March 1/HUGE OUTSIDE DAY REVERSAL FOR BOTH GOLD AND SILVER/GOLD DOWN $12.30 TO $1303.40 AT COMEX CLOSING BUT RECOVER ALL AT ACCESS CLOSING/SILVER DOWN 11 CENTS TO $16.27 COMEX CLOSING AND REBOUNDS TO RECOVER OF THOSE LOSSES AT ACCESS CLOSING/DOW JONES FALLS ANOTHER 420 POINTS/ CHINA GIANT HNA TO LAY OFF 100,000 JOB WORKERS/TRUMP INITIATES HUGE TARIFFS ON STEEL AND ALUMINUM/CHINA , SOUTH KOREA AND EUROPE REACT WITH POSSIBLE TRADE WARS/WPP, LARGEST ADVERTISING COMPANY IN THE WORLD FALTERS 15% ON LOW GROWTH/POOR EARNINGS/POWELL FLIP FLOPS AND DUDLEY STATES THAT THE RATE HIKES WILL BE GRADUAL AND THAT SINKS THE DOW/MORE SWAMP STORIES/

 

 

GOLD: $1304.40 down $12.30

Silver: $16.27 down11 cents

Closing access prices:

Gold $1317.00

silver: $16.48

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: $1323.53 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME: $1315.140

PREMIUM FIRST FIX: $8.13

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SECOND SHANGHAI GOLD FIX: $1318.13

NY GOLD PRICE AT THE EXACT SAME TIME: $1314.40

PREMIUM SECOND FIX /NY:$3.73

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LONDON FIRST GOLD FIX: 5:30 am est $1311.25

NY PRICING AT THE EXACT SAME TIME: $1311.20

LONDON SECOND GOLD FIX 10 AM: $1307.95

NY PRICING AT THE EXACT SAME TIME. $1307.70

For comex gold:

MARCH/

NUMBER OF NOTICES FILED TODAY FOR MARCH CONTRACT: 0 NOTICE(S) FOR NIL OZ.

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

For silver:

MARCH

351 NOTICE(S) FILED TODAY FOR

1,755,000 OZ/

Total number of notices filed so far this month: 3858 for 19,290,000 oz

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Bitcoin: BID $10,634/OFFER $10,713: UP $365(morning)

Bitcoin: BID/ $10,965/offer $11,040: UP $695  (CLOSING/5 PM)

 

end

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 1333 contracts from 193,343  FALLING TO 192,010 DESPITE  YESTERDAY’S TINY 5 CENT FALL IN SILVER PRICING.  WE HAD SOME COMEX LIQUIDATION. HOWEVER, WE WERE AGAIN NOTIFIED THAT WE HAD ANOTHER STRONG SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP ROUTE:  0 EFP’S FOR MARCH AND AND 1849 EFP’S FOR MAY AND ZERO FOR ALL  OTHER MONTHS  AND THUS TOTAL ISSUANCE OF 1849 CONTRACTS.  WITH THE TRANSFER OF 1849 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 1849 CONTRACTS TRANSLATES INTO 9.245 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 MARCH:

1849 CONTRACTS (FOR 1 TRADING DAYS TOTAL 1849 CONTRACTS OR 9.245 MILLION OZ: AVERAGE PER DAY: 1849 CONTRACTS OR 9.245 MILLION OZ/DAY

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH:  9.245 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 1.31% OF ANNUAL GLOBAL PRODUCTION

ACCUMULATION IN YEAR 2018 TO DATE SILVER EFP’S:  502.72 MILLION OZ.

ACCUMULATION FOR JAN 2018: 236.879 MILLION OZ

ACCUMULATION FOR MONTH OF FEBRUARY: 244.945 MILLION OZ

RESULT: WE HAD SOME LOSS  IN COMEX OI SILVER COMEX WITH THE 5 CENT LOSS IN SILVER PRICE.  WE ALSO HAD A GOOD SIZED EFP ISSUANCE OF 1849 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 1849 EFP’S  FOR  MONTHS MARCH AND MAY WERE ISSUED FOR  A DELIVERABLE FORWARD CONTRACT OVER IN LONDON WITH A FIAT BONUS.   WE GAINED  516 OI CONTRACTS i.e. 1849 open interest contracts headed for London (EFP’s) TOGETHER WITH A DECREASE OF 1333  OI COMEX CONTRACTS. AND ALL OF THIS HAPPENED WITH THE FALL IN PRICE OF SILVER OF 5 CENTS AND A CLOSING PRICE OF $16.38 WITH RESPECT TO YESTERDAY’S TRADING. YET WE STILL HAVE A FAIR AMOUNT OF SILVER STANDING AT THE COMEX.

In ounces AT THE COMEX, the OI is still represented by just UNDER 1 BILLION oz i.e. 0.960 BILLION TO BE EXACT or 137% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT FEBRUARY MONTH/ THEY FILED: 351 NOTICE(S) FOR 1,755,000 OZ OF SILVER

In gold, the open interest  FELL BY A CONSIDERABLE 5048 CONTRACTS FALLING TO 527,812 DESPITE THE TINY FALL IN PRICE OF GOLD WITH RESPECT TO YESTERDAY’S TRADING ($0.70). HOWEVER, IN ANOTHER DEVELOPMENT, WE RECEIVED THE TOTAL NUMBER OF GOLD EFP’S ISSUED FOR THURSDAY AND IT TOTALED AN HUGE SIZED  9,903 CONTRACTS OF WHICH  APRIL SAW THE ISSUANCE OF 9903 CONTRACTS AND  JUNE SAW THE ISSUANCE OF 0 CONTRACTS AND THEN ALL OTHER MONTHS ZERO.    The new OI for the gold complex rests at 527,812. 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 4855  CONTRACTS: 5048 OI CONTRACTS DECREASED AT THE COMEX AND A STRONG SIZED  9903 OI CONTRACTS WHICH NAVIGATED OVER TO LONDON.(4855 oi gain in CONTRACTS EQUATES TO 15.10TONNES)

YESTERDAY, WE HAD 13581 EFP’S ISSUED.

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF MARCH : 9903 CONTRACTS OR 990,300  OZ OR 30.802 TONNES (1 TRADING DAY AND THUS AVERAGING: 9903EFP CONTRACTS PER TRADING DAY OR 990,300 OZ/ TRADING DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS :   SO FAR THIS MONTH IN 1 TRADING DAY: IN  TONNES: 30.82 TONNES

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

THUS EFP TRANSFERS REPRESENTS 30.82/2200 x 100% TONNES =  1.40% OF GLOBAL ANNUAL PRODUCTION SO FAR IN MARCH ALONE.

ACCUMULATION OF GOLD EFP’S YEAR 2018 TO DATE:  1283.01 TONNES

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

ACCUMULATION OF GOLD EFP’S FOR FEBRUARY: 649.45 TONNES

Result: A  STRONG SIZED DECREASE IN OI AT THE COMEX DESPITE THE TINY FALL IN PRICE IN GOLD TRADING YESTERDAY ($0.70).  HOWEVER, WE HAD ANOTHER GOOD SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 9903 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 9903 EFP CONTRACTS ISSUED, WE HAD A NET GAIN IN OPEN INTEREST OF 4855 contractON THE TWO EXCHANGES:

9903 CONTRACTS MOVE TO LONDON AND  5048 CONTRACTS DECREASED AT THE COMEX. (in tonnes, the GAIN in total oi equates to 15.10 TONNES).

we had: 0 notice(s) filed upon for NIL oz of gold.

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

GLD

WITH GOLD DOWN $12.30 : a HUGE  CHANGE IN GOLD INVENTORY AT THE GLD OF GOLD INTO THE GLD/ A DEPOSIT OF 2.96 TONNES

Inventory rests tonight: 833.98 tonnes.

SLV/

WITH SILVER DOWN 11 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 1333  contracts from 193,343 DOWN TO 192,010 (AND now A LITTLE FURTHER FROM THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) WITH THE FALL  IN PRICE OF SILVER  (5 CENTS WITH RESPECT TO  YESTERDAY’S TRADING).   OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE ANOTHER 0 PRIVATE EFP’S FOR MARCH AND 1849 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  1333 CONTRACTS TO THE 1849 OI TRANSFERRED TO LONDON THROUGH EFP’S, WE OBTAIN A  GAIN OF 516  OPEN INTEREST CONTRACTS DESPITE THE RAID .  WE STILL HAVE A STRONG AMOUNT OF SILVER OUNCES THAT ARE STANDING FOR METAL IN MARCH (SEE BELOW). THE NET GAIN TODAY IN OZ ON THE TWO EXCHANGES:  2.580 MILLION OZ!!!

RESULT: A CONSIDERABLE SIZED DECREASE IN SILVER OI AT THE COMEX DESPITE THE TINY  FALL OF 5 CENTS IN PRICE (WITH RESPECT TO YESTERDAY’S TRADING ). BUT WE ALSO HAD ANOTHER GOOD 1849 EFP’S ISSUED TRANSFERRING COMEX LONGS OVER TO LONDON. TOGETHER WITH THE GOOD  SIZED AMOUNT OF SILVER OUNCES STANDING FOR MARCH, DEMAND FOR PHYSICAL SILVER INTENSIFIES AS WE WITNESS SEVERE BACKWARDATION IN SILVER IN LONDON.

(report Harvey)

.

2.a) The Shanghai and London gold fix report

(Harvey)

2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY: Bloomberg

3. ASIAN AFFAIRS

i)Late THURSDAY MORNING/WEDNESDAY NIGHT: Shanghai closed UP 14.34 POINTS OR 0.44% /Hang Sang CLOSED UP 199.53 POINTS OR 0.65% / The Nikkei closed DOWN 343.77 POINTS OR 1.56%/Australia’s all ordinaires CLOSED DOWN 0.68%/Chinese yuan (ONSHORE) closed DOWN at 6.3493/Oil DOWN to 61.26 dollars per barrel for WTI and 64.06 for Brent. Stocks in Europe OPENED DEEPLY IN THE RED  .   ONSHORE YUAN CLOSED DOWN AT 6.3493 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.3543 /ONSHORE YUAN TRADING STRONGER AGAINST OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING MUCH WEAKER AGAINST THE DOLLAR AND ALL OTHER CURRENCIES. CHINA IS  HAPPY TODAY (WEAK CURRENCY AND GOOD CHINESE MARKETS/ BUT POOR GLOBAL MARKETS) 

3a)THAILAND/SOUTH KOREA/NORTH KOREA

 i)North Korea

b) REPORT ON JAPAN

3 c CHINA

i)China is definitely slowing down: the following will not help as Chinese giant HNA will planning to axe 100,000 jobs or 1/4 of its workforce

(SouthChinaMorningPost/Hong Kong)

ii)China warns that it is very concerned with Trump’s protectionist policies  ie. huge tariffs on steel and aluminum
(courtesy zerohedge)

4. EUROPEAN AFFAIRS

Great Britain/WPP

WPP is a Bellwether on the global economy..a rise in its stock means the global economy is growing and a drop in its value means contraction.  Their stock fell 19% overnight as its chairman stated that he sees little growth.  What does this mean to ad dependent Google, Facebook etc.

(courtesy zerohedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

i)Putin claims that he has new unstoppable nuclear weapons and he will respond if attacked

(courtesy zerohedge)

ii)IRAN
Iran bans the use of uSA dollars in trade.  Since the multitude of sanctions initiated against Iran, the use of the dollar and the SWIFT system inside Iran has been neglible
(courtesy zerohedge)

6 .GLOBAL ISSUES

7. OIL ISSUES

8. EMERGING MARKET

South Africa

We highlighted this to you over the past few weeks.  It looks like South Africa will confiscate White Owned land with zero compensation.  This will surely bankrupt the country. Over 73% of all agricultural land in South Africa is owned by Whites.

(courtesy zerohedge)

9. PHYSICAL MARKETS

i)A good commentary today from Chris Powell on an interview Pierre Lassonde did with Kitco

( Chris Powell/GATA)

ii)We have been telling you that Libor has been rising for quite some time.  It is now at dangerous levels as the global economy just cannot handle the higher rates.  The reason for libor rising is due to the huge dollar repatriation which caused a scarcity of dollars in Europe.  The banks which had previously levered their dollar  deposits with exotic derivatives are now having difficulty due to the drain on their disappearing USA dollar deposits, the dollars that was used to lever in the first place.  Because of the loss of those dollars, the banks are now afraid to loan to one another as they fear the banks will implode with their exotic derivatives and nothing to hold them up with.

THIS IS A MUST READ…

(courtesy Ambrose Evans Pritchard/UKTelegaph)

iii)My goodness Sheila Bair said a mouthful today:  “We should not bank Bitcoin..the green Bills in your pocket do not have intrinsic value either”

(courtesy zerohedge/Barrons)

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

i)USA Markets today

a)Early this morning, Powell flip flops

(courtesy zerohedge)

b)Then, strangely,on a report that the ECB will delay the end of its QE,, the Euro rises and the dollar tumbles

go figure..

c)Fed’s Dudley sinks stocks when he signals that the 4 rate hikes are still gradual..

in other words..very dovish
(courtesy zerohedge)

ii)Not good for GDP numbers:  real personal spending drops the most in 2 years as saving rate jumbs.

( zerohedge)

iii) a  This will not end well with respect to China:  Trump is to announce steep tariffs on both aluminium and steel.  China and South Korea will certainly be affected

(courtesy zerohedge)

iii b) The hardest hit country for tariffs on steel:  Canada.  China did not make the top 10 although it is the largest supplier of Aluminum

( zerohedge)

iv)Manhattan landlords are now feeling the pinch: they are slashing rents to fill vacant storefronts

(courtesy zerohedge)

v)Our good friends over at Wells Fargo are hit again after the Dept of Justice orders an investigation into the Wealth Management Division

 (zerohedge)
vi)SWAMP STORIES
a)It seems that  the knives are out for Kushner.  Both Mueller and the New York Dept of Financial services are probing his loans for his troubled 5th Avenue property
( zerohedge)
b)Our deep state member Jeff Sessions has been seen eating out with his Deputy Rosenstein after his spat with Trump yesterday. What is he afraid of by nominating a second Special Counsel, going after Hillary and her band of merry criminals?(courtesy zerohedge)

c)The Mooch says that Kelly has blacklisted him form the West Wing.  He also states that many more personnel will leave the wing:

( zero hedge)

d)the revolving door continues to operate at full speed as it looks like National Security Advisor McMaster is being pushed out the door

( zerohedge)

Let us head over to the comex:

The total gold comex open interest FELL BY  5048 CONTRACTS DOWN to an OI level 527,812  DESPITE THE TINY FALL IN THE PRICE OF GOLD ($0.70 LOSS/ YESTERDAY’S TRADING).  WE HAD CONSIDERABLE 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 9903 EFP’S ISSUED FOR APRIL  AND 0 EFP’s  FOR JUNE AND ZERO FOR ALL OTHER MONTHS:  TOTAL  9903 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: 4855 OI CONTRACTS IN THAT 9903 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE LOST 5048 COMEX CONTRACTS.

NET GAIN ON THE TWO EXCHANGES: 5048 contracts OR 504,800  OZ OR 15.71 TONNES.

Result: A  GOOD SIZED DECREASE IN COMEX OPEN INTEREST DESPITE THE TINY FALL IN YESTERDAY’S GOLD TRADING ($0.70.)   TOTAL OPEN INTEREST GAIN ON THE TWO EXCHANGES: 6691 OI CONTRACTS..

We have now entered the non active contract month of MARCH where we LOST 27 contracts DOWN to 665 contracts. We had 0 notices served upon yesterday, so in essence we lost 27 contacts or an additional 2700 oz will not stand for delivery at the comex and they morphed into London based forwards.

April saw a LOSS of 9482 contracts DOWN to 343,146. May saw its initial gain of 10 contracts to stand at 10. The really big June contract month saw a gain of 3764 contracts up to 102,869 contracts.

We had 0 notice(s) filed upon today for  nil oz

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

PRELIMINARY COMEX VOLUME FOR TODAY: 383,498 contracts

CONFIRMED COMEX VOL. FOR YESTERDAY:  294,958 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:

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

end

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And now for the wild silver comex results.

