MARCH 27/WE ENTERED OPTIONS EXPIRY WEEK AND AS SUCH THE CROOKS ALWAYS ORCHESTRATE A RAID: GOLD DOWN $11.70 TO $1342.90 AND SILVER WAS DOWN 14 CENTS TO $16.54/ THE DOW WAS DOWN 345 POINTS AND THE NASDAQ WAS DOWN 211 POINTS/

 

 

GOLD: $1342.90  DOWN $11.70  (COMEX TO COMEX CLOSINGS)

Silver: $16.54 DOWN 14 CENTS (COMEX TO COMEX CLOSINGS)

Closing access prices:

Gold $1344.40

silver: $16.51

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: $N/A DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME: $N/A

PREMIUM FIRST FIX: $N/A

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SECOND SHANGHAI GOLD FIX: $N/A

NY GOLD PRICE AT THE EXACT SAME TIME: $N/A

PREMIUM SECOND FIX /NY:$XX

SHANGHAI REJECTS NY PRICING OF GOLD.

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ON APRIL 1  2018 I WILL NO LONGER PROVIDE THE LONDON FIXES AS THEY ARE MANIPULATED AND THEY WILL BE PROVIDED 36 HRS AFTER THE FACT AND  THUS TOTALLY USELESS TO US!!

LONDON FIRST GOLD FIX: 5:30 am est $1350.65

NY PRICING AT THE EXACT SAME TIME: $1350.30

LONDON SECOND GOLD FIX 10 AM: $1341.45

NY PRICING AT THE EXACT SAME TIME. $1342.45  ???

Nicholas to Bill Murphy and myself on the London fixes:

The first London Gold fix meeting was held on 12th Sept 1919.Now look at the extracts taken direct from the LBMA website:

‘The gold, silver, platinum and palladium price auctions take place in London on a daily basis. All of these prices are internationally regarded as the pricing mechanism for a variety of precious metal transactions and products.

From 1 April 2018, the LBMA Gold and Silver Prices on this page will not be available until midnight London time on the date that the prices are set. This is in line with the revised arrangements for delayed redistribution of the LBMA Gold Price and LBMA Silver Price recently announced by ICE Benchmark Administration (IBA) and is consistent with the timing of the publication of the LBMA Platinum and Palladium prices.’

If you are intrigued as to why the existence of this ‘ICE Benchmark Administration’ should provide cogent or even fair and reasonable grounds for the discontinuation of the promulgation of the daily London gold fix pricings until midnight, you are welcome to do your own research, but I have given up are expending too much redundant effort.

Everything happens for a reason. The last intraday promulgation of the LBMA gold price fix will, in fact be on Thursday afternoon (before Good Friday). Give the LBMA some credit. They were clearly aware of the potential tsunami about to impact the Shanghai physical gold market if the new petro/yuan futures contract gained some transaction. Now, given the volume of trading on the first day (yesterday), the word ‘potential’ should be dropped from the above sentence. All or any doubts can now laid to rest-the advent of petro yuan futures yesterday is a seminal date in the development of the globalized monetary framework, as momentous as the Bretton Woods conference, the TV announcement by Nixon in 1971 re the “temporary’ suspension of the convertibility of the USD and the process whereby Kissinger implemented the petro dollar. In the West, the only promulgation of gold market prices next month will be via the ubiquitous COMEX/GLOBEX platform, and this charade is a pure manipulated paper price only. At least these LBMA London fixes provide(d) (allegedly) some assurance that physical gold actually was exchanged at the quoted fix price.

Bill,

Now you and Harvey and other good men will have to be extra vigilant in seeking to ensure that the differential between the Shanghai physical gold price and COMEX/GLOBEX abomination is given widespread headlines.

Regards
Nicholas

end

For comex gold:

MARCH/

NUMBER OF NOTICES FILED TODAY FOR MARCH CONTRACT:475 NOTICE(S) FOR 47,500 OZ.

TOTAL NOTICES SO FAR 506 FOR 50,600 OZ

For silver:

MARCH

4 NOTICE(S) FILED TODAY FOR

20,000 OZ/

Total number of notices filed so far this month: 5348 for 26,740,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Bitcoin: BID $7909/OFFER $7,981: DOWN $241(morning)

Bitcoin: BID/ $7891/offer $7961: DOWN $261  (CLOSING/5 PM)

 

end

Let us have a look at the data for today

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In silver, the total open interest ROSE  BY A TINY SIZED 177 contracts from 216,910  RISING TO 217,799  DESPITE YESTERDAY’S GOOD  11 CENT GAIN IN SILVER PRICING WE OBVIOUSLY HAD NO COMEX LIQUIDATION. HOWEVER, WE WERE AGAIN NOTIFIED THAT WE HAD ANOTHER SMALL SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP : 653 EFP’S FOR MAY AND ZERO FOR ALL  OTHER MONTHS  AND THUS TOTAL ISSUANCE OF 653 CONTRACTS.  WITH THE TRANSFER OF 653 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 24-48 HRS IN THE ISSUING OF EFP’S. THE 653 CONTRACTS TRANSLATES INTO 3.265 MILLION OZ  ON TOP OF THE RISE 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:

41,233 CONTRACTS (FOR 19 TRADING DAYS TOTAL 41,233 CONTRACTS) OR 206.165 MILLION OZ: AVERAGE PER DAY: 2170 CONTRACTS OR 10.851 MILLION OZ/DAY

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH:  206.17 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 29.45% OF ANNUAL GLOBAL PRODUCTION

ACCUMULATION IN YEAR 2018 TO DATE SILVER EFP’S:  687.99 MILLION OZ.

ACCUMULATION FOR JAN 2018: 236.879 MILLION OZ

ACCUMULATION FOR MONTH OF FEBRUARY: 244.945 MILLION OZ

RESULT: WE HAD A TINY SIZED GAIN IN COMEX OI SILVER COMEX OF 177 WITH THE 11 CENT RISE IN SILVER PRICE.  HOWEVER, WE ALSO HAD A FAIR SIZED EFP ISSUANCE OF 653 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  EFP’S  FOR THE  MONTH OF MAY WERE ISSUED FOR  A DELIVERABLE FORWARD CONTRACT OVER IN LONDON WITH A FIAT BONUS.   WE GAINED A GOOD  830 OI CONTRACTS i.e. 653 open interest contracts headed for London (EFP’s) TOGETHER WITH A INCREASE OF 177  OI COMEX CONTRACTS. AND ALL OF THIS HAPPENED WITH THE RISE IN PRICE OF SILVER OF 11 CENTS AND A CLOSING PRICE OF $16.70 WITH RESPECT TO YESTERDAY’S TRADING. YET WE STILL HAVE A HUGE AMOUNT OF SILVER STANDING AT THE COMEX THIS MONTH.

In ounces AT THE COMEX, the OI is still represented by just OVER 1 BILLION oz i.e. 1.091 BILLION TO BE EXACT or 156% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT MARCH MONTH/ THEY FILED: 4 NOTICE(S) FOR 20,000 OZ OF SILVER

In gold, the open interest  FELL BY A CONSIDERABLE SIZED 12,681 CONTRACTS DOWN TO 551,620 DESPITE THE FAIR SIZED RISE IN PRICE IN YESTERDAY’ TRADING ( GAIN OF $4.60). WE ARE NOW ENTERING THE LAST WEEK BEFORE FIRST DAY NOTICE OF AN ACTIVE GOLD COMEX CONTRACT MONTH AND HERE WE GENERALLY SEE A CONTRACTION AT THE COMEX WITH A CORRESPONDING HIGHER EFP ISSUED AND THAT IS WHAT WE GOT. THE CME RELEASED THE DATA FOR EFP ISSUANCE AND IT TOTALED AN STRONG SIZED  14,247 CONTRACTS :  APRIL SAW THE ISSUANCE OF 9,531 CONTRACTS, JUNE SAW THE ISSUANCE OF 4716 CONTRACTS AND THEN ALL OTHER MONTHS ZERO.   The new OI for the gold complex rests at 551,620. 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  AND WE ARE WITNESSING DELAYS IN ACTUAL DELIVERIES. IN ESSENCE WE HAVE A FAIR  OI GAIN IN CONTRACTS: 12,681 OI CONTRACTS DECREASED AT THE COMEX AND A STRONG SIZED 14,247 OI CONTRACTS WHICH NAVIGATED OVER TO LONDON.THUS  TOTAL OI GAIN: 1566 CONTRACTS OR 156,600 OZ =4.87 TONNES

YESTERDAY, WE HAD 17,571 EFP’S ISSUED.

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF MARCH : 197,049 CONTRACTS OR 19,704,900  OZ OR 612.905 TONNES (19 TRADING DAYS AND THUS AVERAGING: 10,371 EFP CONTRACTS PER TRADING DAY OR 1,037,100 OZ/ TRADING DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS :   SO FAR THIS MONTH IN 19 TRADING DAYS IN  TONNES: 612.905 TONNES

TOTAL ANNUAL GOLD PRODUCTION, 2017, THROUGHOUT THE WORLD EX CHINA EX RUSSIA: 2555 TONNES

THUS EFP TRANSFERS REPRESENTS 612.905/2550 x 100% TONNES =  24.03% OF GLOBAL ANNUAL PRODUCTION SO FAR IN MARCH ALONE.

ACCUMULATION OF GOLD EFP’S YEAR 2018 TO DATE:  1906.23 TONNES

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

ACCUMULATION OF GOLD EFP’S FOR FEBRUARY: 649.45 TONNES

Result: A GOOD SIZED DECREASE IN OI AT THE COMEX DESPITE THE STRONG RISE IN PRICE IN GOLD TRADING YESTERDAY ($4.60 GAIN).  HOWEVER, WE HAD ANOTHER GOOD SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 14,247 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 14,247 EFP CONTRACTS ISSUED, WE HAD A NET GAIN IN OPEN INTEREST OF 1566 contracts ON THE TWO EXCHANGES:

14,247 CONTRACTS MOVE TO LONDON AND 12,681 CONTRACTS DECREASED AT THE COMEX. (in tonnes, the GAIN in total oi equates to 4.87  TONNES).

we had: 475 notice(s) filed upon for 47,500 oz of gold.

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

GLD

WITH GOLD DOWN  $11.70 : AND A RAID ORCHESTRATED THIS WAS TO EXPECTED:   A HUGE  CHANGE IN GOLD INVENTORY AT THE GLD /A WITHDRAWAL OF 3.26 TONNES OF GOLD WHICH WAS USED IN THE RAID

Inventory rests tonight: 847.30 tonnes.

SLV/

WITH SILVER DOWN 14 CENTS TODAY: NO CHANGE

NO CHANGES IN SILVER INVENTORY AT THE SLV/

/INVENTORY RESTS AT 318.069 MILLION OZ/

end

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

1. Today, we had the open interest in silver ROSE BY A TINY 177  contracts from 217,622 UP TO 217,799 (AND now A LITTLE  CLOSER TO THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) DESPITE THE STRONG RISE IN PRICE OF SILVER (11 CENTS WITH RESPECT TO  YESTERDAY’S TRADING).   OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE ANOTHER 710 EFP CONTRACTS FOR MARCH  (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 ZERO COMEX SILVER COMEX LIQUIDATION. IF WE TAKE THE  OI GAIN AT THE COMEX OF 177   CONTRACTS TO THE 653 OI TRANSFERRED TO LONDON THROUGH EFP’S, WE OBTAIN A GAIN OF 830  OPEN INTEREST CONTRACTS.  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:  4.15 MILLION OZ!!!

RESULT: A SMALL SIZED  INCREASE IN SILVER OI AT THE COMEX DESPITE THE STRONG RISE IN SILVER PRICING  YESTERDAY (11 CENT RISE IN PRICE) . BUT WE ALSO HAD ANOTHER WEAK SIZED 653 EFP’S ISSUED TRANSFERRING COMEX LONGS OVER TO LONDON. TOGETHER WITH THE STRONG  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)TUESDAY MORNING/MONDAY NIGHT: Shanghai closed UP 32.93 POINTS OR 1.05% /Hang Sang CLOSED UP 242.06 POINTS OR 0.79% / The Nikkei closed UP 551.22/Australia’s all ordinaires CLOSED UP 0.72%/Chinese yuan (ONSHORE) closed DOWN at 6.2823/Oil UP to 65.76 dollars per barrel for WTI and 70.35 for Brent. Stocks in Europe OPENED DEEPLY IN THE GREEN   .   ONSHORE YUAN CLOSED DOWN AT 6.2826 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.2692 /ONSHORE YUAN TRADING WEAKER AGAINST OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR . CHINA IS   HAPPY TODAY  GOOD  CHINESE MARKETS/WITH  NEW TRUMP TRADE DEALS DISCUSSED/STRONGER GLOBAL MARKETS ) 

3a)THAILAND/SOUTH KOREA/NORTH KOREA

 

North Korea/China

 Kim Jong Un leaves Beijing after a surprise visit.  No doubt that Kim is planning with China how to conduct themselves in the upcoming Trump visit
( zerohedge)

b) REPORT ON JAPAN

3 c CHINA

i)Early this morning, the USA unveiled its Chinese tariff list.  We are now waiting for Beijing to respond.

( zerohedge)

ii)Despite all this morning’s “happy” talk, stocks are fading as the USA confirms USA curbs on Chinese investments. China very angry.

( zerohedge)

4. EUROPEAN AFFAIRS

i)ECB

We have known for quite a while, the total of European non performing loans has been approximately 1 trillion euros.  Now you can add another 10 billion euros to this list due to miscalculations. It seems that banks are lying as to the real value of the collateral that they hold.  Both Germany and France has 250 billion euros of non performing loans but the ring leader is Italy at over 360 billion euros. Interesting enough Italy is complaining that the ECB is not paying attention to the huge risk in derivatives held by some of European banks, with the ring leader in that category:  Deutsche bank

( zerohedge)

ii)Deutsche bank is preparing to oust its CEO John Cryan

( zerohedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

6 .GLOBAL ISSUES

Greece, Austria Portugal are among countries that will not expel Russian diplomats. Interesting our good friends over in New Zealand stated that they cannot find any Russian spies to expel

( zerohedge)

7. OIL ISSUES

 i) Report from Shanghai oil futures

ii)Both WTI and Gasoline extend losses after another large crude build( zerohedge)

8. EMERGING MARKET

9. PHYSICAL MARKETS

i)China has a long way to go before it supplants the dollar.  However the new yuan for oil for gold is a terrific start.  Chinese yuan represents only 1.1% of total reserves.  The USA dollar is 63.5%

( Mike Bird/Wall Street Journal)

ii)Mine production is of the decline but there is still plenty of paper gold upon which obligations to provide physical is probably not there

( Clint Siegner/GATA)

iii)A good reason why Russia and China are stockpiling gold: to replace the dominance of the USA as the reserve currency of the world

( Tom Lewis/GoldTelegraph.com)

iv)Briscoe believes as do I that China’s new oil futures contract will threaten the USA dollars primacy

(courtesy Reuters/Duguid)

v)Chris Powell takes on Avi Gilburt and destroys him
(courtesy Chris Powell/GATA)

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

i)USA data reports:

Despite poor number of homes being built, we still see a surge in home prices and the jump with this report is the largest in 4 years with all cities up in home prices

( zerohedge)

ii)Consumer confidence falters as “hope” plunges to new lows

( zerohedge)
iii)Early trading:
stocks give up overnight gains as trade war anxiety reappears:
( zerohedge)

iiib) LATE TRADING

YIELD CURVE CRASHING TO NEW CYCLE LOWS INDICATING DEEP RECESSION/MARKETS CRASHING
(COURTESY ZEROHEDGE)

iv)Wow!! we were totally unaware of this:  The uSA exports a huge percentage of its waste material to China. Now China is ready to strike back if the USA imposes tariffs on steel and aluminum products plus other items

(courtesy zerohedge)

a very important read..
(zerohedge)

v)Jim Grant states that they may replace Libor with an another rate called  SOFR which will probably give us a better picture of risk to the banks and thus a key figure to be used by investors around the world to price in risk( Jim Grant/Interest Rate observer)

vi) David Stockman/part ii/Train wreck

vii)SWAMP STORIES

a)Stormy Daniel’s slaps Trump’s lawyer, Cohen with a defamation suit.  Then Trump’s team sends a cease and desist letter to Stormy.  The 60 Minutes interview had the highest ratings in over 10 years.

