPANESE BOND YIELD: +.0.047% DOWN 0    in basis points yield from MONDAY/JAPAN losing control of its yield curve/

SPANISH 10 YR BOND YIELD: 1.569% UP 1  IN basis point yield from MONDAY/

ITALIAN 10 YR BOND YIELD: 2.015 DOWN 0 POINTS in basis point yield from MONDAY/

the Italian 10 yr bond yield is trading 44 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: +.679%  UP 2  IN BASIS POINTS ON THE DAY

END

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IMPORTANT CURRENCY CLOSES FOR TUESDAY

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

Euro/USA 1.2213 DOWN.0083 (Euro DOWN 83 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 107.39 UP 0.327 Yen DOWN 33 basis points/

Great Britain/USA 1.3903 DOWN .0057( POUND DOWN 57 BASIS POINTS)

USA/Canada 1.2751 UP  .0066 Canadian dollar DOWN 66 Basis points AS OIL FELL TO $62.91

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This afternoon, the Euro was DOWN 83 to trade at 1.2231

The Yen FELL to 107.39 for a LOSS of 33 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 57 basis points, trading at 1.3903/

The Canadian dollar FELL by 66 basis points to 1.2751/ WITH WTI OIL FALLING TO : $62.96

The USA/Yuan closed AT 6.3170
the 10 yr Japanese bond yield closed at +.047%  DOWN 0  BASIS POINTS / yield/
Your closing 10 yr USA bond yield UP 6 IN basis points from MONDAY at 2.917% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 3.1929  UP 5  in basis points on the day /

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

Your closing USA dollar index, 90.41 UP 55 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 TUESDAY: 1:00 PM EST

London: CLOSED DOWN 7.13 POINTS OR 0.10%
German Dax :CLOSED DOWN 36.31 POINTS OR 0.29%
Paris Cac CLOSED DOWN 0.33 POINTS OR 0.01%
Spain IBEX CLOSED DOWN 2.20 POINTS OR 0.02%

Italian MIB: CLOSED  UP 18.25 POINTS OR 0.08%

The Dow closed DOWN 299.24 POINTS OR 1.16%

NASDAQ WAS UP 94.11 Points OR 1.23% 4.00 PM EST

WTI Oil price; 62.96 1:00 pm;

Brent Oil: 66.61 1:00 EST

USA /RUSSIAN ROUBLE CROSS: 56.24 UP 59/100 ROUBLES/DOLLAR (ROUBLE LOWER BY 59 BASIS PTS)

TODAY THE GERMAN YIELD FALLS TO +.679% 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:$62.82

BRENT: $66/48

USA 10 YR BOND YIELD: 2.8930%   THIS RAPID ASSENT IN YIELD IS VERY DANGEROUS/DERIVATIVES START TO BLOW UP/ dangerous/stays extremely high in yield/

USA 30 YR BOND YIELD: 3.1588%/BROKE GUNDLACH’S KEY 3.00% AGAIN WHERE ALL VALUATIONS ON STOCKS BLOW UP/ VERY DEADLY

EURO/USA DOLLAR CROSS: 1.2232 down.0082  (down 82 BASIS POINTS)

USA/JAPANESE YEN:107.34 UP 0.276/ YEN down 28 BASIS POINTS/ very dangerous as yen carry traders are getting killed/yen continues to rise despite the NYSE rising.

USA DOLLAR INDEX: 90.38 up 53 cent(s)/dangerous as the lower the dollar the higher the inflation.