Total silver OI ROSE  BY A CONSIDERABLE 1333  CONTRACTS FROM 193,343 DOWN TO 192,010 DESPITE YESTERDAY’S TINY 5 CENT FALL IN TRADING).   HOWEVER,WE WERE ALSO INFORMED THAT WE HAD  0 EMERGENCY EFP’S FOR MARCH ISSUED BY OUR BANKERS (WITH 1849 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: 1849.   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 BUT WE ALSO HAD A SMALL SIZED GAIN IN TOTAL SILVER OI FROM OUR TWO EXCHANGES. WE ARE ALSO WITNESSING A FAIR AMOUNT OF SILVER OUNCES STANDING FOR COMEX METAL IN THIS NON ACTIVE JANUARY AS WELL AS THAT CONTINUAL MIGRATION OF EFPS OVER TO LONDON. ON A PERCENTAGE BASIS THERE ARE MORE EFP’S ISSUED FOR GOLD THAN SILVER.  ON A NET BASIS WE GAINED  516  SILVER OPEN INTEREST CONTRACTS

1333 CONTRACT LOSS AT THE COMEX COMBINING WITH THE ADDITION OF 1849 OI CONTRACTS NAVIGATING OVER TO LONDON.

NET GAIN ON THE TWO EXCHANGES: 516 CONTRACTS 

We are now in the  active delivery month of MARCH and here the front month LOST 3417 contracts FALLING TO 1517 contracts. We had 3507 contracts filed upon yesterday, so we GAINED 90 contracts or an additional 450,000 will stand in this active delivery month of March.

April lost 10 contracts down to 414 .

The next big active delivery month for silver will be May and here the OI lost by 460 contracts down to 149,945

We had 351 notice(s) filed for 1755,000 OZ for the MARCH 2018 contract for silver

INITIAL standings for MARCH

MARCH 1/2018.

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 788.235 oz

Brinks

Deposits to the Customer Inventory, in oz  nil
No of oz served (contracts) today
0 notice(s)
 NIL OZ
No of oz to be served (notices)
665 contracts
(66,500 oz)
Total monthly oz gold served (contracts) so far this month
0 notices
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 1 inventory movement at the dealer accounts
i) Into Brinks:  788.235 oz
total inventory deposit into the dealer accounts:  788.235  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 3 adjustment(s)
i) out of Delaware:
14,698.439 oz was adjusted out of the dealer and this landed into the customer account of Delaware
ii) out of I D:
5,304.75oz leaves the dealer and arrives at the customer account of International Delaware
iii) out of Malca:
96.453 oz leaves the dealer and this arrives at customer account of Malca
a total of 20,099.642 oz leaves the above dealers and arrives at the customer accounts
total registered or dealer gold:  339,378.269 oz or 10.556 tonnes
total registered and eligible (customer) gold;   9,133,645.713 oz 284.156 tones
THE COMEX IS AGAIN IN STRESS AS ONLY 10.556 TONNES OF GOLD ARE LEFT TO SERVICE DELIVERIES
 

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

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To calculate the INITIAL total number of gold ounces standing for the MARCH. contract month, we take the total number of notices filed so far for the month (0) x 100 oz or 0 oz, to which we add the difference between the open interest for the front month of FEB. (665 contracts) minus the number of notices served upon today (0 x 100 oz per contract) equals 66,500 oz, the number of ounces standing in this nonactive month of MARCH (2.0684 tonnes)

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

No of notices served (0 x 100 oz or ounces + {(665)OI for the front month minus the number of notices served upon today (0 x 100 oz )which equals 66,500 oz standing in this  nonactive delivery month of March . THERE IS 10.556 TONNES OF REGISTERED GOLD AVAILABLE FOR DELIVERY SO FAR.

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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

MARCH INITIAL standings

March 1 2018
Silver Ounces
Withdrawals from Dealers Inventory nil oz
Withdrawals from Customer Inventory
  150,299.000 oz
Scotia
Deposits to the Dealer Inventory
211,427,160
oz
brinks
Deposits to the Customer Inventory
985.560 oz
Delaware
No of oz served today (contracts)
351
CONTRACT(S
(1,755,000 OZ)
No of oz to be served (notices)
1166 contracts
(5,830,000 oz)
Total monthly oz silver served (contracts) 3858 contracts

(19,290,000 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: 211,427.160  oz

total inventory deposits into dealer: 211,427.160 oz

we had 1 deposits into the customer account

i) into Delaware:

985.560 oz was deposited into the customer account of Delaware

ii) JPMorgan:  zero

*** 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.

total deposits customer account: 985.560 oz

we had 1 withdrawals from the customer account;

i) Out of Scotia: 150,299.000??? exact weight???

total withdrawals; 150,299.000  oz

we had 1 adjustments

i) out of CNT:  422,735.150  oz  was adjusted out of the customer is this landed into the dealer account of CNT

total dealer silver:  56.193 million

total dealer + customer silver:  251,382 million oz

The total number of notices filed today for the March. contract month is represented by 351 contract(s) FOR 1,755,000 oz. To calculate the number of silver ounces that will stand for delivery in March., we take the total number of notices filed for the month so far at 3858 x 5,000 oz = 19,290,000 oz to which we add the difference between the open interest for the front month of Mar. (1517) and the number of notices served upon today (351 x 5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the March contract month: 3507(notices served so far)x 5000 oz + OI for front month of March(1517) -number of notices served upon today (351)x 5000 oz equals 25,120,000 oz of silver standing for the March contract month. 

We gained an additional 90 contracts or 450,000 additional silver oz will stand for delivery at the comex.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

ESTIMATED VOLUME FOR TODAY: 90,847 CONTRACTS

CONFIRMED VOLUME FOR YESTERDAY: 65,888 CONTRACTS

YESTERDAY’S CONFIRMED VOLUME OF 65,888 CONTRACTS EQUATES TO  329 MILLION OZ OR 47.0% 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 -1.57% (MARCH 1/2018)
2. Sprott gold fund (PHYS): premium to NAV RISES TO -0.42% to NAV (MARCH 12018 )
Note: Sprott silver trust back into NEGATIVE territory at -1.57%-/Sprott physical gold trust is back into NEGATIVE/ territory at -0.42%/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 -3.66%: NAV 13.62/TRADING 13.153//DISCOUNT 3.66.

END

And now the Gold inventory at the GLD/

March 1/WITH GOLD DOWN ANOTHER $12.30/A HUGE CHANGE IN GOLD INVENTORY/ A DEPOSIT OF 2.96 TONNES/INVENTORY RESTS AT 833.98 TONNES

FEB 28/WITH GOLD DOWN ANOTHER 70 CENTS/NO CHANGE IN GOLD INVENTORY/INVENTORY RESTS AT 831.03 TONNES/.

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

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

MARCH 1/2018/ Inventory rests tonight at 833.98 tonnes

*IN LAST 333 TRADING DAYS: 107,16 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 263 TRADING DAYS: A NET 50.14 TONNES HAVE NOW BEEN ADDED INTO GLD INVENTORY.

end

Now the SLV Inventory

March 1/WITH SILVER DOWN 11 CENTS TODAY/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 316.590 MILLION OZ./

FEB 28/WITH SILVER DOWN 5 CENTS TODAY/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 316.590 MILLION OZ/

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/

MARCH 1/2018: NO CHANGES TO SILVER INVENTORY/

Inventory 316.590 million oz

end

6 Month MM GOFO 1.93/ and libor 6 month duration 2.22

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

G0FO+ 1.93%

libor 2.22 FOR 6 MONTHS/

GOLD LENDING RATE: .290%

12 Month MM GOFO
+ 2.38%

LIBOR FOR 12 MONTH DURATION: 2.500

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = .120

end

Major gold/silver trading /commentaries for THURSDAY

GOLDCORE/BLOG/MARK O’BYRNE.

GOLD/SILVER

 GoldCore

Four Key Themes To Drive Gold Prices In 2018 – World Gold Council

– Four key themes to drive gold prices in 2018 – World Gold Council annual review
– Monetary policies, frothy asset prices, global growth and demand and increasing market access important in 2018
– Weak US dollar in 2017 saw gold price up 13.5%, largest gain since 2010
– “Strong gold price performance was a positive for investors and producers, and was symptomatic of a more profound shift in sentiment: a growing recognition of gold’s
role as a wealth preservation and risk mitigation tool” 

– China’s gold coins and bars market recorded its second-best year ever
– German, central bank and technological demand supporting gold prices
– Latest Goldnomics podcast explores these and other themes

Editor: Mark O’Byrne

Annual Review 2017 has just been released by the World Gold Council (WGC) and it’s annual report on the gold market and the outlook for gold prices is fact based, comprehensive and well worth a read – especially the section ‘Market Outlook for 2018’.

2017 was a relatively quiet one for gold prices, which was surprising given the increasing tensions and turbulence going on in the rest of the financial and particularly political spheres. The World Gold Council’s comprehensive analysis strongly suggests that the set up for gold is very positive and we are on the verge of further gains in the coming years.

This is also our own view which we expanded upon in the just released latest Goldnomics podcast (Episode 3).

Gold demand fell slightly but supply was also down

2017 was a challenging year for gold demand: it fell to its lowest level since 2009. Investment and central bank demand accounted for most of the decline.

There were two interesting positive increases in gold demand in 2017; central banks and the technology industry. Whilst central bank demand did decline from the previous year, it was still notable.

According to the World Gold Council we are set to see both of these factors rise in 2018 which bodes well for gold prices.

Central banks continue buying as tensions rise between West and East

Last year made for the eighth consecutive year that central banks added to their gold reserves. As mentioned in our latest podcast this demand is high, but it could increase even more given the level of foreign exchange reserves.

Just this last week the news broke that the Russian central bank added a further 18 tonnes to their gold reserves. By way of reminder this is the bank that last year said it was stocking up on gold in order to “beef up national security.”

2017’s most notable central banks buying gold were Russia, Turkey and Kazakhstan. The former two having made some bold statements in recent times about protecting themselves from US dollar hegemony.

China, Russia, Iran and more recently Turkey have made no secret of their desire to operate outside of the financial and monetary control mechanisms the U.S. has managed to control for so long. China (another major central bank buyer) is the most important in this regard but each of these countries have actively encouraged private gold ownership as well as national, in order to reduce their reliance on and exposure to the US dollar.

Interestingly, the WGC highlight China’s phenomenal gold buying record which rose again once again in 2017 to the second highest level on record.

Geopolitical changes are seen as driving factors for the 2018 gold price by both the WGC and ourselves.

The WGC draw particular attention to the sabre-rattling between North Korea and the United States. Whilst in our latest podcast we do touch on North Korea we also consider a number of factors including the ‘massive’ destabilisation of the Middle East. We discuss rising political tensions as well as what uncertainty and war mean for the gold price. Hint …  increased safe haven demand.

Tech demand for gold

In 2017 demand for gold in technology increased for the first time since 2010. The WGC expects this to be an ongoing trend as both the semi-conductor sector and gold nanoparticle-based technologies grow in popularity.

After contracting year after year since 2010, we expect technology demand to stabilise and, in some areas, grow over the coming years. 

Back to Basics: Supply and Demand

The WGC look to synchronised global economic growth, monetary policy, frothy asset prices and market transparency and access including Sharia gold demand to drive the gold market into 2018.

Monetary policy and frothy asset prices are those grabbing the headlines of late. It may be surprising to many investors but higher interest rates are good news for gold (as discussed here) whilst frothy asset prices could lead to yet another stock market crash and indeed another financial crisis. Investors should realise that cash can quickly turn to trash and how bail-ins are a very real threat today.

However, it is the basics of supply and demand which are key to the price of gold in the long-term.

The underlying fundamentals of gold, particularly on the supply side, and the advent of peak gold, help to underpin gold’s likely rise to $10,000 in the long term.

Most commentators focus on the demand side of the gold market but we consider the supply side to be just as important. As discussed in our podcast we are seeing supply drop. According to this latest report from the WGC ‘Total supply [in 2017] fell 4% compared to 2016. Declines in recycling and hedging activity offset a modest rise in mine production.’ 

It is increasingly expensive to mine gold and there have been no major gold discoveries in recent years. How will this play out in the long term when gold demand has been increasing on average by 18% per year in recent years?

Elon Musk’s grand plans to mine in space gets lots of headlines and uninformed press which misguided gold bears use to bolster their weak central thesis. In truth, mining gold on asteroids or on Mars is fake gold news.

There is no real threat here to the gold market. Indeed, the notion of mining on other planets is laughable nonsense. It is not feasible today and if it does become feasible, the cost per ounce of “space gold” or “asteroid gold” will be hundreds of thousands of dollars if not million of dollars per ounce.

We discuss many of the 2018 factors raised by the WGC in Goldnomics but expand into other areas, notably the key decisions and lessons investors must take in the current environment when it comes to protecting their assets and the importance of owning gold in the safest way possible.  Not all types of gold are made equal.

Annual Review 2017 and Outlook 2018 can be accessed via the World Gold Council here

Listen to Goldnomics (Ep. 3) on SoundCloud , Blubrry & iTunesWatch on YouTube below

Listen to the full episode or skip directly to a key discussion point here

News and Commentary

Gold suffers first monthly loss since October (MarketWatch.com)

February U.S. Mint American Eagle gold, silver coin sales fall (Reuters.com)

Nationwide weakness: Pending home sales drop 4.7 percent in U.S. in January (CNBC.com)

Foxtons profits plunge over London housing market slump (TheGuardian.com)

Retail job losses may reach 15,000 as industry strains under cost pressures (CityAM.com)


Source: St Louis Fed

Libor surge is nearing danger level for debt-drenched world (Telegraph.co.uk)

Tycoons fold on old-economy assets (MoneyWeek.com)

Lessons from Buffett’s latest letter: stay patient and avoid debt (MoneyWeek.com)

Europe’s leaders brace for the climax to Italy’s opera of an election (Telegraph.co.uk)

The World’s Cobalt Supply Is in Jeopardy (GoldSeek.com)

Gold Prices (LBMA AM)

01 Mar: USD 1,311.25, GBP 953.80 & EUR 1,075.75 per ounce
28 Feb: USD 1,320.30, GBP 951.14 & EUR 1,080.53 per ounce
27 Feb: USD 1,332.75, GBP 954.78 & EUR 1,081.26 per ounce
26 Feb: USD 1,339.05, GBP 953.00 & EUR 1,085.30 per ounce
23 Feb: USD 1,328.90, GBP 951.09 & EUR 1,079.20 per ounce
22 Feb: USD 1,323.50, GBP 952.66 & EUR 1,076.40 per ounce
21 Feb: USD 1,328.60, GBP 952.87 & EUR 1,078.16 per ounce

Silver Prices (LBMA)

01 Mar: USD 16.32, GBP 11.87 & EUR 13.39 per ounce
28 Feb: USD 16.44, GBP 11.88 & EUR 13.45 per ounce
27 Feb: USD 16.61, GBP 11.91 & EUR 13.48 per ounce
26 Feb: USD 16.67, GBP 11.88 & EUR 13.52 per ounce
23 Feb: USD 16.61, GBP 11.88 & EUR 13.50 per ounce
22 Feb: USD 16.47, GBP 11.86 & EUR 13.40 per ounce
21 Feb: USD 16.44, GBP 11.80 & EUR 13.35 per ounce


Recent Market Updates

– Is The Gold Price Going To $10,000? (Goldnomics Podcast 3)
– Gold Corridor From Dubai to China Sought By China
– Digital Gold Provide the Benefits Of Physical Gold?
– Weekly Briefing: Currency Wars – ECB Warns Re Trump, Russia and Turkey Buy Gold and BOE Bitcoin Warning
– Russian Central Bank Buys Gold – 600,000 Ounces Or 18.7 Tons In January As Venezuela Launches ‘Petro Gold’
– Bitcoin or British Pound ‘Pretty Much Failed’ As Currency?
– Bank Bail-In Risk In European Countries Seen In 5 Key Charts
– US-China Trade War Escalates As Further Measures Are Taken
– Gold Up 3.8% In Week – If Closes Above $1,360/oz Will Be Biggest Weekly Gain In Nearly 2 Years
– Is The Gold Price Heading Higher? IG TV Interview GoldCore
– Global Debt Crisis II Cometh
– Sovereign Wealth Funds Investing In Gold For “Long Term Returns” – PwC
– Bitcoin and Crypto Prices Being Manipulated Like Precious Metals?