Greg Gutfeld had the best line on this 60 Minute interview:

“Finding out Donald Trump slept with a porn star is like finding out Mike Pence didn’t…”

Let us head over to the comex:

The total gold comex open interest FELL BY AN CONSIDERABLE SIZED 12,681 CONTRACTS DOWN to an OI level 551,620  DESPITE THE STRONG RISE IN THE PRICE OF GOLD ($4.60  GAIN/ YESTERDAY’S TRADING) .  FOR TWO YEARS STRAIGHT WE HAVE NOTICED THAT ONE WEEK PRIOR TO FIRST DAY NOTICE OF AN ACTIVE DELIVERY MONTH THE COMEX OPEN INTEREST CONTRACTS AND EFP’S NOTICES EXPONENTIALLY INCREASE.   THE CME REPORTS THAT  THE BANKERS ISSUED A HUGE SIZED  COMEX TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS. WE HAD A STRONG 9531 EFP’S ISSUED FOR APRIL , AND 4716 CONTRACTS FOR  JUNE AND ZERO FOR ALL OTHER MONTHS:  TOTAL  14,247 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: 1566 OI CONTRACTS IN THAT 14,247 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE LOST 12,681 COMEX CONTRACTS.

NET GAIN ON THE TWO EXCHANGES: 1566 contracts OR 156600  OZ OR 4.87 TONNES.

Result: A STRONG SIZED DECREASE IN COMEX OPEN INTEREST DESPITE THE  RISE IN PRICE YESTERDAY  (ENDING UP WITH A GAIN OF $4.60)THE  TOTAL OPEN INTEREST GAIN ON THE TWO EXCHANGES: 1566 OI CONTRACTS..

We have now entered the non active contract month of MARCH where we LOST 2 contracts LOWERING TO  475 contracts. We had 0 notices served upon yesterday, so LOST 2 contracts  or 200 additional oz will NOT stand for delivery at the comex AND THESE MORPHED INTO LONDON BASED FORWARDS.

April saw a LOSS of 51,123 contracts DOWN to 108,630. May saw A GAIN of 228 contracts to stand at 1085. The really big June contract month saw a GAIN of 34,020 contracts UP to 327,650 contracts.

We had 475 notice(s) filed upon today for  47500 oz

FIRST DAY NOTICE IS THIS THURSDAY.

Trading Volumes on the COMEX

PRELIMINARY COMEX VOLUME FOR TODAY:553,366  contracts

CONFIRMED COMEX VOL. FOR YESTERDAY: 534,476 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:

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And now for the wild silver comex results.

Total silver OI ROSE BY A TINY 177  CONTRACTS FROM 217,622 UP TO 218,323 DESPITE OUR STRONG 11 CENT RISE IN SILVER PRICING/ YESTERDAY’).   ALSO,WE WERE ALSO INFORMED THAT WE HAD 653 EMERGENCY EFP’S FOR MAY ISSUED BY OUR BANKERS 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: 653.   THE SILVER BOYS HAVE STARTED TO MIGRATE TO LONDON FROM THE START OF DELIVERY MONTH AND CONTINUING RIGHT THROUGH UNTIL FIRST DAY NOTICE JUST LIKE WE ARE WITNESSING TODAY. USUALLY WE NOTED THAT CONTRACTION IN OI OCCURRED ONLY DURING THE LAST WEEK OF AN UPCOMING ACTIVE DELIVERY MONTH AS WE HAVE JUST SEEN IN GOLD TODAY. THIS PROCESS HAS JUST BEGUN IN EARNEST IN SILVER STARTING IN SEPTEMBER 2017. HOWEVER, IN GOLD, WE HAVE BEEN WITNESSING THIS FOR THE PAST 2 YEARS. NICK LAIRD WAS KIND ENOUGH TO SUPPLY US THE TOTAL FOR 2017 GOLD EFP’S AND IT WAS 6600 TONNES FOR THE ENTIRE YEAR.  WE OBVIOUSLY HAD ZERO LONG COMEX SILVER LIQUIDATION AND WE ALSO HAVE A GOOD SIZED GAIN IN TOTAL SILVER OI FROM OUR TWO EXCHANGES. WE ARE ALSO WITNESSING A STRONG AMOUNT OF SILVER OUNCES STANDING FOR COMEX METAL IN THIS ACTIVE OF MARCH AS WELL AS THE 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 830 SILVER OPEN INTEREST CONTRACTS AS  WE OBTAINED A 177 CONTRACT GAIN AT THE COMEX COMBINING WITH THE ADDITION OF 653 OI CONTRACTS NAVIGATING OVER TO LONDON.

NET GAIN ON THE TWO EXCHANGES: 830 CONTRACTS 

AMOUNT STANDING FOR SILVER AT THE COMEX

We are now in the  active delivery month of MARCH and here the front month GAINED 4 contracts RISING TO 84 contracts. We had 1 contract filed YESTERDAY, so we GAINED 5 contracts or an additional 25,000 OZ will stand in this active delivery month of March

April LOST 7 contracts FALLING TO 396 .

The next big active delivery month for silver will be May and here the OI LOST 2094 contracts DOWN to 149,163

We had 4 notice(s) filed for 20,000 OZ for the MARCH 2018 contract for silver

INITIAL standings for MARCH/GOLD

MARCH 27/2018.

Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
nil oz
Deposits to the Dealer Inventory in oz NIL oz
Deposits to the Customer Inventory, in oz  nil OZ
No of oz served (contracts) today
475 notice(s)
 47,500 OZ
No of oz to be served (notices)
0 contracts
(NIL oz)
Total monthly oz gold served (contracts) so far this month
506 notices
50600 OZ
1.5738 TONNES
Total accumulative withdrawals of gold from the Dealers inventory this month NIL oz
Total accumulative withdrawal of gold from the Customer inventory this month xxx oz
we had 0 kilobar transaction/
We had 0 inventory movement at the dealer accounts
total inventory deposit into the dealer accounts:  NIL  oz
total inventory withdrawals out of dealer accounts; nil oz
we had 0 withdrawals out of the customer account:
total withdrawal: nil   oz
we had 0 customer deposit
total customer deposits: nil oz
we had 0 adjustment(s)

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 475 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 113 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 (506) x 100 oz or 50,600 oz, to which we add the difference between the open interest for the front month of FEB. (475 contracts) minus the number of notices served upon today (475 x 100 oz per contract) equals 50,600 oz, the number of ounces standing in this nonactive month of MARCH (1.738 tonnes)

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

No of notices served (506 x 100 oz or ounces + {(475)OI for the front month minus the number of notices served upon today (475 x 100 oz )which equals 50,600 oz standing in this  nonactive delivery month of March . THERE IS 12.003 TONNES OF REGISTERED GOLD AVAILABLE FOR DELIVERY SO FAR.

WE LOST 2 CONTRACTS OR AN ADDITIONAL 200 OZ WILL NOT STAND FOR DELIVERY IN THIS NON ACTIVE DELIVERY MONTH OF MARCH AND THESE GUYS MORPHED INTO LONDON BASED FORWARDS.

total registered or dealer gold:  385,923.014 oz or 12.003 tonnes
total registered and eligible (customer) gold;   9,060,591.220 oz 281.82 tones
THE COMEX IS AGAIN IN STRESS AS ONLY 12.003 TONNES OF GOLD ARE LEFT TO SERVICE DELIVERIES

IN THE LAST 18 MONTHS 72 NET TONNES HAS LEFT THE COMEX.

end

And now for silver

AND NOW THE DECEMBER DELIVERY MONTH

MARCH INITIAL standings/SILVER

March 27 2018
Silver Ounces
Withdrawals from Dealers Inventory nil oz
Withdrawals from Customer Inventory
 26,104.990
  oz
SCOTIA
DELAWARE
Deposits to the Dealer Inventory
nil
oz
Deposits to the Customer Inventory
599,792.26 oz
Scotia
No of oz served today (contracts)
4
CONTRACT(S
(20,000 OZ)
No of oz to be served (notices)
80 contracts
(400,000 oz)
Total monthly oz silver served (contracts) 5348 contracts

(26,740,000 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 0 inventory movement at the dealer side of things

total dealer deposits:  nil oz

we had 1 deposits into the customer account

i) Into JPMorgan: nil oz

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

JPMorgan now has 137 million oz of  total silver inventory or 53.6% of all official comex silver.

JPMorgan  deposited zero into its warehouses (official) today.

ii) into Scotia:  599,792.260 oz

total deposits today:  599,792.260  oz

we had 2 withdrawals from the customer account;

i) Malca; 25,104.990 oz

ii) Out of Delaware: 999.90

total withdrawals;26,104.89  oz

we had 0 adjustments

total dealer silver:  59.383 million

total dealer + customer silver:  259.496 million oz

The total number of notices filed today for the March. contract month is represented by 4 contract(s) FOR 20,000 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 5348 x 5,000 oz = 26,740,000 oz to which we add the difference between the open interest for the front month of Mar. (84) and the number of notices served upon today (4 x 5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the March contract month: 5348(notices served so far)x 5000 oz + OI for front month of March(84) -number of notices served upon today (4)x 5000 oz equals 27,140,000 oz of silver standing for the March contract month. 

We GAINED 5 contracts or 25,000 additional silver oz will  stand for delivery at the comex

FIRST DAY NOTICE IS THIS THURSDAY.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

ESTIMATED VOLUME FOR TODAY: 87,806 CONTRACTS

CONFIRMED VOLUME FOR YESTERDAY: 111,165 CONTRACTS

YESTERDAY’S CONFIRMED VOLUME OF 111,165 CONTRACTS EQUATES TO  555 MILLION OZ OR79,2% OF ANNUAL GLOBAL PRODUCTION OF SILVER

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

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

end

NPV for Sprott 

1. Sprott silver fund (PSLV): NAV RISES TO -2.51% (MARCH 27/2018)
2. Sprott gold fund (PHYS): premium to NAV FALLS TO -0.81% to NAV (March 27/2018 )
Note: Sprott silver trust back into NEGATIVE territory at -2.51%-/Sprott physical gold trust is back into NEGATIVE/ territory at -0.81%/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 -2.65%: NAV 13.82/TRADING 13.44//DISCOUNT 2.65.

END

And now the Gold inventory at the GLD/

MARCH 27/WITH GOLD DOWN $11.70 AND A RAID INITIATED, IT WAS NO SURPRISE TO SEE THAT A MASSIVE WITHDRAWAL OF 3.24 TONNES WAS USED IN THE ABOVE RAID/INVENTORY RESTS AT 847.30 TONNES

MARCH 26./WITH GOLD UP $4.60/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 850.54 TONNES

MARCH 23/WITH GOLD UP $23.30/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 850.54 TONNES

MARCH 22.WITH GOLD UP $5.90, NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 850.54 TONNES/

MARCH 21/WITH GOLD UP $9.65 NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 850.54 TONNES

March 20/WITH GOLD DOWN $5.75, A SURPRISING HUMONGOUS DEPOSIT OF 10.32 TONNES OF GOLD INTO THE GLD/INVENTORY RESTS AT 850.64 TONNES/

SO FAR, FOR THE MONTH OF MARCH, THE GLD HAS ADDED 19.61 TONNES WITH A NET LOSS OF $17.45

March 19/WITH GOLD UP $5.25: ANOTHER HUGE DEPOSIT OF GOLD TO THE TUNE OF 2.07 TONNES/GOLD INVENTORY RESTS TONIGHT AT 840.22 TONNES

MARCH 16/WITH GOLD DOWN $5.65/OUR CROOKS DEPOSITED ANOTHER 4.42 TONNES INTO GLD INVENTORY/INVENTORY RESTS AT 838.15 TONNES

FOR THE WEEK: GOLD LOST  $11.80, BUT GOLD INVENTORY ADVANCED:4.42 TONNES

MARCH 15/WITH GOLD DOWN $7.85, NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 833.73 TONNES

MARCH 14/WITH GOLD DOWN $1.55/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 833.73 TONNES

MARCH 13/WITH GOLD UP $6.25/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 833.73 TONNES

MARCH 12/WITH GOLD DOWN $3.00/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 833.73 TONNES

MARCH 9/WITH GOLD UP $2.25/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 833.73 TONNES

March 8/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 833.73 TONNES

GOLD DOWN 5.45 TODAY.

MARCH 7/WITH GOLD DOWN 8.00/A SLIGHT CHANGE IN GOLD INVENTORY AT THE GLD/A WITHDRAWAL OF .25 TONNES TO PAY FOR FEES//INVENTORY RESTS AT 833.73 TONNES

MARCH 6/WITH GOLD UP $15.60/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 833.98 TONNES

March 5/WITH GOLD DOWN $4.10/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 833.98 TONNES

MARCH 2/WITH GOLD UP $18.70/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 833.98 TONNES

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

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

MARCH 27/2018/ Inventory rests tonight at 847.30 tonnes

*IN LAST 350 TRADING DAYS: 93.74 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 300 TRADING DAYS: A NET 62.56 TONNES HAVE NOW BEEN ADDED INTO GLD INVENTORY.

end

Now the SLV Inventory/

MARCH 27/WITH SILVER DOWN 14 CENTS/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.069 MILLION OZ/

WITH SILVER UP 11 CENTS/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.069 MILLION OZ/

MARCH 23/WITH SILVER UP 19 CENTS, A HAD A BIG WITHDRAWAL OF 1.602 MILLION OZ.INVENTORY RESTS AT 318.069 MILLION OZ/

MARCH 22/WITH SILVER DOWN ONE CENT, NO CHANGE IN SLV INVENTORY/INVENTORY RESTS AT 319.671 MILLION OZ/

March 21/WITH SILVER UP 21 CENTS/NO CHANGE IN SLV INVENTORY/INVENTORY RESTS AT 319.671 MILLION OZ/

March 20/WITH SILVER DOWN 13 CENTS/NO CHANGE IN SLV INVENTORY/INVENTORY RESTS AT 319.671 MILLION OZ/

March 19/WITH SILVER UP 5 CENTS, THE SLV ADDS A SMALL 659,000 OZ TO ITS INVENTORY/INVENTORY RESTS AT 319.671 MILLION OZ/

MARCH 16/WITH SILVER DOWN 15 CENTS/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 319.012 MILLION OZ.

FOR THE WEEK;  SILVER IS DOWN 42 CENTS YET ADDS 943,000 OZ OF SILVER INTO THE SLV/

MARCH 15/WITH SILVER DOWN 11 CENTS/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 319.012 MILLION OZ/

MARCH 14/WITH SILVER DOWN 8 CENTS/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 319.012 MILLION OZ/

MARCH 13/WITH SILVER UP 10 CENTS/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 319.012 MILLION OZ/

MARCH 12/WITH SILVER DOWN 8 CENTS/A BIG CHANGES IN SILVER INVENTORY AT THE SLV/ A DEPOSIT OF 943,000 OZ/INVENTORY RESTS AT 319.012 MILLION OZ/

MARCH 9/WITH SILVER UP 21 CENTS, NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.069 MILLION OZ/

March 8/WITH SILVER DOWN 1 CENT TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.069 MILLION OZ/

MARCH 7/WITH SILVER DOWN 27 CENTS/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.069 MILLION OZ/

MARCH 6/WITH SILVER UP 38 CENTS/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.069 MILLION OZ/

March 5/WITH SILVER DOWN 11 CENTS/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.069 MILLION OZ/

MARCH 2/WITH SILVER UP 23 CENTS: A HUGE 1.479 MILLION OZ WAS ADDED TO SILVER’S INVENTORY/INVENTORY RESTS AT 318.069 MILLION OZ/

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/

MARCH 27/2018: NO CHANGE IN SILVER INVENTORY

Inventory 318.069 million oz

end

6 Month MM GOFO 2.12/ and libor 6 month duration 2.45

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

G0FO+ 2.12%

libor 2.45 FOR 6 MONTHS/

GOLD LENDING RATE: .33%

XXXXXXXX

12 Month MM GOFO
+ 2.47%

LIBOR FOR 12 MONTH DURATION: 2.67

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = +.20

end

Major gold/silver trading /commentaries for TUESDAY

GOLDCORE/BLOG/MARK O’BYRNE.