The British pound at 5 pm: Great Britain Pound/USA: 1.3903 : UP 0.0061  (FROM LAST NIGHT DOWN 61 POINTS)

Canadian dollar: 1.2769 DOWN 84 BASIS pts

German 10 yr bond yield at 5 pm: +0.679%


VOLATILITY INDEX:  18.59  CLOSED  up   2.79  

END

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

TRADING IN GRAPH FORM FOR THE DAY

Hawkish’ Powell Sinks Stocks & Bonds As VIX Curve Re-Inverts

Just when you thought it was all over…

Quite a chaotic day across asset-classes today – the most chaotic since the XIV crisis moves…

Once Powell had finished his prepared remarks and confidently expressed his expectations for the economy (and rate hikes), stocks tumbled (as rates spiked)…

Only The Dow managed to hold on to yesterday’s gains…

Nasdaq managed to get back into the green for the month but slipped notably lower all day…

DOW stalled at a 75% retracement of its losses…

All of which leaves stocks lower for February and unless tomorrow sees a heroic panic-bid in the S&P, will break the unprecedented 15-month win streak… although that hanging-man candle for Feb is stunning…

VIX jumped notably on the day…

Having shifted back into contango yesterday for the first time since the crisis, the VIX term structure snapped back into backwardation (inverted) today following Powell’s hawkish comments…

All major US Equity index ‘VIX’ measures are once again higher for the month of Feb…

Treasury yields spike today on Powell’s relatively hawkish comments… then rallied back lower in yields as stocks tumbled.

Notably 10Y Yields tested the CPI/FOMC highs before fading this afternoon as stocks sank on infrastructure headlines…

As Treasury yields spiked during Powell’s testimony, Breakevens slipped lower after recoupling from the early Feb chaos…

The entire curve shifted in parallel on Powell but then 2s30s really started to flatten…

The Dollar Index spiked during Powell’s testimony, running stops above last week’s FOMC Minutes highs…

Commodities all tanked together as the dollar spiked…

Nasdaq and Bitcoin recoupled…

With Bitcoin stabilizing above $10,000…

Finally,  we note that US macro economic surprise data has tumbled to its lowest since October… are stocks about to catch back down?

END

Morning trading:

(zerohedge)

Stocks Sink As ‘Hawkish’ Powell “Sees Some High Prices”, Raises Economic Assessment

Echoing The Fed’s Outlook report, Fed Chair Jay Powell warned Congress in the Q&A this morning that he “sees some high prices.”

Ahead of Fed Chair Powell’s first semi-annual monetary policy report to Congress next week (brought forward to 2/27), The Fed has released his prepared remarks warning that “valuations are still elevated across a range of asset classes” and fears “signs of rising non-financial leverage.”

Stocks pushed towards the lows of the day after his comment, not helped by his additional hawkish comment that he has strengthened his outlook for the economy since December…

All major indices are now in the red since Powell began his testimony…

Treasury yields and the dollar are now spiking…

2Y Treasury yields are spiking…

As the market confirms The Fed’s 3 rate-hike scenario…

endMnuchin is wrong in that investors should be worried about rising inflation.  Just take a look at rising transportation cost of goods
(courtesy zerohedge)

Mnuchin’s Wrong: Here’s Why Investors Should Be Very Worried About Inflation

Despite Treasury Secretary Steven Mnuchin’s bizarre insistence that there’s no connection between consumer-price inflation and rising energy prices and wages, these factors – plus a spate of others – are forcing some food companies to consider raising prices on goods from chicken to cereal, according to Reuters.

One of these factors, as Reuters explores in a wide-ranging feature published on Monday, involves US trucking and railroad operators foisting higher shipping rates on customers like General Mills Inc. and Hormel Foods Corp.

According to Reuters, transportation costs are climbing at double the rate of inflation.

Pricing

These increases are catching food companies off guard. Struggling railroads and trucking companies haven’t expanded their capacity, choosing instead to focus on cost cuts – much to Wall Street’s delight.

Interviews with executives at 10 companies across the food, consumer goods and commodities sectors reveal that many are grappling with how to defend their profit margins as transportation costs climb at nearly double the inflation rate.

Two executives told Reuters their companies do plan to raise prices, though they would not divulge by how much. A third said it was discussing prospective price increases with retailers.

The prospect of higher prices on chicken, cereal and snacks costs comes as inflation emerged as a more distinct threat in recent weeks. The U.S. Labor Department reported earlier this month that underlying consumer prices in January posted their biggest gain in more than a year.

