June 5/GOLD REBOUNDS ON ITALIAN FEARS: GOLD RISES BY $5.30 TO $1298.50/SILVER UP 10 CENTS TO $16.52/MEXICAN PESO PLUMMETS PAST THE 20 BARRIER TO 20.20 TO THE DOLLAR AS THEY IMPOSE TARIFFS ON IMPORTS OF PORK/BRAZILIAN REAL TUMBLES TO CLOSE TO THE 4 REALS TO THE DOLLAR AS THIS COUNTRY HAD A 7 WEEK TRUCKING STRIKE AND THEN A PETRO STRIKE/ INFLATION IS RUNNING RAMPANT IN BRAZIL/HUGE SWAMP STORY AS BILL PRIESTAP A WILLING WITNESS WILL CAUSE HEADACHES FOR OUR DEMOCRATS/

 

GOLD: $1298.50 UP  $5.30 (COMEX TO COMEX CLOSINGS)

Silver: $16.52 UP  10 CENTS (COMEX TO COMEX CLOSINGS)

Closing access prices:

Gold $1296.500

silver: $16.49

For comex gold:

JUNE/

NUMBER OF NOTICES FILED TODAY FOR JUNE CONTRACT:1491 NOTICE(S) FOR 149,100 OZ.

TOTAL NOTICES SO FAR 1685 FOR 168500 OZ (7.837 tonnes)

For silver:

JUNE

39 NOTICE(S) FILED TODAY FOR

195,000 OZ/

Total number of notices filed so far this month: 770 for 3,850,000 oz

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Bitcoin: BID $7363/OFFER $7463: DOWN $82(morning)

Bitcoin: BID/ $7574/offer $7674: UP $130  (CLOSING/5 PM)

end

First Shanghai gold fix comes at 10 pm est

The second Shanghai gold fix:  2:15 pm

First Shanghai gold fix gold: 10 pm est: 1298.54

NY price  at the same time: 1292.30

PREMIUM TO NY SPOT: $6.14

Second gold fix early this morning: 1300.22

USA gold at the exact same time:1291.60

PREMIUM TO NY SPOT:  $8.62

AGAIN, SHANGHAI REJECTS NEW YORK PRICING.

WE WILL NOT PROVIDE LONDON FIXES AS THEY ARE NOT ACCURATE AS TO WHAT IS GOING ON AT THE SAME TIME FRAME.

Let us have a look at the data for today

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In silver, the total OPEN INTEREST ROSE BY AN SMALL 358 CONTRACTS FROM  209,716  UP TO 210,259 ACCOMPANYING YESTERDAY’S TINY 1 CENT FALL IN SILVER PRICING.    WE ARE NOW WITNESSING OUR USUAL AND CUSTOMARY COMEX LONG LIQUIDATION AS WE ENTERED INTO THE NON ACTIVE DELIVERY MONTH OF JUNE AS LONGS PACK THEIR BAGS AND MIGRATE OVER TO LONDON.  WE WERE  NOTIFIED THAT WE HAD A SMALL SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP :  650 EFP’S FOR JULY AND ZERO FOR ALL  OTHER MONTHS  AND THEREFORE TOTAL ISSUANCE OF 650 CONTRACTS. WITH THE TRANSFER OF 650 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 650 EFP CONTRACTS TRANSLATES INTO 8.625 MILLION OZ  ACCOMPANYING:

1.THE 1 CENT FALL IN  SILVER PRICE  AT THE COMEX AND

2. THE STRONG AMOUNT OF SILVER OUNCES STANDING FOR JUNE COMEX DELIVERY. (3.860 MILLION OZ) DESPITE IT BEING A NON ACTIVE DELIVERY MONTH.

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

3471 CONTRACTS (FOR 2 TRADING DAYS TOTAL 3471 CONTRACTS) OR 17.355 MILLION OZ: (AVERAGE PER DAY: 1157 CONTRACTS OR 5.785 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH:  17.355 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 2.01% OF ANNUAL GLOBAL PRODUCTION (EX CHINA EX RUSSIA)

ACCUMULATION IN YEAR 2018 TO DATE SILVER EFP’S:            1,331.7      MILLION OZ.

ACCUMULATION FOR JAN 2018:                                               236.879     MILLION OZ

ACCUMULATION FOR FEB 2018:                                               244.95         MILLION OZ

ACCUMULATION FOR MARCH 2018:                                       236.67         MILLION OZ

ACCUMULATION FOR APRIL 2018:                                          385.75         MILLION OZ

ACCUMULATION FOR MAY 2018:                                            210.05       MILLION OZ

RESULT: WE HAD A SMALL SIZED INCREASE IN COMEX OI SILVER COMEX OF 358 DESPITE THE 1 CENT FALL IN SILVER PRICE.  WE HAVE NOW ENTERED THE NEW NON ACTIVE MONTH OF JUNE.   THE CME NOTIFIED US THAT IN FACT WE HAD AN GOOD SIZED EFP ISSUANCE OF 650 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 (SEE COMEX DATA) . FROM THE CME DATA:  650 EFP CONTRACTS FOR JULY, AND ZERO FOR ALL OVER MONTHS   FOR  A DELIVERABLE FORWARD CONTRACT OVER IN LONDON WITH A FIAT BONUS (TOTAL: 650). TODAY WE GAINED A FAIR 1008 TOTAL OI CONTRACTS  ON THE TWO EXCHANGES: i.e.650 OPEN INTEREST CONTRACTS HEADED FOR LONDON  (EFP’s) TOGETHER WITH AN INCREASE OF 358  OI COMEX CONTRACTS. AND ALL OF THIS HAPPENED WITH THE 1 CENT FALL IN PRICE OF SILVER  AND A CLOSING PRICE OF $16.42 WITH RESPECT TO FRIDAY’S TRADING. YET WE STILL HAVE A GIGANTIC AMOUNT OF SILVER STANDING AT THE COMEX FOR DELIVERY IN THIS NON  ACTIVE JUNE DELIVERY MONTH. IT SURE LOOKS LIKE A FAILED BANKER SHORT COVERING EXERCISE!!

In ounces AT THE COMEX, the OI is still represented by OVER 1 BILLION oz i.e. 1.050 MILLION OZ TO BE EXACT or 150% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT JUNE MONTH/ THEY FILED AT THE COMEX: 39 NOTICE(S) FOR 195,000 OZ OF SILVER

IN SILVER, WE HAVE NOW SET THE NEW RECORD OF OPEN INTEREST AT 243,411 AND AGAIN THIS HAS BEEN SET WITH A LOW PRICE OF $16.51  ON APRIL 9.2018.

ON THE DEMAND SIDE WE HAVE THE FOLLOWING:

  1. HUGE AMOUNTS OF SILVER STANDING FOR DELIVERY  (MARCH: 27 MILLION OZ , APRIL: 2.485 MILLION OZ AND MAY: 36.285 MILLION OZ /AND JUNE  (3.860 MILLION OZ SO FAR)
  2. HUGE RECORD OPEN INTEREST IN SILVER 243,411 CONTRACTS (OR 1.217 BILLION OZ/ SET APRIL 9/2018
  3. HUGE ANNUAL EFP’S ISSUANCE EQUAL TO 2.9 BILLION OZ OR 400% OF SILVER ANNUAL PRODUCTION/2017
  4. RECORD SETTING EFP ISSUANCE FOR ANY MONTH IN SILVER; APRIL/2018/ 385.75 MILLION OZ/ (FINAL)

AND YET, WITH THE EXTREMELY HIGH EFP ISSUANCE, WE HAVE A CONTINUAL LOW PRICE OF SILVER DESPITE THE ABOVE HUGE DEMAND.  TO ME THE ONLY ANSWER IS THAT WE HAVE SOVEREIGN  (CHINA) WHO IS ENDEAVOURING TO GOBBLE UP ALL AVAILABLE PHYSICAL SILVER NO MATTER WHERE, EXACTLY WHAT J.P.MORGAN IS DOING. AND IT IS MY BELIEF THAT J.P.MORGAN IS HOLDING ITS SILVER FOR ITS BENEFICIAL OWNER..THE USA GOVERNMENT WHO IN TURN IS HOLDING THAT SILVER FOR CHINA.(FOR A SILVER LOAN REPAYMENT). IT ALSO LOOKS LIKE BANKER CAPITULATION IN SILVER AS THEY STRUGGLE TO REMOVE SOME OF THEIR HUGE OBLIGATIONS.

In gold, the open interest FELL BY A CONSIDERABLE 2237 CONTRACTS DOWN TO 452,344 DESPITE THE LOSS IN THE GOLD PRICE/YESTERDAY’S TRADING (LOSS OF $2.50).  WE ARE NOW IN THE  ACTIVE DELIVERY MONTH OF JUNE. NO DOUBT THE BOYS ARE CASHING IN THEIR COMEX LONGS TO BEGIN THE PROCESS TO MOVE INTO LONDON FORWARDS.  THE CME RELEASED THE DATA FOR EFP ISSUANCAND IT TOTALED A GOOD SIZED 5276 CONTRACTS :   JUNE SAW THE ISSUANCE OF 0 CONTRACTS , AND AUGUST SAW THE ISSUANCE OF:  5276 CONTRACTS WITH ALL OTHER MONTHS ZERO.  The new OI for the gold complex rests at 452,344. 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. . 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 STRONG SIZED OI GAIN IN TOTAL CONTRACTS ON THE TWO EXCHANGES: 2237 OI CONTRACTS DECREASED AT THE COMEX AND AN GOOD SIZED 5276 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON.THUS  TOTAL OI GAIN: 3039 CONTRACTS OR 303,900 OZ = 9.45 TONNES. AND ALL OF THIS DEMAND OCCURRED WITH A LOSS OF $2.50

YESTERDAY, WE HAD 76684  EFP’S ISSUED.