Mark O’Byrne

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

A good commentary today from Chris Powell on an interview Pierre Lassonde did with Kitco

(courtesy Chris Powell/GATA)

Lassonde likes the gold price with central banks rigging the market

 Section: 

12:18a ET Thursday, March 1, 2018

Dear Friend of GATA and Gold:

Oh, for a journalist who would put a few serious questions to Franco-Nevada Chairman Pierre Lassonde, former chairman of the World Gold Council, when he says, as he told Daniela Cambone of Kitco News this week, that “gold is well-priced” and “where it should be.”

http://www.kitco.com/news/video/show/BMO-Conference-2018/1869/2018-02-28…

Does Lassonde mean that gold is doing as well as it could against the daily gold derivatives trading by central banks?

After all, what is the Bank for International Settlements doing with those 600 or so tonnes’ worth of gold derivatives issued on behalf of its member central banks?http://www.gata.org/node/18041

Does Lassonde mean that the manipulative trading in gold recently admitted by three investment banks —

http://www.gata.org/node/18004

— has done no particular harm to gold investors?

Is Lassonde certain that the 15-percent discount given by CME Group, operator of the major U.S. futures exchanges, to governments and central banks for their surreptitious trading of gold futures —

http://www.gata.org/node/17976

— is part of an entirely innocent enterprise?

Or by asserting that gold is “where it should be” does Lassonde mean that he approves of the surreptitious rigging of the gold market by central banks?

Four years ago, when he was still a member of the World Gold Council’s Board of Directors, Lassonde told Cambone that central banks “spend no time whatsoever thinking about gold”:

http://www.gata.org/node/13683

Simultaneously the gold council was advertising a seminar for central bankers about trading, clearing, and vaulting gold and accounting for gold reserves:

http://www.gata.org/node/13851

In his interview with Kitco News this week Lassonde added that he doesn’t think gold is going anywhere this year. If gold does go anywhere, it sure won’t be with any help from this supposed leader of the gold industry. He well may be the favorite gold mining executive of central bankers.

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

END

We have been telling you that Libor has been rising for quite some time.  It is now at dangerous levels as the global economy just cannot handle the higher rates.  The reason for libor rising is due to the huge dollar repatriation which caused a scarcity of dollars in Europe.  The banks which had previously levered their dollar  deposits with exotic derivatives are now having difficulty due to the drain on their disappearing USA dollar deposits, the dollars that was used to lever in the first place.  Because of the loss of those dollars, the banks are now afraid to loan to one another as they fear the banks will implode with their exotic derivatives and nothing to hold them up with.

THIS IS A MUST READ…

(courtesy Ambrose Evans Pritchard/UKTelegaph)

Ambrose Evans-Pritchard: Libor surge nears danger level for debt-drenched world

 Section: 

By Ambrose Evans-Pritchard
The Telegraph, London
Wednesday, February 28, 2018

The stress signals of the global credit system are flashing amber. The offshore dollar funding markets that lubricate world finance are facing an incipient squeeze.

The “Libor-OIS spread,” watched carefully by traders, has risen to levels reached during the onset of the Chinese currency crisis in early 2016 and during the onset of the Italian and Spanish funding crisis in late 2011

The three-month rate for dollar Libor (London Interbank Offered Rate) used to price a vast nexus of financial contracts around the world has spiked to a 10-year high of 2 percent this week. A third of all U.S. business loans are linked to Libor, as are most student loans, and 90 percent of the leverage loan market.

The U.S. can doubtless handle the sixfold rise in Libor costs over the last two years since it is a reflection of economic recovery itself. America needs tighter money: The economy is on the cusp of overheating, with a double blast of irresponsible fiscal stimulus coming from the Trump tax cuts and Republican pork barrel spending.

Whether the rest of the world can handle it is less clear. The Libor spike is transmitted almost instantly through global finance. The Bank for International Settlements says any rise in short-term borrowing costs on dollar markets resets rates on $5 trillion (L3.6 trillion) of dollar bank loans.

It tightens the whole credit structure in Asia and emerging markets regardless of what currency it is in. The Libor-OIS spread measures the extra cost that banks charge each other for short-term “unsecured” dollar loans on the London interbank market. It basically takes the pulse of the lending markets. …

… For the remainder of the report:

https://www.telegraph.co.uk/business/2018/02/28/libor-surge-nearing-dang…

* * *

The stress signals of the global credit system are flashing amber. The offshore dollar funding markets that lubricate world finance are facing an incipient squeeze.

The “Libor-OIS spread’ – watched carefully by traders – has risen to levels reached during the onset of the Chinese currency crisis in early 2016, and during the onset of the Italian and Spanish funding crisis in late 2011.

The three-month rate for dollar Libor (London Interbank Offered Rate) used to price a vast nexus of financial contracts around the world has spiked to a 10-year high of 2pc this week. A third of all US business loans are linked to Libor, as are most student loans, and 90pc of the leverage loan market.

The US can doubtless handle the sixfold rise in Libor costs over the last two years since it is a reflection of economic recovery itself. America needs tighter money: the economy is on the cusp of over-heating, with a double blast of irresponsible fiscal stimulus coming from the Trump tax cuts and Republican pork barrel spending.

Whether the rest of the world can handle it is less clear. The Libor spike is transmitted almost instantly through global finance. The Bank for International Settlements says any rise in short-term borrowing costs on dollar markets resets rates on $5 trillion (£3.6 trillion) of dollar banks loans.

It tightens the whole credit structure in Asia and emerging markets regardless of what currency it is in. The Libor-OIS spread measures the extra cost that banks charge each other for short-term “unsecured” dollar loans on the London interbank market. It basically takes the pulse of the lending markets. 

Patrick Perret-Green from the hedge fund AdMacro says US companies are starting to repatriate their vast cash holdings abroad to comply with president Trump’s tax changes. This is being drained from the pool of available lending. “It is reducing offshore liquidity. US entities have little incentive to lend that money back out internationally because of risk weightings and capital charges,” he said.

US corporations have some $2.5 trillion in liquid assets offshore, led by the tech giants Apple with $257bn, Alphabet (Google) with $126bn, and Microsoft with $84bn. Much of the money is already in US dollar assets so there is no currency exchange when it returns to the US. The problem is that it vanishes from the dollar-based funding markets in the City or hubs such as Singapore. It rations credit for Asia, Latin America, Russia, and the Middle East.

Borrowers can suddenly find it harder to roll over three-month dollar loans. This is what happened in 2007 and 2008 when offshore markets seized up and threatened to bring down the European banking system.

The scale is epic. BIS data show that offshore dollar credit has ballooned from $2 trillion to $11.6 trillion in fifteen years, turbo-charged by leakage from the Fed’s QE. The BIS has identified a further $13 to $14 trillion in disguised lending through derivatives contracts that are “functionally equivalent”.

Dollar liabilities on this scale are unprecedented and leave the world financial system more vulnerable than ever before to rising US rates.This is the sharp edge of a bigger problem: the $70 trillion edifice of global bonds is built on the assumption of a deflationary global liquidity trap lasting deep into the 21st century. Almost $10 trillion is still trading at negative yields. The structure cannot withstand a sudden shift to a reflation psychology.   This week’s Libor spike was driven by the hawkish debut of Fed chairman, Jay Powell, keen to show that he is no White House poodle – no Trumpian “Arthur Burns” – by bravely flagging four interest rate rises this year.

Michael Hartness from Bank of America says the ‘Powell Put’ is set at a lower strike price than the old “Fed Puts” of the Bernanke and Yellen eras, meaning that Mr Powell will not come to the rescue of asset markets until they have suffered. 

A vast shift in the balance of the global bond supply and demand is under way

This should give rise to pause since the US Treasury’s own watchdog (OFR) warns that broker margin debt is dangerously high and that Wall Street pricing is at  its “97th percentile relative to the last 130 years”. Bank of America says the profits cycle for US equities has peaked. Its “Bull & Bear” indicator is at extreme levels of investor optimism, still issuing a sell alert despite the mini-crash in early February

The buy-to-dip reflex remains powerful. Veteran value investor Warren Buffet is rare in standing coolly on the sidelines, keeping his powder dry, accumulating $116bn in short-term Treasury notes and cash assets in order to better survive what he calls ‘economic discontinuities’. He has displaced China and Japan as the chief buyer at Treasury sales.

Mr Buffett insists that “history” is on his side, and the next crisis may come like a thief in the night. “If you want to be able to acquire the highest quality assets when prices crash, you have to be liquid,” he said.

For now the story is in the bond markets. The 10-year US Treasury yield has jumped 50 basis points to 2.9pc since the start of the year, driven both by rising inflation and the prospect of Mr Trump’s fiscal deficits topping $1 trillion at the top of the cycle – and therefore $2 trillion in a bad recession.

The buyer of last resort for this debt is currently adding to supply instead. The Fed will be selling down its $4.4 trillion stockpile of bonds at a pace of $50bn a month by the end of the year (though Citigroup warns that the Fed will be forced to carry out a volte-face and resume QE by 2020). In parallel, the European Central Bank will have tapered its asset purchases to zero by September.

A vast shift in the balance of the global bond supply and demand is underway. It is this that lies behind the wild ructions across global bourses this year. My own view is that rising US rates will hit just as the China and Europe come off the boil later this year, creating an unpredictable “scissor” action through currency and credit markets.

China’s slowdown is already crystallizing. The fiscal blitz before last autumn’s Communist Party Congress is fading. Credit growth – when measured properly – keeps slipping. The official PMI gauge of manufacturing fell to a 19-month low of 50.3 in February.

Data from Janus Henderson shows that a key measure of money growth – six-month real M1 – has dropped to the lowest level since the Great Recession in the biggest G7 and E7 economies combined. This is chiefly driven by China and the eurozone, including France and Spain. The data leads the real economy by six to nine months.

Asia and Europe are likely to look very different in late 2018. Far from seeing synchronized global growth in all regions – as the markets expect – we could instead see major tectonic plates moving against each other. In that context, surging dollar Libor rates and a hawkish Fed could prove inflammatory. It is not hard to imagine fresh currency flight from China and radical repricing of Italian sovereign debt.

The Fed likes to tell us that extracting the world from nine years of zero rates and QE will be a dull as “watching paint dry”. The coming drama is more likely to be a spine-shivering thriller

end

My goodness Sheila Bair said a mouthful today:  “We should not bank Bitcoin..the green Bills in your pocket do not have intrinsic value either”

(courtesy zerohedge/Barrons)

Sheila Bair on Bitcoin: “We Shouldn’t Ban It: The Green Bills In Your Pocket Don’t Have Intrinsic Value, Either”

In a surprisingly forthright and honest interview between Barrons and Sheila Bair, the former FDIC chair who was responsible for big banks avoiding bank runs in the aftermath of the Lehman bankruptcy, discussed what she sees as the trigger for the next financial crisis, her thoughts on China’s record leverage (and the recent promotion of Xi Jinping to emperor), how she views the current economy, on $1.3 trillion in student debt, and finally on bitcoin.

While we will focus on the latter, here are some excerpts on the other key points. First, here is Bair on what she thinks will trigger the next crisis:

I’d keep an eye on credit-card debt. Subprime auto has been a problem for a couple years, and valuations on loans used to finance leveraged buyouts are high. Any type of secured lending backed by an asset that is overvalued should be a concern. That is what happened with housing. Corporate debt also has not gotten as much attention as it should. It is market-funded, rather than bank-funded, but the banks still have exposure. Then there’s cyber-risk. It took us so long to get around to the reforms postcrisis that we got a little behind on systemic cyber-risk, but regulators are very focused on it now.

On China’s risk to the global financial system:

We look at their debt and wag our fingers and tsk, tsk. It is high. But they realize it is a threat to financial stability and are dealing with it. Last month, regulators took over privately held Anbang Insurance to keep it from collapsing. It is a sign they are continuing to crack down on reckless growth and excessive leverage.

On Student Debt:

That debt is all on the government’s balance sheet, so no, not a market crisis. But there are parallels to 2008: There are massive amounts of unaffordable loans being made to people who can’t pay them, and the easy availability of those loans is leading to asset inflation. In 2008, that was reflected in housing prices. Today, that’s tuition. It’s too easy to raise tuition because kids will borrow to pay for it. If the loan defaults, the primary beneficiaries — educational institutions — have no skin in the game, like in the mortgage crisis.

How record student debt promotes inequality:

Student-loan stories always feature someone who borrowed $90,000 to go to grad school or med school. But those people generally get jobs and have earnings potential, and debt-forgiveness programs disproportionately help them. The distress and high default rates are among the kids borrowing $10,000 to go to a for-profit school and dropping out; $10,000 may not sound like a lot to you and me, but for a first-generation student or someone without a college degree, that’s a lot of money. Student debt also suppresses small-business formation. Kids who would have started a business in their parents’ garage can’t do that now because they owe $50,000. Beyond that, it’s just a terrible financial burden for our kids that didn’t exist 20 years ago.

And finally, and most importantly, is Bair’s tacit endorsement of bitcoin. By saying that “we should not ban it”, Bair has effectively become the highest ranked current or former administration official to recommend keeping bitcoin while pointing out that – just like the dollar – its value is only what someone else would be willing to pay for it.

Here is Bair’s view on cryptocurrencies.

Don’t put any money into bitcoin that you can’t afford to lose. But I don’t think we should ban it — the green bills in your pocket don’t have an intrinsic value, either. The value is based on what others think is its value. That’s true of any currency. Regulation should be focused on good disclosure, education, warding off fraud, and making sure it is not used for illicit activities. Let the market figure out what it’s worth. That is what it is doing now.

Source: Barrons



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

 

i) Chinese yuan vs USA dollar/CLOSED DOWN 6.3493  /shanghai bourse CLOSED UP 14.34 POINTS OR 0.44%  / HANG SANG CLOSED UP 199.53 POINTS OR 0.65%
2. Nikkei closed DOWN 343.77 POINTS OR 1.56% /USA: YEN RISES TO 106.69/ STILL DEADLY AS YEN CARRY TRADERS DISINTEGRATE

3. Europe stocks OPENED DEEPLY IN THE RED    /USA dollar index RISES TO 90.76/Euro FALLS TO 1.2177

3b Japan 10 year bond yield: FALLS TO . +.043/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 106.69/ 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:: 61.26  and Brent: 64.06

3f Gold DOWN/Yen UP

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund FALLS TO +.625%/Italian 10 yr bond yield DOWN to 1.970% /SPAIN 10 YR BOND YIELD DOWN TO 1.520%

3j Greek 10 year bond yield RISES TO : 4.475?????????????????

3k Gold at $1308.40 silver at:16.29     7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 49/100 in roubles/dollar) 56.83

3m oil into the 61 dollar handle for WTI and 64 handle for Brent/

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

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 106.69 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 0.9463 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1517 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.

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

3r the 10 Year German bund now POSITIVE territory with the 10 year FALLING to +0.625%

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 2.8220% early this morning (THIS IS DEADLY TO ALL MARKETS). Thirty year rate at 3.103% /BOTH VERY DEADLY

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

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

Risk-Off: Global Stock Rout Accelerates, Futures Slide Below 2700 Before Powell Part 2

With the worst month for global markets in two years now in the history books, world stocks entered March with shaky knees as global equity markets and US futures are a sea of red this morning, as European shares drop the most since a global rout three weeks ago following sharp declines in the U.S. and Asia ahead of Powell’s second testimony, and amid talk that Trump is ready to announce steep tariffs on steel and aluminum imports.

After attempting a breakout above the unchanged line overnight, S&P 500 Index futures have drifted lower, and the selloff has accelerated in recent minutes, sliding below 2700.

Today’s main event for markets will be Fed Chairman Jerome Powell’s appearance before the Senate Banking Committee following his comments Tuesday that spurred speculation the U.S. central bank might raise rates four times this year. Chinese purchasing managers’ indexes missed estimates on Wednesday, while President Donald Trump warned the U.S. would use “all available tools” to pressure the nation on trade.

Philip Shaw, chief economist at Investec in London said Powell’s testimony was unlikely to change from the one he delivered on Tuesday, putting the focus on the question and answer session.

“He (Powell) appears to have got an easy ride from lawmakers in the sense that the technical questioning on Tuesday wasn’t too heavy,” Shaw said. “He may not have such an easy time today with the Senate Banking Committee.”