As US economic growth has revved up, railroads and truck fleets have not expanded capacity to keep pace – a decision applauded by Wall Street. Shares of CSX Corp, Norfolk Southern, and Union Pacific Corp have risen an average 22 percent over the past year as they cut headcount, locomotives and rail cars, and lengthened trains to lower expenses and raise margins.

Quickening economic growth, a shortage of drivers and reduced capacity, and higher fuel prices have driven up transportation costs, prompting some companies to threaten to raise prices on goods ranging from chicken to cereal.

So far, Reuters has confirmed that Cream of Wheat maker B&G Foods Inc, Cheerios maker General Mills and Tyson Foods Inc, owner of Hillshire Farms brand and Jimmy Dean sausage, are planning to pass along higher freight costs to their customers. Many see these increases taking place during the coming months.

Tyson Chief Executive Officer Tom Hayes told Reuters in an interview that its price increases ”should be in place for the second half” of its fiscal year, and that it has begun negotiating price increases with retailers and food service operators. The company declined to specify how much its freight costs increased in recent months, but a spokesman said they are up between 10 to 15 percent for the total industry.

General Mills informed convenience store and food service customers of the price increases directly, a spokeswoman told Reuters in an emailed statement, declining to provide specifics. Chief Executive Officer Jeff Harmening cited logistic costs and wage inflation as factors.

“It feels to me like an environment that should be beneficial for some pricing,” he said in a presentation at last week’s Consumer Analyst Group of New York conference.

Hormel Foods, the maker of Skippy peanut butter and SPAM, has been talking with retailers about raising prices, according to Chief Executive Jim Snee.

“We don’t believe we’re going to recoup all of our freight cost increases for the balance of the year,” Snee told Reuters in an interview, noting operating margin sank to 13.2 percent, from 15.6 percent due to higher costs – including freight – in the most recent quarter.

Of all the factors contributing to these cost increases, the paucity of qualified truck drivers is also leading to production disruptions and delays at some of the country’s largest food-processing plants.

Confectionary and snack company Mondelez International Inc halted operations over a weekend late last month at its Toledo, Ohio wheat flour mill – the second-largest flour mill in the United States – because the plant could not get enough rail cars to carry flour to bakeries, a spokeswoman said.

She declined to comment on whether Mondelez would raise prices to cover any higher costs.

A new government regulation for drivers and truck availability are pushing up freight costs at JM Smucker Co. “We anticipate inflationary pressures likely to cause upward price movements in a variety of categories,” Chief Financial Officer Mark Belgya said last week at an analyst conference.

To be sure, transportation costs are just a sliver of the price consumers pay at the grocery store. The U.S. Department of Agriculture estimates transportation represents just 3.3 cents of every dollar consumers spend.

But an increase in truck rates over the next 12 months implies a 15-to-18 basis point gross margin headwind for U.S. food companies on average, according to Bernstein analyst Alexia Howard.

“A lot of the consumer goods companies work on margin,” said Joe Glauber, a former USDA Chief Economist and a senior research fellow at the International Food Policy Research Institute. “They are going to be pushing those costs along” to retailers. Ultimately “consumers end up shouldering more of the burden,” he said.

That would be a change for consumers who have seen years of low-to-negative food inflation, he noted.

While prices for most agricultural commodities remain near cycle lows, rising oil prices are contributing both to higher transportation costs while also raising the price of plastics used in packaging.

Shipping

This trend has forced many food brands and commodity producers to lower their full-year earnings forecasts.

Some are blaming CSX and Norfolk Southern for unfairly trying to squeeze “every last dollar” of profit out of their customers.

Global energy prices have risen sharply from 2016’s lows, driving up prices for not only diesel but also packing material like plastics, which are byproducts of crude and natural gas.

Others companies have blamed freight hikes for lower earnings forecasts for 2018, including US oilfield services company Halliburton Co. It shaved ten cents per share from its earnings forecast last week due to delays in deliveries of sand used in fracking.