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF MAY : 22,841 CONTRACTS OR 2,284,100  OZ OR 71.04 TONNES (3 TRADING DAYS AND THUS AVERAGING: 7,613 EFP CONTRACTS PER TRADING DAY OR 761300 OZ/ TRADING DAY),,

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 3 TRADING DAYS IN  TONNES: 71.04 TONNES

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

THUS EFP TRANSFERS REPRESENTS 71.04/2550 x 100% TONNES =  2.78% OF GLOBAL ANNUAL PRODUCTION SO FAR IN APRIL ALONE.***

ACCUMULATION OF GOLD EFP’S YEAR 2018 TO DATE:  3,523.24*  TONNES   *SURPASSED ANNUAL PROD’N

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

ACCUMULATION OF GOLD EFP’S FOR FEBRUARY 2018:         649.45 TONNES

ACCUMULATION OF GOLD EFP’S FOR MARCH 2018:                741.89 TONNES  (22 TRADING DAYS)

ACCUMULATION OF GOLD EFP’S FOR APRIL 2018:                   713.84 TONNES  (21 TRADING DAYS)

ACCUMULATION OF GOLD EFP’S FOR MAY 2018:                     693.80 TONNES ( 22 TRADING DAYS)

WHAT IS ALARMING TO ME, ACCORDING TO OUR LONDON EXPERT ANDREW MAGUIRE IS THAT THESE EFP’S ARE BEING TRANSFERRED TO WHAT ARE CALLED SERIAL FORWARD CONTRACT OBLIGATIONS AND THESE CONTRACTS ARE LESS THAN 14 DAYS.  ANYTHING GREATER THAN 14 DAYS, THESE MUST BE RECORDED AND SENT TO THE COMPTROLLER, GREAT BRITAIN TO MONITOR RISK TO THE BANKING SYSTEM.  IF THIS IS INDEED TRUE, THEN THIS IS A MASSIVE CONSPIRACY TO DEFRAUD AS WE NOW WITNESS A MONSTROUS TOTAL EFP’S ISSUANCE AS IT HEADS INTO THE STRATOSPHERE

Result: A CONSIDERABLE SIZED DECREASE IN OI AT THE COMEX OF 2237 WITH THE $2.50 LOSS  IN PRICE // GOLD TRADING YESTERDAY ($2.50 FALL).  WE ALSO HAD AN GOOD SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 5276 CONTRACTS AS THESE HAVE ALREADY BEEN NEGOTIATED AND CONFIRMED.   THERE OBVIOUSLY DOES NOT SEEM TO BE MUCH PHYSICAL GOLD AT THE COMEX.  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 5276 EFP CONTRACTS ISSUED, WE HAD AN GOOD SIZED NET GAIN OF 3039 CONTRACTS IN TOTAL OPEN INTEREST  ON THE TWO EXCHANGES:

5276 CONTRACTS MOVE TO LONDON AND 2237 CONTRACTS DECREASED AT THE COMEX. (in tonnes, the GAIN in total oi equates to 9.45 TONNES). ..AND BELIEVE IT OR NOT BUT ALL OF THIS DEMAND OCCURRED AT THE COMEX WITH A LOSS OF $2.50 IN TRADING!!!.

we had: 1491 notice(s) filed upon for 149,100 oz of gold at the comex.

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

GLD...

WITH GOLD  UP $5.30  TODAY: / A SMALL CHANGE IN GOLD INVENTORY AT THE GLD/ A WITHDRAWAL OF 0.29 TONNES WHICH NO DOUBT WAS USED TO PAY FEES/  /

Inventory rests tonight: 836.13 tonnes.

SLV/

WITH SILVER UP 10 CENTS TODAY NO CHANGE IN THE SILVER INVENTORY AT  THE SLV INVENTORY/ A

/INVENTORY RESTS AT 322.561 MILLION OZ/

COMPARE GOLD TO SILVER

end

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

1. Today, we had the open interest in SILVER ROSE BY A SMALL SIZED 358 CONTRACTS from  209,716 UP TO 210,074 (AND, FURTHER FROM THE  NEW COMEX RECORD SET /APRIL 9/2017 AT 243,411/SILVER PRICE AT THAT DAY: $16.53). THE PREVIOUS RECORD OTHER THAN WAS ESTABLISHED AT: 234,787, SET ON APRIL 21.2017 OVER ONE YEAR AGO.  THE PRICE OF SILVER ON THAT DAY: $17.89.OUR CUSTOMARY MIGRATION OF COMEX LONGS MORPH INTO LONDON FORWARDS CONTINUES AS OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE:   (WE DO NOT GET A LOOK AT THESE CONTRACTS AS IT IS PRIVATE BUT THE CFTC DOES AUDIT THEM), 650 EFP’S FOR JULY AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 650 CONTRACTS . EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON.  IF WE TAKE THE  OI GAIN AT THE COMEX OF 358 CONTRACTS TO THE 650 OI TRANSFERRED TO LONDON THROUGH EFP’S,  WE OBTAIN A FAIR SIZED GAIN OF 1008 OPEN INTEREST CONTRACTS.  THUS IN OUNCES, THE GAIN ON THE TWO EXCHANGES:  5.04 MILLION OZ!!! AND THIS GOOD SIZED DEMAND OCCURRED DESPITE A 1 CENT LOSS IN PRICE .  THE BANKERS ORCHESTRATED THEIR RAID THROUGHOUT LAST WEEK  DESPERATELY TRYING TO PARE THEIR GIGANTIC OPEN INTEREST SHORT ON BOTH EXCHANGES BUT TO NO AVAIL. JUDGING BY THE RECORD NUMBER OF EFP ISSUANCE DURING APRIL AT 385.75 MILLION OZ AND THE CONTINUAL OI GAIN ON THE TWO EXCHANGES, THE CONSTANT RAIDS, (THAT ARE NOW BEING CALLED UPON BY OUR BANKER FRIENDS  IN AN ATTEMPT TO SHAKE AS MANY SILVER LEAVES FROM THE SILVER TREE AS POSSIBLE) AND JUDGING BY THE RESULTS FROM YESTERDAYS ACTION, THEY HAVE NOT BEEN AT ALL SUCCESSFUL.

RESULT: A SMALL SIZED INCREASE IN SILVER OI AT THE COMEX WITH THE 1 CENT LOSS  IN SILVER PRICING YESTERDAY. BUT WE ALSO HAD ANOTHER GOOD SIZED 650 EFP’S ISSUED TRANSFERRING COMEX LONGS OVER TO LONDON. TOGETHER WITH THE STRONG  SIZED AMOUNT OF SILVER OUNCES STANDING FOR JUNE, DEMAND FOR PHYSICAL SILVER CONTINUES TO INTENSIFY 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 23.02 points or 0.74%   /Hang Sang CLOSED UP 95.47 points or 0.31%    / The Nikkei closed UP 63.60 POINTS OR 0.28% /Australia’s all ordinaires CLOSED DOWN .49%  /Chinese yuan (ONSHORE) closed UP at 6.4039/Oil DOWN to 64.55 dollars per barrel for WTI and 74.31 for Brent. Stocks in Europe OPENED ALL GREEN/EXCEPT LONDON /.  ONSHORE YUAN CLOSED UP AT 6.4039 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.3990/ONSHORE YUAN TRADING WEAKER AGAINST OFFSHORE YUAN/ONSHORE YUAN TRADING STRONGER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR /CHINA RETALIATES WITH TARIFFS/ TRUMP RESPONDS TO NEW TARIFFS AND IT NOW LOOKS LIKE A FULL TRADE WAR IS BEGINNING/

/NORTH KOREA/SOUTH KOREA

i)North Korea/South Korea/USA

b) REPORT ON JAPAN

3 c CHINA

CHINA/USA

The markets initially jumped on the news, but faded when they realized it was the same rehash as before

( zerohedge)

4. EUROPEAN AFFAIRS

i)Tuesday morning: ITALY

As promised, Conte delivers a populist outline of where he expects Italy will proceed in the coming months. In essence he will need much debt as he wants to overhaul the healthcare system, increase minimum wage, change the retirement scheme as well as introducing a flat tax.  All of this will add to Italy’s debt to GDP and as we pointed out yesterday it is at 160% if you include its Target 2 balances.  With the speech, Italian 10 yr bonds plummeted to 2.90%

( zerohedge)

ii)Famed analyst Chris Whalen tackles whether Italy will receive a bailout( Chris Whalen)

iii)Morgan Stanley lays out 3 cases of what might happen with the new government in Italy and how the debt to GDP will look under all of these scenarios

( zerohedge/MorganStanley)

iv)Tom Luongo discusses why Trump is so adamant in trying to stop the Nordstream 2 pipeline into Europe as this would be another dagger into the heart of USA hegemony

( TomLuongo)

v)What a liar:  Juncker( zerohedge)

vi)Afternoon trading Europe/NY

Italian bonds plummet in price (rise dramatic in yield).  Also Italian banks suffer along with some European banks

(courtesy zerohedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

This is why Israel will try and knock out Iran’s capability of producing nuclear weapons.

( zerohedge)

6 .GLOBAL ISSUES

i)Mexico

the Peso plummets to 20.25 to the dollar after Mexico announces retaliatory tariffs against the USA.  Mexico imposes a 20% tariff on uSA pork..a staple import to Mexico. In a trade war nobody wins. Canada is a pretty good producer of pork so Mexico will likely seek this source for their staples

( zerohedge)

ii)The head of the Central bank of India warns of a sudden evaporation of dollar funding and this would no doubt be a death knell to emerging nations.  Why the sudden evaporation of dollars:
1. the huge deficit of the USA where Trump needs to fund 1.2 trillion dollars
2  the contraction of the Fed balance sheet:  this is the famous David Stockman value of 600 billion dollars that will leave the Fed’s balance sheet per year.
thus total evaporation of dollars: 1.8 billion dollars
There is actually a third reason and that is the repatriation of dollars form Europe which has also caused a scarcity of dollars there and that is morphed into dollar scarcity around the globe
( zerohedge)

7. OIL ISSUES

Trump is worried that higher oil prices will hurt the recovery in the USA. So he has asked Saudi Arabia to boost production by 1 million barrels per day

(courtesy zerohedge)

8. EMERGING MARKET

i)BRAZIL

The Brazilian central bank intervenes as the real crashes to a 2 year low.  If it penetrates 4.0, trouble ahead

( zero hedge)

ii)This is not good for Brazil.  Despite a massive intervention, the real continues to decay

( zero hedge)

9. PHYSICAL MARKETS

i)Nicholas Biezanek comments on the huge amount of PetroYuan contracts underwritten. Most of these will be delivered upon in September. That is when the fun begins as gold will be used in the ultra payment for their yuan oil contracts.
( Nichols Bienanek)

ii)I brought this important commentary to your attention yesterday, but it is well worth repeating it for you just in case you missed it:

( Nicholas Biezanek)

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

i)USA DATA

MARKET DATA

Soft data Markit US Services signals a 3.5% GDP growth rate.