Confirming the risk-off mood, the U.S. dollar rose to six-week highs against G-10 currencies while the gap between short-dated U.S. and German bond yields was at its widest since 1997. MSCI’s all-country equity benchmark fell 0.4% after snapping a record 15-month long winning streak in February, while European stocks lost almost 1 percent

Asian equity markets were hit hard after the S&P 500 and DJIA posted their worst monthly performance in over 2 years. This weighed on the Asia-Pac majors from the open with ASX 200 (-0.7%) led lower by weakness in energy names after similar underperformance of the sector in US due to declines in crude, while Nikkei 225 (-1.6%) suffered broad losses amid a firmer JPY. Chinese bourses outperformed, Hang Seng (+0.7%) and Shanghai Comp. (+0.4%) with pressure somewhat alleviated following better than expected Chinese Caixin Manufacturing PMI data and the resumption of PBoC liquidity operations.

Europe was also hit hard, with the Stoxx 50 down over -1%, as retailers and media companies were among the biggest losers in the Stocks Europe 600 Index as some earnings missed estimates and manufacturing data showed mounting signs growth momentum may have peaked. In terms of sector specific moves, losses are relatively broad-based with all ten sectors trading with losses; minor underperformance in the IT sector with Dialog Semiconductor paring back some of yesterday’s earnings-inspired gains. Ultimately, this morning’s trade has been one dominated by earnings with notable movers including: Cobham (+11.6%), Peugeot (+6.6%), AB Inbev (+5.3%), Eiffage (+2%), WPP (-13.2%), Adecco (-8.5%), Carrefour (-6.5%), Beiersdorf (-3.4%).

“A simultaneous sell-off in equity and bond markets, higher U.S. yields and concerns of possible outflows continue to buttress USD/Asia,” says Andy Ji, Asian currency strategist at Commonwealth Bank of Australia in Singapore. China’s faltering manufacturing PMI has stoked worries of weaker growth momentum, he says.

Ahead of Powell, Treasury yields fell to a two-week low despite surging earlier in the week on his comments which riled markets earlier this week. . Treasuries began unwinding Wednesday’s strong month-end related buying with 10-year futures edging lower from the open.

In global macro, the Bloomberg Dollar Spot Index rose to a six-week high before Powell’s Senate testimony, and preparations for trade wars as Trump is set to unveil steep tariffs on steel and aluminum imports, hurting EM exporters. Traders will watch for consistency in Powell’s message earlier this week on faster pace of tightening. The greenback’s major peers failed to sustain Asia-session gains even as month-end flows that had been supporting the dollar have ended.

The Aussie dollar dropped to a two-month low after disappointing capital expenditure data encouraged leveraged funds to add to short positions. Asia’s emerging currencies fell after a drop in U.S. stocks damped appetite for risk and the dollar kept rising. The region’s sovereign notes were mixed, while most stock markets rose.

Elsewhere, the U.K. pound extended a decline after the European Union published a draft Brexit treaty, squaring off with Prime Minister Theresa May.

Aluminum headed lower with President Donald Trump set to announce steep import tariffs on Thursday. West Texas Intermediate crude retreated for a third day, with oil futures seeing very little in the way of price action during Asia-Pac and European trade following yesterday’s DoE-inspired sell-off with newsflow today otherwise particularly light. In metals markets, spot gold has been unable to benefit from the risk aversion seen in European equity markets as the firmer USD supresses prices and extends on recent losses. Elsewhere, Chinese steel futures were seen higher overnight as the prospects of additional output cuts supports prices, whilst copper prices endured another session of losses despite encouraging Chinese Caixin Manufacturing PMI.

Key events include Powell’s comments, Trump’s announcement of trade sanctions, the ISM and vehicle data and reports from companies including Nordstrom and Kohl’s

Market Snapshot

  • S&P 500 futures down 0.2% at 2,709.25
  • STOXX Europe 600 down 0.5% to 377.58
  • MXAP down 0.8% to 176.01
  • MXAPJ down 0.2% to 576.93
  • Nikkei down 1.6% to 21,724.47
  • Topix down 1.6% to 1,740.20
  • Hang Seng Index up 0.7% to 31,044.25
  • Shanghai Composite up 0.4% to 3,273.76
  • Sensex down 0.4% to 34,045.30
  • Australia S&P/ASX 200 down 0.7% to 5,973.34
  • Kospi down 1.2% to 2,427.36
  • German 10Y yield fell 1.9 bps to 0.637%
  • Euro down 0.06% to $1.2187
  • Italian 10Y yield fell 3.0 bps to 1.706%
  • Spanish 10Y yield fell 1.4 bps to 1.525%
  • Brent Futures down 1.8% to $64.60/bbl
  • Gold spot down 0.6% to $1,310.89
  • U.S. Dollar Index up 0.1% to 90.73

Bulletin Headline Summary from RanSquawk

  • European bourses have followed on from performance in their US and Asia-Pac counterparts (Eurostoxx 50 – 1.1%) to trade lower across the board
  • Core bonds are gradually building on earlier positive momentum and advancing further amidst what appears to be heightened risk-off or averse sentiment
  • Looking ahead, highlights include US manufacturing PMI, US PCE, US manufacturing ISM and a slew of speakers including Fed’s Powell

Top Overnight News

  • Euro-area factory output continues to expand at a robust pace but with mounting signs that growth momentum may have peaked. The manufacturing gauge’s decline since the end of 2017 was the steepest in two years, reinforced by a slowdown in export orders across the region
  • U.K. manufacturing lost a bit of steam last month, with growth slipping to an eight-month low
  • EU officials were fairly sure the draft Brexit deal they published on Wednesday would be unacceptable to Theresa May. It’s part of their strategy to pressure the British government so that it decides to keep the U.K. as close to the EU as possible, according to three people familiar
  • U.S. President Donald Trump is set to announce steep tariffs on steel and aluminum imports Thursday, people familiar with the matter said, in what would be one of his toughest actions yet to implement a hawkish trade agenda that risks antagonizing friends and foes alike
  • Fed Chair Jerome Powell, who delivers his second round of semi-annual testimony to Congress on Thursday, told lawmakers on Tuesday the next two years will be “good” ones for the economy. If he’s right, he’ll be at the controls when the current U.S. expansion becomes the longest on record
  • China’s rubber-stamp parliament is expected to enact sweeping legislative changes in a two-week session starting Monday that would allow President Xi to rule indefinitely and give him greater control over the levers of money and power

Asian equity markets were mostly lower as the downbeat tone rolled over from the US, where the S&P 500 and DJIA posted their worst monthly performance in over 2 years following the market turmoil seen in early February. This weighed on the Asia-Pac majors from the open with ASX 200 (-0.7%) led lower by weakness in energy names after similar underperformance of the sector in US due to declines in crude, while Nikkei 225 (-1.6%) suffered broad losses amid a firmer JPY. Chinese bourses outperformed, Hang Seng (+0.7%) and Shanghai Comp. (+0.4%) with pressure somewhat alleviated following better than expected Chinese Caixin Manufacturing PMI data and the resumption of PBoC liquidity operations. Finally, 10yr JGBs were subdued with prices contained after yesterday’s reduced-Rinban-induced selling, while a 10yr auction also failed to spur firm demand as the results were mixed with b/c slightly softer and accepted prices higher than prior. Chinese Caixin Manufacturing PMI (Feb) 51.6 vs. Exp. 51.3 (Prev. 51.5). PBoC injected CNY 100bln via 7-day reverse repos, CNY 30bln via 28-day reverse repos & CNY 20bln via 63-day reverse repos.

Top Asian News

  • Xi Set to Pass Last Hurdle in Bid for Power to Reshape China
  • BOJ’s Kataoka Urges More Stimulus, Says Tightening Long Way Off
  • Exxon’s PNG LNG Project Seen Shut for Six Weeks After Quake
  • Singapore Freezes World-Leading Ministerial Salaries For Now

European bourses have followed on from performance in their US and Asia-Pac counterparts (Eurostoxx 50 -1.1%) to trade lower across the board. In terms of sector specific moves, losses are relatively broad-based with all ten sectors trading with losses; minor underperformance in the IT sector with Dialog Semiconductor paring back some of yesterday’s earnings-inspired gains. Ultimately, this morning’s trade has been one dominated by earnings with notable movers including: Cobham (+11.6%), Peugeot (+6.6%), AB Inbev (+5.3%), Eiffage (+2%), WPP (-13.2%), Adecco (-8.5%), Carrefour (-6.5%), Beiersdorf (-3.4%).

Top European News

  • Euro-Area Factories’ Slowing Pace Seen Hinting at Growth Peak
  • U.K. Manufacturing Comes Further Off the Boil Amid Brexit Worry
  • Germany Feb. Manufacturing PMI 60.6 vs Flash Reading 60.3
  • France Feb. Manufacturing PMI 55.9 vs Flash Reading 56.1
  • Italian Jobless Rate Rises as More People Seek Employment

In FX, the DXY has cleared another chart hurdle having climbed above 90.500-600 resistance on Wednesday, and has maintained positive momentum to edge towards the next upside technical objective around 90.886 (Fib level) despite Usd/Jpy and the Jpy in general bucking the overall trend (on safe-haven grounds). Eur/Usd is retesting sub-1.2200 bids around 1.2180 ahead of Fib support at 1.2173, and with decent option expiries between 1.2150 and 1.2200 (1 bn and 2 bn respectively) also in the mix. Cable continues to weaken on Brexit-related factors and trending even lower under 1.3750, while Eur/Gbp has breached 0.8850 even though the single currency is relatively soft independently (more long liquidation and political premium ahead of Italian and German votes on Sunday). On that note, Eur/Jpy is hovering just above 130.00 having dipped below overnight, and back on track to hit TOTW profit targets for a couple of major banks. The Aud is underperforming G10 peers again, and heading for a 0.7700 test after significantly weaker than forecast Aussie Capex data. Having breached key support at 0.7759, bears will be eyeing 0.7695, while Nzd/Usd is only just holding above 0.7200. Usd/Cad hovering around 1.2850 ahead of Canadian current account data and

In commodities, WTI and Brent crude futures have seen very little in the way of price action during Asia-Pac and European trade following yesterday’s DoE-inspired sell-off with newsflow today otherwise particularly light. In metals markets, spot gold has been unable to benefit from the risk aversion seen in European equity markets as the firmer USD supresses prices and extends on recent losses. Elsewhere, Chinese steel futures were seen higher overnight as the prospects of additional output cuts supports prices, whilst copper prices endured another session of losses despite encouraging Chinese Caixin Manufacturing PMI. North Sea Buzzard oil field production is still restricted; according to sources

Looking at the day ahead, a range of data will be out, including: January Core PCE, February ISM manufacturing index, personal income and spending, weekly initial jobless claims and continuing claims and total vehicle sales. Onto other events, the Fed’s Powell is back again in front of the US Senate while the US Transportation Secretary Ms Chao also testifies before the Senate on Trump’s infrastructure plan. The ECB’s Nouy and Lane will also speak. Finally senior officials from Euro area finance ministries will discuss the banking union and the future role of the ESM.

US Event Calendar

  • 8:30am: Personal Income, est. 0.3%, prior 0.4%; Personal Spending, est. 0.2%, prior 0.4%; Real Personal Spending, est. -0.1%, prior 0.3%
  • 8:30am: PCE Deflator MoM, est. 0.4%, prior 0.1%; PCE Deflator YoY, est. 1.7%, prior 1.7%;
  • 8:30am: PCE Core MoM, est. 0.3%, prior 0.2%; PCE Core YoY, est. 1.5%, prior 1.5%
  • 8:30am: Initial Jobless Claims, est. 225,000, prior 222,000; Continuing Claims, est. 1.93m, prior 1.88m
  • 9:45am: Bloomberg Consumer Comfort, prior 56.6;
  • 9:45am: Markit US Manufacturing PMI, est. 55.9, prior 55.9
  • 10am: Construction Spending MoM, est. 0.3%, prior 0.7%
  • 10am: ISM Manufacturing, est. 58.7, prior 59.1
  • Wards Domestic Vehicle Sales, est. 13.3m, prior 13.1m; Total Vehicle Sales, est. 17.2m, prior 17.1m

DB’s Jim Reid concludes the overnight wrap

If you’re in Europe I hope your encounters with “The Beast from the East” weather system are going as well as can be expected. London saw some heavy snow yesterday – a rare sight. I was somewhat alarmed to read that meanwhile the Arctic is seeing a heatwave. Siberia is seeing temperatures 35 degrees C above averages at the moment and Greenland is having some of its hottest days for the time of year on record. There are always exceptions and extremes but I’ve seen a lot of stories suggesting that scientists are worried that global warming is causing this weather shift and that there is some evidence that climate could change more quickly in the future than even the most extreme forecasters have previously suggested. Food for thought.

Talking of which a turbulent February is now behind us and that’s just the markets. At the end today we’ll do our normal performance review but the highlight is that the record 15 month successive positive run for S&P 500 total returns are over. Interestingly yesterday was the fourth successive plus or minus 1% move day (in either direction) for the S&P 500 (-1.11%). February actually had 12 such days after the 13 months from the start of 2017 to January 2018 had just 10. An impressive stat.

Today we’ll see all the usual first of the month PMIs which are as important as ever, especially as its’ been a week of largely disappointing global data. We also have the all-important Fed preferred core US PCE inflation number. We’ll preview later but first today sees the fourth part of our series on the impact of rising yields and discusses the rising incidence of zombie firms in recent years (link).

Bottom-up data of some 3,000 companies in the FTSE All World index show that the percentage of zombie firms more than tripled to 2.0% of firms in 2016 from 0.6% in 1996. That matters because zombie firms are linked to fading  business dynamism and because years of low interest rates should have led to fewer such firms, not more. There are early signs we are at a turning point, however. The numbers for 2017, with two-thirds of firms reporting, suggest that zombie firm incidence declined sharply last year. If this proves to be a real trend, it may give central banks confidence that continuing to raise rates and pull away from unconventional monetary policy will have some advantages. As a recap on Monday we outlined the macro reasons why yields are rising and why they will continue to (link). On Tuesday we looked at the relationship between yields and credit through history (link) and yesterday the same with equities (link) with lots of trade ideas. So feel free to dip back in.

Onto today, as discussed we have the potentially market sensitive January PCE data. The consensus is for a +0.3% mom core reading and +1.5% yoy reading (which would be unchanged versus December). As a reminder the big pickup in medical services inflation in the January CPI report and healthcare industries series in the PPI report should read-through positively to today’s PCE. Our US economists also expect a +0.3% mom print. It’s worth also highlighting that Fed Chair Powell will also testify again today (in front of the Senate this time) however its highly unlikely to differ much from Tuesday’s speech so shouldn’t be much of a game changer. This morning we’ve also got the final manufacturing PMIs in Europe which means a first look at the data for the periphery also.

This morning in Asia, markets are broadly lower with the Nikkei (-1.84%) and Hang Seng (-0.40%) both down following the late US sell-off while China’s CSI300 (+0.31%) is up. The Kospi is closed today. Datawise, China’s February Caixin manufacturing PMI was slightly above market at 51.6 (vs. 51.3 expected) while Japan’s 4Q capital spending also beat at 4.3% yoy (vs. 3%) and the final reading of the Nikkei manufacturing PMI was revised up by 0.1 to 54.1. Elsewhere, President Trump has warned China that the US will use “all available tools” to prevent it from undermining global competition.

Risk assets were soft yesterday with European bourses ending lower after a late day sell-off (Stoxx 600 -0.71%) with the S&P 500 reversing earlier gains to close -1.11% with all sectors in the red and losses led by energy and material stocks.

Elsewhere, WTI oil dropped 2.32% following a higher than expected build up in US crude inventories while the VIX rose 7% to 19.85. Yields in Europe fell between 2 and 3bps while 10y Treasuries ended 3.2bps lower – albeit still c2bps above Tuesday’s lows.