“They try to squeeze every dollar for profit rather than provide service,” said Robert Murray, the chief executive of Murray Energy Corporation, the largest privately-owned U.S. coal company which relies on CSX and Norfolk Southern to help transport its goods.

Murray said both CSX and Norfolk Southern have lacked rail cars and crew to haul 4 million tons of coal from mines in West Virginia and Ohio to the Port of Baltimore this year.

Despite worsening train speeds, Norfolk Southern has no plans to hire more employees or move some of its equipment out of storage. However, Union Pacific plans to rehire 500 employees in the first quarter to prevent rail cards from idling too long.

Earhart said the railroad was moving some employees to problem spots, like its terminal in Birmingham, Alabama, from other areas of its network.

Union Pacific has started pulling stored locomotives back into service and plans to bring back 600 employees in the first quarter 2018 to prevent rail cars from spending too much time in yards, said Union Pacific spokeswoman Raquel Espinoza.

The time UP rail cars were sitting idle in terminals rose to 32.5 hours in the fourth quarter from 29 hours in the year-ago period, and its overall workforce dropped during the last two quarters, according to company data.

Berkshire Hathaway’s BNSF said winter weather has impacted velocity and fluidity on portions of its primary route between the Pacific Northwest and Midwest, but said it has not been cutting crews and rolling stock.

Another factor that’s prevented trucking companies from expanding is a federal regulation that requires drivers to electronically log their hours. This, Reuters said, has turned off many drivers, who aren’t willing to drive – and shoulder these extra responsibilities – for the wages being offered.

Shipping

This would suggest that many trucking firms will soon be forced to raise wages – another cost that will likely be passed along to customers.

And because of the tightening capacity, trucking firms have additional leverage as they negotiate rates.

Tight capacity means trucking firms have leverage as they negotiate freight rates. Dry van shipping rates are expected to rise as much as 10 percent in 2018, while “spot” rates for last-minute cargo hit record levels in January before falling slightly, according to online freight marketplace DAT Solutions.

Chemical maker Chemours Company estimates 30 percent of its rail shipments have highly unpredictable delivery times, while automaker Toyota Motor Corp has struggled periodically to get rail cars for finished vehicles at plants served by the major railroads.

“If I was to ask for anything, it’s consistency,” said Lee Hobgood, general manager of Toyota’s transportation operations. “I am not feeling cuts. I am feeling imbalance at times.”

Agribusiness giant Cargill declined to quantify how much its freight costs are going up and whether it would pass costs on to its customers. But at a soybean processing plant near Lafayette, Ind., Cargill has had such long delays getting loaded railcars moved out, the company plans to buy its own Trackmobile railcar mover to relieve the congestion. One Trackmobile unit can cost at least $250,000.

Brad Hildebrand, Cargill’s Global Rail and Barge Lead, told Reuters the Lafayette plant otherwise could shut down.

“When we load a train at one of our eastern elevators it sits for an extended period of time before locomotive power and crews can come in,” Hildebrand said. “There is no slack in the system to handle weather problems or even a small uptick in demand.”

Increasingly inconsistent delivery times are a huge problem for companies hoping to sell their goods at Wal-Mart, the country’s largest brick-and-mortar retailer is punishing trucking companies by charging them additional fees.

In summary, higher energy prices and dwindling workforces are pushing up costs for shipping companies. These costs are, in turn, being passed along to their clients – the big food processors and commodity producers.

How much longer will it be before these companies turn around and hike prices on the consumer?

END

Looks like the uSA economy turned on a time during January. This time it is durable good orders that have tumbled

(courtesy zerohedge)

Durable Goods Orders Tumble In January

Durable goods orders slumped unexpectedly in January – dropping 3.7% MoM (vs a 2.0% expected decline), and worse still, December’s bounce was revised lower as the ‘uneven-ness’ of the so-called recovery rears its ugly head once again.

The uglier picture here is that January’s plunge is not a reflection of a one-off December surge (in aircraft or defense orders) as we have seen previously.