(courtesy zero hedge)

v)SWAMP STORIES

As promised Billl Priestap, is the deep throat and he is the FBI counterintelligence chief.  He has knowledge of the Trump spygate affair as well as the Clinton email scandal.  He will reveal all

get your popcorn ready..if this stuff is leaked out

(courtesy zerohedge)

Let us head over to the comex:

The total gold comex open interest FELL BY A CONSIDERABLE SIZED 2237  CONTRACTS DOWN to an OI level 453,031 WITH THE FALL IN THE PRICE OF GOLD ($2.50 LOSS/ 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 GOOD SIZED  COMEX TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS., THAT IS 5276 CONTRACTS WERE ISSUED: FOR  JUNE, 0 CONTRACTS ISSUED,  FOR AUGUST 5276 CONTRACTS AND ZERO FOR ALL OTHER MONTHS:

TOTAL  5276 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 BASED FORWARD.

ON A NET BASIS IN OPEN INTEREST WE GAINED THE FOLLOWING TODAY ON OUR TWO EXCHANGES: 3039 OI CONTRACTS IN THAT 5,276 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE LOST 2237 COMEX CONTRACTS.

NET GAIN ON THE TWO EXCHANGES: 3039 contracts OR 303,900  OZ OR 9.45 TONNES.

Result: A CONSIDERABLE SIZED DECREASE IN COMEX OPEN INTEREST WITH THE LOSS IN PRICE /YESTERDAY  (ENDING UP WITH AN LOSS IN PRICE OF $2.50).  THE  TOTAL OPEN INTEREST GAIN ON THE TWO EXCHANGES: AT A GOOD 3039 OI CONTRACTS..

We have now entered the active contract month of JUNE where we LOST 60 contracts and that leaves us with 6937 contracts  We had 18 notices filed upon yesterday so we lost 42 contracts or 4200 additional oz will not stand for delivery at the comex and they morphed into London based forwards.

.JULY saw a GAIN of 14 contracts to stand at 1381.  The next big delivery month after June is August and here the OI FELL BY 3395 contracts DOWN to 325,594.

AFTER AUGUST, THE NEXT ACTIVE DELIVERY MONTH IS OCTOBER AND HERE THE OI ROSE BY 381 CONTRACTS UP TO 11,644 CONTRACTS.

We had 1491 notice (s) filed upon today for 149,100 oz at the comex

FOR COMPARISON:

FOR THE JUNE/2017 CONTRACT INITIALLY 19.95 TONNES STOOD FOR DELIVERY.  AT THE END OF JUNE/2017:  9.176 TONNES STOOD AND THE REST MORPHED INTO LONDON BASED FORWARDS.

THERE IS NO QUESTION THAT THE COMEX DOES NOT HAVE ANY  GOLD TO SATISFY UPON OUR LONGS.

Trading Volumes on the COMEX

PRELIMINARY COMEX VOLUME FOR TODAY: 254,169  contracts

CONFIRMED COMEX VOL. FOR YESTERDAY:  222,482   contracts

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And now for the wild silver comex results.

Total silver OI ROSE BY A SMALL SIZED 358 CONTRACTS FROM 209,716 DOWN TO 210,074 (AND CLOSER TO THE NEW RECORD OI FOR SILVER SET APRIL 9.2018/ 243,411 CONTRACTS)  DESPITE THE 1 CENT LOSS IN SILVER PRICING/ YESTERDAY. SINCE WE ARE NOW INTO THE NON  ACTIVE DELIVERY MONTH OF JUNE, WE WERE  INFORMED THAT WE HAD A GOOD SIZED 650 EFP CONTRACT ISSUANCE FOR JULY AND ZERO FOR ALL OTHER MONTHS.  THESE EFPS WERE ISSUED TO COMEX LONGS WHO RECEIVED A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON.  THE TOTAL EFP’S ISSUED: 650.  ON A NET BASIS WE GAINED 1008 SILVER OPEN INTEREST CONTRACTS AS WE OBTAINED A 358 CONTRACT GAIN AT THE COMEX COMBINING WITH THE ADDITION OF 650 OI CONTRACTS NAVIGATING OVER TO LONDON.

NET GAIN  ON THE TWO EXCHANGES:  1008 CONTRACTS

AMOUNT STANDING FOR SILVER AT THE COMEX

We are now in the NON active delivery month of JUNE and here the front month FELL BY 277 contracts FALLING TO 41 contracts. We had 316 notices filed upon yesterday so we gained 39 contracts or an additional 195,000 oz will stand in this non active delivery month of June AS SOMEBODY IS IN URGENT NEED OF PHYSICAL ON THIS SIDE OF THE POND AND QUEUE JUMPING CONTINUES IN EARNEST

The next big active delivery month for silver is July and here the OI LOST 1096 contracts DOWN to 135,337.  The next delivery month is August and here we gained 0 contracts  to stand at 5. The next active delivery month after August for silver is September and here the OI ROSE by 1325 contracts UP to 39,960

We had 39 notice(s) filed for 195,000 OZ for the JUNE 2018 COMEX contract for silver which is extremely large!!

PLEASE NOTE THE FOLLOWING FOR COMPARISON PURPOSES:

ON MAY 31.2017 WE INITIALLY HAD 396 OPEN INTEREST STAND OR A LARGE 1.98 MILLION OZ 

STOOD FOR METAL.

AT THE CONCLUSION OF JUNE 2017:  4.92 MILLION OZ FINALLY STOOD AS QUEUE JUMPING STARTED IN EARNEST AND IN THE ENSUING YEAR, IT CONTINUED WITH RECKLESS ABANDON INCLUDING WHAT YOU ARE WITNESSING TODAY

INITIAL standings for JUNE/GOLD

JUNE 5/2018.

Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
257.20 OZ
Manfra
8 kilobars
Deposits to the Dealer Inventory in oz NIL oz
Deposits to the Customer Inventory, in oz   nil

OZ

No of oz served (contracts) today
1491 notice(s)
 194,100 OZ
No of oz to be served (notices)
5446 contracts
(544,600 oz)
Total monthly oz gold served (contracts) so far this month
1685 notices
168,500 OZ
7.837 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
VERY UNUSUAL: gold comex comatose despite June being a huge delivery month.
 TODAY, WE HAVE  A TINY PULSE AT THE GOLD COMEX
we had 1 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 1 withdrawal out of the customer account:
i) out of Manfra 257.20 oz
8 kilobars
total customer withdrawals:  257.20 oz
we had 0 customer deposit
total customer deposits: nil oz
we had 0 adjustment(s)

For JUNE:

Today, 0 notice(s) were issued from JPMorgan dealer account and 1314 notices were issued from their client or customer account. The total of all issuance by all participants equates to 1491 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 634 notice(s) was (were) stopped/ Received) by j.P.Morgan customer account.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
To calculate the INITIAL total number of gold ounces standing for the JUNE. contract month, we take the total number of notices filed so far for the month (1685) x 100 oz or 168,500 oz, to which we add the difference between the open interest for the front month of JUNE. (6937 contracts) minus the number of notices served upon today (1491 x 100 oz per contract) equals 713,100 oz, the number of ounces standing in this active month of JUNE (22.180 tonnes)

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

No of notices served (1685 x 100 oz)  + {(6937)OI for the front month minus the number of notices served upon today (1491 x 100 oz )which equals 713,100 oz standing in this  active delivery month of JUNE .

WE LOST 42 CONTRACTS OR AN ADDITIONAL 4200 OZ PACKED THEIR BAGS AND HEADED OVER TO LONDON THROUGH THE EFP ROUTE.

THERE ARE ONLY 8.2689 TONNES OF REGISTERED GOLD AVAILABLE FOR DELIVERY  WHICH WILL MAKE JUNE AN EXTREMELY INTERESTING MONTH AS WE SEE HOW THIS PLAYS OUT!!!

total registered or dealer gold:  265,846.240 oz or 8.2689 tonnes
total registered and eligible (customer) gold;   9,014,904.393 oz 280.401 tones
THE COMEX IS AGAIN IN STRESS AS ONLY 8.2689 TONNES OF GOLD ARE LEFT TO SERVICE DELIVERIES. THERE IS HARDLY ANY GOLD AT THE COMEX TO SERVE UPON LONGS AND THUS THE REASON FOR THE EFP TRANSFER OVER TO LONDON.

IN THE LAST 18 MONTHS 74 NET TONNES HAS LEFT THE COMEX.

end

And now for silver

AND NOW THE APRIL DELIVERY MONTH

JUNE INITIAL standings/SILVER

JUNE 5/ 2018
Silver Ounces
Withdrawals from Dealers Inventory nil oz
Withdrawals from Customer Inventory
 820,169.800 oz
scotia
Deposits to the Dealer Inventory
nil;
oz
Deposits to the Customer Inventory
 1000.25
oz
Delaware
No of oz served today (contracts)
39
CONTRACT(S)
(195,000 OZ)
No of oz to be served (notices)
2 contracts
(10,000 oz)
Total monthly oz silver served (contracts) 770 contracts

(3,850,000 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 140 million oz of  total silver inventory or 52.3% of all official comex silver. (140 million/268 million)

ii) into Delaware: 1000.25 oz

total customer deposits today: 1000.25 oz

we had 1 withdrawals from the customer account;

i) Out of Scotia: 820,169.800 oz

total withdrawals;  820,169.800 oz

we had 0  adjustment/

total dealer silver:  66.078 million

total dealer + customer silver:  270.756 million oz

The total number of notices filed today for the JUNE. contract month is represented by 39 contract(s) FOR 195,000 oz. To calculate the number of silver ounces that will stand for delivery in JUNE., we take the total number of notices filed for the month so far at 770 x 5,000 oz = 3,850,000 oz to which we add the difference between the open interest for the front month of JUNE. (41) and the number of notices served upon today (39 x 5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the JUNE contract month: 770(notices served so far)x 5000 oz + OI for front month of JUNE(41) -number of notices served upon today (39)x 5000 oz equals 3,860,000 oz of silver standing for the JUNE contract month

We gained 39 contracts or an additional 195,000 oz will stand in this non active delivery month of June as somebody was in urgent need of silver.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

ESTIMATED VOLUME FOR TODAY: 81,233 CONTRACTS

CONFIRMED VOLUME FOR YESTERDAY:61,226 CONTRACTS

YESTERDAY’S CONFIRMED VOLUME OF  66126 CONTRACTS EQUATES TO 330 MILLION OZ  OR 47.2% 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 -2.37% (JUNE 5/2018)
2. Sprott gold fund (PHYS): premium to NAV RISES TO -0.12% to NAV (JUNE 5/2018 )
Note: Sprott silver trust back into NEGATIVE territory at -2.37%-/Sprott physical gold trust is back into NEGATIVE/ territory at -0.12%/Central fund of Canada’s is still in jail but being rescued by Sprott.
Sprott WINS hostile 3.1 billion bid to take over Central Fund of Canada

(courtesy Sprott/GATA)

3.SPROTT CEF.A FUND (FORMERLY CENTRAL FUND OF CANADA): NAV FALLS TO -2.22%: NAV 13.47/TRADING 13.15//DISCOUNT 2.30.