Closer to home, Brexit headlines largely dominated the news outlets – at least after the storm stories – as the EU Commission released its draft legal text on the article 50 withdrawal agreement. All of the focus, and to put it simply – the important stuff, concerned Northern Ireland. As a reminder, at the December EU Council meeting it was the status of Northern Ireland post Brexit which was the main sticking point on agreeing progress on divorce talks between the UK and EU. As DB’s Oliver Harvey notes in a report he published yesterday (link), yesterday’s legal text showed that the EU have made Northern Ireland’s post-Brexit status much more explicit. In the absence of a future free trade agreement or technological solutions that would solve the border issue, Northern Ireland would remain within the EU regulatory and customs area. Oliver thinks that there is little prospect of PM May agreeing to the EU’s current draft text. Indeed May said that no UK prime minister could accept such a deal in the House of Commons yesterday. Indeed aside from the question of the opposition of the DUP, the details could compromise the constitutional integrity of the United Kingdom.

In this sense, May would face a far larger parliamentary rebellion than the 10 DUP MPs. As a reminder the release of the legal text comes only three weeks before the UK and EU must agree a transitional deal at the March EU Council, in which the UK needs the support of the Irish government. It also comes before May’s speech on Friday in which she is due to lay out her vision of a future UK/EU trade relationship, which now appears to be a must watch TV event.

As Oliver rightly says, they have reduced the chance of transitional agreement being reached at the March Council, and increased the risk of an imminent political crisis in the UK. We can’t help feel that the EU have seen opposition leader Corbyn’s loose support for a customs union and decided to play a game of high stakes given they in theory like this idea. It could be that the unelected officials at the EU force the UK electorate to the polls again soon if a  Northern Ireland solution can’t be found. Ex Tory PM Sir John Major didn’t help Mrs May by saying “the (Brexit referendum) result gave the government the obligation to negotiate a Brexit. But not any Brexit; not at all costs and certainly not on any terms” and that voters have rights to “reconsider” Brexit. Elsewhere, he added “the only solution that I can see is to join a customs union”.

Unsurprisingly it was Gilts and Sterling that were the relative big movers in markets yesterday. 10 Gilt yields ended the session down 6.1bps at 1.499% and the Pound fell -1.07% versus the USD (most since 5th Feb) and -0.75% versus the Euro (most since Nov. 17).

Before we take a look at today’s calendar, we wrap up with the other data releases from yesterday. In the US, the February Chicago PMI was below market but still solid at 61.9 (vs. 64.6 expected). The January pending home sales fell 4.7% mom (vs. 0.5% expected), partly impacted by higher mortgage rates.

Notably, the annual growth is now -1.7% and the lowest since 2014. Elsewhere, the second reading on the 4Q GDP was revised down by 0.1ppt, but in line with expectations at 2.5% qoq.

The Euro area’s February headline and core CPI were both in line at 1.2% yoy and 1% yoy respectively, while France (1.3% yoy vs. 1.5% expected) and Italy’s CPI (0.7% yoy vs. 1% expected) were below market. Germany’s February unemployment rate was also in line at 5.4% and remained at its post-unification low. Elsewhere, France’s January PPI was 0.9% yoy (vs 1.7% previous) while the second reading of its 4Q GDP was in line at 0.6% qoq, leading to annual growth of 2.5% yoy. The February GfK consumer confidence index for the UK was in line at -10, while the March index for Germany was slightly softer at 10.8 (vs. 10.9 expected).

Looking at the day ahead, the final readings on February manufacturing PMIs across Europe are also due. Elsewhere, the Euro area and Italy January unemployment rate will be out. In the UK, the January net consumer credit lending and mortgage approvals along with the February flash manufacturing PMI and Nationwide House price index are all due. In the US, a range of data will be out, including: January Core PCE, February ISM manufacturing index, personal income and spending, weekly initial jobless claims and continuing claims and total vehicle sales. Onto other events, the Fed’s Powell is back again in front of the US Senate while the US Transportation Secretary Ms Chao also testifies before the Senate on Trump’s infrastructure plan. The ECB’s Nouy and Lane will also speak. Finally senior officials from Euro area finance ministries will discuss the banking union and the future role of the ESM.

3. ASIAN AFFAIRS

i)Late THURSDAY MORNING/WEDNESDAY NIGHT: Shanghai closed UP 14.34 POINTS OR 0.44% /Hang Sang CLOSED UP 199.53 POINTS OR 0.65% / The Nikkei closed DOWN 343.77 POINTS OR 1.56%/Australia’s all ordinaires CLOSED DOWN 0.68%/Chinese yuan (ONSHORE) closed DOWN at 6.3493/Oil DOWN to 61.26 dollars per barrel for WTI and 64.06 for Brent. Stocks in Europe OPENED DEEPLY IN THE RED  .   ONSHORE YUAN CLOSED DOWN AT 6.3493 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.3543 /ONSHORE YUAN TRADING STRONGER AGAINST OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING MUCH WEAKER AGAINST THE DOLLAR AND ALL OTHER CURRENCIES. CHINA IS  HAPPY TODAY (WEAK CURRENCY AND GOOD CHINESE MARKETS/ BUT POOR GLOBAL MARKETS) 

3 a NORTH KOREA/USA

/NORTH KOREA

end
 

3 b JAPAN AFFAIRS

end

c) REPORT ON CHINA

China is definitely slowing down: the following will not help as Chinese giant HNA will planning to axe 100,000 jobs or 1/4 of its workforce

(SouthChinaMorningPost/Hong Kong)

Chinese giant HNA to axe 100,000 jobs, quarter of its workforce, says report

Private conglomerate planning the cuts this year amid a liquidity squeeze, Risk Event-Driven and Distressed Intelligence has reported, citing five unidentified sources

PUBLISHED : Wednesday, 28 February, 2018, 10:15pm
UPDATED : Wednesday, 28 February, 2018, 11:33pm

HNA Group, the Chinese private conglomerate, is planning to cut 100,000 jobs or about a quarter of its global workforce this year amid a liquidity squeeze, Risk Event-Driven and Distressed Intelligence (REDD), the emerging markets news website, has reported, citing five unidentified sources

 Job cuts of that scale would rank among the biggest ever for any single company.

The heavily indebted Chinese giant plans to eliminate jobs in areas such as human resources, business operations and asset restructuring, REDD reported, citing the people.

The axe will also fall on units that HNA is planning to sell and the group has informed staff at its home base of Haikou, Hainan province, about the reduction plan, according to the report.

Employees at HNA’s aviation arm could be spared, as the business has been recruiting, REDD reported. A representative at HNA could not immediately comment.

Financial pressure has been intensifying on HNA after it spent tens of billions of dollars to snap up global assets from Manhattan buildings to hotels.

The group has reversed its overseas shopping spree and has been focusing on selling assets in recent months to repay debts.

HNA told creditors it was facing a potential shortfall of at least 15 billion yuan (US$2.3 billion) in its ability to repay debt in the first quarter, sources with knowledge of the matter said.

It is the first time such details of the group’s financial squeeze have emerged, illustratin­g the extent and urgency of the liquidity challenges that HNA is facing.

In February, HNA announced a US$2 billion deal for two land parcels in Hong Kong and offloaded part of its stake in Deutsche Bank.

HNA Group chairman Chen Feng said that liquidity problem exists “because we made a big number of mergers”, even as the external environment became more challenging and China’s economy “transitioned from rapid to moderate growth”, impacting the group’s access to new financing, Reuters reported in January.

HNA, among other high-profile overseas assets acquirers, has been falling under tougher government scrutiny on “irrational” overseas buying.

In June 2017, HNA, together with Wanda, Fosun International, Anbang Insurance Group, and east China’s Zhejiang-based Rossoneri Sport Investment – the vehicle used by mainland businessman Li Yonghong to acquire Italian soccer club AC Milan in April 2017 – have been singled out for scrutiny by local banks, following a directive from the banking regulator, according to emails seen by the South China Morning Post.

Additional reporting by Maggie Zhang, in Shanghai

 This article appeared in the South China Morning Post print edition as: HNA plans to eliminate 100,000 jobs in 2018
END
(See below/USA section where Trump initiates steep tariffs on aluminum and steel)
China warns that it is very concerned with Trump’s protectionist policies  ie. huge tariffs on steel and aluminum
(courtesy zerohedge)

China Warns It Is “Seriously Concerned” About US Trade-Policy Agenda

Ahead of Trump’s steel and aluminum tariff announcement, now tentatively expected to take place around 11am, China said it was “seriously concerned” over U.S. criticism of China’s economic growth model and related policies in its annual report on trade-policy agenda, China Ministry of Commerce said in statement on website.

The U.S. trade-policy report is ignorant of China’s “huge” accomplishments in building market-based economy and the fact that China sticks to commitments to WTO.

According to Beijing China and the U.S. should manage and control differences in constructive ways while avoiding politicizing economic, trade issues. The two nations should also improve communications and open markets to each other, and solve key concerns of both sides appropriately.

As a reminder, yesterday President Trump warned that the U.S. will use “all available tools” to prevent China’s state-driven economic model from undermining global competition, in his latest warning to Beijing as America readies a host of trade actions.

According to the president’s annual report to Congress on his trade-policy agenda, China hasn’t lived up to the promises of economic reforms it made when it joined the World Trade Organization in 2001, and actually appears to be moving further away from “market principles” in recent years. The report also accused that China’s “statist” policies are causing a “dramatic misallocation” of global resources that is leaving all countries poorer than they should be.

And the most direct threat was the following line in the report: “China is free to pursue whatever trade policy it prefers. But the United States, as a sovereign nation, is free to respond.”

As reported earlier, and as Bloomberg adds, Trump’s warning comes as his administration considers a range of actions either directly aimed at China, or that could impact the Asian power.

The president is weighing several options for curbing imports of steel and aluminum, and Trump has told confidants he’s considering a global tariff on steel of 24 percent, the most punitive alternative recommended by his officials. The administration is ready to act unilaterally if necessary to fight unfair trading practices, according to trade report.

Meanwhile, Xi has called for countries to avoid protectionism and stick to the current path of globalization. At the same time, Chinese officials are weighing raising tariffs on U.S. soybeans as tensions escalate.

There will likely be discussions over such trade irritants when Liu, who sits on China’s 25-member Politburo, meets with a group of Trump’s most senior economic advisers on Thursday, including Gary Cohn, Treasury Secretary Steven Mnuchin and Lighthizer. He’s also expected to talk with Susan Thornton, the State Department’s acting assistant secretary for East Asia and the Pacific.

For now, however, one thing is without doubt: China is winning the trade battle with the US.

It still remains to be seen if US-Chinese relations turn into an all out trade war as Trump tries to change the direction of the trend shown above.

4. EUROPEAN AFFAIRS

Great Britain/WPP

WPP is a Bellwether on the global economy..a rise in its stock means the global economy is growing and a drop in its value means contraction.  Their stock fell 15% overnight as its chairman stated that he sees little growth.  What does this mean to ad dependent Google, Facebook etc.

(courtesy zerohedge)

8. EMERGING MARKET

South Africa

We highlighted this to you over the past few weeks.  It looks like South Africa will confiscate White Owned land with zero compensation.  This will surely bankrupt the country. Over 73% of all agricultural land in South Africa is owned by Whites.

(courtesy zerohedge)

“Time For Reconciliation Is Over” – South Africa Votes To Confiscate White-Owned Land

Is South Africa on the verge of a race-based civil war?

Just as we warned was likely a week ago, the Parliament of South Africa voted this week in favor of a motion allowing lawmakers to amend the constitution to allow for the confiscation of white-owned farmland without any form of monetary compensation.

The motion, brought by the Economic Freedom Fighter (EFF) leader Julius Malema (radical Marxist), was overwhelming adopted in parliament with a vote of 241 in support, and 83 against.

According to News24.com, an English-language South African online news publication, there were only a few parties that were against the motion including the Democratic Alliance, Freedom Front Plus, Cope and the ACDP. The proposal will be sent to the Constitutional Review Committee which must report back to Parliament by late August.

Confiscation of white-owned farmland was a major topic in the new president Cyril Ramaphosa’s platform, after he became the fifth President of South Africa since the 1994 democratic transition, in mid-February.

“The time for reconciliation is over. Now is the time for justice,” Malema told the parliament.

“We must ensure that we restore the dignity of our people without compensating the criminals who stole our land.”

With over 50 million citizens in South AfricaBloomberg indicates that a 2017 government report shows white people own 73 percent of farmland.

White farmers own almost three-quarters of South Africa’s agricultural land, even after 23 years of government efforts to redistribute land to the black majority, City Press reported, citing a land audit by farm lobbying group Agri SA.

Some 73.3 percent of agricultural land is owned by whites, down from 85.1 percent in 1994, the year South Africa first held democratic elections, the newspaper reported.

Black ownership has increased markedly in some of the country’s most fertile provinces. Black farmers own 74 percent of the land in KwaZulu-Natal and 52 percent in Limpopo, City Press reported, citing the report to be released this week.

Total acreage available for farming fell 4 percent over the 23 years reviewed, as mining and expanding municipalities took over agricultural land, according to economist Johann Bornman, who conducted the audit for the lobbying group.

Last week, South Africa’s new president, Cyril Ramaphosa, said that he would return the lands owned by the white farmers since the mid-1600s to the black citizens of the country. He added the country’s agriculture (see below) must be preserved.

Gugile Nkwinti, the former minister of rural affairs and land reform until Monday (reassigned to the minister of water affairs) said, “The ANC unequivocally supports the principle of land expropriation without compensation.”

“There is no doubt about it, land shall be expropriated without compensation,” he added.

On the other hand, the official opposition Democratic Alliance party (DA) has criticized the motion, saying white confiscation of farmland by the government will undermine property rights and possibly collapse the economy.

The DA’s Thandeka Mbabama told the parliament that the wrongs of the past must be addressed, but white confiscation of farmland without compensation “cannot be part of the solution.”

The Transvaal Agricultural Union of South Africa (TAU SA), a commercial farmers union in the region, warned the country is in danger of traveling the same path as Zimbabwe, which “plunged into famine after a government-sanctioned purge of white farmers in the 2000s,” said the Russian Times.

“Where in the world has expropriation without compensation coupled to the waste of agricultural land, resulted in foreign confidence, economic growth and increased food production?” Meintjes said, via Australia’s news.com.au.

“If Mr Ramaphosa is set on creating an untenable situation, he should actively create circumstances which will promote famine. His promise to expropriate land without compensation sows the seed for revolution. Expropriation without compensation is theft.”

Freedom Front Plus leader Pieter Groenewald warned,

“If you continue on this course, I can assure you there is going to be unforeseen consequences that is not in the interest of South Africa.”

The Coming Civil War in South Africa explained: 

 end

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

Euro/USA 1.2177 DOWN .0015/ REACTING TO MERKEL’S FAILED COALITION/ SPAIN VS CATALONIA/REACTING TO +GERMAN ELECTION WHERE ALT RIGHT PARTY ENTERS THE BUNDESTAG/ huge Deutsche bank problems + USA election:/TRUMP HEALTH CARE DEFEAT//ITALIAN REFERENDUM DEFEAT/AND NOW ECB TAPERING BOND PURCHASES/JAPAN TAPERING BOND PURCHASES /USA FALLING INTEREST RATES AGAIN/HOUSTON FLOODING/EUROPE BOURSES ALL IN THE RED 

USA/JAPAN YEN 106.69 DOWN  0.059 (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 1.3753 DOWN .0001(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 1.2856 UP .0021 (CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA)

Early THIS THURSDAY morning in Europe, the Euro FELL by 12 basis points, trading now ABOVE the important 1.08 level RISING to 1.2214; / Last night Shanghai composite CLOSED UP 14.34  OR 0.44% /   Hang Sang CLOSED UP 199.53 POINTS OR 0.65%  /AUSTRALIA CLOSED DOWN 0.68% / EUROPEAN BOURSES DEEPLY IN THE RED  

The NIKKEI: this THURSDAY morning CLOSED DOWN 343.77 POINTS OR 1.56%

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

2/ CHINESE BOURSES / : Hang Sang CLOSED UP 199.53 POINTS OR 0.65%  / SHANGHAI CLOSED DOWN 32.66 OR 0.99%   /

Australia BOURSE CLOSED DOWN 0.68% /

Nikkei (Japan)CLOSED DOWN 321.62 POINTS OR 1.44%

INDIA’S SENSEX  IN THE RED

Gold very early morning trading: 1308.25

silver:$16.29

Early THURSDAY morning USA 10 year bond yield: 2.822% !!! DOWN 4  IN POINTS from WEDNESDAY 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 3.103 DOWN 2 IN BASIS POINTS from TUESDAY night. (POLICY FED ERROR)/DEADLY

USA dollar index early THURSDAY morning: 90.76 UP 14  CENT(S) from WEDNESDAY’s close.