Core durable goods orders dropped for the first time in 7 months…

Non-Defense new orders also declined MoM.

end

Wholesale inventories show a huge build and this should signal a big Q1 boost for GDP.  Problem: how could inventories surge and orders plummet?

(courtesy zerohedge)

Wholesale Inventories Build Most In 3 Years, Signal Q1 GDP Boost

Wholesale Inventories rose 4.5% YoY in January – the biggest annual build since June 2015 – as it appears the nation’s businesses are embracing the ‘field of dreams’ economy.

The 0.7% MoM rise in inventories is almost double expectations.

This better than expected inventory build will likely force an upside adjustment to Q1 GDP guesses (though Durable Goods disappointment may offset that).

And while we are reflecting on Q1 – is it not somewhat off-putting that inventories surged but orders tumbled in January?

end
As promised, the Atlanta Fed forecasting for 1st quarter GDP has plunged. You will recall that it started at 5.4%. It is now at 2.6% and will falter again until the final numbers are released in June
(courtesy zerohedge)

Atlanta Fed GDP Forecast Plunges Below Consensus, Growth Halved In A Month

On February 1st, The Atlanta Fed’s GDPNOW model forecast Q1 GDP growth in the US economy would be 5.4%… and the world (on the right) celebrated.

As a reminder, that was the highest GDP forecast by the Atlanta Fed going back to Q1 2012:

We warned at the time that GDPNOW tended to drift lower after an exuberant open… and sure enough, less than a month later, things have gone downhill fast!

As of today, the latest forecast from The Atlanta Fed is just 2.6% GDP growth – a 52% tumble in expectations since the start of the month…

After this morning’s Advance Economic Indicators and durable manufacturing reports from the U.S. Census Bureau, the nowcasts of the contributions of real nonresidential equipment investment and real inventory investment to first-quarter real GDP growth declined from 0.45 percentage points and 1.20 percentage points, respectively, to 0.37 percentage points and 0.95 percentage points, respectively. The nowcast of first-quarter real residential investment growth declined from 0.6 percent on February 16 to -4.5 percent on February 26 after housing market releases from the Census Bureau and the National Association of Realtors.

And now below the concensus blue-chip estimate.

None of this should be a surprise – as this has been the pattern of the GDPNOW model’s trajectory for multiple years – and in fact this level of GDP growth is equal to the growth seen in Q1 2017 on its way to new lows…

 END
Powell’s first report to the House is hawkish as he ignores recent volatility.  He states that rate hikes will continue on course
(courtesy zerohedge)

Powell Hawkish Highlights: Ignore Recent Volatility, Gradual Rate Hikes Will Continue

In advance of his first testimony before the House at 10am today, Fed Chair Jay Powell released his prepared remarks moments ago, as “some of the headwinds the U.S. economy faced in previous years have turned into tailwinds” and that the Fed can continue gradually raising interest rates as the outlook for growth remains strong, as and the recent bout of financial volatility shouldn’t weigh on the U.S. economy.

Commenting on Trump’s tax reform and policies, Powell said that “fiscal policy has become more stimulative and foreign demand for U.S. exports is on a firmer trajectory.” He also glossed over the recent bout of volatility, “saying financial conditions remain accommodative.” At the same time, he noted that “inflation remains below our 2 percent longer-run objective. In the FOMC’s view, further gradual increases in the federal funds rate will best promote attainment of both of our objectives. As always, the path of monetary policy will depend on the economic outlook as informed by incoming data.”

Of particular interest to markets will be Powell’s commentary on recent market events, which Powell is not too worried about: “After easing substantially during 2017, financial conditions in the United States have reversed some of that easing. At this point, we do not see these developments as weighing heavily on the outlook for economic activity, the labor market, and inflation. Indeed, the economic outlook remains strong.

Looking forward, Powell said that “in gauging the appropriate path for monetary policy over the next few years, the FOMC will continue to strike a balance between avoiding an overheated economy and bringing PCE price inflation to 2 percent on a sustained basis.”