END

And now the Gold inventory at the GLD/

JUNE 5/WITH GOLD UP $5.30 TODAY, WE HAD A TINY WITHDRAWAL OF .29 TONNES AND THAT NO DOUBT WAS TO PAY FOR FEES/

JUNE 4/WITH GOLD DOWN ONLY $2.50, THE CROOKS UNLEASHED A MASSIVE WITHDRAWAL OF 10.61 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 836.42 TONNES

JUNE 1/WITH GOLD DOWN $5.10 TODAY, A HUGE 4.42 TONNES OF GOLD WAS WITHDRAWN FROM THE GLD AND THIS WAS USED IN THE RAID TODAY/INVENTORY RESTS AT 847.03 TONNES

MAY 31/WITH GOLD DOWN 1.60/NO CHANGE IN GOLD INVENTORY/INVENTORY REMAINS AT 851.45 TONNES

MAY 30/WITH GOLD UP $2.70: A HUGE DEPOSIT OF 2.95 TONNES INTO THE GLD/INVENTORY REMAINS AT 851.45 TONNES

MAY 29/2018/WITH GOLD DOWN $4.50/ NO CHANGES IN GLD INVENTORY/INVENTORY REMAINS AT 848.50 TONNES

May 25/WITH GOLD UP ON THE WEEK BUT DOWN 80 CENTS TODAY: WE HAD A HUGE 3.54 TONNES OF GOLD WITHDRAWAL FROM THE CROOKED GLD/

MAY 24/WITH GOLD UP $12.40/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 852.04

MAY 22/WITH GOLD UP $1.05/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 852.04 TONNES

MAY 21/WITH GOLD DOWN 50 CENTS/A HUGE CHANGE IN GOLD INVENTORY/A WITHDRAWAL OF 3.24 TONNES FORM GLD INVENTORY/INVENTORY RESTS AT 852.04 TONNES

MAY 18/WITH GOLD UP $1.80/A HUGE CHANGE IN GOLD INVENTORY AT THE GLD/ A DEPOSIT OF 9.11 TONNES INTO GLD INVENTORY/INVENTORY RESTS AT 865.28 TONNES/

GLD WAS ONE MASSIVE FRAUD

May 17/WITH GOLD DOWN $1.75/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 856.17 TONNES

MAY 16./WITH GOLD UP $1.05: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 856.17 TONNES

MAY 15/WITH GOLD DOWN $27.35, THE CROOKS WITHDREW 10 TONNES OF GOLD FROM THE GLD WHICH WAS USED IN THE RAID TODAY/INVENTORY RESTS AT 856.17 TONNES

MAY 14/ WITH GOLD DOWN $2.35: A HUGE DEPOSIT OF 4.68 TONNES OF GOLD INTO THE GLD and then a withdrawal of 1.48 tonnes /INVENTORY RESTS AT 866.17

A net gain of 3.2 tonnes of gold.

MAY 11/WITH GOLD DOWN $1.75/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 862.96 TONNES/

MAY 10/WITH GOLD UP $9.60/A WITHDRAWAL OF 1.17 TONNES FROM THE GLD/INVENTORY RESTS AT 862.96 TONNES/SUCH CROOKS

MAY 9/WITH GOLD DOWN $0.55/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 864.13 TONNES

MAY 8/WITH GOLD DOWN $0.10/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 864.13 TONNES

MAY 7/WITH GOLD DOWN $0.55/ANOTHER WITHDRAWAL OF 1.47 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 864.13 TONNES

MAY 4/WITH GOLD UP $2.05/A WITHDRAWAL OF 1.13 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 865.60 TONNES

MAY 3/WITH GOLD UP $7.05/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 866.77 TONNES

MAY 2/WITH GOLD DOWN $1.15/ A HUGE WITHDRAWAL OF 4.43 TONNES FROM THE GLD/INVENTORY RESTS AT 866.77 TONNES

MAY 1/WITH GOLD DOWN $12.15/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 871.20 TONNES

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

JUNE 5/2018/ Inventory rests tonight at 836.13 tonnes

*IN LAST 391 TRADING DAYS: 90.46 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 341 TRADING DAYS: A NET 65.84 TONNES HAVE NOW BEEN ADDED INTO GLD INVENTORY.

end

Now the SLV Inventory/

JUNE 5/WITH SILVER UP 10 CENTS NO CHANGE IN SILVER INVENTORY/INVENTORY RESTS AT 322.561 MILLION OZ

JUNE 4/WITH SILVER DOWN 1 CENTA SMALL CHANGE IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 522,000 OZ INTO THE SLV/.INVENTORY RISES AT 322.561 MILLION OZ/

JUNE 1/WITH SILVER DOWN 3 CENTS/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY REMAINS AT 322.039 MILLION OZ/

MAY 31/WITH SILVER DOWN 7 CENTS/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY REMAINS AT 322.039 MILLION OZ/

MAY 30/WITH SILVER UP 16 CENTS: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV/ A DEPOSIT OF 2.071 MILLION OZ/INVENTORY RESTS AT 322.039 MILLION OZ/

MAY 29.2018/ NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 319.968 OZ

May 25/INVENTORY LOWERS TO 319.968 AS WE HAD A WITHDRAWAL OF 1.035 MILLION OZ

MAY 24/WITH SILVER UP 27 CENTS/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 321.003 MILLION OZ/

MAY 22/WITH SILVER UP 6 CENTS/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 321.003 MILLION OZ/

MAY 21/ WITH SILVER UP 5 CENTS/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 321.003 MILLION OZ/

MAY 18/WITH SILVER DOWN 5 CENTS  A SMALL CHANGE IN SILVER INVENTORY AT THE SLV/ A WITHDRAWAL OF 942,000 OZ/INVENTORY RESTS AT 321.003 MILLION OZ/

May 17/WITH GOLD UP 6 CENTS/A SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 471,000 OZ//INVENTORY RESTS AT 321.945 MILLION OZ/

MAY 16./WITH SILVER UP 10 CENTS/A HUGE DEPOSIT OF 1.883 MILLION OZ OF SILVER INTO THE SLV/INVENTORY RESTS AT 321.474 MILLION OZ

MAY 15/WITH SILVER DOWN 33 CENTS, NO CHANGES AT THE SLV; THE CROOKS COULD NOT BORROW ANY SILVER BECAUSE THERE IS NONE: INVENTORY RESTS AT 319.591 MILLION OZ

MAY 14/WITH SILVER DOWN 10 CENTS/A SMALL CHANGES IN SILVER INVENTORY AT THE SLV/ A WITHDRAWAL OF 858,000 FROM THE SLV/INVENTORY RESTS AT 319.591 MILLION OZ/

MAY 11/WITH SILVER DOWN 2 CENTS/THE CROOKS WITHDREW A MONSTROUS 2.824 MILLION OZ FROM THE SLV INVENTORY/INVENTORY RESTS AT 320.439 MILLION OZ/

MAY 10/WITH SILVER UP 22 CENTS/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 323.263 MILLION OZ/

MAY 9/WITH SILVER UP 6 CENTS/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 323.263 MILLION OZ/

MAY 8/WITH SILVER DOWN 2 CENTS:NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 323.263 MILLION OZ.

MAY 7/WITH SILVER FLAT: A BIG CHANGE IN SILVER INVENTORY AT THE SLV// A WITHDRAWAL OF 942,000 OZ OF SILVER FROM THE SLV INVENTORY/INVENTORY RESTS AT 323.263 MILLION OZ/

MAY4/WITH SILVER UP 5 CENTS/A BIG CHANGES IN SILVER INVENTORY AT THE SLV/ A DEPOSIT OF 1.224 MILLION OZ/INVENTORY RESTS AT 324.205 MILLION OZ/

MAY 2/WITH SILVER UP 24 CENTS/A HUGE CHANGE IN SILVER INVENTORY AT THE SLV// A DEPOSIT OF 6.082 MILLION OZ INTO THE SLV/INVENTORY RESTS AT 322.981 MILLION OZ/

MAY 1/WITH SILVER DOWN 24 CENTS/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 316.899 MILLION OZ/

JUNE 5/2018:

Inventory 322.561 million oz

end

6 Month MM GOFO 2.12/ and libor 6 month duration 2.48

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

G0FO+ 2.12%

libor 2.48 FOR 6 MONTHS/

GOLD LENDING RATE: .36%

XXXXXXXX

12 Month MM GOFO
+ 2.74%

LIBOR FOR 12 MONTH DURATION: 2.58

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = +.16

end

end

Major gold/silver trading /commentaries for TUESDAY

GOLDCORE/BLOG/MARK O’BYRNE.

GOLD/SILVER

off today

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
Nicholas Biezanek comments on the huge amount of PetroYuan contracts underwritten. Most of these will be delivered upon in September. That is when the fun begins as gold will be used in the ultra payment for their yuan oil contracts.
(courtesy Nichols Bienanek)

PETROYUAN CONTRACT RESULTS

NICHOLAS B. TO ME:
There is a very interesting appendix to yesterday’s MIDAS, in which the probable ‘futility/impotence’ of Comex paper contracts as a physical delivery vehicle is discussed. I am intrigued. Does the constituency of GATA/ORGAN and all the many other associates not have access to the wording of  the standard COMEX contract? Or are these contracts all ‘ad hoc’ creations with no standardized set of terms and conditions?
Anyway, I do not for one moment believe that the suppression of the physical gold price will be crushed via the COMEX route but out of Shanghai.The first three trading days of June 2018 in the SC1809 contract have totaled Yuan325 billion,so these petro yuan trading volumes are increasing at an exponential rate from inception in April 2018.
SC1809 Turnover Data from
Shanghai Energy Exchange
YUAN
April 2018 533,735,069,200
May 2018 1,764,654,402,200
2,298,389,471,400
All the Russian,Iranian,Turkish,Syrian traders etc will seek international full convertibility of these yuan via the physical gold route and paper gold will become a sideshow,subject to global derision. .
END
I brought this important commentary to your attention yesterday, but it is well worth repeating it for you just in case you missed it:
(courtesy Nicholas Biezanek)

Nicholas Biezanek: Whatever ‘exchange for

physicals’ do, they’re not taking London gold

 Section: 

10:57p ET Monday, June 4, 2018

Dear Friend of GATA and Gold:

South African market analyst Nicholas Biezanek reports that whatever is represented by the explosive increase in use of the “exchange for physicals” mechanism to settle gold and silver contracts on the New York Commodities Exchange represents, it is not drawing down the inventory of metal vaulted in London.