GOLD/SILVER

Silver Futures Report and JP Morgan Record Silver Bullion Holding Is Extremely Bullish

– Silver Futures Report, JP Morgan Record Silver Bullion Holding Is Extremely Bullish
– JP Morgan Continues Adding To Massive Silver Bullion Holdings (see chart)
– Silver Speculators Go Short – Which Is Extremely Bullish
– Stunning Silver COT Report: One For the Ages (see chart)

The silver futures Commitment of Traders (COT) report released last Friday was extremely positive and has most silver analysts calling for higher silver prices in the near term.


ZeroHedge.com

The COT data signaled we are close to bottoming and suggest that both gold and silver should make gains in the coming weeks and months. The data showed that the hedge funds and “Managed Money traders,” the “dumb money” speculators now have record short positions in silver.

At the same time, the large commercials and including large bullion banks such as JP Morgan, the “smart money” and the “inside money” have reduced their shorts dramatically and are now long.

The COT report shows ‘Managed money’ silver specs have their largest short position in at least 28 years and maybe ever. From a contrarian perspective this is very bullish.


Goldchartsrus.com 

Another less reported bullish factor is JP Morgan continuing to add to its massive silver bullion holdings. They rose to a new record high last week at 139.12 million troy ounces. Either JP Morgan themselves or their clients or both are acquiring physical silver bullion in a big way and are clearly bullish silver.


Goldchartsrus.com

The notes by Ed Steer and Jon Rubino about this are well worth a read and below are the key snippets:

Ed Steer from EdSteerGoldSilver.com in Stunning Silver COT Report: One For the Ages put it this way

The Commitment of Traders Report, for positions held at the close of COMEX trading on Tuesday was right on the money in gold as far as Ted estimates were concerned, but in silver the decline in the Commercial net short position exceeded even his most bullish expectations. Considering the very modest price decline in silver during the reporting week, I thought his “5,000 to 10,000 contract improvement” estimate to be wildly optimistic. How wrong I was!

In silver, the Commercial net short position dropped by an eye-watering 15,564 contracts, or 77.8 million troy ounces of paper silver. Wow!

Listen on SoundCloud , Blubrry & iTunesWatch on YouTube above

Jon Rubino from Dollar Collapse in Silver Speculators Go Short – Which Is Extremely Bullish put it this way:

Silver is a whole different story, with speculators going aggressively net short, something very seldom seen, and commercials almost in balance, which is also unusual. Looked at in a vacuum, this is hyper-bullish.

But of course the games futures traders play aren’t all that matters. Between trade wars, massive ongoing government deficits and spiking stock market volatility, the reasons for owning safe haven assets like gold and silver are both multiplying and gaining urgency.

Editors Note:  Silver remains very undervalued in the short term and on a long term historical basis. It is also undervalued against gold as seen in the gold silver ratio at over 80:1.

Gold is beginning to receive some interest again from a small minority of retail investors but silver remains the preserve of relatively few contrarian investors. The media and financial press rarely, if ever, covers silver and almost never in a positive manner despite its strong fundamentals.

Yet silver is quite likely in the early stages of a new bull market that will rival or surpass that of the 1970s and thus merits an allocation in investment and pension portfolios.

Related Reading

Buy Silver And Sell Gold Now

Money and Markets Infographic Shows Silver Most Undervalued Asset

Buy Silver – “Best Precious Metals Trade”

JP Morgan Cornering Silver Market?

Listen on SoundCloud , Blubrry & iTunesWatch on YouTube above

News and Commentary

Gold marks longest streak of session gains since January (MarketWatch.com)

Gold at more than five-week high as U.S. expels Russian diplomats (Reuters.com)

Dow rises after last week’s rout as trade tensions show signs of cooling (MarketWatch.com)

Stocks Roar Back, Dollar Falls as Trade Angst Ebbs (Bloomberg.com)

World stocks bounce on report of U.S.-China trade talks (Reuters.com)


Source: Bloomberg.com

The World’s Most Controversial Interest Rate Is Haunting Us Again (Bloomberg.com)

As Trade War Heats Up, Biggest Currency Whales Make Their Move (Bloomberg.com)

Former Bank of England guru warns Trump’s ‘economic madness’ will lead world into recession (Telegraph.co.uk)

Mortgage approvals fall 11 percent in February (Reuters.com)

Goldman Sachs expects gold to ‘outperform’ amid growing fears of a stock market correction (CNBC.com)

Gold Prices (LBMA AM)

27 Mar: USD 1,350.65, GBP 954.64 & EUR 1,087.41 per ounce
26 Mar: USD 1,348.40, GBP 949.27 & EUR 1,086.95 per ounce
23 Mar: USD 1,342.35, GBP 952.80 & EUR 1,088.65 per ounce
22 Mar: USD 1,328.85, GBP 939.36 & EUR 1,078.10 per ounce
21 Mar: USD 1,316.35, GBP 935.53 & EUR 1,071.64 per ounce
20 Mar: USD 1,312.75, GBP 935.60 & EUR 1,066.22 per ounce
19 Mar: USD 1,311.70, GBP 934.59 & EUR 1,066.41 per ounce

Silver Prices (LBMA)

27 Mar: USD 16.64, GBP 11.79 & EUR 13.41 per ounce
26 Mar: USD 16.61, GBP 11.67 & EUR 13.39 per ounce
23 Mar: USD 16.53, GBP 11.70 & EUR 13.39 per ounce
22 Mar: USD 16.52, GBP 11.64 & EUR 13.41 per ounce
21 Mar: USD 16.25, GBP 11.56 & EUR 13.23 per ounce
20 Mar: USD 16.25, GBP 11.60 & EUR 13.22 per ounce
19 Mar: USD 16.29, GBP 11.59 & EUR 13.24 per ounce


Recent Market Updates

– London House Prices Falling Sharply – UK’s Much Needed Wake-Up Call
– Global Trade War Fears See Precious Metals Gain And Stocks Fall
– Gold +1.8%, Silver +2.5% As Fed Increases Rates And Trade War Looms
– Credit Concerns In U.S. Growing As LIBOR OIS Surges to 2009 High
– Four Charts: Debt, Defaults and Bankruptcies To See Higher Gold
– Crock Of Gold Hidden In Ireland? Happy Saint Patrick’s Day
– Buy Silver And Sell Gold Now
– Stephen Hawking – Doomsday Prophet’s Top Five Predictions
– Gold Cup At Cheltenham – Gold Is For Winners, Not For the Gamblers
– Hungary’s Gold Repatriation Adds To Growing Protest Against US Dollar Hegemony
– Stock Market Selloff Showed Gold Can Reduce Portfolio Risk
– Gold Protects As Cashless Society Threatens Vulnerable
– Women’s Pension Crisis Highlights Dangers To Savers

janskoyles

 end

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

end

China has a long way to go before it supplants the dollar.  However the new yuan for oil for gold is a terrific start.  Chinese yuan represents only 1.1% of total reserves.  The USA dollar is 63.5%

(courtesy Mike Bird/Wall Street Journal)

China’s attempts to supplant dollar face historic difficulties

 Section: 

By Mike Bird
The Wall Street Journal
Monday, March 26, 2018

https://www.wsj.com/articles/chinas-attempts-to-supplant-dollar-face-his…

The world’s first yuan-denominated oil contracts launched today, as part of China’s drive to turn its currency into a global force in markets.

The history of international currency markets suggests that may be a difficult task, though not impossible if Beijing eases the capital controls that make it hard for foreigners to buy up domestic assets, economists say.

Those capital controls and investors’ concerns over the opaqueness of Chinese government and central bank policy mean that the yuan remains a minnow in international finance, despite China being the world’s largest exporter.

The dollar and euro are global currencies because central banks hold them in their reserves and they are used to buy services and goods both in and outside their home markets.

In launching new yuan-denominated crude-oil futures, Beijing hopes to create an oil benchmark to rival those in New York and London and challenge the dollar’s role as the dominant commodity-pricing currency by making it possible for crude exporters to sell oil in another currency.

Professor Barry Eichengreen of the University of California, Berkeley, who writes about the history of currencies in the international financial system, believes the dollar’s grip on oil pricing isn’t guaranteed.

“As financial markets continue to develop — as there are liquid markets in more currencies, and currency trading becomes cheaper—- traditional arguments for why one currency should monopolize this function become even weaker,” Mr. Eichengreen said.

Still, “I don’t think the renminbi will displace the dollar from the global oil market any time soon. Lack of liquidity and accessibility continue to limit its usage,” he added.

China’s currency has some way to go. The yuan’s share of global foreign exchange reserves is just 1.1 percent of the global total, behind currencies like the Australian and Canadian dollars. The U.S. dollar’s share is 63.5 percent.

The yuan makes up only 1.1 percent share of international payments, placing it behind seven others, according to payments firm SWIFT. That share has dipped in recent years, from as high as 2.8 percent in August 2015. Currently almost all oil and most commodities are bought and sold in dollars.

However, even in modern history, it hasn’t always been this way. Economists point to the demise of the British pound’s dominance in world trade as showing that the tide can turn quickly against one currency in favor of another, especially during a crisis.

The London Metal Exchange benchmark copper contract was denominated in sterling until 1993. Even today cocoa trading is priced in sterling.

Though crude has a longer history of being denominated in dollars, due to the U.S.’s status as a major producer, as late as the 1970s oil-producing countries received around a fifth of their royalty payments in sterling, according to economic historian Professor Catherine Schenk.

Before the outbreak of the World War I, dollar-denominated international trade credit was almost nonexistent and British banks dominated the sector. By the mid-1920s the dollar and sterling-denominated trade credit occupied similar market shares.

The economic impact of the First and World War II left London’s influence in international finance and trade dramatically weakened, leaving the dollar firmly in the driving seat by the second half of the 20th century.

Sheer economic heft isn’t enough to guarantee a currency international primacy. The U.S. economy supplanted the U.K.’s as the world’s largest in the 1870s, around half a century before the dollar began to replace sterling as the world’s dominant currency.

That is a lesson to China, as its economy catches up with the U.S. and by some measures has already taken over.

One factor currently limiting the adoption of the yuan as a global currency is Beijing’s capital controls, which place limits on investment in China. Beijing keeps a tight grip of money coming in and out of the country to maintain control of the country’s economy and prevent sudden outflows of capital.

Currently, selling a yuan-denominated future means investors must either exchange the currency back into dollars — partly defeating the purpose of the contract — or find assets denominated in the Chinese currency to invest in.

There is no shortage of Chinese assets. The IHS Markit iBoxx Asia China index, a broad index of Chinese bonds, has more than doubled in size in the last 4 1/2 years, to over $11 trillion.

Some of the government controls have already been loosened. In 201, China launched a “bond-connect program” to allow global investors with trading accounts in Hong Kong to access China’s interbank bond market.

Just because more foreigners can now buy Chinese bonds, it doesn’t mean they will. Some investors say Beijing will have to open up its economy more for that to happen.

“Firstly, China will have to remove, or substantially reduce, capital controls for [renminbi] priced oil trading to take off,” said Hayden Briscoe, head of fixed income Asia Pacific at UBS Asset Management.

Mr. Briscoe added that the inclusion of Chinese bonds in major indexes would boost outside investment in the country’s debt, given investors and passive funds track such benchmarks.

“When that happens, we’re expecting a major reallocation of capital into China’s onshore bond markets,” Mr. Briscoe said.

Bloomberg LP said Friday it would add Chinese bonds to its Bloomberg Barclays Global Aggregate Index in 2019.

However, the country’s controls on capital flows aren’t the only concerns. The Chinese government’s propensity to intervene in domestic commodity markets and the lack of transparency about the country’s monetary policy are also unlikely to find favor among investors.

END

Briscoe believes as do I that China’s new oil futures contract will threaten the USA dollars primacy

(courtesy Reuters/Duguid)_

China’s oil futures launch may threaten dollar’s primacy, UBS analyst says

 Section: 

By Kate Duguid
Reuters
Monday, March 26, 2018

NEW YORK — China’s launch of its crude futures exchange today will improve the clout of the yuan in financial markets and could threaten the international primacy of the dollar, argues a new report by Hayden Briscoe, APAC head of fixed income at UBS Asset Management.

“This is the single biggest change in capital markets, maybe of all time,” Briscoe said in a follow-up telephone interview.

The launch of the oil futures denominated in China’s renminbi currency, also known as the yuan, is China’s first commodity derivative open to foreign investors. This marked the culmination of a decade-long push by the Shanghai Futures Exchange to give the world’s largest energy consumer more power in pricing crude sold to Asia.

Already today Unipec, the trading arm of Asia’s largest refiner Sinopec, has inked a deal with a Western oil major to buy Middle East crude priced against the newly-launched Shanghai crude futures contract.
This helps cement the exchange’s viability and challenges the petro-dollar system, in which oil deals are executed in dollars. This would decrease demand for the greenback and boost U.S. inflation. …

… For the remainder of the report:

https://www.reuters.com/article/us-china-oil-futures-dollar/china-oil-fu…

END

Mine production is of the decline but there is still plenty of paper gold upon which obligations to provide physical is probably not there

(courtesy Clint Siegner/GATA)

Clint Siegner: Mine production may decline but there’s still plenty of ‘paper gold’

 Section: 

12:56p SST Tuesday, March 27, 2018

Dear Friend of GATA and Gold:

Annual world gold production seems to be about to decline, Clint Siegner of Money Metals Exchange writes this week, but there’s never any shortage of “paper gold,” claims to gold that may not exist.

“When it comes to trading in gold futures,” Siegner writes, “the physical supply and demand for the metal is barely a consideration. Practically no one trading contracts cares about getting delivery. During periods of high speculative demand in the futures markets, the bullion banks stand ready to sell a virtually unlimited number of fresh new contracts. Physical gold may be scarce, but available paper gold has been limitless.”

Siegner adds: “Someday the confidence in gold (and silver) futures is likely to collapse. Some event will prompt traders to look at the shocking amount of leverage built into the contracts. They will suddenly be uncomfortable with how little physical metal there is supporting the enormous paper trade. When too many begin standing for delivery of bars, they will be handed cash instead, provided their counterparties are solvent.”

His commentary is headlined “Physical Gold Production May Be Peaking, But There Is No Shortage In Paper Gold” and it’s posted at Money Metals here —

https://www.moneymetals.com/news/2018/03/26/paper-gold-vs-physical-gold-…

— and at GoldSeek here:

http://news.goldseek.com/GoldSeek/1522094389.php

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

END

A good reason why Russia and China are stockpiling gold: to replace the dominance of the USA as the reserve currency of the world

(courtesy Tom Lewis/GoldTelegraph.com)

Russia Stockpiles Gold, But Why?

Authored by Tom Lewis via GoldTelegraph.com,

The US’s overhang of debt and looming trade war is worrisome on many levels as the value of the dollar keeps decreasing and the national debt spiraling. So, what should we make of the fact that the Central Bank of Russia has been steadily amassing vast gold reserves since 2015? By the end of 2017, its total gold reserves rose to 1,828.56 tons, usurping China’s place as the country with the fifth largest gold reserves.

Russia has been aggressively increasing its gold reserves for a reason. It has seen the US dollar dominate as a global currency and is working with China to end the US/Western currency supremacy. Their strategy appears to be working. Russia and China are in the midst of rumors of introducing gold-backed futures to circumvent the U.S dollar. 