This ends early morning numbers THURSDAY MORNING

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And now your closing THURSDAY NUMBERS \1 PM

Portuguese 10 year bond yield: 1.947% DOWN 5  in basis point(s) yield from WEDNESDAY/

JAPANESE BOND YIELD: +.0.043% DOWN 1    in basis points yield from WEDNESDAY/JAPAN losing control of its yield curve/

SPANISH 10 YR BOND YIELD: 1.507% DOWN 3  IN basis point yield from WEDNESDAY/

ITALIAN 10 YR BOND YIELD: 1.947 DOWN 3 POINTS in basis point yield fromWEDNESDAY/

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

GERMAN 10 YR BOND YIELD: FALLS TO +.644%   IN BASIS POINTS ON THE DAY

END

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IMPORTANT CURRENCY CLOSES FOR THURSDAY

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

Euro/USA 1.2211 UP .0020 (Euro UP 20 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 106.87 UP 0.236 Yen DOWN 24 basis points/

Great Britain/USA 1.3744 DOWN .0009( POUND DOWN 9 BASIS POINTS)

USA/Canada 1.2850 UP  .0015 Canadian dollar DOWN 15 Basis points AS OIL FELL TO $60.99

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This afternoon, the Euro was UP 20 to trade at 1.2211

The Yen FELL to 106.87 for a LOSS of 24 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 9 basis points, trading at 1.3744/

The Canadian dollar FELL by 15 basis points to 1.2850/ WITH WTI OIL FALLING TO : $60.99

The USA/Yuan closed AT 6.3580
the 10 yr Japanese bond yield closed at +.043%  UP 1  BASIS POINTS / yield/
Your closing 10 yr USA bond yield DOWN 2 IN basis points from WEDNESDAY at 2.857% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 3.125  DOWN 2  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, 90.62 UP 1 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 THURSDAY: 1:00 PM EST

London: CLOSED DOWN 56.27 POINTS OR 0.78%
German Dax :CLOSED DOWN 244.91 POINTS OR 1.97%
Paris Cac CLOSED DOWN 57.93 POINTS OR 1.09%
Spain IBEX CLOSED DOWN 101.70 POINTS OR 1.03%

Italian MIB: CLOSED  DOWN 159.23 POINTS OR 0.70%

The Dow closed DOWN 420.22 POINTS OR 1.68%

NASDAQ WAS DOWN 92.45 Points OR 1.27% 4.00 PM EST

WTI Oil price; 60.99 1:00 pm;

Brent Oil: 63.18 1:00 EST

USA /RUSSIAN ROUBLE CROSS: 56.77 UP 42/100 ROUBLES/DOLLAR (ROUBLE LOWER BY 42 BASIS PTS)

TODAY THE GERMAN YIELD FALLS TO +.644% 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:$61.32

BRENT: $64.17

USA 10 YR BOND YIELD: 2.811%   THIS RAPID ASSENT IN YIELD IS VERY DANGEROUS/DERIVATIVES START TO BLOW UP/ 

USA 30 YR BOND YIELD: 3.093%/BROKE GUNDLACH’S KEY 3.00% AGAIN WHERE ALL VALUATIONS ON STOCKS BLOW UP/

EURO/USA DOLLAR CROSS: 1.2263 UP.0072  (UP 72 BASIS POINTS)

USA/JAPANESE YEN:106.23 DOWN 0.410/ YEN UP 41 BASIS POINTS/ very dangerous as yen carry traders are getting killed/yen continues to rise despite the NYSE rising.

USA DOLLAR INDEX: 90.27 DOWN 35 cent(s)/dangerous as the lower the dollar the higher the inflation.

The British pound at 5 pm: Great Britain Pound/USA: 1.37675: UP 0.0021  (FROM LAST NIGHT UP 21 POINTS)

Canadian dollar: 1.2823 UP 8 BASIS pts

German 10 yr bond yield at 5 pm: +0.644%


VOLATILITY INDEX:  22.47  CLOSED  up   2.62

LIBOR 3 MONTH DURATION: 2.01%  

END

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

TRADING IN GRAPH FORM FOR THE DAY

Stocks Slammed Into Red For 2018: Powell Plunge, Dudley Dump, Or Trump Turmoil?

Gluskin Sheff’s David Rosenberg summed it all up nicely“Hmmm. Let’s see. Tariffs. Sharp bond selloff. Weak dollar policy. Massive twin deficits. New Fed Chairman. Cyclical inflationary pressures. Overvalued stock markets. Heightened volatility. Sounds eerily familiar (from someone who started his career on October 19th, 1987!).”

h/t Doug Kass

Only The Nasdaq remains green for 2018…

A very chaotic day across asset classes today amid headlines from Powell, Dudley, and Trump (note the post-Trade-War move sent USD, Bond yields, and stocks all lower together – a different regime from earlier in the day)…

While the blame for today’s tumble has been laid at Trump’s feet (for his trade war talk), we do note that both The Fed’s Powell (hawkish with comments about getting behind the curve on inflation) and Dudley (uber hawkish noting that 4 rate hikes is still gradual) went full hawk intraday and didn’t exactly help things...

Dow’s bounce stalled perfectly at 75%, then snapped back below Fib 68.2 and 50 and found support today at Fib 38.2…

Notably The S&P is down 1% for 3 straight days – the first time since the global growth scare in January 2016.

The week got ugly once Powell started…

VIX spiked to over 25 but was hit hard there…again

But the VIX term structure remains inverted…

The S&P bounced at its 100DMA

Tech was hammered today with FANGs and AAPL making good use of buyback this afternoon…

Treasury yields tumbled today – with the entire curve now lower in yield on the week…

30Y Yields dropped to 3-week lows…

Breakevens were hammered lower again… smelling a lot like the VIXgeddon week’s moves…

The Dollar Index was slammed lower – worst day in a week (first down day in a week)…seemingly unable to break that critical resistance above the Mnuchin Massacre…

As the dollar sank so commodities rebounded (PMs most and crude less so)…Silver surged back into the green on the week…

Cryptos were broadly higher today (as the dollar slumped)…

Is Bitcoin still leading The Dow?

Just as we started with him, it seems appropriate to give Rosie the last word… “I’ve always been a huge fan of Paul Tudor Jones. If he’s right and the 10-yr note yield jumps to 3.75% within a year, that would imply a -5% total return. But the implications for the ERP, all else equal, would mean a near-15% slide in the SPX. Oops — he left that part out!

“The laugh of the day really has to come from the front page WSJ article titled “Investors’ Overriding Fear: Missing Out on Stock Rally”. What perfect timing, just as the SPX moves into negative terrain year-to-date.

#BringBackOurYellen

end

Early this morning, Powell flip flops

(courtesy zerohedge)

Stocks Jump, Dollar Dumps As Powell Flip-Flops On Inflation

What the market interpreted 48 hours ago as hawkish, is now dovish.

On Tuesday Fed Chair Powell proclaimed boldly:

CONFIDENCE ON INFLATION GETTING STRONGER

700 Dow points lower and VIX back above 20 and we arrive at this morning and Powell’s flip-flop:

NO STRONG EVIDENCE OF DECISIVE MOVE UP IN WAGES, MORE LABOR MARKET GAINS CAN OCCUR WITHOUT CAUSING INFLATION”

So dovish Powell is back and stocks are ripping higher…

Here are some of the highlights according to various desks:

  • Wages less of a factor: Powell said that he expects to see more wage increases. “I would expect that some continued strengthening in the labor market can take place without causing inflation,” he said. “We don’t see any strong evidence yet of a decisive move up in wages.” This means the Fed is not as glued to rising wage prints (assuming they are there) as previously assumed.
  • The Fed is also less hawkish on labor: Powell said there are a couple of places with additional slack in the labor market, primarily in the prime-age participation rate. He adds that unemployment is at or near the natural rate, even below.
  • No evidence of overheating: “By continuing to gradually raise interest rates over time, we’re trying to balance those two things and achieve inflation moving up to target but also make sure the economy doesn’t overheat,” Powell said adding that “the economy is strong, and it’s even stronger now,” noting “there is no evidence the economy is overheating.” On the other hand, Powell also said that the Fed does not want to cause a recession by getting behind the curve and having to raise rates quickly.
  • Fiscal policy: The tax bill will add meaningfully to growth in the next couple years but we are not on a sustainable fiscal path. Wouldn’t single out the tax bill as affecting rate hikes.
  • Inflation: We see idiosyncratic factors behind low inflation, but is part of a global phenomenon. We don’t want to fall behind the curve on inflation.

And the dollar is dumping as gold pops.

end
Then, strangely, on a report that the ECB will delay the end of its QE,, the Euro rises and the dollar tumbles
go figure..
(courtesy zerohedge)

Dollar Tumbles, Euro Spikes On Report ECB Will Delay QE End Announcement

The Dollar slumped to session lows as the Euro jumped to HOD, and back over 1.22, following a Reuters report that while ECB policymakers are “likely to discuss a small tweak in their communication stance at their March 8 meeting” no major policy shift is expected.

According to the report, the ECB is hoping to delay any discussion of the inevitable, and hawkish, tapering of QE and amid concerns about recent market turbulence, the strong euro and a dip in both headline and underlying inflation, the ECB prefers to wait “perhaps as late as the summer”, before starting to signal the end of asset buys, the sources said.

The market reaction was quick, pushing the EUR to session highs even as the market debates if the concurrent Powell presentation is dovish or hawkish.

As Reuters adds, having bought more than 2 trillion euros worth of bonds to prop up inflation, the ECB is expected to shut its bond purchase scheme by the end of the year, satisfied that robust economic growth will lift consumer prices, even if only slowly. But the sources said the bank wants plenty of evidence that inflation will rise, fearing damage to its credibility if moved too early and had to reverse course.

Some more details on how the ECB has trapped itself, and just like Custer, is facing its last stand, in the words of Paul Tudor Jones:

The most ambitious change to be discussed at the meeting could be a proposal to give up the bank’s so-called easing bias, a stipulation that the ECB could increase asset buys if necessary.

While this would be relatively uncontroversial as few if any expect bigger purchases, policymakers rejected such a suggestion in January and the sources said fundamentals did not change enough since then to make such a tweak certain.

And while Reuters is known for spreading ECB trial balloons, if accurate this suggests that a broader decision about revamping the bank’s guidance, already flagged for “early” 2018, will not come this month, with some policymakers arguing that such a shift could wait until April or June.

The bottom line: it’s all about the market, and the ECB knows that the moment the end of QE is announced, the shockwave will be major:

“There is general concern about market volatility and inflation has been heading down so it’s clearly not the right time,” one of the sources said. “The easing bias could easily go but even that might have to wait. There is fear about signaling too much and increasing market volatility,” the source added.

end
Fed’s Dudley sinks stocks when he signals that the 4 rate hikes are still gradual..
in other words..very dovish
(courtesy zerohedge)

Stocks Sink As Dudley Signals “Four Rate Hikes Is Still Gradual”

While their remains doubt over just how hawkish Fed Chair Powell is, it’s pretty clear which way Fed’s Dudley is swinging…

  • *DUDLEY SAYS FASTER PACE OF FED TIGHTENING REMAINS TO BE SEEN
  • *FED’S DUDLEY: FOUR 25 BP RATE HIKES `WOULD STILL BE GRADUAL’

And the reaction is a drop in stocks…

For now Bonds and the Dollar are ignoring Dudley…

end
Then in afternoon trading:

Trade War Talk Tanks Stocks, Spikes VIX Above 23

We warned ahead of Trump’s big announcement that China may send a message

Emperor Xi about to give the sell order

Perhaps they just did..Dow down 350/VIX back above 23

It’s been quite a day across asset-classes so far…

end
The hardest hit country for tariffs on steel:  Canada.  China did not make the top 10 although it is the largest supplier of Aluminum
(courtesy zerohedge)

Which Countries Will Be Hardest Hit From Trump’s Tariffs

The Trump administration announced today that it will impose global tariffs on steel and aluminum imports; the proposed levels are 25% on steel imports and 10% on aluminum imports and the rates will apply to all source countries. While no normal declaration was made, the president said he would formally institute these tariffs next week and has promised that they would be in effect “for a long period of time.”

The White House said the tariffs are needed to “protect American-based businesses and workers from cheap foreign steel” that it claims is unfairly subsidized. A Commerce Department report pointed to several mill closures in the past few years and the loss of several thousand jobs.

“We are going to continue to protect American workers,” White House spokeswoman Sara Sanders said Thursday.

And while Trump’s stated intention behind the tariffs is to protect American jobs and domestic producers while punishing major foreign trade partners who “benefit” from US gullibility – i.e. China – not only is Trump unlikely to have much success, but the direct macroeconomic effects would be limited.

For one thing, imports of steel and aluminum together account for only about 2% of total goods imports (figure 1). The U.S. imports four times as much steel as it exports, and imports are on the rise again. While the U.S. imports steel from more than 100 countries, three-quarters come from just eight countries (figure 2), according to the International Trade Organization.

Furthermore, while Trump’s trade war is clearly aimed at China, the top exporters to the U.S. in 2017 were Canada, followed by Brazil, South Korea, Mexico and Russia. Other notables include Turkey, Japan, Taiwan and Germany. China did not even make the top 10, coming in at 11th spot, despite producing half of the world’s steel. Furthermore, as Marketwatch notes, the US already has restrictions on Chinese steel imports.

Meanwhile, the five targeted source countries for aluminum tariffs make up a much smaller share of aluminum imports, accounting for only 20% over the past three years, with nearly all coming from two countries, China and Russia (figre 3), according to Barclays.

In other words, if Trump hopes to punish China (and Russia and South Korea), he will have to try mach harder.

Meanwhile, according to Barclays calculations, the direct economic effects of anti-trade policies in these industries will be limited, given their small share in total goods imports. On the issue of what, if any, inflationary impulse will be generated from higher tariffs, it depends on whether firms view the increase as permanent and if the current state of the business cycle would contribute to a high pass-through rate from tariffs to final goods. That said, Barclays estimates tariffs at these levels to boost y/y rates of core CPI and PCE by an almost negligible 0.1pp.  Separately, in regard to activity, the tariffs could reduce trade volumes and higher prices could restrain consumer and business spending. Together Barclays estimates they could reduce GDP growth by 0.1-0.2pp.

And while the direct threat to the US economy from Trump’s tariffs is negligible, the risk of course, lies in the response of US trading partners and whether the administration’s decision to impose restrictive trade policies is only the first in a series of moves. To be sure, as noted earlier, in light of the record US trade deficit (ex petroleum), it is likely that the White House will seek to enact further steps to restrict trade.

Finally, it is worth noting that as Bloomberg highlights, “in 2002 President Bush imposed tariffs of as much as 30% on steel imports before reversing course the following year amid a heap of retaliation from trading partners. What followed was a drop of more than 30% in the S&P 500, a weaker dollar and a rally in bonds that cut 10-year yields almost in half.”

It won’t take much for offshore holders of trillions in US securities – both stocks and bonds – and certainly the newly crowned Emperor Xi, to bark “sell”, and watch as Trump’s precious stock market implodes upon itself, forcing the administration to quickly reverse course.

END

Not good for GDP numbers:  real personal spending drops the most in 2 years as saving rate jumbs.(courtesy zerohedge)

Real Personal Spending Drops Most In 2 Years As Savings Rate Jumps

Despite a slightly better than expected rise in personal income (+0.4% MoM), Real Personal Spending declined 0.1% in January – its biggest drop since January 2016.

The was the bad news; the good news was in the nominal Personal Income number, which rose 0.4% MoM in January (vs 0.3% expected rise), the same growth as in December. The number got a big boost from the tax cuts which started filtering through to paychecks thanks to one-time corporate bonuses. As a result, worker pay adjusted for inflation and taxes rose 0.6%, the most since December 2012Wages and salaries were adjusted up by $30 billion to reflect one-time bonuses given out in wake of tax cut legislation.

Additionally, consumers benefited from the $115.5 billion annualized drop in personal taxes.

Meanwhile, Personal Spending growth slowed to 0.2% MoM from 0.4% MoM in December.