Also notable is his conviction that “the economic outlook remains strong” because “the robust job market should continue to support growth in household incomes and consumer spending, solid economic growth among our trading partners should lead to further gains in U.S. exports, and upbeat business sentiment and strong sales growth will likely continue to boost business investment.”

The Fed chair also said that “we anticipate that inflation on a 12-month basis will move up this year and stabilize around the FOMC’s 2 percent objective over the medium term,’’ and added that the lag in wages during the expansion was due to low gains in output per hour, or productivity, though a new wave of investment spending “should support higher productivity growth in time.’’

Wages should increase at a faster pace as well,’’ Powell said, adding that the FOMC continued to view the shortfall in inflation last year “as likely reflecting transitory influences that we do not expect will repeat.’’

While getting little attention lately, the Fed’s balance sheet runoff continues, and as Powell claims “that program has been proceeding smoothly. These interest rate and balance sheet actions reflect the Committee’s view that gradually reducing monetary policy accommodation will sustain a strong labor market while fostering a return of inflation to 2 percent.”

Finally, on the topic of transition from Yellen to Powell, the new Fed chair explained that “Chair Yellen and I have worked to ensure a smooth leadership transition and provide for continuity in monetary policy.

* * *

Overall, a modestly hawkish commentary, with optimistic tone on wages and inflation, while lacking concern about market volatility and the recent market correction, hinting that as long as “outlook remains strong”, rate hikes will continue, although as some banks have noted, there is “far from a strong endorsement of 4 rate hikes” instead Powell promising data-dependence and that the “path of monetary policy will depend on the economic outlook as informed by incoming data.”

His full testimony is below:

end

this one takes the cake:  Fed’s Powell admits that the USA is not on a sustainable fiscal path due to the huge level of debt built up.  After the Dow initially plunged, it rebounded on that news

(courtesy zerohedge)

Fed Chair Admits “US Is Not On A Sustainable Fiscal Path”

Less than a week after Dallas Federal Reserve Bank President Robert Kaplan sounded the alarm over the level of debt that America’s government is projected to carry, Fed Chair Jay Powell told Congress today that “the US is not on a sustainable fiscal path.”

Treasury yields were already spiking…

Echoing the recent Goldman analysis, which warned that the recently implemented Republican spending plan could lead to an “unsustainable” debt load, Kaplan predicted the US fiscal future beyond 2 years: he said that while the corporate tax cuts and other reforms may boost productivity and lift economic potential, most of the stimulative effects will fade in 2019 and 2020, leaving behind an economy with a higher debt burden than before.

“This projected increase in government debt to GDP comes at a point in the economic cycle when it would be preferable to be moderating the rate of debt growth at the government level,” Kaplan said.

And now Fed Chair Powell is confirming that view.

However, as we pointed out previously, this sudden Fed anxiety comes nearly a decade after the US unleashed its biggest debt-issuance binge in history, doubling the US debt from $10 trillion to $20 trillion under president Obama, which was only made possible thanks to the Fed’s monetization of $4 trillion in deficits (and debt issuance).

To summarize Kaplan’s and Powell’s view: when US debt doubled in the past decade the Fed had no problems, and in fact enabled it. And now, it’s time to panic…

And stocks rallied on this headline…

Presumably since any “unsustainable” fiscal collapse would force an ‘independent’ Fed to monetize moar and moar and save the world… again?

Interesting: soft data Consumer confidence soars despite stock market hope plunging

(courtesy zerohedge)

Consumer Confidence Surges To 2000 Highs But Stock Market Hope Plunges

Conference Board Consumer Confidence measures beat expectations handily in February with headline data at its best since Nov 2000.

However, while investors are increasingly sure of higher interest rates, hopes for a higher stock market plunged from record highs.

This is the biggest monthly drop in bullish investor stock market expectations since March 2007.

“Consumer confidence improved to its highest level since 2000 (Nov. 2000, 132.6) after a modest increase in January,”said Lynn Franco, Director of Economic Indicators at The Conference Board.