The US dollar has had no gold-backing since 1933, nor has the US increased its gold reserves for a decade. See chart below.

With  speculation of Russia and China working on a gold-backed currency, a shift in monetary power from the West to the East seems to be their ambitions. The situation between East and West is exacerbated by recent tensions between Russia and the UK, since the alleged Kremlin poisoning of former spy Sergei Skripal and his daughter. British Prime Minister Theresa May has ousted 23 Russian diplomats from Great Britain. Geopolitical tension is once again, high.

It seems Russian may have tossed aside Das Kapital as its economic guidebook. Not only is creating a gold-backed currency appearing more likely month over month, but Russia has also brought inflation way down over the past decade. More importantly, Russia continues to lower their national debt, while the US has been increasing its debt to a record $21 trillion.

Russia’s financial strategy is making the country less vulnerable to volatile geopolitics. Not only is it a significant player in gold, but it is also the world’s third-largest gold producer, with the Central Bank of Russia buying up its supplies. During the past decade, Russian has mined more than 2,000 tons of gold, with tonnage expected to increase by 400 tons annually by 2030.

Russia and China understand the value of real, physical gold, a lesson that the US has forgotten while reveling in worthless paper currency.

If Russia and China establish a 100 percent gold-backed currency, it inevitably changes the game in the West. The dollar will continue to devalue against gold at a rapid rate.

Ultimately, the battle will not be Eastern vs. Western dominance. The real battle long term will be between the US dollar (fiat) and gold.

But remember:

END
Chris Powell takes on Avi Gilburt and destroys him
(courtesy Chris Powell/GATA)

(GATA) No, GATA never took Russian central banker or Greenspan out of context

Submitted by cpowell on 02:32PM ET Tuesday, March 27, 2018. Section: Daily Dispatches

10:39p Tuesday, March 27, 2018

Dear Friend of GATA and Gold:

In commentary posted today at GoldSeek, headlined “GATA Is at It Again” —

http://news.goldseek.com/GoldSeek/1522155660.php

— financial letter writer Avi Gilburt accuses GATA of routinely taking quotes out of context, starting with the mention made of GATA by the deputy chairman of the Bank of Russia, Oleg Mozhaiskov, in his address to the London Bullion Market Association meeting in Moscow in June 2004.

But GATA has never taken Mozhaiskov out of context. To the contrary, soon after Mozhaiskov gave his address and we heard that he had mentioned us, we strove to obtain a copy of his complete remarks and have often referred to his full remarks when citing him:

http://gata.org/node/4235

Mozhaiskov’s speech was notable for establishing that while GATA at that time had never to our knowledge had any contact with the Russian government or, for that matter, anyone in Russia, the Bank of Russia was following our work. We construed Mozhaiskov’s reference to GATA as signifying that the Bank of Russia shared GATA’s suspicion about the activity of the U.S. government and its allies in the gold market.

In any case soon after Mozhaiskov’s speech Russia began repatriating its gold from the Bank of England and Russian President Vladimir Putin announced that he had instructed the Bank of Russia to start buying gold on all markets — the very policy that GATAs research seemed to argue for.

Gilburt construes Mozhaiskov’s remarks about GATA as ridicule. But Mozhaiskov told the LBMA that there was reason to believe that the gold market was operating under something other than free-market forces. If Mozhaiskov really found GATA so ridiculous, would he have taken so much time to call its work to the LBMA’s attention? Or was this his way of letting the bullion bankers know that Russia was on to them and the Western central banks for which they were fronting?

A little background here supplies more context than Gilburt can. When GATA heard of Mozhaiskov’s remarks from a participant in the LBMA conference in Moscow, we were told that the LBMA had a copy of his speech. So we asked the LBMA to share it with us. The LBMA refused, apparently construing the speech as unfavorable to the bullion banks. Whereupon your secretary/treasurer located a fax number for the Bank of Russia in Moscow and sent a letter to Mozhaiskov, asking if he would provide a copy of his speech. Your secretary/treasurer told Mozhaiskov that a copy in the original Russian would do fine, since at that time your secretary/treasurer worked with a U.S. graduate student in Russian studies who was fluent in the language and would gladly translate the speech for us.

Remarkably Mozhaiskov replied within hours, agreeing to provide a copy of his speech but adding that he wanted his own friend, the president of Moscow Narodny Bank in London, to do the translation into English.

Sure enough, a month or so later the translation arrived in the surface mail from London and GATA published it in full on the day it was received.

If Mozhaiskov found GATA as ridiculous as Gilburt does, the central bankers courtesy was all the more amazing. As his speech discloses, Mozhaiskov knew full well what GATA was about and surely was aware of how GATA was likely to construe his remarks. Neither Mozhaiskov nor anyone else at the Bank of Russia has ever complained that GATA has misconstrued him. Only Gilburt has made such an allegation, as if he knows what central bankers think better than they themselves do.

But anyone can read Mozhaiskovs speech and draw his own conclusions precisely because GATA alone has provided the original document from the source and repeatedly has called attention to it to guard against any taking it out of context.

Then Gilburt disputes GATAs interpretation of Federal Reserve Chairman Alan Greenspans famous testimony to Congress in July 1998 that central banks were ready to lease gold to suppress its price:

https://www.federalreserve.gov/boarddocs/testimony/1998 /19980724.htm

Gilburt says GATA has mistakenly construed this as an admission that the Fed itself was leasing gold, but he is mistaken. He cites no authority for his assertion.

If Gilburt had done a little research he would have found that in 2000 GATA extracted and publicized a statement from Greenspan denying that the Fed was leasing gold but acknowledging that other central banks were:

http://www.gata.org/node/704

Perhaps Gilburt is confusing gold leasing by the Fed with gold swapping by the Fed. For in 2009 GATA extracted a statement from a member of the Feds Board of Governors, Kevin M. Warsh, admitting that the Fed has gold swap arrangements with foreign banks and refuses to disclose them:

http://www.gata.org/node/7819

Is Gilburt really incapable of wondering why, if the Fed’s gold swap arrangements are innocent, they cannot be disclosed or explained? And is Gilburt incapable of understanding that a gold swap by the Fed with another central bank or with a bullion bank could be quickly turned into a gold lease by that other central bank or bullion bank?

Gilburt writes: “Again, it deserves repeating. Mr. Greenspan did not admit that the Fed manipulates gold. Mr. Greenspan did not even note that there was anyone who manipulated gold. Rather, he was saying that if someone attempted to manipulate the gold market, the Fed may have a tool to combat such manipulation attempts. More importantly, he never even opined as to whether such a tool would or could even be successful.”

If this “deserves repeating” it is only because Gilburt himself has been misquoting GATA about Greenspan. GATA maintains that Greenspans 1998 testimony about gold leasing is important mainly for acknowledging that gold leasing is a mechanism of price suppression far more than it is what others have called it, a mechanism by which central banks try to earn a little money on a supposedly dead asset.

But Greenspan did assure Congress that gold leasing would work to suppress the gold price — presumably because he knew from experience that it already had done so.

Gilburt continues: “GATA and its ilk will often point to evidence of small price manipulations and suggest that these ‘paper cuts’ have caused the market to bleed to death.”

Not so. Of course GATA has called attention to charges and admissions of gold and silver market manipulation involving investment banks and various traders outside government. But our primary complaint long has been that governments and central banks are the primary manipulators of the monetary metals markets, the real parties in interest in gold price control.

Gilburt also suggests that GATA blames central banks for the entirety of every move down in monetary metals prices every day. This is nonsense and again Gilburt fails to support his charge with anything published by GATA.

Rather, GATA maintains that central banks are meddling in the gold market surreptitiously “nearly on a daily basis,” to use the words of the director of market operations for the Banque de France, Alexander Gautier, in his address to another LBMA meeting, this one in Rome in September 2013:

http://www.gata.org/node/13373

No one but central banks themselves can know exactly how much of any days price move they cause. But since central banks are authorized to produce infinite money, they can move markets as much as they want in any direction.

GATA has produced documentation that governments and central banks are surreptitiously trading all futures markets in the United States, according to filings with the U.S. Securities and Exchange Commission and Commodity Futures Trading Commission:

http://www.gata.org/node/14385

http://www.gata.org/node/14411

GATA readily admits that it doesnt know everything governments and central banks are doing surreptitiously in the monetary metals markets. But we have compiled enormous documentation of that involvement and the longstanding policy of Western central banks to suppress the gold price to defend their currencies, government bond prices, and interest rates against market forces.

http://www.gata.org/taxonomy/term/21

By contrast Gilburt concludes his latest misrepresentations by proclaiming his great success at predicting monetary metals prices, as if that is somehow a rebuttal to GATAs work and not just egotism.

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

* * *

 _____________________________________________________________________________________

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

 

i) Chinese yuan vs USA dollar/CLOSED DOWN 6.2826  /shanghai bourse CLOSED UP 32.93 POINTS OR 1.05%  / HANG SANG CLOSED UP 242.06 POINTS OR 0.79%
2. Nikkei closed UP 551.22 POINTS OR 2.65% /USA: YEN RISES TO 105.75/  

3. Europe stocks OPENED GREEN     /USA dollar index RISES TO 89.44/Euro FALLS TO 1.2398

3b Japan 10 year bond yield: RISES TO . +.038/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 105.75/ 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:: 65.76  and Brent: 70.35

3f Gold DOWN/Yen DOWN

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund FALLS TO +.529%/Italian 10 yr bond yield DOWN to 1.887% /SPAIN 10 YR BOND YIELD DOWN TO 1.234%

3j Greek 10 year bond yield FALLS TO : 4.383?????????????????

3k Gold at $1347.20 silver at:16.65     7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 4/100 in roubles/dollar) 57.23

3m oil into the 65 dollar handle for WTI and 70 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 105.75 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 0.9481 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1760 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 +0.529%

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 2.850% early this morning (THIS IS DEADLY TO ALL MARKETS). Thirty year rate at 3.0865% /

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

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

Trump’s “Happy” Tweet Sends Global Stocks Soaring As Trade Tensions Ease Further

Just as Trump sent stocks into a tailspin last week with his bellicose trade overtures against China, so the near record (point) rebound in the Dow on Monday is being attributed to a much more diplomatic tone out of the Trump administration, when first Mnuchin, then Peter Navarro played down the threat of a trade war and instead said that the administration is “actively” involved in talks with China to resolve the recent trade tensions between the two nations. Various unconfirmed media reports then also suggested that trade war with China may never materialize (of course, as Mark Cudmore explained this morning, it very well still may). It culminated with a “happy” tweet from Trump himself on Monday night, in which the stock-picking president, hours after confirming his delight with the spike in the market, tweeted “trade talks going on with numerous countries that, for many years, have not treated the United States fairly. In the end, all will be happy!

Trade talks going on with numerous countries that, for many years, have not treated the United States fairly. In the end, all will be happy!

And so, just like yesterday morning, this morning global markets and US equity futures are a sea of green, which once again is being attributed to fading chances of an “all-out global trade war.”

The fresh surge in risk appetite emerged as the Trump administration was said to be urging China to lower tariffs on cars and open its market to U.S. financial services as part of talks to resolve trade tensions. Treasury Secretary Steven Mnuchin and his Chinese counterpart have been discussing the trade deficit between the two countries and were committed to finding a mutually agreeable way to reduce the gap and help China avoid tariffs on $50 billion of exports to the U.S. Ironically, after yesterday’s upside rout, US and global stocks are almost unchanged since March 1, with the bulk of assets since March 1 now positive.

Only, unlike yesterday when the dollar was tumbling, serving as a key component of the risk-on narrative, today the USD has rebounded and erased almost all of yesterday’s losses. At the same time, the euro weakened as economic confidence in the region continued to slide in March.

“Our base case is that there won’t be an all-out trade war,” Aberdeen Standard Investments’ global head of fixed income, Craig MacDonald, , told Bloomberg. “It’s a way of applying pressure to get some wins by Trump.” Still, it will lead to more volatility, MacDonald added. “Our sense is that they will get some wins rather than all out war, but it’s not something you can just dismiss. The tail risk is higher.”

Meanwhile in the aftermath of yesterday’s massive US rally, the euphoria was everywhere, as European shares headed for their first gain in five sessions, with the Stoxx 600 Index jumping the most in six weeks, up 1.4% and joining the global relief rally seen between US and Asia overnight as, what else, “trade tensions ease.”  19 out of 19 Stoxx 600 sectors rise; technology sector has the biggest volume at 111% of its 30-day average; 584 Stoxx 600 members gain, 7 decline. In terms of sector specifics, materials (+2.0%) are the outperformers, enjoying a strong rebound from yesterday’s losses. Looking at individual movers, Casino (+3.4%) spiked at the open after its Monoprix chain has agreed to sell products on Amazon, GSK (+6.0%) is a top performer in the FTSE 100 after it announced to purchase a 36.5% stake in Novartis’ healthcare unit for USD 13bln.

Earlier in Asia shares were green across the board, with Japan’s Topix Index jumping the most since November 2016. South Korea’s won was the best performer among major currencies as Kim Jong Un was said to be making an unannounced visit to Beijing, his first known trip outside North Korea since taking power in 2011. The ASX 200 (+0.7%) and Nikkei 225 (+2.7%) were higher with mining names and financials leading Australia, while the Japanese benchmark outperformed as the index coat-tailed on gains in USD/JPY and following the testimony by former tax office chief Sagawa who declared there were no instructions made by PM Abe or his close circle to alter the documents related to the land sale scandal.

Specifically, Japan’s former tax agency chief Sagawa said there was no report to the PM’s office of documents being altered and added that there were no instructions from PM Abe, his wife, Finance Minister Aso or their aides to doctor the documents. In related news, there were also comments from Finance Minister Aso that PM Abe’s office was not involved with document alterations in the controversial land sale.

Mainland China and Hong Kong shares advance along with other equity markets on hopes that talks with the U.S. will resolve trade tensions. Hang Seng Index rises 0.8%; Hang Seng China Enterprises Index adds 0.9%; Shanghai Composite Index closed up 1.1% after weathering some downward pressure in the last hour of trade; it was its first gain in five sessions.

As noted above, in FX, the dollar reversed earlier losses, with demand picking up amid month-end flows as the London session gets under way. EUR/USD rallied briefly in early London trading to a five-week high of 1.2476 on dollar supply and euro demand against crosses, before reversing the move; in the Asian session, the pair had traded in a very narrow range. Sterling led losses in G-10, partly driven by strong demand in euro-pound, and weighed by EUR/GBP bids amid month-end flows supportive of the greenback. The yen slid as much as 0.3% against the dollar after heavy buying in the U.S. currency across the Tokyo fix took the pair to session high of 105.75 as trade tensions between the U.S. and China eased. The Aussie fell with local bond yields as capital flows are redirected back into emerging markets; the South Korean won rallied as much as 1.2% and the onshore Chinese yuan briefly touched the strongest level since the 2015 devaluation before gains were erased Elsewhere, China’s currency touched the highest level in almost three years.

In geopolitical developments, the Russian Deputy Foreign Minister warned of ‘harsh’ response to expulsion of diplomats from the US, but still open to cooperation.

Euro-area bonds traded in the green, as do longer-dated Treasuries. Bunds initially rallied to make another test of 50bps in yield before fading; TSYs in a tight range with curve marginally flatter amid focus on this weeks heavy supply, with large early buying seen in white eurodollars, leading to a tightening in the FRA/OIS spread further from recent blowout.

In commodities, crude futures unchanged, spot gold weighed by USD rally and industrial metals hold Asian session gains. Bitcoin edged higher, nearing the $8,000 level. And copper broke out of a three-day trading slump, climbing as much as 1.8%.