Biezanek, an associate of monetary metals futures market observer and GATA consultant Harvey Organ, notes that the EFP mechanism is on track to fulfill, at least nominally, thousands of tonnes of gold demand this year but the accounting provided by the London Bullion Market Association for gold vaulted in the London area is almost unchanged.

So what exactly is happening with those “exchange for physicals”? Whatever it is, Biezanek and Organ conclude that the mechanism is a fraud, concealing a lack of metal.

Biezanek speculates that China’s undertaking to price oil futures in yuan will break the so-called petrodollar and the gold market soon.

Biezanek’s analysis is headlined “The Imminent Endgame for Comex/LBMA/Petrodollar Hegemony” and it is posted in Word format at GATA’s internet site here:

http://www.gata.org/files/Biezanek-EFPs-06-04-2018_0.doc

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 UP TO 6.4039  /shanghai bourse CLOSED UP 23.02 POINTS OR 0.74%     HANG SANG CLOSED UP 95.47  POINTS OR 0.31%
2. Nikkei closed UP 63.60 POINTS OR 0.31% /  /USA: YEN FALLS TO 109.78/

3. Europe stocks OPENED GREEN  /     /USA dollar index FALLS TO 93.79/Euro RISES TO 1.1724

3b Japan 10 year bond yield: RISES TO . +.05/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 109.78/ 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:: 64.55  and Brent: 74.31

3f Gold DOWN/Yen UP

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund FALLS TO +.39%/Italian 10 yr bond yield DOWN to 2.66% /SPAIN 10 YR BOND YIELD DOWN TO 1.37%

3j Greek 10 year bond yield RISES TO : 4.48

3k Gold at $1291.30 silver at:16.40   7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 8/100 in roubles/dollar) 62.15

3m oil into the 64 dollar handle for WTI and 74 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 109.78 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 0.9859 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1522 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 +0.39%

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 2.92% early this morning (THIS IS DEADLY TO ALL MARKETS). Thirty year rate at 3.07%

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

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

Market Rally Fizzles As Old Fears Return

While global markets remain largely a sea of green, ignoring the threat of a trade war between the US and the rest of the world which remains a non-event for now (for reasons discussed overnight), the move higher has been more muted overnight, and even as European and Asian stocks extended Monday’s gains and U.S. futures pointed to a higher open, some familiar risks have re-emerged.

Europe’s Stoxx 600 Index advanced for a third day, if off its highs, led by tech companies and automakers. Looking at sectors, Telecoms are underperforming while IT names outperform. In terms of stock specifics, RBS (-3.6%) is hit after the UK government decided to sell a 7.7% stake in the company worth around GBP 2.6bln following the bank bailout during the crisis.

Following some early outperformance, Italy’s FTSE MIB slumped into the red as Italian PM Conte delivered his inaugural speech before Senate (ahead of a confidence vote later today which is expected to pass) in which the new prime minister re-asserted that the Five Star-League government will follow a radical policy program, noting that citizens have a right to universal income and minimum wage, proposals which are set to blow out Italy’s budget and public debt. It is therefore not surprising that Italian bond yields spiked to session highs as Conte spoke.

Here are the highlights so far from Conte’s inaugural speech:

  • This is a project for the change of Italy.
  • I take up this responsibility with humility and determination … I am motivated by nothing but a spirit of service … like a lawyer representing all of Italy’s people.
  • This is not a simple novelty. The truth is that we have brought a radical change, of which we are proud.
  • We will put an end to the immigration “business” which has grown out of control under the guise of solidarity.
  • We want to reduce public debt by increasing the wealth of our economy, not through austerity.
  • We intend to preliminarily restate our convinced membership of our country of NATO, with the United States of America as a privilege partner.
  • The elimination of the gap in growth between Italy and the European Union is our objective, which must be followed in a framework of financial stability and the trust of markets.
  • This government intends to act with determination (against political privileges). The struggle against the privileges and waste is not a merely symbolic question.
  • Italian public debt is fully sustainable today. However, its reduction must be pursued, but with a view to economic growth. Fiscal and public spending policy should be geared towards the pursuit of the objectives set for stable and sustainable growth. In Europe, these issues will be strongly pushed forward with the aim of change of its governance, a change already at the centre of reflection and discussion in all EU member states.

Furthermore, as Bloomberg’s Heather Burke points out, “Italy’s CDS remains elevated, and above their five-year average despite a pullback from last week’s peak (which was within striking distance of the July 2013 high).”

The spread between Italy’s CDS and that of emerging markets … still shows investors are paying more to hedge against a default in the euro-area nation than for a basket of 14 developing countries — a dynamic that hasn’t persisted since the height of the euro crisis in 2012

Elsewhere, there was more bad economic news for Europe this morning, when the Markit PMI dropped to a fresh 18 month low of 54.1 from 55.1 in Apr, although it is still above the 50-mark separating growth from contraction.

Earlier, Asian equity markets traded indecisive after the momentum faded from Wall St, where all majors extended on gains and the Nasdaq Comp. posted a record close. ASX 200 (-0.5%) was negative with the index weighed by the energy sector after oil prices slipped to below USD 65.00/bbl and with Retail Food Group the worst performer in the index after it flagged a statutory net loss due to termination payments. Elsewhere, Nikkei 225 (+0.3%) remained afloat following the recent currency weakness, while Shanghai Comp. (+0.7%) and Hang Seng (+0.3%) were choppy as participants mulled over a mild liquidity drain as well as inconclusive Chinese Caixin Services and Composite PMI data which were unchanged from the prior month.

U.S. futures also turned higher following the S&P 500’s highest finish since mid-March, on the back of more records by tech stocks, as the S&P 500 gradually morphs into the FAAMG 5.

Treasury yields slipped for the first time in five days, while those of Italian bonds seemed ready to resume their push higher (as Morgan Stanley warned overnight) and were poised for the first increase since they blew up a week ago.

In overnight FX trading, the dollar meandered without a direction and was largely unchanged against Group-of-10 peers, with the the Bloomberg Dollar Spot Index paring modest earlier gains as traders adjusted positions before the G7 summit this week (which will be attended by Trump) and policy decisions by the Fed and the ECB.

The pound rose to a session high in the wake of a strong U.K. services PMI that exceeded expectations, and as the economy continued its modest recovery from the snow disruption of the first quarter. Australia’s dollar fell from a six-week high as the current-account deficit widened more than economists’ forecast, dampening the optimism toward GDP data due tomorrow, and the central bank kept interest rates on hold. The yen touched the lowest in more than a week before recovering to trade little changed as investors were reluctant to sell beyond 110 on caution of heavy positioning before a slew of events including the FOMC meeting next week. Overnight, BoJ member Wakatabe said they are still distant from the 2% inflation target and thus too early to talk about specific exit strategies.

Just after midnight EDT, Australia’s RBA announced that it kept its cash rate at 1.50%, as expected by all economists; the RBA said that its policy is consistent with sustainable economic growth and reaching inflation target. Low level of rates continues to support economy. Inflation and wage growth likely to remain low for a while. Expect pick up in domestic growth this year and next, global economy has strengthened. Strengthening currency would result in slower pick up of growth and inflation.

Earlier this morning, Bloomberg reported that Trump had explicitly requested that Saudi Arabia/OPEC boost oil production by 1MMb/d, offsetting the Iranian export drop; the news promptly sent Brent and WTI to session lows.  Trump’s request comes ahead of US mid-terms later this year, which has recently seen US President Trump try to talk down the price of oil via OPEC with US retail gasoline prices at 3 year highs.

Looking ahead traders are eyeing the OPEC+ meeting on June 22nd. Energy ministers did initially signal a rise in output to offset supply disruptions from Iranian and Venezuelan sanctions but then switched rhetoric at the unofficial OPEC+ meeting over the weekend. An official restriction ease is still anyone’s guess. Meanwhile, participants await the latest stockpile count with API inventories due after-hours.

Elsewhere, in the metals complex, the yellow metal takes a breather with little price change following three consecutive days in the red. Dalian iron ore futures rise despite record stockpiles after reports Tangshan (China’s number 1 steelmaking city) is to shut 226 mining companies. Furthermore, copper rose for a fourth consecutive session to its highest in almost six weeks as the red metal is underpinned by potential supply disruptions amid wage talks at the world’s largest mine.

In overnight geopolitical news, Iran nuclear official Kamalvandi said Tehran will inform the UN atomic agency regarding beginning of capacity increase for uranium gas production. Iran has begun work on infrastructure for advanced centrifuges at the Natanz facility, as according to the Iranian atomic energy organization, these activities will be within the framework of the nuclear agreement.

It’s a relatively quiet day, with data includingJOLTS job openings and the final May PMIs. HD Supply, Navistar, Guidewire, and YY Inc are among companies reporting earnings.