“Consumers’ assessment of current conditions was more favorable this month, with the labor force the main driver. Despite the recent stock market volatility, consumers expressed greater optimism about short-term prospects for business and labor market conditions, as well as their financial prospects. Overall, consumers remain quite confident that the economy will continue expanding at a strong pace in the months ahead.

The proportion expecting more jobs in the months ahead increased from 18.7 percent to 21.6 percent, while those anticipating fewer jobs declined from 12.5 percent to 11.9 percent.

end

SWAMP STORIES

A joke:  Schiff hints that Mueller’s next indictment will implicate Trump’s team

(courtesy zerohedge)

Schiff Hints Mueller’s Next Indictment To Implicate Trump Team

Special Counsel Robert Mueller’s indictment of 13 Russian nationals earlier this month can only mean one thing according to Rep. Adam Schiff (D-CA): there’s more to come.

Speaking with MSNBC’s Chris Hayes, Schiff – the ranking minority leader on the House Intelligence Committee, suggested that because Mueller was so extraordinarily detailed in his indictment of the 13 Russians, the Special Counsel’s office must be saving all the evidence of collusion pertaining to the DNC hack for the next indictment.

Schiff points to the fact that there was “ample evidence” of Russia hacking the DNC, which – because Mueller didn’t include any of it in the “troll farm” indictment, obviously means things are just heating up. “And the key question there is: Is that going to involve Russian figures alone or are there going to be U.S. persons implicated as well?” posits Schiff.

Earlier this month, Schiff told reporters at a newsmaker breakfast hosted by the Christian Science Monitor “There is already, in my view, ample evidence in the public domain on the issue of collusion if you’re willing to see it.” Schiff also said there is evidence — heard by the committee behind closed doors —that he can’t talk about publicly because it remains classified.

Adam Schiff Thinks The Next Mueller Indictments Will Implicate Team Trump

One thing I found striking about the indictment of these 13 Russians, aside from the fact of the extraordinary detail, and that is what is not included in the indictment. And that is the whole Russian hacking of these documents, the dumping of this information was not a part of that indictment. Now there is ample evidence for Bob Mueller to have included it. I can only conclude from the fact it was left out that Bob Mueller wants that to be part of a separate indictment. And the key question there is: Is that going to involve Russian figures alone or are there going to be U.S. persons implicated as well? –Adam Schiff

Of course, the evidence of all that Russian hacking was compiled by discredited cybersecurity firm, Crowdstrike, which was the only group allowed to analyze the hacked servers – while the FBI was told to buzz off. Perhaps Mueller’s team doesn’t feel confident using the independent report. One would think, however, that perhaps just one of the “17 intelligence agencies” which Hillary Clinton claims verified the hack could provide Mueller’s team with a little assist – or not, considering that it turns out only three agencies were involved in that assessment.

NYT issues a correction repudiating the “17 intelligence agencies” canard that continues to get endlessly repeated https://www.nytimes.com/2017/06/25/us/politics/trumps-deflections-and-denials-on-russia-frustrate-even-his-allies.html?_r=0 

Also, you can’t transfer files at 23 MB/s over the internet – at least not in the United States. That’s more of an “insider with a memory stick” kinda thing.

Let me assure you, the DNC hack wasn’t even a hack. It was an insider with a memory stick. I know this because I know who did it and why. Special Counsel Mueller is not interested in my evidence. My lawyers wrote to him twice. He never replied. 360 pounds!https://www.google.com/amp/s/amp.smh.com.au/world/us-election/dnchack-did-kim-dotcom-warn-the-world-about-the-democratic-party-hacking-20160622-gpp15a.html https://twitter.com/realdonaldtrump/status/965202556204003328 

Did Kim Dotcom warn the world about the DNCHack?

Megaupload boss Kim Dotcom said in 2015 that he knew of information that was going to create an obstacle for Hillary Clinton’s 2016 presidential election bid.

smh.com.au

Perhaps Mueller doesn’t want to open that can of worms?