And with the PCE Deflator coming in hotter than expected at +0.4% MoM, real personal spending dropped the most in 2 years…

Meanwhile, inflation continued to tick up if not at a runaway pace, with the PCE Price Index rising 0.4% M/M, and 1.7% Y/Y while the January PCE Core Price Index rose 0.3% M/M and 1.5% Y/Y.

Commenting on the data, Bloomberg senior economist Yelena Shulyatyeva said that “The stall in retail sales in January was a precursor to a more pervasive pattern in overall household consumption. Weakness in personal spending should be temporary, likely the result of two factors: adverse weather hindered retail sales at the start of the month, and the January data may be payback after a stellar fourth-quarter performance. Robust disposable income growth, driven by tax cuts, will likely boost consumption as the first quarter progresses.”

It appears American consumers finally had their ‘come to jesus’ moment with credit excess as the savings rate jumped off record lows, also largely thanks to the tax-cut impact.

Which is the last thing the administration and The Fed wants – remember, saving bad, spending good.

Still, in context, this report – together with yesterday’s GDP print which showed resilient Q4 spending – confirms that the US consumer is doing well, at least for the time being.

end

This will not end well with respect to China:  Trump is to announce steep tariffs on both aluminium and steel.  China and South Korea will certainly be affected

(courtesy zerohedge)

Trump To Announce Steep Tariffs On Aluminum, Steel Imports As Soon As Today

Update: In yet another sign that the tariffs could be unveiled as soon as today, Trump tweeted Thursday morning that “our steel and aluminum industries (and many others) have been decimated by decades of unfair trade and bad policy with countries around the world…We must not let our country, companies and workers be taken advantage of…”

Our Steel and Aluminum industries (and many others) have been decimated by decades of unfair trade and bad policy with countries from around the world. We must not let our country, companies and workers be taken advantage of any longer. We want free, fair and SMART TRADE!

Meanwhile, Axios published a study showing voters in swing states largely back Trump’s protectionist trade policies, with about half of the voters surveyed saying they’d be willing to pay more for cars if it helped the US steel and automotive industries.

* * *

Ignoring threats of a WTO challenge by the European Union and other potentially harmful countermeasures by China, President Trump is reportedly preparing to impose stiff tariffs on steel and aluminum on Thursday, according to Bloomberg.

Trump has abruptly summoned steel and aluminum executives to the White House – telling them he could announce the tariffs at the meeting, the Wall Street Journal adds.

Last week, media reports said Trump was leaning toward the stiffest trade protections from a bevy of options presented to him by the Commerce Department two weeks ago. These include  tariffs of 25 percent on steel and 10 percent on aluminum from all countries.

However, other sources told WSJ that a final decision on tariffs had not yet been made, and that the meeting could just be an opportunity to consider alternatives.

In its initial study, the Commerce Department and other agencies concluded that imports of cheap steel and aluminum harm US national security and military needs. While Trump is said to favor the broadest measures, Defense Secretary James Mattis has suggested that exemptions could be made. Commerce Secretary Wilbur Ross, a longtime steel executive, has also pushed for the toughest sanctions.

The White House ordered the Commerce Department back in April to look into these issues under the seldom-used section 232 of the 1962 Trade Expansion Act.

Steel

Both BBG and WSJ pointed out that tariffs could elicit protests and retaliations from some of the US’s biggest trading partners. The timing of the announcement could also be interpreted as an insult to China. Liu He,President Xi Jinping’s top economic advisor who’s widely believed to be in line to become China’s next financial superregulator as well as head of the PBOC, is visiting Washington this week.

Contrary to the outraged reactions from US trade partners and some pro-free trade economists, UBS’ chief economist Paul Donovan suggested that a 25% tariff on steel and 10% tariff on aluminum wouldn’t have much of an impact on consumers, who could see prices of goods from beer cans to cars move marginally higher. Indeed, the pass-through impact felt by consumers from Trump’s tariffs on solar panels and washing machines would probably be more intense.

The real risk, UBS says, is to markets, which – if history is any guide – could pitch a fit as protectionist rumblings out of the Trump administrations have often harmed stocks and the dollar. Reports late last night that Trump might unveil the sanctions today sent Asian steel stocks lower.

One economist who spoke with Bloomberg said Trump’s tariffs likely wouldn’t have a major impact on global trade on their own – the danger, he said, lies in whether the affected countries (i.e. China, Mexico and Canada) choose to retaliate. China in particular has been accused of flooding the global market with cheap steel to undermine foreign producers.

Chinese bureaucrats are already threatening retaliation.

“The United States has over-used trade remedies and it will impact employment in the U.S. and the interests of U.S. consumers,” Chinese Foreign Ministry spokeswoman Hua Chunying said. “China will take proper measures to safeguard its rights and interests.”

European officials have argued it doesn’t make sense to penalize NATO members in the name of national security.

Trump’s protectionist push comes as free-trade Republicans pressure him to soften the crackdown. However, the decision will likely go over well in Pennsylvania and Ohio – two rust belt swing states that Trump needs to keep in his corner if he wants to win reelection in 2020.

Imposing these tariffs could also complicate the renegotiation of the North American Free Trade Agreement. Canada and the US are already engaged in mini-trade spats over the Trump administration’s decision to slap a massive 300% tariff on C-Series jets produced by Canadian aerospace company Bombardier.

Ironically, Trump’s unveiling of the new tariffs would follow a surprising statement made by Treasury Secretary Steve Mnuchin earlier this week that the president is open to rejoining the Trans-Pacific Partnership – that is, if he could secure a good enough deal.

Trump still prefers bilateral trade agreements over group accords, Mnuchin said.

Any announcement on tariffs likely wouldn’t come until late Thursday, after Trump’s meeting with steel and aluminum executives has concluded.

end

Manhattan landlords are now feeling the pinch: they are slashing rents to fill vacant storefronts

(courtesy zerohedge)

“They’re Finally Accepting Reality” – Manhattan Landlords Are Slashing Rents To Fill Vacant Storefronts

Owners of Manhattan’s commercial real-estate might soon begin to regret their decision to hike rents to absurdly high levels in the hope of attracting the next Chase, Bank of America or Duane Reade capable of paying their extortionate prices.

As Bloomberg reports, owners of prime retail storefronts in the heart of Soho – a trendy shopping district in downtown Manhattan – are struggling to find and retain tenants willing to pay the record rents being demanded by landlords.

BBG

The Bloomberg story begins by recounting the story of one boutique clothing shop that threatened to vacate its space six years early and just eat its security deposit unless the landlord agreed to a lower rate.

The Kooples, a French clothing seller, is threatening to vacate its space six years ahead of schedule if it can’t get landlord Thor Equities to cut the rent. With brick-and-mortar stores suffering from a retail industry shakeout, the company says it isn’t making enough money at the property and wants to focus on the web.

The scene unfolding on the cobblestones of one of New York’s trendiest shopping areas shows the increasingly fraught negotiations between tenants and landlords as vacancies soar and retail rents plunge. Similar scenarios are playing out along Madison Avenue to the north and along other thoroughfares in the city that have long been a draw for those shopping for designer clothing and other luxury goods. Property owners are confronting demands once unheard of in Manhattan, from rent reductions to short-term leases.

Again and again, we’ve pointed to the stagnant deals and rents in some of Manhattan’s wealthiest and most expensive areas as a sign that the New York real-estate market is heading for a downturn after years of torrid growth in the valuations of residential and commercial real-estate.

Manhattan

According to Bloomberg, after a lull in leasings, landlords are beginning to accept their new reality, according to Patrick Smith, a vice chairman of the retail brokerage at Jones Lang LaSalle Inc. It no longer makes sense to keep rents so high in the hopes of landing one of the few corporate clients willing to pay.

Indeed, “landlords are adjusting the way they do business to market conditions,” Smith said. “It’s healthy. It certainly has stimulated activity.”

Of course, outside of Manhattan, many landlords are struggling with an even more ominous problem: As more brick and mortar retailers close, malls and other commercial storefronts are struggling to find somebody – anybody – who would be willing to fill their vacant spaces.

CHart

As a result, American malls are being forced to close, or suffer the indignity that accompanies having so many vacant storefronts.

In Manhattan, home to some of the most valuable retail real estate in the world, a sharp rise in rents following the recession exacerbated the problem, with property owners clinging to unrealistic income expectations. Today, the glut of empty space is taking a toll, pushing landlords to make concessions to plug holes.

Some are signing shorter-term leases to draw tenants that may be reluctant to make long-term commitments. In Soho, Hermes is negotiating a deal at 63 Greene St. that gives the retailer the option to leave after one year, while a few blocks over at 375 West Broadway, Gucci signed a lease that allows it to vacate the space if sales don’t meet expectations after two years, according to people familiar with the deals, who asked not to be identified because terms are private.

Historically, a typical lease term in New York was between 10 and 15 years.

Representatives for Gucci and Hermes didn’t respond to emails seeking comment.

“Landlords, more today than in the past, are coming around to the retailer’s mentality,” said Steve Soutendijk, an executive director at Cushman. Both sides are making calculations on store sales “and how much can they pay in rent. If a store is unprofitable for them, it doesn’t make sense to keep it open.”

To be sure, these issues aren’t confined to downtown – it’s a problem that’s beginning to manifest throughout Manhattan and even in some trendy outer-borough neighborhoods.

Downtown landlords aren’t the only ones caving. On a tony corridor of Madison Avenue on the Upper East Side, an 18,000-square-foot (1,670-square meter) stretch of luxury retail is facing vacancies. Landlord Vornado Realty Trust doesn’t expect tenants including Gucci and Cartier to sign long-term renewals to leases that expire in September given market conditions, according to mortgage documents tied to the property. It’s offering short-term agreements at lower rates to keep the space occupied, the documents show. As of last month, no deals had been struck.

Vornado, which recently paid off its mortgage at the property, declined to comment.

“Landlords have to be open-minded,” said Robert Cohen, a vice chairman at retail brokerage RKF.

In Soho, retail rents in the area have since plunged, dropping 17 percent in the past year to an average of $440 a square foot, the largest decline in all of Manhattan, according to the latest data from Cushman. But across the city, the number of new leases is falling and landlords in both retail and commercial are offering more rent concessions than they have in years.

This might soon translate to a crash in the number of real-estate deals, mirroring a dire situation that’s playing out across the country, as high prices and a paucity of supply caused pending home sales to crash the most since 2010 in January.

end

Take a look at the graph below.  The True Money Supply deceleration is certainly indicating a deep recession is heading our way:

(courtesy SchiffGold.c0m/Mises)

A Great Big Warning Sign

Via SchiffGold.com,

Jerome Powell came out pretty hawkish in his public debut this week (albeit with some flip-flopping this morning). The new Federal Reserve chairman said he sees little risk of recession and reaffirmed plans to continue tightening the money supply through interest rate increases and quantitative tightening.

“My personal outlook for the economy has strengthened since December. I don’t see [the recession risks] as at all high at the moment.”

But there are signals that Powell’s optimism is unwarranted and that the monetary blanket knitted together with nearly a decade of easy money may be about to unravel. In fact, the deceleration in the growth of the money supply orchestrated by the Fed matches the trend just prior to the 2008 crash.

Mises Institute academic vice president, and Pace University professor of economics Joseph Salerno explains in an article originally published on the Mises Wire.

Jeffrey Peshut at RealForecasts.com has composed several very illuminating graphs based on the Rothbard-Salerno True Money Supply (TMS). In one graph Peshut shows the collapse of the growth rate of TMS beginning at the end of 2016, which was caused by the Fed beginning to raise the fed funds target rate at the end of the preceding year. What is of great interest is that the recent deceleration of monetary growth (the second red arrow) almost exactly matches in extent and rapidity the monetary deceleration (the first red arrow) that immediately preceded the financial crisis of 2007-2008.

The Fed recently reaffirmed its commitment to increasing the fed funds rate three more times in 2018 and has just begun its program of shrinking its balance sheet by a cumulative total of $450 billion by the end of 2018. Given these circumstances, I am inclined to agree with Peshut’s conclusion:

With equity prices heading back toward historic highs after the January “correction” and housing prices bubbling to an all-time high in major marketsthe suppression of the TMS growth rate, if it is sustained for the rest of the year, portends another credit crisis and housing bust, followed by an economic recession for the US economy.

As Peshut’s graph below indicates the qualitative relationship between TMS growth, credit crisis, and recession has been remarkably clear since 1978.

Of course, this empirical relationship should not surprise us, because it is nothing but an illustration of the Austrian theory of the business cycle.

end
Mish Shedlock takes a good loook at the USA credit card debt.  A huge 43% carry a balance. And without a doubt delinquencies are rising and that is deflationary>>>why? because once debt deflation hits the economy one sees huge amount of bankruptcies and a destruction of credit.
Mish has the correct definition of both inflation and deflation:

“my definition of inflation: An increase in money supply and credit, with credit marked to market.

Deflation is the opposite: A decrease in money supply and credit, with credit marked to market.”

Inflation Is In The Rear-View Mirror

Authored by Mike Shedlock via MishTalk,

43 percent of credit card holders carry a balance. Delinquencies are rising. It’s a deflationary debt trap.

Revolving Credit Hits New Record High

In December, revolving debt has topped the previous high-water mark of $1.021 trillion set in April of 2008. Debt as of December 2017 (the latest available) is $1.028 trillion.

Relationship Killer

In addition to student loans, credit card debt is another factor holding down home ownership and family formation. Studies show Credit Card Debt is a Relationship Killer.

  • Of all household debts, Americans find credit card debt the most unacceptable in a partner, but credit card balances are creeping higher.
  • About 43 percent off all card holders carry a balance each month according to the American Bankers Association.
  • More than 3 in 4 Americans consider too much card debt a relationship deal breaker, according to personal finance site Finder.com.

Overdue Debt Hits 7-Year High

The Financial Times reports Overdue US Credit Card Debt Hits 7-Year High.

Distressed debt, defined as debt that’s at least three month’s delinquent, totals $11.9 billion. That’s an 11.5% fourth-quarter surge.

​The Financial Times also notes “More Americans are also falling behind on their mortgages, for which problematic debt levels rose 5.2 percent over the same period to $56.7 billion.”

Deflationary Debt Trap Setup

These numbers are huge deflationary. When credit expands there is inflation. When credit contracts (think defaults, bankruptcies, mortgage walk-away events), debt deflation occurs.

Here’s my definition of inflation: An increase in money supply and credit, with credit marked to market.

Deflation is the opposite: A decrease in money supply and credit, with credit marked to market.

Looking Ahead

  • Credit card delinquencies are priced as if they will be paid back. They won’t.
  • As soon as recession hits, defaults and charge-offs will mount. In turn, this will reduce the amounts banks will be willing to lend.
  • Subprime corporations who had been borrowing money quarter after quarter will find they are priced out of the market, unable to roll over their debt.

In a fiat credit-based global setup, this is how the real world works.

Rear-View Mirror Thinking

Those looking for a huge inflation boost fail to understand credit dynamics.

Austrians who only look at money supply keep expecting pent-up inflation. The Monetarists at the Fed (central banks in general), are clueless about the situation they fueled.

Perhaps we get consumer inflation for a quarter or two, but inflation is in the rear view mirror, primarily having impacted asset prices, not consumer prices.

Rising interest rates are already starting to impact the housing market.

The auto market, home supply markets, and consumer credit in general got a temporary housing boost.

What’s next won’t be pretty, and almost no one sees it coming. They can’t. Inflation is in the rear-view mirror.

What economists expect to happen, already has. They don’t see it because they do not understand what inflation really is.

Weakening Economy

The economy is weakening and the Fed, fearing inflation is hiking right into it.

  1. Pending Home Sales: Pending Sales Unexpectedly Dive to Lowest Level in 3.5 Years.
  2. GDP Forecasts Dive: GDPNow “Real Final Sales” Forecast Dips to 1.6%
  3. Durable Goods: New Durable Goods Orders Dive 3.7%
  4. New Home Sales Down 7.8%: Six Reasons Sales Can’t Break Out
  5. Trade War Setup: Huge Mistake Coming Up – Trump Set to Promote Trade Hawk Peter Navarro

Moreover, real median wages have fallen in seven of the last eleven years!

This helps explain the falling savings rate. It certainly does not support consumption.

For discussion, please see How the Fed’s Inflation Policies Crucify Workers in Pictures.