Bulletin Headline Summary from RanSquawk

  • Cable saw a significant jump in the wake of UK PMI data that exceeded expectations
  • Reports suggest that the US has asked OPEC to raise output by 1mln BPD
  • Looking ahead, highlights include, US ISM non-manufacturing, APIs, and ECB’s Weidmann

Market Snapshot

  • S&P 500 futures up 0.2% to 2,749.50
  • STOXX Europe 600 up 0.2% to 388.77
  • MXAP up 0.02% to 174.57
  • MXAPJ up 0.09% to 573.11
  • Nikkei up 0.3% to 22,539.54
  • Topix up 0.02% to 1,774.96
  • Hang Seng Index up 0.3% to 31,093.45
  • Shanghai Composite up 0.7% to 3,114.21
  • Sensex down 0.4% to 34,860.09
  • Australia S&P/ASX 200 down 0.5% to 5,994.88
  • Kospi up 0.3% to 2,453.76
  • German 10Y yield fell 0.5 bps to 0.413%
  • Euro up 0.1% to $1.1713
  • Italian 10Y yield fell 14.9 bps to 2.273%
  • Spanish 10Y yield rose 1.8 bps to 1.348%
  • Brent futures down 0.1% to $75.21/bbl
  • Gold spot little changed at $1,292.46
  • U.S. Dollar Index down 0.2% to 93.90

Top Overnight News from Bloomberg

  • President Donald Trump plans to meet Tuesday with Senate Republicans concerned about restrictions he’s weighing on Chinese investments in the U.S., two people familiar with the matter said
  • While Trump has sown confusion and frustration among fellow political leaders, economists at most Wall Street banks are barely changing their forecasts for solid global growth this year as they estimate only modest fallout from a skirmish over commerce
  • Germany is ready to challenge any attempt by Italy’s populist government to flout European Union regulations or seek special treatment from the bloc
  • Italian Premier Giuseppe Conte’s maiden speech to Parliament Tuesday will be the first public test of his ability to navigate between the contrasting demands of the populist leaders who got him appointed
  • When a group of London hedge-fund managers gathered last month for a quarterly working dinner hosted by corporate-intelligence firm Third Bridge, the discussion struck a tone they hadn’t heard in years. This time guests were asked to suggest bonds likely to fall in value
  • Teamwork is the new way at Pimco, and that’s evident right at the top. Whereas Gross once ran the show, Ivascyn and Roman embrace their shared responsibilities
  • Investors holding Ukrainian debt are approaching a crucial moment as the country counted among the shakiest emerging markets prepares for a vote that can alleviate a swirling political crisis — or tip the nation deeper into turmoil

Asian equity markets traded indecisive after the momentum somewhat petered out from Wall St, where all majors extended on gains and the Nasdaq Comp. posted a record close. ASX 200 (-0.5%) was negative with the index weighed by the energy sector after oil prices briefly slipped to below USD 65.00/bbl and with Retail Food Group the worst performer in the index after it flagged a statutory net loss due to termination payments. Elsewhere, Nikkei 225 (+0.3%) remained afloat following the recent currency weakness, while Shanghai Comp. (+0.7%) and Hang Seng (+0.3%) were choppy as participants mulled over a mild liquidity drain as well as inconclusive Chinese Caixin Services and Composite PMI data which were unchanged from the prior month. Finally, 10yr JGBs were flat amid similar quiet trade in T-notes and the indecisiveness in the region, while the10yr JGB auction failed to provide a catalyst as the results were mixed which added to the sombre tone.

Top Asian News

  • Krishnan Is Said to Mull Buyout of $1.9 Billion Pay-TV Operator
  • Dubai Buyout Firm Abraaj Says Close to Debt Standstill Pact
  • Giant Waste-Spewing Mine Turns to Battleground in Indonesia
  • TPG Enters Private Equity Secondaries With Asia-Focused NewQuest

European bourses are trading mostly in the green (Eurostoxx 50 +0.5%) with the exception of the SMI 20 and FTSE 100. The UK index is feeling pressure from the strengthening GBP following an above consensus UK Services PMI, adding to the slew of recent PMI beats. The FTSE MIB is outperforming its peers while Italian PM Conte is to speak before Senate and go through a confidence vote later today, where the chance of a rejection is almost non-existent following the limbo-state Italy has been in for months. Looking at sectors, Telecoms are underperforming while IT names outperform. In terms of stock specifics, RBS (-3.6%) is hit after the UK government decided to sell a 7.7% stake in the company worth around GBP 2.6bln following the bank bailout during the crisis.

Top European News

  • U.K. Services Growth Quickens Amid Subdued Economic Rebound
  • Waning Italy Political Risk Can Prop Up the Euro Only So Much
  • Elliott, CRC Are Said to Bid for Banco BPM’s $6 Billion Loans
  • German, French Services Cool as Euro Area Growth Loses Steam

In FX, the USD has seen relatively quiet trade overall, but the index has inched back to the 94.000 handle as the Greenback claws back losses vs G10 counterparts and/or rival currencies lose some of their recent momentum. A raft of Eurozone PMIs are not providing much impetus, but the US slate is busy and could prompt more in the way of price action as Treasury yields sit off late May/very early June lows. GBP: The Pound has leapt to the top of the pile in wake of another UK PMI beat that has lifted the composite reading to its best ytd level and prompted survey compiler Markit to predict Q2 GDP growth of 0.3-0.4% q/q (vs just 0.1% in Q1). Cable has duly extended gains above 1.3300 towards 1.3400, while Eur/Gbp has retreated from almost 0.8800 to sub-0.8750. CHF/EUR/JPY:  All keeping tabs with big figure levels vs the Usd with the Franc not straying too far from 0.9900, Eur/Usd pivoting 1.1700 and Usd/Jpy still capped around 110.00. For the single currency especially, a band of option expiries spanning 1.1675-1.1750 and totalling 5 bn looks set to keep the pair rangebound barring any other significant driver. EM: The Peso is a notable laggard with Usd/Mxn back over 20.000 after Mexico upped the trade war ante vs the US buy proposing a 20% tax on pork, while raising objections via the WTO in response to the US tariffs on steel and aluminium

In Commodities, oil is negative on the day with WTI down 0.2% and Brent down 1.2% as traders focus on the US reportedly asking OPEC for a 1mln BPD oil output increase, as according to sources. In an immediate move WTI moved from USD 64.94 to USD 64.78. This comes ahead of US mid-terms later this year, which has recently seen US President Trump try to talk down the price of oil via OPEC with US retail gasoline prices at 3 year highs.

Looking ahead traders are eyeing the OPEC+ meeting on June 22nd. Energy ministers did initially signal a rise in output to offset supply disruptions from Iranian and Venezuelan sanctions but then switched rhetoric at the unofficial OPEC+ meeting over the weekend. An official restriction ease is still anyone’s guess. Meanwhile, participants await the latest stockpile count with API inventories due after-hours.

Elsewhere, in the metals complex, the yellow metal takes a breather with little price change following three consecutive days in the red. Dalian iron ore futures rise despite record stockpiles after reports Tangshan (China’s number 1 steelmaking city) is to shut 226 mining companies. Furthermore, copper rose for a fourth consecutive session to its highest in almost six weeks as the red metal is underpinned by potential supply disruptions amid wage talks at the world’s largest mine.

In terms of the day ahead, we’ll also get April retail sales data for the Euro area, and April JOLTS and the May ISM non-manufacturing prints in the US. Elsewhere, the Brussels Economic Forum is due to begin with Juncker and Moscovici due to speak, while the BoE’s Cunliffe and ECB’s Weidmann speak this morning at separate events. Meanwhile, Italy’s confidence vote in the Senate will be today with the vote in the Lower House still yet to be announced.

US Event Calendar

  • 9:45am: Markit US Services PMI, est. 55.7, prior 55.7
  • 9:45am: Markit US Composite PMI, prior 55.7
  • 10am: JOLTS Job Openings, est. 6,350, prior 6,550
  • 10am: ISM Non-Manf. Composite, est. 57.6, prior 56.8

DB’s Jim Reid concludes the overnight wrap

Well it hasn’t taken long for Italy, and to a lesser extent Spain, to already feel a bit like yesterday’s news. While in all honesty it hasn’t been the most exciting last 24 hours in markets – which is probably welcome following last week – it does seem like the attention is firmly back on the US versus the ROW trade war tit for tat. Aside from the odd Trump tweet or two yesterday and China announcing on Sunday that it’s prepared to backtrack on some its recent commitments in negotiations should Trump pursue tariffs on the country, there were no real developments and instead all eyes appear to be on this Friday and Saturday’s G7 meeting in Quebec and whether or not it will be a united G7 meeting or more a G6+1. But with the calendar reasonably sparse over the next few days it appears that markets are also keeping a close eye on whether or not Trump will be backed far enough into a corner to make him stand down on his threats.

Markets for now seem to be trading as though a worst-case scenario will be avoided with the S&P 500 last night rising +0.45% and Dow +0.72%. The Nasdaq also rose +0.69% and to a new record high although still remains slightly below the intraday highs from mid-March. European markets were in a similarly jovial mood with the Stoxx 600 (+0.31%), DAX (+0.37%) and CAC (+0.14%) all up modestly. The IBEX (+1.22%) was the bigger mover post the positive political developments in Spain although the FTSE MIB (-0.45%) did struggle a bit. Treasury yields finished the day +4.0bps higher while Bunds and OATs were +3.6bps and +2.1bps higher respectively. Meanwhile BTPs continue to recoup some of the recent damage done with 2y and 10y yields ending yesterday -28.3bps and -14.1bps lower. That means 2y BTP yields have now rallied 205bps from the intraday highs of last Tuesday and the spread to similar maturity Bunds and Bonos are now at 138bps and 96bps respectively compared to the intra-day wides of 361bps and 292bps.

On a related note there was a bit made about the latest ECB bond buying numbers yesterday with the data showing a decent slowdown in net purchases of BTPs in May to 16.5%. That is below the implied capital key level of 17.5% and also the roughly 18-19% monthly purchases in 2018 through to April. On the flip side Bund purchases were much higher in May with the ECB stating that this was due to Bund reinvestments being carried over from April, and likewise a timing impact of BTP reinvestments in Italy which lowered net purchases. Indeed gross purchases of BTPs were actually higher but it’s noteworthy that the ECB made the point of addressing the purchases data directly which is something the ECB very rarely does. No doubt this shows how hypertensive the bond market is at present.

Taking a quick look at our screens this morning, overnight in Asia markets are  broadly mixed although moves have been relatively muted. The Nikkei (+0.08%), Hang Seng (+0.16%) and Shanghai Comp (+0.23%) have posted small gains while the Kospi (-0.09%) and ASX (-0.30%) are slightly in the red. Meanwhile, the White House confirmed last night that the US/North Korea leaders’ summit will take place at 9am Singapore time on June 12th, but US sanctions will remain “unless NK denuclearized”. Elsewhere, ahead of the remaining global PMIs today, China’s May Caixin services and composite PMIs were both steady month on month and in line with expectations at 52.3 and 52.9 respectively, while Japan’s May Nikkei composite PMI fell 1.4pts to 51.7 due to a 1.5pt fall in the services reading to 51.0.

Moving on. The improved mood in Europe in particular yesterday may have also in part been due to comments from German Chancellor Merkel over the weekend and then in another interview in Berlin yesterday. Indeed, Merkel appeared to be closing the gap with French President Macron over ESM reform. In the interview, Merkel seemingly gave her approval of support for two new crisis tools which would reduce contagion risk. While some of the other aspects of Eurozone reform appeared a bit vague, crucially, the interview was seen as finally providing a bit of clarity that Merkel is willing to and ready to talk about reforms.  This all comes before the eagerly anticipated EU Leaders Summit on the 28th and 29th this month which is looking like a pivotal couple of days for markets.