Market Snapshot

  • S&P 500 futures up 0.6% to 2,676.00
  • STOXX Europe 600 up 1.2% to 367.37
  • MSCI Asia Pacific up 1.4% to 175.31
  • MSCI Asia Pacific ex Japan up 0.9% to 573.94
  • Nikkei up 2.7% to 21,317.32
  • Topix up 2.7% to 1,717.13
  • Hang Seng Index up 0.8% to 30,790.83
  • Shanghai Composite up 1.1% to 3,166.65
  • Sensex up 0.5% to 33,224.00
  • Australia S&P/ASX 200 up 0.7% to 5,832.30
  • Kospi up 0.6% to 2,452.06
  • German 10Y yield fell 0.8 bps to 0.516%
  • Euro down 0.01% to $1.2443
  • Italian 10Y yield rose 3.4 bps to 1.656%
  • Spanish 10Y yield fell 2.0 bps to 1.241%
  • Brent futures up 0.4% to $70.38/bbl
  • Gold spot down 0.3% to $1,350.16
  • U.S. Dollar Index up 0.3% to 89.25

Top Overnight News

  • The Trump administration is urging China to lower tariffs on cars and open its market to U.S. financial services as part of talks to resolve a rise in trade tensions that has shaken global markets, according to a person familiar with the matter
  • President Donald Trump ordered 60 Russian diplomats the U.S. considers spies to leave the country and closed Russia’s consulate in Seattle in response to the nerve-agent attack on a former Russian spy in the U.K., as European allies and Canada took similar measures.
  • Federal Reserve Governor Randal Quarles says “our economy is performing well, and unemployment is low. However, many households and communities continue to face financial challenges.”
  • Federal Reserve Bank of Cleveland President Loretta Mester says she doesn’t see excessive financial imbalances, but the need to avoid them building up is another argument for “gradually taking away accommodation.”
  • Kim Jong Un made a surprise visit to Beijing on his first known trip outside North Korea since taking power in 2011, three people with knowledge of the visit said.
  • The ECB can only have “deeper discussions” about the next policy changes when its projections are published in June, Governing Council member Vitas Vasiliauskas says in a news conference in Vilnius
  • Euro-area economic confidence dropped for a third month in March as the region showed signs of entering a period of more moderate growth. Optimism slipped in the region’s five biggest economies, taking the overall index to its lowest in six months
  • The ECB alerted auditors that lenders could try to take advantage of the transition to new accounting standards to spread the hit on loan losses over years instead of reflecting them in their 2017 financial results, three people familiar with the matter said
  • The U.K.’s withdrawal from the European Union poses “material risks” to the availability of financial services, especially in areas where fixes must be put in place by both British and EU authorities, the Bank of England said

Central bank speakers:

  • Fed’s Quarles (Voter, Neutral) said US economy is performing well and unemployment is at a low level, although he added that financial challenges remain for many households and communities.
  • Fed’s Mester (Voter, Hawk) said she sees further interest rate hikes this year and next despite seeing more slack, while Mester added that tariffs and NAFTA renegotiations pose risks to economic outlook.
  • Fed’s Bostic (Voter, Dovish) said he supports plans to gradually raise interest rates, but uncertainty over how the economy would respond next year to tax cuts and increased government spending could complicate monetary policy.
  • ECB’s Vasiliauskas (Hawkish) expects more detailed talks on policy changes in June and agrees with market forecast for a mid-2019 rate hike. This follows ECB’s Weidmann yesterday, saying he expects a mid-2019 rate hike.
  • ECB’s Liikanen (Neutral) says EZ inflation is sustainable when ECB’s objective can be met without very   accommodative monetary policy. He adds that the ECB needs patience as underlying inflation is lower than expected.
  • ECB’s Nowotny (Hawkish) believes asset purchases should be gradually reduce. Adding that If things continue as they are, they will be able to reduce asset purchases significantly and must decide by summer. Furthermore, stating we must be careful not to fall behind the curve.

Asian stocks were positive across the board as the region took impetus from the gains on Wall St where stocks rebounded with a vengeance from the prior week’s worst performance in 2 years. The sharp recovery was spurred by easing trade war concerns after reports of US and China negotiating on trade and saw the largest percentage increase in all US majors since August 2015, while DJIA also gained by the most points in nearly a decade. ASX 200 (+0.7%) and Nikkei 225 (+2.7%) were higher in which mining names and financials led Australia, while the Japanese benchmark outperformed as the index coat-tailed on gains in USD/JPY and following the testimony by former tax office chief Sagawa who declared there were no instructions made by PM Abe or his close circle to alter the documents related to the land sale scandal. Hang Seng (+0.8%) and Shanghai Comp. (+1.0%) conformed to the upbeat tone as trade war concerns eased and as corporate financial results took centre stage in China, with the big 4 banks underpinned after AgBank beat estimates as it kicked off the earnings releases amongst China’s banking behemoths. Finally, 10yr JGBs were weaker amid the gains in riskier assets and with demand also shunned following a mixed 40yr auction. Japan former tax agency chief Sagawa said there was no report to the PM’s office of documents being altered and added that there were no instructions from PM Abe, his wife, Finance Minister Aso or their aides to doctor the documents. In related news, there were also comments from Finance Minister Aso that PM Abe’s office was not involved with document alterations in the controversial land sale.

Top Asian News

  • China’s Risky Debt Heads Overseas as Deleveraging Rolls On
  • Troubled Chinese Firm to Put $3.2 Billion of Properties For Sale
  • Xiaomi’s CEO Disses the iPhone in Unveiling $500 Marquee Device
  • PBOC Signals Yi to Run China’s Monetary Policy, Guo in ‘Support’
  • China’s Yuan Jumps to Highest Since 2015 as Trade Tensions Ease

European equities have joined the global relief rally (Eurostoxx +1.4%) seen between US and Asia overnight as trade tensions ease. In terms of sector specifics, materials (+2.0%) are the outperformers, enjoying a strong rebound from yesterday’s losses. Looking at individual movers, Casino (+3.4%) spiked at the open after its Monoprix chain has agreed to sell products on Amazon, GSK (+6.0%) is a top performer in the FTSE 100 after it announced to purchase a 36.5% stake in Novartis’ healthcare unit for USD 13bln. Elsewhere, Akzo Nobel (+3.0%) received a boost after Carlyle has won the bid to acquire the chemical arm unit for approx. EUR 10bln

Top European News

  • Euro-Area Economic Confidence Extends Slide Into Third Month
  • Marubeni to Sell Stake in U.K. Offshore Wind Farm Near Yorkshire
  • Liikanen Urges Caution Against Tightening ECB Policy Too Soon
  • Japan Tobacco Said to Plan Poland Plant Amid Overseas Push
  • Painful Pivot West Starts to Pay Off for Ukraine’s Exporters

In FX markets, it’s been a very choppy session with month end flows/positioning in evidence, but far from one-way or clear cut. The Eur outperformed during early trade and was a broad gainer vs G10 counterparts with the marginal exception of the Chf as that cross traded sideways within a confined 1.1760-75 range. Eur/Usd extended gains beyond near term resistance around 1.2446 to circa 1.2475, while Eur/Gbp and Eur/Jpy got close to 0.8800 and 132.00 respectively on stops and buy orders that appeared to be fix-related. However, dovish ECB comments coincided with a loss of impetus and retreat in the single currency to the benefit of the Greenback and other peers, with a French bank noting ‘strong’ Dollar demand for month end re-balancing (according to Newswires, Credit Agricole). Indeed, the DXY managed to reclaim 89.000+ status, as Cable recoiled to the 1.4125 area from 1.4240 highs, Aud/Usd pulled back from 0.7750+ to 0.7715 and Nzd/Usd topped out around 0.7300 again. Usd/Cad bounced ahead of strong chart support at 1.2803 and the psychological 1.2800 level as the Loonie lost some of its NAFTA related positive momentum (after US reports that a ‘good’ deal is in the offing), while the Jpy continues to track overall risk sentiment and suffered on a sharp global stock market recovery – falling to 105.75 vs the Usd and testing resistance in the 105.70- 75 zone (200 HMA)

In commodities, WTI crude futures are flat after failing to breach the USD 66/bbl level to the upside ahead of this week’s inventory releases and with Russia’s Energy Minister reiterating it is too early to discuss an exit from the output cut deal. Elsewhere, spot gold is trading marginally lower as it tracks fluctuations in the dollar index, while fears of trade wars recede after yesterday’s reports of talks between US and China. In base metals, copper strengthened overnight amid the recovery in risk appetite and with upside spurred on the open of Chinese metals trade.

US Event Calendar

  • 9am: S&P Case Shiller 20-City NSA Index, MoM SA, est. 0.6%, prior 0.64%
    • Case Shiller 20-City YoY NSA, est. 6.15%, prior 6.3%
    • Case Shiller CS US HPI YoY NSA, prior 6.27%
  • 10am: Richmond Fed Manufact. Index, est. 22, prior 28
  • 10am: Conf. Board Consumer Confidence, est. 131, prior 130.8; Present Situation, prior 162.4; Expectations, prior 109.7

DB’s Jim Reid concludes the overnight wrap

Let’s be honest, given the events of recent weeks, when we did get a rebound in markets it was only ever going to be in style. Last night the S&P 500, Dow and Nasdaq notched up gains of +2.72%, +2.84% and +3.26%, respectively – the biggest one-day gains since August 26th 2015. For the S&P 500, that is the third consecutive session where we have seen a move of at least 2% in either direction. The last time that happened was also in late August 2015. It’s also the 19th occasion since the start of February that we’ve seen a move of at least 1%. It took 17 months to notch up that many moves of that magnitude before that.

Yesterday’s rally was helped by a much more diplomatic tone out of the White House. Indeed, on the back of Mnuchin’s comments over the weekend about being “cautiously hopeful” that China will reach a deal to avoid tariffs,  the White House trade advisor, Peter Navarro, extended the narrative by playing down the threat of a trade war and instead said that the Trump administration is “actively” involved in talks with China to resolve the recent trade tensions between the two nations.

To be fair the day wasn’t without its ups and downs as US markets did their best to nearly wipe out early gains of some +2% and the VIX swung in a 4pt range. The news (Bloomberg) that the FIC had opened a probe into Facebook’s recent privacy practices sparked a big wave of selling across the technology complex and while they eventually recovered, European markets closed at their lows. The Stoxx 600 finished -0.72% after being up as much as +0.62% and on an intraday basis it now means that the index is officially in correction territory having dropped over 10% from the January highs. Currency moves didn’t help as the Euro rallied +0.74%. Meanwhile bond moves were also a bit all over the place. Benchmark 10y Treasuries closed 3.8bps higher yesterday at 2.853% and so clocked up the 22nd day in a row that they’ve finished with a 2.8%-handle. A 2y auction passed smoothly with a 5y and 7y auction still to go in another busy week for supply.  European rates for the most part closed unchanged.

Overnight, Japan’s Kyodo News reported that North Korea’s Kim Jong Un may have made a surprise visit to China, marking his first offshore trip since taking power in 2011. For now, White House Deputy Press Secretary Raj Shah said about the reports “we don’t know if they’re necessarily true”. Markets in Asia have followed the positive US lead and are trading higher, with the Nikkei (+2.19%), Hang Seng (+0.92%), Shanghai Comp. (+0.97%) and Kospi (+0.56%) all up as we type. US equity index futures have also nudged a bit higher.

Moving on. A bit of an eyesore to the broader trend in markets over the past 24 hours has been the underperformance for Italian assets. The FTSE MIB closed -1.24% yesterday while a sub-index of Italian banks closed down -1.72%. It was the same for bonds where 10y BTPs sold-off 3.6bps and the spread to similar maturity Bunds was 3.9bps wider at 139bps. That’s about 9bps wider than the post-election tights. Yesterday’s move appeared to be related to the political developments over the weekend with the election of the presidents of the lower and upper house of Italy’s parliament confirming the political strengths of the Five Star Movement and Northern League. As our economists highlight, Salvini (leader of the NL) and Di Maio (leader of 5SM) made an agreement over the weekend to obtain for each party or coalition one presidency of each of the two houses of parliament. Under such an agreement, the centre-right has proposed the presidency of the lower house to a 5SM candidate, while claiming for itself as the most voted coalition, the presidency of the senate.

Importantly, our colleagues now note that the success of the agreement shows that there is a clear line of communication between the two parties and mutual acknowledgement of a valuable political interlocutor. At the margin, it would appear that the chances of a NL/5SM government have increased. The caveat is obviously that there is still a long way to go if they use this as the basis to forming a stable and long-last government and there is still a possibility that Italy may repeat elections in the near term. For now, as our colleagues rightly note, the market reaction has still on the whole been fairly muted and as long as euro membership is not questioned, the cycle remains positive, ECB’s exit remains slow and the sustainability of public finances is not at risk, sentiment is unlikely to really change. For more, please see our economists’ note here.

In other news, President Trump confirmed yesterday that 60 Russian diplomats will be ordered to leave the US following the Russian spy poisoning incident in the UK. European Council President Tusk also announced that 14 EU countries would follow suit. Russia’s MICEX closed -1.62% yesterday following the news. In response, Russia’s foreign ministry noted “this unfriendly step won’t pass without impact and we will respond”. Interestingly the official twitter account of Russia’s US embassy have asked which US consulate should be closed in response.

Away from politics, in the US, the Fed’s Mester noted that “if the economy evolves as I anticipate, I believe further gradual increases in rates will be  appropriate this year and next year”. She noted that “gradual” hikes remain appropriate as they balance getting inflation back to target versus easy financial conditions and risks that the economy could overheat. She then added that this gradual path is consistent with the Fed’s median dot plots. Elsewhere, she noted the threat of trade wars hasn’t changed her economic outlook and that “this year is shaping up to be another good year for the economy”. The Fed’s Quarles echoed similar sentiment as he noted “our economy is performing well and unemployment is low”. In Europe, the ECB’s Weidmann reiterated that QE should be scaled back “soon” as inflation picks up and the market’s expectations for QE to end in 2018 and a first rate-hike in mid-2019 was “not unrealistic”. Elsewhere, he noted the EU’s exemption from the US metals tariffs reduces risks of escalation, but “it’s not a victory for free global trade”.

Before we take a look at today’s calendar, in terms of data yesterday, in the US, the February Chicago Fed national activity index was above consensus at 0.88 (vs. 0.15 expected) while the March Dallas Fed manufacturing index was below at 21.4 (vs. 33.5 expected) and down nearly 16 points from the month prior. Elsewhere, the final reading on France’s 4Q GDP was revised 0.1ppt higher to +0.7% qoq, leading to an annual growth of +2.5% yoy. Finally, the latest ECB CSPP/PSPP ratio was 40.6% (32.0% over last 4 weeks). As a reminder, before Apr 2017 when QE was still €80bn/m the ratio was 11.5%. Between Apr-Dec 2017 (QE €60bn/m) the ratio edged up to 12.7% but since Jan 2018 (QE €30bn/m) the ratio is now 27.9%. Indeed, the strength of corporate vs. government purchases as proxied by the CSPP/PSPP ratio continues to surpass our expectations of “roughly 20%”.

Looking at the day ahead, the main focus will likely be the March confidence indicators for the Euro area. In the US we’ll also get the March consumer confidence print, as well the March Richmond Fed manufacturing PMI and January S&P/Case-Shiller house price index readings. The Fed’s Bostic and the ECB’s Liikanen will speak, while the BoE is due to publish the record of its Financial Policy Committee meeting.

end

3. ASIAN AFFAIRS

i)TUESDAY MORNING/MONDAY NIGHT: Shanghai closed UP 32.93 POINTS OR 1.05% /Hang Sang CLOSED UP 242.06 POINTS OR 0.79% / The Nikkei closed UP 551.22/Australia’s all ordinaires CLOSED UP 0.72%/Chinese yuan (ONSHORE) closed DOWN at 6.2823/Oil UP to 65.76 dollars per barrel for WTI and 70.35 for Brent. Stocks in Europe OPENED DEEPLY IN THE GREEN   .   ONSHORE YUAN CLOSED DOWN AT 6.2826 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.2692 /ONSHORE YUAN TRADING WEAKER AGAINST OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR . CHINA IS   HAPPY TODAY  GOOD  CHINESE MARKETS/WITH  NEW TRUMP TRADE DEALS DISCUSSED/STRONGER GLOBAL MARKETS ) 

3 a NORTH KOREA/USA

North Korea/China

 Kim Jong Un leaves Beijing after a surprise visit.  No doubt that Kim is planning with China how to conduct themselves in the upcoming Trump visit
(courtesy zerohedge)

Kim Jong Un Leaves Beijing After Surprise Visit

North Korean leader Kim Jong Un’s first foreign trip to Beijing since coming to power in 2011 has ended, and the distinctive green locomotive that reportedly ferried Kim has departed the Beijing Railway Station…

A little over two hours after the armored express was reported to have pulled out, it was business as usual, according to South China Morning Post.