Debt Deflation Coming Up

I expect another round of asset-based deflation with consumer prices and US treasury yields to follow.

end
Our good friends over at Wells Fargo are hit again after the Dept of Justice orders an investigation into the Wealth Management Division
(courtesy zerohedge)

Wells Tumbles After DOJ Orders Investigation Into Wealth Management Division

Wells Fargo – Warren Buftett’s largest investment – is once again making headlines for customer abuses. According to the Wall Street Journal, in the latest alleged criminal violation by the recidivist bank, whistleblowers within Wells Fargo Advisors flagged several issues related to products and services sold to customers “with an eye toward earning more compensation than finding the best fit for the customer.”

In response, the DOJ asked Wells Fargo to assess “whether there have been inappropriate referrals or recommendations, including with respect to rollovers for 401(k) plan participants, certain alternative investments, or referrals of brokerage customers to the company’s investment and fiduciary-services business,” revealed the bank in a Thursday regulatory filing.

The claims include Wells Fargo’s brokerage division, which is known as Wells Fargo Advisors , these people said. Wells Fargo’s former head of that division, Mary Mack, was tapped in July 2016 to clean up its retail banking business. More recently, she was promoted to also lead its consumer lending unit. WSJ

The bank has hired Shearman & Sterling LLP to look into the allegations, according to people familiar with the matter. In April 2017, Shearman released a 113-page report on the bank’s sales and practices issues in the wake of widespread reports into questionable sales conduct affecting up to 3.5 million customers dating back to 2002.

Wells Fargo was hit with a $185 million regulatory penalty in September 2016. In 2015, they were ordered to pay $15 million to customers who were hit with certain sales fees, while last November they had to pay $3.4 million for unsuitable recommendations of volatility-linked exchange traded products.

Employees at the bank, which has 40 million retail customers, in some instances issued debit cards without customers’ knowledge and assigned personal identification numbers without telling them, according to the U.S. Consumer Financial Protection Bureau. They also transferred funds from authorized customer accounts to temporarily fund ones without customer permission, according to the allegations, sometimes resulting in fees for insufficient funds.
WSJ

Most recently, the federal Reserve slapped wells Fargo with an unprecedented enforcement action, capping the bank’s growth. In an early February press release, the Fed said it would bar Wells from expanding its assets beyond their end-2017 level until it “sufficiently improves its governance and controls.”

The Fed also demanded that Wells replace three current board members by April and a fourth board member by the end of the year. The release says the board of directors must also improve its oversight practices. The bank will not be allowed to grow until the Fed approves a detail plan of action to be submitted by the bank.

Last year the bank improperly charged nearly 800,000 loan customers and up to 110,000 mortgage customers – which Wells Fargo is issuing refunds to in excess of $100 million.

Wells Fargo is the third worst performer among the KBW bank index following a steady intraday decline. And, according to Oppenheimer’s head of technical analysis, Ari Wald, there are no signs that the stock’s relative underperformance is abating.

END

SWAMP STORIES
It seems that  the knives are out for Kushner.  Both Mueller and the New York Dept of Financial services are probing his loans for his troubled 5th Avenue property
(courtesy zerohedge)

The Knives Are Out For Kushner: Loans With Deutsche Under Scrutiny By Regulator

The knives are out for Jared Kushner.

After losing his top secret security clearance and reportedly falling under intense scrutiny by Robert Mueller’s probe, the New York Department of Financial Services has asked Deutsche Bank two local lenders for information about their dealings with Jared Kushner, the Kushner companies and his family, according to Bloomberg.

Letters were sent by department superintendent Maria Vullo to Deutsche Bank, Signature Bank and New York Community Bank last week, said a person who had seen the letter which seeks a response by March 5. Vullo was appointed by New York’s Democratic governor, Andrew Cuomo.

The requested information is broad, and include the banks’ processes for approving loans.

Vullo requested copies of emails and other communications between the Kushners and the banks related to financing requests that have been denied or are pending. She also asked whether the banks have conducted any internal reviews of the Kushners and their companies and the results of any such inquiries revealed.

The most detailed information about the Kushners’ finances can be found in their government disclosures. The couple had unsecured lines of credit of $5 million to $25 million each from Deutsche Bank, Signature Bank and New York Community Bank according to a late December filing.

Deutsche Bank’s line of credit was extended to Kushner and his mother; lines from the other two banks were extended to Kushner and his father. Signature Bank also extended a secured line of credit to the couple of $1 million to $5 million, according to the disclosure. –Bloomberg

A spokeswoman for the Kushner Cos, Christine Taylor, said “We have not received a copy of any letter from the New York State Department of Financial Services,” adding “Our company is a multi-billion enterprise that is extremely financially strong. Prior to our CEO voluntarily resigning to serve our country, we never had any type of inquiries. These type of inquiries appear to be harassment solely for political reasons.

Kushner’s family business, the Kushner Companies, has had longstanding financial troubles related to 666 Fifth Avenue, “the most expensive building ever purchased”, in New York City.

After Kushner bought the Fifth Avenue property in late 2006 for $1.8 billion – with zero skin in the game coming from Kushner, the building came under intense pressure during the financial crisis. Vornado Realty Trust stepped in with financing in exchange for a 49.5% stake in the building, which is now carrying over $1.4 billion in debt according to a March release by Vornado.

The Kushner companies are also reportedly negotiating with Vornado to buy their stake back.

While Jared has separated himself from his family’s business and placed assets in a trust, he has fallen into the crosshairs of Special Counsel Robert Mueller. Of interest are discussions between Kushner and Chinese investors during the transition, according to sources familiar with the investigation. Kushner met with executives of troubled Chinese conglomerate Anbang Insurance which was recently taken over by China’s insurance regulator. Talks between Kushner and Anbang’s chairman, Wu Xiaohui, broke down in March 2017, according to the New York Times.

Also of interest to Mueller are Kushner’s dealings with a Qatari investor over the 666 property, for which Kusher reportedly sought financing from former Prime Minister Jassim Al Thani, according to The Intercept. The discussion apparently went nowhere, similar to the Anbang deal.

Kushner in the crosshairs

Dovetailing off of the reports of Kushner’s meetings to shore up his finances, the Washington Post reported this week that officials from at least four countries – China, Israel, Mexico and the United Arab Emirates have explored ways to manipulate Kushner by taking advantage of his “complex business arrangements, financial difficulties and lack of foreign policy experience.” The story cited current and former US intelligence officials – and noted that it is unclear on whether the cited countries took any action.

Meanwhile, the presidential son-in-law’s security clearance was downgraded from “Top Secret/SCI-level” to “secret” this week, walling him off from the most sensitive information.

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. In a statement issued last week, Kelly said that any changes to Kushner’s security clearance wouldn’t impact his 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.

At the end of the day, unless Kushner or his company broke the law, it appears that this entire exercise is meant to embarrass the president’s son-in-law over his troubled 666 property.

END

Our deep state member Jeff Sessions has been seen eating out with his Deputy Rosenstein after his spat with Trump yesterday. What is he afraid of by nominating a second Special Counsel, going after Hillary and her band of merry criminals?

(courtesy zerohedge)

Browbeaten Sessions Dines With Rosenstein After Spat With Trump

After a day of taking heat from the President over a “disgraceful” investigation into FISA abuse, Attorney General Jeff Sessions grabbed dinner Wednesday night with his deputy AG Rod Rosenstein and the Solicitor General, Noel Francisco.

​​​​​photo: Axios

Sessions and Rosenstein have finished their dinner

While it’s anyone’s guess what the trio discussed, the image of Sessions, dining with Rosenstein – who signed off on one or more “Steele dossier” FISA applications – is unmistakable: Sessions enjoys the culinary delights of the swamp.

From refusing to appoint a Special Counsel to investigate the suspected Awan family spy ring, to seemingly covering for the FBI’s mishandling of evidence in the Uranium One case – which Robert Mueller and Rod Rosenstein were directly involved in, to now relegating the FISA abuse investigation to the Office of the Inspector General (OIG) instead of appointing a second Special Counsel – many believe Sessions has been stonewalling for the establishment.

But wait… could this be 4D chess? Perhaps Sessions simply doesn’t trust anyone “from the swamp” to lead Special Counsel investigations – and Inspector General Michael Horowitz – who Trump referred to as an “Obama guy,” is about to set D.C. on fire with his upcoming OIG report. He also fought the Obama administration for several years to restore OIG powers which the previous administration stripped. You can read more about Horowitz hereand will likely conclude that he’s no “Obama guy.”

a

Earlier in the day, President Trump fired off an angry tweet rebuking Sessions for asking the OIG – an “Obama guy,” to “investigate potentially massive FISA abuse.”

Trump said the investigation will “take forever, has no prosecutorial power and already late with reports on Comey etc. Isn’t the IG an Obama guy? Why not use Justice Department lawyers? DISGRACEFUL!”

Why is A.G. Jeff Sessions asking the Inspector General to investigate potentially massive FISA abuse. Will take forever, has no prosecutorial power and already late with reports on Comey etc. Isn’t the I.G. an Obama guy? Why not use Justice Department lawyers? DISGRACEFUL!

Sessions fired back in a stiffly-worded statement to Trump, defending his handling of the FISA investigation by saying he followed the “appropriate process” by ordering the IG to investigate and that, as long as he remains attorney general, he will “continue to discharge my duties with integrity and honor.”

AG SESSIONS STATEMENT: “We have initiated the appropriate process that will ensure complaints against this Department will be fully and fairly acted upon if necessary….” (1/2) https://twitter.com/realDonaldTrump/status/968856971075051521 

AG SESSIONS STATEMENT CT’D: “As long as I am the Attorney General, I will continue to discharge my duties with integrity and honor, and this Department will continue to do its work in a fair and impartial manner according to the law and Constitution. “ (2/2) https://twitter.com/realDonaldTrump/status/968856971075051521 

On its face, Sessions publicly “swimming with the swamp creatures” while appearing to stonewall several legitimate investigations into potential espionage, election interference, and pay-for-play has infuriated those who expected Hillary to be in jail by now, along with the Awans and corrupt FBI and DOJ officials (some of whom are still collecting paychecks).

On the other hand, perhaps Sessions knows that Inspector General Michael Horowitz is simply the best man for the job, and today’s entire exchange between Trump and Sessions was nothing more than theater while ongoing investigations mature.

One has to wonder; in a swampy town like D.C., who would lead a second Special Counsel into anything anyway?

end

The Mooch says that Kelly has blacklisted him form the West Wing.  He also states that many more personnel will leave the wing:

(courtesy zero hedge)

Scaramucci Says “General Jackass” John Kelly “Blacklisted” Him From The West Wing

Anthony Scaramucci said Thursday that he had been “blacklisted” from the White House by Chief of Staff John Kelly during an interview with CNN’s “New Day,” where he also anticipated that more West Wing staffers would follow Hope Hicks out the door thanks to the “terrible” morale under the notoriously strict retired general.

“The morale’s terrible, and the reason why the morale is terrible is that the rule by fear and intimidation does not work in a civilian environment,” Scaramucci said, adding that “there will be a further evacuation of talent.”

Of course, it’s important to remember that Kelly was responsible for ousting Scaramucci 11 days after he stepped in to the (perpetually vacant) communications director job, allegedly because of a profanity-filled statement he made to the New Yorker.

But the Mooch apparently couldn’t resist kicking his old nemesis while he’s down, blasting Kelly for purportedly ignoring former White House Staff Secretary Rob Porter’s history of domestic abuse. He also claimed that the erstwhile Marine General rules through “fear and intimidation.”

In addition to Hicks, longtime WH deputy communications director Josh Raffel said earlier this week that he is planning to leave the White House, too. Exits might be hastened thanks to dozens of staffers losing their top-level security clearance.

“This is how it works…I guess he’s an honorable marine so he’s got to look himself in the mirror and come to grips with what he knew and when he knew it. I’ll tell you what I don’t like. I talked a little bit of smack about two guys that we were trying to get rid of, he fires me in five seconds,”Scaramucci said.

“These guys are smacking up their wives and he’s trying to figure out a way to keep them inside the White House. So it’s very dishonest to me.”

Finally, Scaramucci predicted that Kelly will eventually drive the entire staff out of the West Wing, while also insinuating that the general is too tough on “Trump loyalists” – presumably referring, in part, to himself.

Does the president want to lose everyone because of General Jackass?” Scaramucci said.

“If you want to kill Trump loyalists because you’re into martial law, go ahead and do that,” he said of Kelly. “But it’s not helping the president.”

Scaramucci reportedly still talks with Trump, who has a notorious habit for keeping in touch with former employees.

end
the revolving door continues to operate at full speed as it looks like National Security Advisor McMaster is being pushed out the door
(courtesy zerohedge)

HR McMaster Is Being Pushed Out Of The Trump Administration

Two senior White House staffers, including communications director Hope Hicks – have announced their departures from the West Wing this week, and now NBC is reporting that  National Security Advisor HR McMaster is on the verge of being pushed out.

According to NBC, Chief of Staff John Kelly and Defense Secretary James Mattis have orchestrated McMaster’s ouster, even going so far as to select a leading candidate for the job, whom they will presumably recommend to the president.

McMaster could be handing in his resignation as early as next month.

General McMaster forgot to say that the results of the 2016 election were not impacted or changed by the Russians and that the only Collusion was between Russia and Crooked H, the DNC and the Dems. Remember the Dirty Dossier, Uranium, Speeches, Emails and the Podesta Company!

McMaster – who recently elicited an angry tweet from his boss after telling the audience at a forum in Germany that evidence of Russian meddling in the 2016 race was “incontrovertible” – has never fit in with the rest of the administration. He was tapped to step in for Mike Flynn when he resigned after only 24 days on the job. McMaster had no previous connection to the Trump campaign, and refused to retire from the Army upon taking the job, maintaining his rank of active duty lieutenant general.

McMaster

The leading candidate to replace McMaster is the auto industry executive Stephen Biegun. Biegun, a former National Security Council staffer who was introduced to Mattis and Kelly by Condoleezza Rice, has reportedly been vetted by both Kelly and Mattis. Biegun needs a few weeks to get his finances in order, allowing him to take the job.

Biegun, who currently serves as vice president of international governmental affairs for the Ford Motor Company, is no stranger to the White House. He served on the National Security Council staff from 2001 to 2003, including as a senior staffer for then-national security adviser Condoleezza Rice.

Rice introduced Biegun to Mattis, recommending him for a position in the administration, according to a close associate of Rice. After Mattis met with Biegun at a think tank event he was convinced Biegun would be a good fit for the national security adviser role, the associate said.

Two people close to Biegun said he would need several weeks to get his financial affairs in order to be able to join the administration this spring.

Mr. Biegun did not respond himself to a request for comment, but Ford Motor Company spokesperson Christin Baker said, “Steve has no plans to leave Ford.”

The White House did not respond to requests for comment.

Mattis has reportedly assured Kelly that he would offer McMaster either another three-star job in the Army or even a promotion after he leaves the administration.

As an Army major, he turned his Ph.D. dissertation into a best-selling book that became mandatory reading inside the halls of the Pentagon and on military bases around the world. “Dereliction of Duty” held military leaders responsible for the U.S. defeat in Vietnam, arguing that they quietly acquiesced to the demands of President Lyndon S. Johnson rather than providing their best counsel.

He earned a Silver Star as a tank commander during the Gulf War. During McMaster’s promotion to lieutenant general, retired Lt. Gen. David Barno called him “the rarest of soldiers,” admiring his ability to repeatedly “buck the system and survive to join its senior ranks.”

McMaster took over command of U.S. Army Training and Doctrine Command in 2012 and was planning to retire last summer until he got a surprise call from the White House in February 2017.

Now, a year later, a source close to Mattis said the Pentagon chief assured Kelly that he would offer McMaster a graceful landing, either another three-star job in the Army or even a promotion to a four-star general.

To be sure, this isn’t the first report claiming McMaster’s days in the administration were numbered. He has somehow managed to hang on this long despite a torrent of criticism from Trump, his supporters and political allies. He has also committed the gravest sin of all – in Trump’s mind, at least: Disloyalty.

Could McMaster, by all accounts a widely respected commander in the Army who turned his PhD thesis into a book that is now required reading at the Pentagon, find a way to hang on? Perhaps.

But maybe the real question is, does he even want to stay?

end

I will  see you FRIDAY night

HARVEY

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