Away from politics and in light of it being a fairly quiet last 24 hours for newsflow we thought we’d revisit Friday’s manufacturing PMIs and update our charts showing the data regressed against the YoY change in equity markets over the last 20 years. A good starting place for last month is Italy given the big selloff for the FTSE MIB into month end. Indeed the index is now up only +6% over the last 12 months (compared to +17% at the end of April) and despite the PMI deteriorating further, the implied level now is broadly fair compared to it being 8% expensive as at the end of April. For the rest of Europe however the same story largely holds. The Stoxx is still 17% cheap (unchanged from April), the DAX 22% cheap (versus 23% previously) and CAC 11% cheap (versus 8% previously).

Spain’s IBEX is 22% cheap and also in line with where it was at April. For the UK the FTSE 100 is 6% cheap (compared to 4% cheap at April) while in Asia the Nikkei (1% cheap) and Shanghai Comp (16% cheap) are also broadly the same. In the US, despite the manufacturing ISM rising well over 1pt in May a higher S&P 500 means that the performance gap continues to hover around the 10% cheap level. Check the PDF for the tables and charts where we’ve also included the data in USD terms.

Back to yesterday, the economic data didn’t move the dial a huge amount although the Sentix investor confidence reading for the Eurozone did at least show the impact of the Italy woes from last month after the reading tumbled 9.9pts in June to 9.3 (vs. 18.5 expected) and the lowest since October 2016. More eye catching though was the expectations component which slumped over 11pts to -13.3 and the lowest since the depths of the Eurozone crisis in 2012. In the US the data was mostly flat to slightly softer. Headline April factory orders fell more than expected to -0.8% mom (vs. -0.5% expected), while the final readings for core durable goods and capital orders were confirmed at +0.9% mom and +1.0% mom respectively (unchanged versus flash estimates).

Before we wrap up, a quick mention that yesterday DB’s Luke Templeman published a thematic note called “Wall Street’s dislocation gauge”. Luke notes that since the financial crisis, companies have experienced great variation in their profitability, yet stock returns have been remarkably similar. Yet, a reversal of this trend is finally in full swing. Investors can now buy stocks that benefit from the reattachment of RoE and market prices, and sell those that are hurt. Indeed Luke highlights that ‘reattachment’ stocks have returned 37% since the inflection point in mid-2016 (when bond yields began to rise), one-third more than the market’s return. The report identifies 74 stocks that can benefit from further normalisation and a further 76 that could be hurt. See the link for more here.

In addition to that, Michal in our team published the report “ECB CSPP Flows Picking Up but Still Below Q1”. It provides an update on the latest CSPP purchases, their breakdown into primary and secondary, and their relative weight in the  ECB QE programme. It also estimates the ECB’s average allocation of primary deals and analyses the relative pricing of CSPP-eligible and ineligible securities during the Italy-driven sell-off. You can download the full report here.

Finally, in terms of the day ahead, as noted earlier the final May services and composite PMIs in Europe and the US are due today. Outside of that we’ll also get April retail sales data for the Euro area, and April JOLTS and the May ISM non-manufacturing prints in the US. Elsewhere, the Brussels Economic Forum is due to begin with Juncker and Moscovici due to speak, while the BoE’s Cunliffe and ECB’s Weidmann speak this morning at separate events. Meanwhile, Italy’s confidence vote in the Senate will be today with the vote in the Lower House still yet to be announced.

3. ASIAN AFFAIRS

i)TUESDAY MORNING/MONDAY NIGHT: Shanghai closed UP 23.02 points or 0.74%   /Hang Sang CLOSED UP 95.47 points or 0.31%    / The Nikkei closed UP 63.60 POINTS OR 0.28% /Australia’s all ordinaires CLOSED DOWN .49%  /Chinese yuan (ONSHORE) closed UP at 6.4039/Oil DOWN to 64.55 dollars per barrel for WTI and 74.31 for Brent. Stocks in Europe OPENED ALL GREEN/EXCEPT LONDON /.  ONSHORE YUAN CLOSED UP AT 6.4039 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.3990/ONSHORE YUAN TRADING WEAKER AGAINST OFFSHORE YUAN/ONSHORE YUAN TRADING STRONGER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR /CHINA RETALIATES WITH TARIFFS/ TRUMP RESPONDS TO NEW TARIFFS AND IT NOW LOOKS LIKE A FULL TRADE WAR IS BEGINNING/

3 a NORTH KOREA/USA

North Korea/South Korea/usa

3 b JAPAN AFFAIRS

end

c) REPORT ON CHINA/HONG KONG

CHINA/USA

The markets initially jumped on the news, but faded when they realized it was the same rehash as before

(courtesy zerohedge)

To Appease Trump, China Offers To Buy $70BN In

Farm And Energy Goods

The Wall Street Journal gave the market some good news amid rising concerns about Italy and trade wars, when it reported that in an attempt to appease Trump, over the weekend Beijing had offered to buy US farm and energy products in a trade package worth an estimated $70 billion.

The team of Chinese envoys – led by Vice Premier Liu He, President Xi Jinping’s top economic official – offered a US team headed by Commerce Secretary Wilbur Ross a package that involved Chinese companies buying more US soybeans, corn, natural gas, crude oil and coal among other agricultural and energy products. Stocks briefly rallied on the news, but the gains then quickly faded as the market realized this was nothing more (or less) than prior such gambits offered by China.

China’s voluntary proposal comes as president Trump pushes China to commit to reduce the $375 billion US merchandise-trade deficit with China by $200 billion, and while the $70 billion package would help move the US toward that goal, it would be rather insufficient.

Ross

Also diluting the Chinese offer, Liu explained that the package would be void if Washington proceeded with plans to impose tariffs on $50 billion in China-made products.

WSJ also points out that US officials are skeptical of the offer for several reasons, including the fact that the US likely wouldn’t be able to ramp up agricultural production quickly enough. As of last week, the White House said it would move ahead with tariffs and sanctions restricting China’s access to US technology and the US market while punishing Beijing for its purportedly unfair trading practices. If accepted, the offer would benefit the farm-belt states that voted heavily for Trump during the election.

China also offered to get state-owned companies to buy more US natural gas, though that could also be subject to production difficulties.

“Nothing has firmed up yet,” one official said. “It would require additional rounds of discussions between the two sides.”

It’s unclear whether the Trump administration will take the offer seriously, although judging by the market reaction, the early answer is no.

4. EUROPEAN AFFAIRS

Tuesday morning: ITALY

As promised, Conte delivers a populist outline of where he expects Italy will proceed in the coming months. In essence he will need much debt as he wants to overhaul the healthcare system, increase minimum wage, change the retirement scheme as well as introducing a flat tax.  All of this will add to Italy’s debt to GDP and as we pointed out yesterday it is at 160% if you include its Target 2 balances.  With the speech, Italian 10 yr bonds plummeted to 2.90%

(courtesy zerohedge)

Italian Bonds Slide After Italy’s New Prime Minister

Spooks Markets With “Radical” Plans

The eye of the hurricane may have passed over Italy and the winds are again starting to pick up speed, because shortly after Morgan Stanley laid out what a worse case scenario for Rome could look like (ugly, read here), Italian bonds started selling off again, with 2Y yields rising to session highs following Italian premier Conte’s inaugural speech in which the populist premier spooked markets by reiterating that the new populist government will pursue a radical policy program, and highlighting legislative priorities that will be extremely costly – including the right to universal income, minimum wage, overhauling the healthcare system, prioritizing social rights, and so on – all without saying just how these will be paid for (spoiler alert: much more debt).

Conte also said that a new flat tax would be introduced, even if no timeframe has been provided, and there was no mention of avoiding the hike in sales taxes which is currently planned for 2019, or canceling the “Fornero” pension reform.

Amusingly, in the speech Conte also said that he plans on reducing public debt, although in light of the surge in spending which will not be financed with increased revenue, it is not clear how that can be achieved. As Bloomberg economist Stephanie Flanders notes “Italy cannot convincingly cut its public debt as a share of GDP without reasonable growth in nominal GDP (real growth plus inflation). Even the more optimistic forecasts do not point to nominal GDP growing much faster than 2.5% in the foreseeable future. By contrast, the average cost of its public debt is 3.1%.”

A much more important chart is the following from Morgan Stanley showing what would happen to Italy’s debt/GDP if interest rates rose even modestly from their artificially low levels.

As a result of Italy politely reminding the world that nothing has changed since the start of last week when the world woke up to the reality of a populist government in Europe’s 3rd largest economy, Italian 2Y yields have spiked….

… with the move starting to seep across the Atlantic, sending the dollar to sessions highs…

… and 10Y yields back to lows.

Via Reuters, here are the key excerpts from Conte’s speech (link to full speech here), highlights ours:

INTRODUCTION

“Today we come before you to ask for your trust not only in a government team, but also in a project for the change of Italy.”

“I do not think this is simple novelty. The truth is that we have brought with us radical change, of which we are proud.”

“I take on this task with humility, but also with determination, with the awareness of my limits, but also with passion.”

“The political forces that make up this government have been accused of being ‘populist’ and ‘anti-system’ … If ‘populism’ means the ruling class listens to the needs of the people … (and) if ‘anti-system’ means to aim to introduce a new system, which removes old privileges and encrusted power, well these political forces deserve both these epithets.”

EUROPE AND PUBLIC FINANCES

“We want to reduce the public debt, but we want to do it by increasing our wealth, not with austerity that, in recent years, has helped to make it (public debt) grow.”

“Italian public debt is fully sustainable today. However, its reduction must be pursued, but with a view to economic growth. Fiscal and public spending policy should be geared towards the pursuit of the objectives set for stable and sustainable growth.

“In Europe, these issues will be strongly pushed forward with the aim of changing its governance, a change already at the centre of reflection and discussion in all EU member states.

“We are optimistic about the outcome of these discussions and confident of our negotiating power, because we are facing a situation in which Italy’s interests … coincide with the general interests of Europe, with the aim of preventing its possible decline. Europe is our home.”

PENSIONS AND CITIZEN’S WAGE

“The government’s goal is to provide income support for families most affected by socio-economic hardship. The support … will be conditional on vocational training and job reintegration. We propose, in a first phase, to strengthen the employment centres.”

“We will also take action to help pensioners who do not have enough income to live in a dignified manner.”