Shiff also failed to mention Mueller’s takedown of Paul Manafort and his right hand man Rick Gates on money laundering and fraud charges unrelated to the Trump campaign. Gates flipped on Manafort last week, changing his plea from not guilty to guilty on two charges; lying to Mueller’s team, and “impeding, impairing, obstructing and defeating” the DOJ and Treasury.

Thus, it seems that Mueller having gone from indicting Trump’s campaign manager, to indicting 13 Russian internet trolls “with a shaky grasp of English and a rudimentary understanding of U.S. politics shitposting on Facebook,” doesn’t bode well for Schiff’s prediction.

END

Donald is not going to like this; Kushner loses access to top secret intelligence

(courtesy zerohedge)

Jared Kushner Loses Access To Top Secret Intelligence

In a move that represents a serious blow to Trump son-in-law Jared Kushner’s standing in the West Wing, Politico reports that all White House aides working on the highest-level interim security clearance were informed on Friday that they will have their clearance downgraded from “Top Secret/SCI-level” to “secret” – walling them off from the most sensitive information.

Kushner

Many had expected that Trump would grant Kushner a waiver, even though Trump himself said Friday that he would let Chief of Staff John Kelly decide if such an exception should be granted. Friday’s memo was not signed by Kelly.

The decision is the first major shakeup since the dismissal of former White House staff secretary Rob Porter, who was exposed for abusing both of his ex-wives. The FBI insinuated that it had informed the White House of Porter’s conduct, appearing to contradict a timeline of events initially offered by Kelly.

The White House has been reticent about the downgrade:

White House press secretary Sarah Huckabee Sanders declined to comment on Kushner’s clearance status at a briefing Tuesday.

“We actually haven’t commented on Jared’s issue indicated, but we have commented on his ability to do his job. Which, he’s a valued member of the team and he will continue to do the important work that he’s been doing since he’s started in the administration.”

Kushner’s attorney said the downgrade wouldn’t impact Kushner’s ability to continue to do his job.

Kushner’s attorney Abbe Lowell said in a statement that Kushner “has done more than what is expected of him in this process.”

Lowell added that the changes would “not affect Mr. Kushner’s ability to continue to do the very important work he has been assigned by the president.”

Indeed, media reports indicated that White House staffers were already exploring workarounds to help Kushner continue to handle his sizable West Wing portfolio – which includes several sensitive foreign policy issues – without having a top-level security clearance. Kelly also issued a statement last week saying any changes to security clearance wouldn’t impact Kushner’s ability to do his job.

“As I told Jared days ago, I have full confidence in his ability to continue performing his duties in his foreign policy portfolio including overseeing our Israeli-Palestinian peace effort and serving as an integral part of our relationship with Mexico,” Kelly said in the statement.

The decision to downgrade staff still working on interim clearances indicates that Kelly is prepared to impose the same sort of discipline on the White House clearance process that he has tried to impose on the West Wing staff more broadly, Politico said.

“The American people deserve a White House staff that meets the highest standards and that has been carefully vetted – especially those who work closely with the president or handle sensitive national security information,” Kelly told colleagues in a memo circulated on Feb. 16. “We should – and in the future, must – do better.”

But no matter what workarounds the White House staff come up with, the fact remains that Kushner will no longer be able to sit in on his father-in-law’s daily intelligence briefings, and myriad other meetings to which he previously had unfettered access.

It’s hard to believe this change won’t severely limit the influence he has on the president – even if he retains his senior advisor position.

 END
I will  see you WEDNESDAY night

HARVEY

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One comment

  1. HARVEY YOUR STUPID EXCUSES FOR GOLD DROPPING ARE ANNOYING gold is a dead asset that no one wants silver neither and it just KEPPS GOING DOWN for any old reason……options expired last week not today today was the JEROME POWELL excuse tommorrow there will be another ans next week as well…..another useless website HARVEYORGAN BLOG that shoudl be shut down or hacked witha good virus for fake useless news

    Like

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