Reuters, citing reports from South Korean media, also reported that Kim had in fact been part of the delegation of North Koreans that traveled to Beijing for a whirlwind series of meetings ahead of a tentatively planned summit between President Trump and the North Korean leader in May.

South Korea’s left-leaning press Hankyoreh also reported Kim had traveled to Beijing for meetings with Chinese President Xi Jinping on Monday afternoon before leaving for a “third location” on Tuesday. It did not cite specific sources. The third location could be in China, but other media reports said the train was on its way to Pyongyang.

Kim

Two sources, who declined to be named because of the sensitivity of the issue, confirmed that the mystery guest was Kim.

“It wasn’t his sister, it was Kim himself,” one said.

The Chinese foreign ministry has yet to confirm the visit by Kim or any North Korean delegation, which is standard practice.

The agenda of Kim’s visit – his first foreign excursion since coming to power in 2011 – is still unknown.

However, it’s notable that the meeting took place against a backdrop of easing tensions on the Korean peninsula, after officials from the North and South agreed to hold talks, and US President Donald Trump gave the green light for direct negotiations with the head of the restive state.

Beijing

Beijing

Beijing remains a key economic backer of the North Korean regime, even though  Kim was reportedly frustrated at China’s decision to back UN Security Council sanctions against its restive neighbor.

The return to normal security levels on Tuesday was in marked contrast to the scenes in Beijing on Monday, when motorcades and roadblocks were seen across the city. Security has also been intensified on the China-North Korea border.

The first hint that the mystery guest was Kim was the appearance of the green train of the type favoured by North Korea’s senior leadership, which was seen travelling from the border city of Dandong to Beijing.

The roads around the Diaoyutai State Guesthouse, where foreign dignitaries usually stay, were cordoned off on Monday and local people were told to avoid the area.

Reporters were held back behind a cordon a couple of hundred metres away, as a convoy of vehicles accompanied by police motorbikes left the compound about 9.30am on Tuesday and returned about two hours later.

Wei Du 杜唯@WeiDuCNA

Rumor circling in Beijing that Kim Jong Un is in town to smooth relations with Xi Jinping before summit with Trump.

Later, the motorcade was spotted passing by Tiananmen Square, apparently en route to the railway station.

The North Korean delegation arrived on Sunday, Reuters reported.

end

 

3 b JAPAN AFFAIRS

END

c) REPORT ON CHINA

Early this morning, the USA unveiled its Chinese tariff list.  We are now waiting for Beijing to respond.

(courtesy zerohedge)

Global Times: US To Unveil China Tariff List “In A Few Hours”; Beijing Will Respond

Last Friday, when the word was wondering why China “responded” with just $3 billion in US tariffs to the proposed 60 billion in “Section 301” duties to be levied by the Trump administration on China, it was Hu Xijin, the editor-in-chief of China’s state-owned nationalist tack-on of the People’s Daily, Global Times, who explained that the $3 billion in tariffs targeting 128, mostly agricultural products, was in response for the formerly revealed “Section 232” steel and aluminum tariffs which, while exempting much of the world, clearly had China in their crosshairs.

I learned that Chinese govt is determined to strike back. Friday’s plan to impose $3b tariffs is to retaliate tariffs on steel and aluminum products. China’s retaliation lists against the 301 investigation will target US products worth $ tens of billions. It is in the making.

Fast forward to today, when the otherwise unassuming twitter account of the Global Times editor in chief was once again the focus on global macro traders, when shortly before 9am ET, he wrote that as far as he knows, “the US will release a list of products that it will impose higher tariffs based on 301 investigation in a few hours. China will put forward its retaliation list later, but the list will definitely come out. The US had better not think China will back off.

As far as I know the US will release a list of products that it will impose higher tariffs based on 301 investigation in a few hours. China will put forward its retaliation list later, but the list will definitely come out. The US had better not think China will back off.

So is this return of last week’s angry tone out of China an indication that yesterday’s “trade war truce” rally was built on quicksand, and that once the US reveals the details of its second round in Chinese tariffs, Beijing will respond immediately. Or is this just the editor of China’s main US-facing propaganda outlet seeking to drum up page views and clicks?

For the answer, keep an eye on what the US commerce department does in the next few hours, and whether Hu is proven right on the immediate release, which would suggest that with an imminent Chinese response to this latest trade war shot, it is only a matter of time before market’s fade the entire Monday surge.

END

Despite all this morning’s “happy” talk, stocks are fading as the USA confirms USA curbs on Chinese investments. China very angry.

(courtesy zerohedge)

Stocks Stall As Ross Confirms US Curbs On Chinese Investments

After all the hard work of Mnuchin and Navarro ‘happy-talking’ stocks higher yesterday, Commerce Secretary Wilbur Ross may have begun the process of reality-checking as he confirms US will announce curbs on Chinese inevstements.

When asked about U.S. retaliation against China’s alleged violation of intellectual property, Ross told Fox News

“It’s not my practice to get ahead ahead of the president and what he announces. There will be limitations on foreign investment…

CFIUS, which is the entity that regulates foreign investment, has new legislation pending both in the House and in the Senate, so that will be part of it…

And then some other action by the president will be the other part of it. He’s going to be making some announcements about it.

And while the reaction is modest for now, the epic ramp from yesterday is starting to fade into the open…

end

4. EUROPEAN AFFAIRS

ECB

We have known for quite a while, the total of European non performing loans has been approximately 1 trillion euros.  Now you can add another 10 billion euros to this list due to miscalculations. It seems that banks are lying as to the real value of the collateral that they hold.  Both Germany and France has 250 billion euros of non performing loans but the ring leader is Italy at over 360 billion euros. Interesting enough Italy is complaining that the ECB is not paying attention to the huge risk in derivatives held by some of European banks, with the ring leader in that category:  Deutsche bank

(courtesy zerohedge)

ECB Finds €10 Billion In European Bank Loan “Miscalculations”

By now it is, or should be, well-understood that the biggest deflationary virus at the heart of the European financial system is the ~€1 trillion mountain of bad loans  (of which which over €230 billion is found in Germany and France) and which casts a giant shadow both over Europe and the ECB whose president is well aware that without the central bank’s bid, the liquidity and confidence vortex that is this massive monetary black hole, will promptly drag Europe’s economy back into depression.

Well, as of today one can make it $1 trillion and €10 billion, because in a report published by the European Central Bank today, it announced its inspectors had found “shortcomings and miscalculations worth more than €10 billion when going through euro zone banks’ loan books last year.

Not surprisingly – after all the stinking pile of bad debt is arguably the biggest threat facing the European financial system once QE and NIRP is over – the ECB’s annual report showed some banks were found to be deficient in the way they identify problem customers and loans, set aside provisions and choose when to grant credit according to Reuters.

In other words “some banks” lied about pretty much everything.

Tasked with avoiding a new financial crisis, the ECB has been putting pressure on banks to clean up their balance sheets from unpaid loans inherited from the last recession, a problem for most countries in the south of Europe, as well as Slovenia and Ireland. Ironically, the ECB’s own monetary policy has removed all urgency to actually clean up balance sheets at a time when European junk bonds yield less than US government paper.

The bad loans, along with risky derivative instruments, will remain the focus of ECB supervisors this year, President Mario Draghi said in the report.

“In 2018 banks continue to face some key challenges,” Draghi said adding that These include cleaning up their balance sheets, reducing legacy exposures largely originating from the financial crisis, such as certain non-marketable financial products, and from the ensuing Great Recession, such as non-performing loans.

In short, nearly a decade after the crisis, Europe still has about €1 trillion in bad loans should not be there.

The report shows the ECB’s focus has been mostly on the latter – a cause of griping among Italian banks, which meanwhile have been complaining that risks associated with derivatives held by their competitors in France and Germany have been overlooked.

Recall that as we first disclosed four years ago, Deutsche Bank has tens of trillions of gross derivative exposure on its books.

Not surprisingly, the ECB focused on the bad loan aspect instead of derivatives (knowing which usual suspects could be implicated): the ECB launched 156 inspections in 2017, around 60 of which concentrated on bank credit – in most cases including soured loans. By comparison, market risk, which includes derivatives, accounted for fewer than 10 inspections. These revealed that some banks were failing to classify their derivatives correctly according to how difficult they are to value, and therefore potentially risky.

In other words, while some banks lied about their bad loans, other banks lied about their derivatives. And with that in mind, we look forward to finding out just how the ECB thinks it can gradually or otherwise withdraw its support of the European financial system.

END
Deutsche bank is preparing to oust its CEO John Cryan
(courtesy zerohedge)

Deutsche Bank Preparing To Oust CEO John Cryan

With Deutsche Bank shares heading back toward their 2016 postcrisis lows and yields on DB default swaps moving sharply higher, the Times of London reported Tuesday that Germany’s largest lender is planning to part ways with CEO John Cryan after the CEO fell out of favor with Supervisory Board Chairman Paul Achleitner.

Though the Times didn’t specify where it got the information, it said the bank approached Richard Gnodde, the head of Goldman Sachs Group Inc.’s international operations, but he’s believed to have spurned the overture. Deutsche Bank also considered UniCredit SpA CEO Jean Pierre Mustier and Standard Chartered Plc CEO Bill Winters, according to the report.

“Cryan may be a good person, but he’s not the right guy on top of Deutsche Bank,” Stefan Mueller, CEO of the German Institute for Asset and Equity Allocation and Valuation, said in an interview with Bloomberg TV. Still, “I think the main problem at Deutsche Bank is Paul Achleitner, he implemented all these CEOs in the last years.”

The Times’ anonymous source praised Cryan, but said he struggled to get along with Achleitner.

The source said: “It is quite clear the relationship is broken between the chief executive and the chairman.” The source added that Cryan was “outstanding” but was fighting a battle with Achleitner over cuts to the investment bank, leading to a stalemate. Cryan’s contract runs until 2020.

Disagreements between Cryan, 57, and Achleitner, 61, have emerged over bank strategy, with the CEO and Chief Financial Officer James von Moltke pushing for a more radical restructuring of businesses, including the investment bank. Cryan also angered Achleitner last year by avoiding a meeting with one of the company’s top shareholders, HNA Group Co. The Chinese government has since pushed the indebted conglomerate to unwind an acquisition binge to pay down some of its massive debt load, sending DB shares spiraling lower as investors pull their money in a liquidation panic.

Cryan

Since saying it wouldn’t sell its DB stake, HNA has sold off a chunk of stock equivalent to 1.1% of the company’s float.

DB shares are down 60% since Cryan took over as co-CEO in 2015. Shares have shed 10% of their value in the past week following a profit warning from the bank.
DB

DB has struggled to raise cash to shore up its troubled balance sheet. The lender has undertaken three fundraisings in the past eight years, raising nearly €27 billion. Last week, the bank spun out its asset management business via a stock market flotation, raising about €1.4 billion.

One person close to the bank said that it needed to look outside its existing ranks for a replacement as internally there was “no one as good as John.” However, one former insider said Marcus Schenck, co-head of corporate and investment banking, was viewed internally as a strong candidate.

Bloomberg reported that the bank approached Richard Gnodde, the head of Goldman Sachs Group Inc.’s international operations, but he’s thought to have spurned the overture, the newspaper said. Deutsche Bank also considered UniCredit SpA CEO Jean Pierre Mustier and Standard Chartered Plc CEO Bill Winters.

END

8. EMERGING MARKET

SOUTH AFRICA

END

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

Euro/USA 1.2395 DOWN .0060/ 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 GREEN   

USA/JAPAN YEN 105.75 UP  0.214 (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 1.4110 DOWN .01360  (Brexit March 29/ 2017/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED

USA/CAN 1.2871 UP .0034 (CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA/CANADA HAS A HUGE HOUSEHOLD DEBT/GDP PROBLEM)

Early THIS TUESDAY morning in Europe, the Euro FELL by 60 basis points, trading now ABOVE the important 1.08 level RISING to 1.2324; / Last night Shanghai composite CLOSED UP 32.93  OR 1.05% /   Hang Sang CLOSED UP 242.06 POINTS OR 0.79%  /AUSTRALIA CLOSED UP 0.72% / EUROPEAN BOURSES  ALL DEEPLY IN THE GREEN

The NIKKEI: this TUESDAY morning CLOSED UP 551.22 POINTS OR 2.65%

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

2/ CHINESE BOURSES / : Hang Sang CLOSED UP 242.06 POINTS OR 0.79%  / SHANGHAI CLOSED UP 32.93 OR 1.05%   /

Australia BOURSE CLOSED UP 072% /

Nikkei (Japan)CLOSED UP 551.22 POINTS OR 2.65%

INDIA’S SENSEX  IN THE GREEN 

Gold very early morning trading: 1345.35

silver:$16.60

Early TUESDAY morning USA 10 year bond yield: 2.850% !!! UP 1/2  IN POINTS from MONDAY night in basis points and it is trading WELL ABOVE resistance at 2.27-2.32%. (POLICY FED ERROR)/ 

The 30 yr bond yield 3.086 UP 1/2  IN BASIS POINTS from FRIDAY night. (POLICY FED ERROR)/

USA dollar index early  TUESDAY morning: 89.44 UP 44  CENT(S) from MONDAY’s close.

This ends early morning numbers TUESDAY MORNING

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And now your closing TUESDAY NUMBERS \1: 00 PM

Portuguese 10 year bond yield: 1.669% DOWN 5  in basis point(s) yield from MONDAY/

JAPANESE BOND YIELD: +.0.038% up 1 1/2    in basis points yield from MONDAY/JAPAN losing control of its yield curve/

SPANISH 10 YR BOND YIELD: 1.237% DOWN 2  IN basis point yield from MONDAY/

ITALIAN 10 YR BOND YIELD: 1.875 down 4 POINTS in basis point yield from MONDAY/

the Italian 10 yr bond yield is trading 64 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD:FALLS TO +.504%   IN BASIS POINTS ON THE DAY

END

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IMPORTANT CURRENCY CLOSES FOR TUESDAY

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

Euro/USA 1.2407 down .0050 (Euro down 50 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 105,71 UP 0.162 Yen DOWN 16 basis points/

Great Britain/USA 1.4153 DOWN .0085( POUND DOWN 85 BASIS POINTS)

USA/Canada 1.2855 UP  .0018 Canadian dollar DOWN 18 Basis points AS OIL FELL TO $65.35

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This afternoon, the Euro was DOWN 50 to trade at 1.2407

The Yen FELL to 105.71 for a LOSS of 16 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 85 basis points, trading at 1.4153/

The Canadian dollar FELL by 18 basis points to 1.2871/ WITH WTI OIL FALLING TO : $65.35

The USA/Yuan closed AT 6.2830
the 10 yr Japanese bond yield closed at +.038%  UP 1 AND 1/2   IN BASIS POINTS / yield/
Your closing 10 yr USA bond yield DOWN 1 IN basis points from MONDAY at 2.8154% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 3.0552  DOWN 1    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,89.32 UP 30 CENT(S) ON THE DAY/1.00 PM/

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

London: CLOSED UP 111.19 POINTS OR 1.61%
German Dax :CLOSED UP 182.57 POINTS OR 1.56%
Paris Cac CLOSED UP 49.46 POINTS OR 0.86%
Spain IBEX CLOSED UP 92.60 POINTS OR 0.99%

Italian MIB: CLOSED  UP 197.99 POINTS OR 0.90%

The Dow closed DOWN 344.89 POINTS OR 1.43%

NASDAQ WAS DOWN 211.74 Points OR 2.93% 4.00 PM EST

WTI Oil price; 65.35 1:00 pm;

Brent Oil: 70.18 1:00 EST

USA /RUSSIAN ROUBLE CROSS: 57.32 UP 14/100 ROUBLES/DOLLAR (ROUBLE LOWER BY 14 BASIS PTS)

TODAY THE GERMAN YIELD RISES TO +.504% 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:$64.88

BRENT: $69.50

USA 10 YR BOND YIELD: 2.773%   THIS RAPID ASSENT IN YIELD IS VERY DANGEROUS/DERIVATIVES START TO BLOW UP/ 

USA 30 YR BOND YIELD: 3.025%/

EURO/USA DOLLAR CROSS: 1.2403 DOWN .0053  (DOWN 53 BASIS POINTS)

USA/JAPANESE YEN:105.39 DOWN 0.155/ YEN UP 16 BASIS POINTS/ very dangerous as yen carry traders are getting killed/yen continues to rise despite the NYSE rising. however gold is now breaking away from yen influence.

USA DOLLAR INDEX: 89.35 UP  32 cent(s)/dangerous as the lower the dollar the higher the inflation.

The British pound at 5 pm: Great Britain Pound/USA: 1.4159: DOWN 0.0079  (FROM LAST NIGHT DOWN 79 POINTS)

Canadian dollar: 1.2888 DOWN 53 BASIS pts

German 10 yr bond yield at 5 pm: +0.504%


VOLATILITY INDEX:  22.50  CLOSED  UP 1.47

LIBOR 3 MONTH DURATION: 2.30%  ..

END

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

TRADING IN GRAPH FORM FOR THE DAY

Momo Massacred, Tech Wrecked, & Bond Yields Battered

Today was yesterday’s alternative ending…

Only NASDAQ remains marginally green on the year…

Today’s fun and games started with comments from Wilbur Ross on “emergency” curbs on Chinese investment but then a series of headlines on megatech – NVDA self-driving car suspension, TSLA NTSB probe, FB hearings and more headlines, and GOOGL and TWTR being dragged into the furore. All in all – a bloodbath!

What goes up (on low volume) collapses on heavy volume… (Nasdaq – green, was worst; The Dow – blue, managed to hold some gains)…

Cash markets saw Nasdaq and Small Caps erase all of yesterday’s gains…

Equity market momentum was massacred today…

The S&P 500 failed to get back to its 100DMA (blue) and tumbled back towards its 200DMA (red)…

The Dow is back below its Fib 38.2 Retrace level…

VIX spiked back above 23…

FANGMAN Stocks were a total bloodbath…

US bank stocks collapsed back to reality today…

Fading yesterday’s outperformance of European banks…

Credit stress continues to build…

HY and IG smashed wider…

Bonds led stocks…

Bond yields tumbled today…

Real and BEs collapsed…

10Y Yields broke their 24 day streak of closing with a 2.8x% handle… to the downside, closing at 2.78% – lowest close since Feb 5th…

And the yield curve collapsed to fresh 11 year lows…

As bonds catch down to Copper/Gold’s disinflationary reality…

The Dollar Index rebounded grandly overnight but stalled once the US session started…

Cryptos had another tough day…

It seems that Bitcoin is leading tech lower once again…

Commodities were all lower today on the stronger dollar, led by crude…

The energy complex was all hit hard today…

What next?

END

USA data reports:

Despite poor number of homes being built, we still see a surge in home prices and the jump with this report is the largest in 4 years with all cities up in home prices

(courtesy zerohedge)

“The Home Price Surge Continues” – Case-Shiller Jumps Most In 4 Years, All Cities Up

US housing data has been disappointing so far in 2018 as affordability plummets on the heels of rising rates, but that didn’t stop Case-Shiller Home Prices from surging at a faster-than-expected 6.4% YoY in January.

Home sales, permits, and starts have been underwhelming so far this year…

But according to Case-Shiller, home prices are accelerating at their fastest rate since July 2014 (up 6.4% YoY vs 6.15% YoY exp)…

All 20 cities in the index showed year-over-year gains, led by a 12.9 percent increase in Seattle and an 11.1 percent gain in Las Vegas.

After seasonal adjustment, Seattle, San Francisco and Atlanta had the biggest month-over-month gains.

Washington has the smallest month-over-month advance at 0.2 percent.

“The home price surge continues,” David Blitzer, chairman of the S&P index committee, said in a statement.

“Two factors supporting price increases are the low inventory of homes for sale and the low vacancy rate among owner-occupied housing.”

The 20-City Home price index is less than 1% away from the record highs of 2006…

But the National home price index is over 6% above 2006 highs…

end
Consumer confidence falters as “hope” plunges to new lows
(courtesy zerohedge)

Consumer Confidence Sinks As Stock Market Hope Plunges To Trump Election Lows

Having shrugged off stock market volatility in February, with present situation confidence buoyed by tax reform hope, Conference Board Consumer Confidence slipped in March (and missed expectations).

Febuary’s headline data was a 18 year high, so this remains an extreme level of confidence… Both current and future expectations also slid lower in March

“Consumer confidence declined moderately in March after reaching an 18-year high in February,” said Lynn Franco, Director of Economic Indicators at The Conference Board.

“Consumers’ assessment of current conditions declined slightly, with business conditions the primary reason for the moderation.

Consumers’ short-term expectations also declined, including their outlook for the stock market, but overall expectations remain quite favorable. Despite the modest retreat in confidence, index levels remain historically high and suggest further strong growth in the months ahead.

After reaching record highs in January, Americans’ confidence in continued stock market gains has crashed to its lowest since Trump’s election…

This is the biggest two-month collapse in stock market confidence in the survey’s 30-year history…

end
Early trading:
stocks give up overnight gains as trade war anxiety reappears:
(courtesy zerohedge)

US Stocks Give Up Overnight Gains As Trade War Anxiety Reappears

The Dow and S&P have erased overnight gains (and Nasdaq is sliding fast) as traders sell the cash open following headlines from Wilbur Ross and China’s Global Times that suggest the trade war is far from over…

Treasury yields are tumbling…

And the dollar index is rapidly fading after spiking since Asia’s close.

 end
AFTERNOON TRADING
YIELD CURVE CRASHING TO NEW CYCLE LOWS INDICATING DEEP RECESSION
(COURTESY ZEROHEDGE)

Treasury Yield Curve Crushed To New Cycle Lows

Treasury yields are cratering today after spiking higher with stocks yesterday with the long-end dramatically outperforming, flattening the yield curve to near 10-year cycle lows…

Bond yields are well below yesterday’s lows, leading stocks lower…

The yield curve is plunging…

Set for the flattest close since October 2007…

END
Wow!! we were totally unaware of this:  The uSA exports a huge percentage of its waste material to China. Now China is ready to strike back if the USA imposes tariffs on steel and aluminum products plus other items

(courtesy zerohedge)

a very important read..
(zerohedge)

US Demands China Keep Importing American Garbage

As it tries to strike an agreement with the US to avert a trade war that economists fear could destabilize global markets, China has an ace up its sleeve that it’s just about ready to play: The Communist Party last year implemented a ban on imports of recyclable material that is provoking a mild panic in the US.

The reason? The US relies on China to “import” much of its bulk recyclable waste. But last July, in an effort to battle the “illegal foreign garbage” influx into China, the country’s Ministry of Environmental Protection notified the World Trade Organization that it plans to ban imports of 24 types of solid waste materials, including soda bottles, mixed paper, recycled steel and newsprint.

Despite the threat to implement the ban by the end of the year, the document stated that the “proposed date of adoption” is “to be determined.”

But by moving ahead with the decision, China risks creating serious problems for the global recycling industry, something that would probably have the greatest impact on the US by essentially forcing it to make difficult choices about how it process its solid waste, including – most notably – how and where it is stored.

China

According to Reuters, which was the first western media outlet to report on the decision, the US Institute of Scrap Recycling Industries said at the time that the ban would devastate an industry that supported 155,000 jobs and had exported scrap worth $5.6 billion to China in 2016.

“China’s import restrictions on recycled commodities have caused a fundamental disruption in global supply chains for scrap materials, directing them away from productive reuse and toward disposal,” a US representative told the meeting, according to a trade official in Geneva.

The United States recognized China’s environmental concerns but Beijing’s approach seemed to be having the opposite effect to what was intended, and its rules had changed far too quickly for industry to adjust, the U.S. representative told the meeting.

The US also accused China of violating its obligations under the WTO framework.

China seemed to be breaching its WTO obligations by treating domestic and foreign waste differently and employing an overly trade-restrictive policy, the U.S. official said.

“We request that China immediately halt implementation and revise these measures in a manner consistent with existing international standards for trade in scrap materials, which provide a global framework for transparent and environmentally sound trade in recycled commodities.”

Washington’s demand came a day after President Trump ordered the US trade rep to levy tariffs on at least $50 billion of Chinese imports. Although the USTR was given 15 days by Trump to propose a list of Chinese products that would be targeted, China’s commerce ministry had already threatened to take legal action against the US through the WTO. The country is also contemplating targeting 128 American products through an imposition of harsh import tariffs – though earlier today officials from both countries privately confirmed to the Wall Street Journal and other media organizations that a deal could soon be reached.

The Chinese Foreign Ministry also made clear that it has the means to fight a potentially devastating trade war with the US but urged Washington to reconsider its aggressive economic policy. Beijing warned that “the American consumers and enterprises will bear the brunt” of a trade war with China.

China

According to RT, China is by far the biggest importer of US recyclables. Banning US junk imports will have a catastrophic impact on the US labor market and will drive up waste management costs. The Chinese representative at the meeting in Geneva on Friday agreed to relay the US’s concerns to Beijing, though the envoy still noted that, ultimately, individual countries are responsible for their own waste.

“In any given year, approximately one-third of the scrap recycled in the United States is prepared for shipment to the export market, and China is the recycling industry’s largest customer,” ISRI President Robin Wiener told China Daily earlier. “This includes more than $1.9 billion in scrap paper and $495 million in scrap plastics. A ban on imports of scrap commodities into China would be catastrophic to the recycling industry.”

If the world’s No. 2 economy closes off its waste-management market, recycling centers across the US would be faced with a hard choice. They can either hire a much more expensive workforce which would raise prices for their services, require households to sort their own waste, or be forced to use more landfills across all fifty US states.

Of course, there’s a third option: Find new foreign buyers for its bulk waste. But doing so would be incredibly fraught because there’s no single buyer – or even group of buyers – that could adequately make up for China’s heft.

Regardless of what happens, one thing is for certain: While China likely won’t be able to force concessions on major issues like America’s complaints about China’s methods for siphoning off foreign IP, the garbage issue could loom large in the closed-door discussions currently taking place to strike a more equitable trade deal that would appeal both Trump and his factory-town base.

END

Jim Grant states that they may replace Libor with an another rate called  SOFR which will probably give us a better picture of risk to the banks and thus a key figure to be used by investors around the world to price in risk

(courtesy Jim Grant/Interest Rate observer)

Grant’s Almost Daily: Leverage On Offer

Submitted by Grants Interest Rate Observer

If regulators on either side of the pond have their way, it will soon be time to say tata to the London Interbank Offered Rate (Libor) as the benchmark interest rate used to set the price of hundreds of trillions of dollars in debt securities the world over.  Today, Bloomberg notes that the Federal Reserve Bank of New York, in tandem with the Treasury Department’s Office of Financial Research are set to debut the Secured Overnight Financing Rate (SOFR).  The salient distinction between Libor and its presumed successor:

Where LIBOR relied on the expectations of bankers, SOFR is based on real transactions from a swath of firms including broker-dealers, money market funds, asset managers, insurance companies, and pension funds.  It’s different from Libor as well in that it’s a secured rate, since the repo rates it’s derived from are collateralized, or backed by assets.

As financial authorities prepare to usher Libor to the exit, the benchmark reference rate has managed to make its way back into the investment spotlight. A methodical rise to 2.29% from 0.65% as the 10-year yield bottomed in July 2016 has pushed Libor’s spread over the “risk free” overnight indexed swap [OIS] rate to its highest since 2009.  That type of widening would traditionally signal diminished liquidity or even credit stress. 

Bhanu Baweja, deputy head of macro strategy at UBS Investment Bank, argued in an opinion piece in last Tuesday’s Financial Times that other factors explain the recent move. Baweja estimates that two-thirds of the widening can be attributed to rising Treasury bill yields (higher issuance amid the recent spending bill and tax cuts is the apparent catalyst), while the 2016 money market reform and subsequent upward pressure on commercial paper yield accounts for the rest. Baweja goes on to comment:

Does the price of funding not matter at all, then? It most certainly does. It can fundamentally alter market trends. But instead of Libor-OIS widening, which is likely a red herring, we need to focus on the right channels to detect signals of a change in the investment opportunity set.

First, watch the hit from yields to floating rate high yield credit and leveraged loans. We estimate floating rate loans to U.S. borrowers at $2.2 trillion, nearly half of which have been extended to issuers rated below double-B-minus. Our analysis shows that leveraged loan issuers will remain resilient to the next 75-100 basis point increase in Fed Funds rates, but could see their interest coverage ratios reaching dangerously low levels beyond that.

If leveraged loans are the canary in the coal mine, then so far, so good. The S&P/LSTA Leveraged Loan Total Return Index made another new high on Friday, up by more than 18% from its February 2016 interim lows.


Source: The Bloomberg

On March 15, Bloomberg noted more issuers managed to place leveraged loans at 175 basis points over Libor (the tightest spread seen since the crisis) in the prior month than in the past ten years combined. At the same time, investors continue to accept diminished legal protection, in the form of so-called covenant-lite loans.  S&P Global Intelligence’s LCD unit reported Friday that cov-lite’s share of the $984 billion leveraged loan market reached a fresh record high of 75.8% in February.

Last week, Uber Technologies, Inc., which lost $4.5 billion on $7.5 billion in revenue in 2017 and recently sold shares to Softbank at a 30% markdown from its prior valuation (see “Out of gas” from the Jan. 12 issue of Grant’s for more), tapped the leveraged loan market, hoping to borrow $1.25 billion at an indicated yield of 425-450 basis points over Libor.  Investor demand was strong enough for Uber to both upsize the offering to $1.5 billion and lower its spread over Libor to 400 basis points.

end

Train wreck:  Part II

Stockman details that Trump’s new war cabinet will bring in a fiscal doom loop

a must read…

(courtesy David Stockman/ContraCornerBlog)

 

Stockman Warns Trump’s New War Cabinet Will Create A Fiscal Doom Loop

Authored by David Stockman via Contra Corner blog,

Last week the Donald’s incipient trade war got Wall Street’s nerves jangling, but that wasn’t the half of what’s coming.

To wit, Trump has now essentially formed a War Cabinet and signed a Horribus spending bill that is a warrant for fiscal meltdown.

Indeed, the two essentially comprise a self-fueling doom loop which means Washington’s descent into fiscal catastrophe is well-nigh unstoppable; it’s all over except for the screaming in the bond pits.

That is, Trump’s new War Cabinet of John Bolton, Mike Pompeo, Gina Haspel and Mad Dog Mattis is arguably the most interventionist, militarist, confrontationist and bellicose national security team ever assembled by a sitting President. We cannot think of a single country that has even looked cross-eyed at Washington in recent years where one or all four of them has not threatened to drone, bomb, invade or decapitate its current ruling regime.

That means Imperial Washington’s rampant War Fever owing to the Dem-left declaration of war on Russia and Putin is now about to be drastically intensified by the complete victory of the neocon-right in the Trump Administration. The result will be sharpened confrontation, if not actual outbreak of hostilities, across the full spectrum of adversaries—Iran, Russia, China, Syria and North Korea—-and an escalating tempo of military operations and procurement to implement the policy.

At the same time, the Donald’s pathetic Fake Veto maneuver on Friday cemented the special interest lobbies’ absolute control over domestic appropriations. Of course, Chuckles Schumer and Nancy Pelosi crowed loudly about the $63 billion annual domestic spending increase they got in return for the Donald’s $80 billion defense add-on, but the victory was not partisan; it belonged to the Swamp creatures who suckle the politicians of both parties and own the appropriations committees lock, stock and barrel.

To be sure, upon folding at mid-day from his four-hour’s earlier veto tweet, the Donald promised “never again”, but his reason for signing the most wasteful, pork-ridden appropriations bill of this century tells you all you need to know. To wit,

There are a lot of things I’m unhappy about in this bill. There are a lot of things that we shouldn’t have had in this bill, but we were in a sense forced if we want to build our military,” Trump said. “I said to Congress, I will never sign another bill like this again.”

Au contraire. As long as he lasts in office, the Donald will be signing budget busters far worse than this one because the aggressive foreign policies of his War Cabinet will drive the pace of national security spending dramatically higher than the record $695 billion he signed into law last week; and these “must have” increases for pay, operations, ammo, spare parts, training, readiness and weapons replacement/augmentation will not get through the Congress until the bipartisan porkers have had their fill on the domestic side.

Your editor experienced long ago the toxic fiscal equation which arises when hawks and militarists take control of foreign policy and the defense budget. What you get is a “guns and butter” log-rolling dynamic as defense advocates on the spending committees buy the votes of colleagues whose snouts have penetrated deeply into the domestic pork barrel or whose paymasters inhabit the vast expanse of the health, education and social welfare complex.

That’s what stopped cold the Gipper’s short-lived attack on Big Government after 1981, and why the hawk-dominated GOP has been such a dismal failure on the fiscal front ever since.

But the Trumpite/GOP has brought guns and butter log-rolling to a whole new level of fiscal profligacy. And the overwhelming share of the blame for the resulting Horribus appropriations bill—which will raise spending by $143 billion this year and $2.4 trillion over the next decade—rests squarely with the incumbent member of Trump’s new War Cabinet, SecDef James Mattis.

Not only does his brazen bellicosity and demented militarism rival that of the other three members of Trump’s new War Cabinet, but Mattis also spent a 40 year career sucking the hind teats of the Warfare State, where he apparently never met a military budget that was big enough.

That is to say, Mattis is not remotely the “warrior monk” or “military intellectual” the fawning mainstream press makes him out to be. He’s actually a gung-ho bull-in-the-china-shop who defines his mission as complete obliteration of any foe who comes along; and which is to be accomplished by the assembly of overwhelming military capabilities and firepower.

Stated differently, the quotes below are not the expressions of a subtle mind. They reflect the mindset of the bombastic militarist who should have never, ever been let near the top post at the Pentagon, and who is the architect of the Donald’s hideously bloated defense budget and new long-term strategic plan for unaffordable, insensible global military dominance:

“The first time you blow someone away is not an insignificant event. That said, there are some assholes in the world that just need to be shot…..I come in peace. I didn’t bring artillery. But I’m pleading with you, with tears in my eyes: If you fuck with me, I’ll kill you all.’

Unlike most of the American generals who have been waging and loosing pointless wars over the last half century while cheerfully checking the boxes on the way to their post-retirement bonanzas, Mattis never got over it. He blitzed the enemy as an assault battalion commander in the first Gulf War, brought carnage to the Pashtun villages of southern Afghanistan and obliterated Fallujah (Iraq) twice—without ever noticing that he was not winning any wars, but just dispensing random high-tech violence at huge cost in blood (theirs), treasure (ours) and blowback (throughout the Muslim world).

Indeed, Mattis’ apparent lesson was that America needed massive military dominance to pacify an uncooperative world, and the Donald fell for it hook, line and sinker.

Yet in today’s world, America has no industrial state enemies remotely capable of and/or motivated to threaten the homeland. Indeed, the only real homeland defense we need is our nuclear retaliatory force of land-based ICBMs, sea-based Trident missiles and DOD’s 5,000 active and standby nuclear warheads—all of which were bought and paid for long ago.

That is, America doesn’t need no stinkin’ defense build-up, and could slash what it’s already spending by $250 billion per year without harming national security in the slightest.

That is also to say, neither Russia nor China is about to invade the American homeland with conventional forces because neither has even 5% of the necessary air-lift, sea-lift and power projection capacity that would be needed—even if they were ruled by lunatics, which they most assuredly are not.

Likewise, Russia and China are not suicidal enough to launch a first nuclear strike or attempt nuclear blackmail.

And beyond that, the even more dispositive point is that the very thought of hostile action against the American homeland would amount to an economic death warrant for either power.

That’s because in the case of the Red Ponzi, the Donald is absolutely right about its massive trade imbalance. China’s $510 billion per year of exports to the US do not represent free and fair trade in the historic sense: They are an absolute freak of economic nature stemming from the massive central bank money printing spree of the last 25-years and the egregious mercantilism that Beijing has instituted to exploit it and to build the greatest credit-fueled house of cards in human history.

Accordingly, if China were to threaten the US militarily, the resulting embargo on Chinese goods would cause its economy to plunge into a thundering collapse within six months: To wit, America’s spacious closets are already stuffed full of enough junk from China—including every variety of Apple device—to last for years, while China’s debt-ridden production chain on the margin survives hand-to-mouth on export orders.

And as for Russia, pulleese!

Its entire GDP of $1.5 trillion is less than that of the New York metro area, and only 8% of the US economy as a whole. The very idea that it’s a military threat to America is just flat out ludicrous; and that is in no way changed by Putin’s recent hints that Russia has developed a new class of non-ballistic strategic weapons that are not vulnerable to US ABM defenses.

But of course!

It was the US and John Bolton specifically during his stint as head of arms control at the Bush State Department that caused the expiration of Nixon’s ABM treaty. And in light of the subsequent drive toward a US missile defense system, what does another power that wishes to preserve the credibility and efficacy of its nuclear deterrent or retaliatory strike capability do?

Why, it finds a way around the ABMs to insure that no adversary is tempted to launch a pre-emptive first strike while secure from retaliation in a protective ABM cocoon. That’s exactly what the old MAD playbooks recommend, and what Russia, apparently, actually did.

So why does Mattis want $700 billion per year of force structure, readiness and massive weapons upgrades this year, which is just a down payment on an embedded defense bow-wave that will quickly rise towards $1 trillionannually?

A good part of the answer is sheer economic ignorance. Mattis along with the career national security apparatchiks who now comprise the Donald’s new War Cabinet are making the same mistake as their cold war forebears did about the old Soviet Union.

The latter was always destined to collapse under the weight of command and control centralization and ersatz socialism; it was only a matter of funding a strategic deterrent and waiting out the collapse that finally came, and swiftly, too.

There was never any need for the massive conventional forces that were kept in being during the Cold War, and especially not the huge Reagan build-up. The latter essentially funded an expeditionary armada designed for invasion and occupation—an unneeded capability that eventually led to the follies of Washington’s serial military interventions in the Middle East.

That is even truer today. ISIS was a short-lived menace that arose from Washington’s interventions in Iraq and Syria, and has now been largely extinguished by its mortal 13-century old Shiite enemy: That is, the Shiite coalition of the Iraqi government in Baghdad, Iran, the Assad regime in Syria and the Hezbollah fighters of Lebanon.

There is nothing else from that region that threatens the safety and security of the citizens of Lincoln NE or Springfield MA, and most especially not the Iranians and their Shiite allies. The Iranians never had a nuclear weapons program, even by the lights of the 17-agency NIEs (national intelligence estimates) from 2007 onwards, and they have now precluded the possibility by agreeing to the Obama nuke deal.

The fact is, Iran is not a terrorist state—even if its theocracy falls far short of democratic ideals, and even if its leaders do fulminate against the Great Satan in Washington.

After all, during the past 65 years Washington has attacked the Iranian people by installing a brutal, larcenous puppet regime under the Shah from 1953-1979; siding with Iraq when the latter invaded Iran during the 1980s; and by demonizing and attempting to destabilize it ever since.

The entire case against Iran has been concocted by Israeli Prime Minister Netanyahu and the coalition of right-wing parties upon which his rule depends. They claim the Tehran regime is an existential threat to Israel’s survival, but that’s ridiculous when they have upwards of 100 nukes and the Iranians have none, and when the Israeli air force has the capacity to turn Iran’s limited attack forces into a smoldering heap of twisted metal on a moment’s notice.

The Israeli claim that Hezbollah is a lethal Iranian dagger pointed at its survival is equally upside down. In fact, Israel’s repeated brutal occupations of the Shiite regions of southern Lebanon is what brought Hezbollah into existence, and at length has made it the largest political party in this religiously fractured country.

In that context, the main reason Iran supplies Hezbollah with arms is to deter a US/Israel attack; and also because like any other sovereign nation it is allowed to have a foreign policy, including one based on shared confessional ties.

We remonstrate on these matters because when it comes to Iran the Donald’s new War Cabinet is a wholly owned subsidiary of Bebe Netanyahu. Bolton and Pompeo are absolutely rabid in their desire to make war on Iran, and Mad Dog Mattis is not far behind.

Yet it cannot be stated strongly enough: Iran proposes no military threat to the American homeland whatsoever; it has never been involved in a terrorist incident or even plot against America or Europe for that matter; and its religious and political quarrel with the Saudis is absolutely none of Washington’s business.

As we have frequently observed, it really doesn’t matter who controls the vast hydrocarbon deposits surrounding the Persian Gulf—-Sunni or Shiite, dictators or democrats, Arabs or Persians. That’s because they all desperately need the revenue. And if oil prices should temporarily spike due to local wars or political upheaval, the cure for high prices is the global free market, not the US fifth fleet.

The truth of the matter is that a unilateral US military attack on Iran would be tantamount to a war crime—as the Nuremberg trials defined “wars of aggression”. And that is why the Donald’s mindless and groundless conviction that the Iran nuclear accord is the worst deal ever made by the US government is so pregnant with danger.

To a person, his new War Cabinet will be in the business of scratching and clawing the Donald’s itch. Their modus operandi will be to sabotage the greatest breakthrough for world peace in decades on May 12 when the next certification of Iranian compliance arrives.

Once the nuclear deal is ash-canned, in turn, the War Cabinet will revive their historically false claims that the Iranian’s are on the verge of gaining nuclear weapons. That’s even if they merely restart their enrichment plant at Natanz, which they would have every right to do in the event of Washington’s unilateral abrogation.

From there the war drums would start beating loudly in Imperial Washington for a pre-emptive attack to stop them—a speciously Nuremburg compliant attack, as it were.

Regardless of how this scenario plays out in concrete detail and time frame, one thing is certain. A rising crescendo of tensions and confrontations with all of the War Cabinet’s targets—-Iran, Syria, Russia, China and North Korea—is fast coming down the pike. And that means an even larger burst in defense spending is not far behind.

All the while, of course, the Freedom Caucus stumbles around helping to slash tax revenues to 16.6% of GDP—the lowest level since the late 1940s—even as it welcomes the Donald’s War Cabinet and kvetches about soaring entitlements and the Horribus appropriations bill that a good portion of its membership acquiesced to.

And they are the purported fiscal good guys!

Yes, it is a doom loop and there is not a chance in the hot place of avoiding the fast arriving bond market “yield shock” that will make mincemeat out of today’s incorrigible dip buyers.

end

SWAMP STORIES

Stormy Daniel’s slaps Trump’s lawyer, Cohen with a defamation suit.  Then Trump’s team sends a cease and desist letter to Stormy.  The 60 Minutes interview had the highest ratings in over 10 years.

Greg Gutfeld had the best line on this 60 Minute interview:

“Finding out Donald Trump slept with a porn star is like finding out Mike Pence didn’t…”

Stormy Slaps Cohen With Defamation Suit After 60 Minutes’ Highest Ratings In 10 Years

Update: It will come as no surprise that following Trump lawyer Michael Cohen’s sending a fresh cease-and-desist letter to Stormy Daniels that her lawyer would fire one right back alleging in court that his personal attorney Michael Cohen defamed her by insinuating that she lied about an affair with Trump more than a decade ago.

Which remember she actually said herself three times and even signed a statement confirming it.

Daniels amended her existing lawsuit against Trump, adding Cohen as a defendant in the pending case.

Besides accusing Cohen of defamation, the amended complaint broadens Daniels’s contention that the confidentiality agreement was illegal, because it lacked Trump’s signature.

And finally we get the real meat of the litigation – as we detailed below:

The new complaint says the payment violated federal laws that impose limits on campaign donations and require those donations to be publicly reported.

Cue Maxine Waters’ cries of “impeachment.”

*  *  *

As we detailed earlier, following an eye opening 60 Minutes interview which gave the CBS production its highest ratings in a decade, President Trump’s personal lawyer, Michael Cohen, sent a cease-and-desist letter to Stormy Daniels, demanding she apologize for fingering him as the person behind an alleged 2011 threat made in a parking lot.

Cohen’s lawyer fired back almost immediately after the Daniels interview with this letter saying allegation of goon threatening her was false >>

The letter accuses Daniels, whose real name is Stephanie Clifford, of making a false claim against Cohen – “namely that he was responsible for an alleged thug who supposedly visited Ms. Clifford, while she was with her daughter, and made an alleged threat to Ms. Clifford.”

The letter goes on to read “In truth, Mr. Cohen had absolutely nothing whatsoever to do with any such person or incident, and does not even believe that any such person exists, or that such incident ever occurred. You and your client’s false statements about Mr. Cohen accuse him of criminal conduct and constitute, among other claims, liber per se and intentional infliction of emotional distress.”

Cohen’s letter demands that Daniels and her attorney, Michael Avenatti refrain from making “further false and defamatory statements” and that they both retract and apologize for the claims made on 60 Minutes.

“A guy walked up on me and said to me, ‘Leave Trump alone. Forget the story,’”Daniels told Anderson Cooper. “And then he leaned around and looked at my daughter and said, ‘That’s a beautiful little girl. It’d be a shame if something happened to her mom.’ And then he was gone.”

Daniels said that while she never saw the man again, she would “100 percent” recognize him. “Even now, all these years later. If he walked in this door right now, I would instantly know.”

Of note, Cohen paid daniels $130,000 prior to the 2016 election, claiming he did so with his own money.

President Trump hinted at the interview Monday morning, tweeting “So much Fake News. Never been more voluminous or more inaccurate. But through it all, our country is doing great!”

So much Fake News. Never been more voluminous or more inaccurate. But through it all, our country is doing great!

Daniels’s lawyer, Michael Avenatti, previously teased the interview by tweeting a picture of what appeared to be a compact disc in a safe – hinting that he has video or photographic evidence of Clifford’s affair with President Trump.

“If ‘a picture is worth a thousand words,’ how many words is this worth?????” tweeted lawyer Michael Avenatti.

If “a picture is worth a thousand words,” how many words is this worth?????

When asked about “what is the point of this tease” on The View Monday, Avenatti said “it wasn’t a tease, it was a warning shot to Mr. Cohen and to the President.”

When CBS Evening News‘ Julianna Goldman asked Avenatti if he had photos, texts or videos of her alleged relationship with Trump, he replied “No comment,” adding that Clifford just “wants to set the record straight.”

Sex sells

Stormy’s 60 Minutes interview gave CBS its highest ratings in nearly a decade, with 21.3 million viewers – second only to a November 16, 2008 interview with the Obamas that saw an audience of 24.5 million viewers – with all three segments devoted to the then-president-elect and his wife Michelle.

Although as Fox’s Greg Gutfeld said: “Finding out Donald Trump slept with a porn star is like finding out Mike Pence didn’t…”

END

I will  see you  WEDNESDAY night

HARVEY

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