“We need to cut the pensions and annuities of parliamentarians, regional councillors and employees of constitutional bodies … The so-called ‘golden pensions’ are another example of unjustified privilege that must be opposed. We will intervene on pensions that exceed 5,000 euros per month when the sum has not been covered by the contributions paid.”

TAXES

“Our tax burden, combined with an excessive amount of bureaucracy, has a negative effect on the relationship between taxpayers and the state, and on the competitiveness of our country.”

“The goal is the ‘flat tax’, which is a reform with fixed tax brackets and a system of deductions that guarantees the progressiveness of the levy in full harmony with the principles of the constitution. This is the only way to bring about a drastic reduction in tax evasion, which will have benefits in terms of greater tax savings, greater consumer spending and investments, and increasing the tax base.”

IMMIGRATION

“We will end the immigration business, which has grown out of all proportion under the cloak of fake solidarity.”

“We will forcefully seek the overcoming of the Dublin Regulations in order to obtain the effective respect of the principle of equal distribution of the responsibility to set up an automatic system of obligatory re-distribution of asylum seekers.”

“We are not and will never be racists. We want procedures that determine refugee status to be certain and speedy, in order to effectively guarantee their (refugee) rights.”

FOREIGN POLICY

“First of all, we intend to reaffirm our convinced membership of NATO, with the United States of America as a privileged ally.”

“We will support opening up to Russia … We will push for a review of the sanctions system, starting with those that risk humiliating Russian civil society.”

end

Famed analyst Chris Whalen tackles whether Italy will receive a bailout

(courtesy Chris Whalen)

8. EMERGING MARKET

BRAZIL

The Brazilian central bank intervenes as the real crashes to a 2 year low.  If it penetrates 4.0, trouble ahead

(courtesy zero hedge)

Brazil Central Bank Intervenes In FX Market After Real Routed To 2 Year Lows

With the Brazilian economy unexpectedly keeling over in the past two weeks, following the trucker strike protesting surging gas prices which has effectively paralyzed the nation, coupled with an oil-worker strike which has led to a sharp drop in state revenues, and last week resulted in the resignation of Petrobras CEO Pedro Parente, the country’s currency has been in freefall in recent weeks, plunging from 3.55 to 3.75 since May 10, amid concerns of a sharp economic slowdown.

And moments ago, the Brazilian central bank became the latest Emerging Market whose central bank was forced to intervene in the FX market amid relentless dollar strength, as the USDBRL spiked above 3.80, the highest level since March 2016, when Emerging Markets were crashing following the Chinese devaluation.

  • BRAZIL’S BCB RAISES INTERVENTION IN FX AS BRL BREACHES 3.80/USD
  • BRAZIL TO AUCTION UP TO 30,000 FX SWAPS JUNE 5

As Bloomberg explains, the Brazil central bank announced a new auction of up to 30,000 FX swaps 12:20pm-12:30pm, with results 12:40pm, local time; this means another 1.5BN on top of the usual 750MM.

The intervention managed to halt the BRL’s descent, and after sliding just below 3.80, the USDBRL is back down to 3.77

While it is unlikely that this latest intervention will be able to sustain the selling, especially if Brazil’s economy is indeed on the back foot, recall what BofA’s Michael Hartnett said when he showed that of all emerging market “turmoil” indicators, the Brazilian Real crossing 4.00 against the USD is by far the most accurate.

We are almost there again.

end

This is not good for Brazil.  Despite a massive intervention, the real continues to decay

(courtesy zero hedge)

Brazil Central Bank Intervention Fails As Real Rout Accelerates

Call it the shortest central bank intervention failure in recent history.

Earlier today we reported that just as the tanking Brazilian Real tumbled below 3.80, the Brazilian Central Bank announced another $1.5BN in intervention via swaps about an hour before noon; At that point the USDBRL tested 3.80 into the surprise announcement and tumbled towards 3.76. The central bank first placed 800MM around 11:40EDT with USDBRL testing support, and then placed another 300mn of the 700mn balance and USDBRL, but by then the BRL had resumed sliding toward 3.7850.

The problem, as we noted earlier, is what would happen if despite the 1+ billion intervention, the selloff continued. We got the answer a little after 3pm, when the Brazilian intervention was fully absorbed by the market, and the USDBRL spiked as high as 3.8151, well above the BCB’s intervention zone. And now that intervention has failed, the currency predictably closed at the lows, with 2 of Wall Street’s largest desks predicting that with the central bank defense having failed, the most likely next stop for the USDBRL is 4.00

The concern, as regular readers will recall, is that if the selloff accelerates beyond 4.00, it could provide the green light for a broader EM crisis because as Bank of America wrote one month ago, “EM FX never lies and a plunge in Brazilian real toward 4 versus US dollar is likely to cause deleveraging and contagion across credit portfolios.”

But even without a broader contagion, the question is what happens to Brazil next: the Real has tumbled to early 2016 levels, when Dilma Rouseff was still president, and has now lagged all EM currencies except the imploding Turkish Lira and Argentina Peso.

How long before Brazil become the next locus of EM capital outflows, sending the local market plunging, and spreading to the rest of the EM space?

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 1.1684 DOWN .0016/ 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:///ITALIAN CHAOS /AND NOW ECB TAPERING BOND PURCHASES/JAPAN TAPERING BOND PURCHASES /USA RISING INTEREST RATES /FLOODING/EUROPE BOURSES GREEN /EXCEPT LONDON

USA/JAPAN YEN 109.78   DOWN 0.180  (Abe’s new negative interest rate (NIRP), a total DISASTER/SIGNALS U TURN WITH INCREASED NEGATIVITY IN NIRP/JAPAN OUT OF WEAPONS TO FIGHT ECONOMIC DISASTER/

GBP/USA 1.3365 UP  0.0049  (Brexit March 29/ 2017/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED

USA/CAN 1.2978  UP .0055 (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 16 basis points, trading now ABOVE the important 1.08 level FALLING to 1.1684; / Last night Shanghai composite CLOSED UP 23,02 POINTS OR 0.74%  /Hang Sang CLOSED UP 95.47 POINTS OR 0.31% /AUSTRALIA CLOSED DOWN .49% / EUROPEAN BOURSES  ALL GREEN /

The NIKKEI: this TUESDAY morning CLOSED UP 63.47 OR 0.31%

Trading from Europe and Asia

1/EUROPE OPENED ALL GREEN EXCEPT LONDON

2/ CHINESE BOURSES / :Hang Sang CLOSED UP 95,47 POINTS OR 0.31%  / SHANGHAI CLOSED UP 23,02 POINTS OR 0.74%  /

Australia BOURSE CLOSED DOWN .49%

Nikkei (Japan) CLOSED UP 63.60 POINTS OR 0.28%

INDIA’S SENSEX  IN THE RED

Gold very early morning trading: 1291.15

silver:$16.39

Early TUESDAY morning USA 10 year bond yield: 2.92% !!! DOWN 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 3.07 DOWN 1  IN BASIS POINTS from MONDAY night. (POLICY FED ERROR)/

USA dollar index early  TUESDAY morning: 94.07 UP 8  CENT(S) from FRIDAY’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: 1.855% UP 9  in basis point(s) yield from MONDAY/

JAPANESE BOND YIELD: +.054%  UP 3/10   in basis points yield from MONDAY/JAPAN losing control of its yield curve/

SPANISH 10 YR BOND YIELD: 1.396% UP 7  IN basis point yield from MONDAY/

ITALIAN 10 YR BOND YIELD: 2.789  UP 25  POINTS in basis point yield from MONDAY/

the Italian 10 yr bond yield is trading 139 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: FALLS TO +.369%   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 1.1700 UP .0003(Euro UP 3 Basis points/ represents to DRAGHI A COMPLETE POLICY FAILURE/

USA/Japan: 109.66 DOWN 0.308 Yen UP 31 basis points/

Great Britain/USA 1.3365 UP .0050( POUND UP 50 BASIS POINTS)

USA/Canada 1.3008 UP  .0085 Canadian dollar DOWN 85 Basis points AS OIL FELL TO $64.71

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This afternoon, the Euro was UP 3 to trade at 1.1700

The Yen ROSE to 109.65 for a GAIN of 31 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 GAINED 50 basis points, trading at 1.3365/

The Canadian dollar LOST 85 basis points to 1.3008/ WITH WTI OIL FALLING TO : $64.71

The USA/Yuan closed AT 6.4060
the 10 yr Japanese bond yield closed at +.054%  UP 3/10  IN BASIS POINTS / yield/
Your closing 10 yr USA bond yield DOWN 2   IN basis points from MONDAY at 2.9097 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 3.064  DOWN 0  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, 94.15  UP 11 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 PM

London: CLOSED DOWN 54.49 POINTS OR 0.70%
German Dax :CLOSED UP 16.38 OR 0.13%
Paris Cac CLOSED DOWN 11.96 POINTS OR 0.22%
Spain IBEX CLOSED DOWN 63.90 POINTS OR 0.66%

Italian MIB: CLOSED DOWN 259.80 POINTS OR 1,18%

The Dow closed DOWN 13.71 POINTS OR 0.09%

NASDAQ closed UP  31.40 OR .41%4.00 PM EST

WTI Oil price; 64.71  1:00 pm;

Brent Oil: 74.44 1:00 EST

USA /RUSSIAN ROUBLE CROSS: 62.03 UP 19/100 ROUBLES/DOLLAR (ROUBLE LOWER BY 19 BASIS PTS)

TODAY THE GERMAN YIELD FALLS TO +.369% 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:$65.30

BRENT: $75.06

USA 10 YR BOND YIELD: 2.92% the dropping yields signify markets are in turmoil

USA 30 YR BOND YIELD: 3.08%/

EURO/USA DOLLAR CROSS: 1.1716 UP .0016  (UP 16 BASIS POINTS)

USA/JAPANESE YEN:109.78 DOWN 0.175 YEN UP 18 BASIS POINTS/ .

USA DOLLAR INDEX: 93.89 DOWN 15 cent(s)/dangerous as the HIGHER dollar IS DESTROYING THE EMERGING MARKETS.

The British pound at 5 pm: Great Britain Pound/USA: 1.3394 UP 0.0078  (FROM YESTERDAY NIGHT UP 78  POINTS)

Canadian dollar: 1.2969 DOWN 47 BASIS pts

German 10 yr bond yield at 5 pm: +369%


VOLATILITY INDEX:  12.40  CLOSED  down 0.34

LIBOR 3 MONTH DURATION: 2.313%  .

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

TRADING IN GRAPH FORM FOR THE DAY

Big-Tech & Small-Caps Record High But Bonds,

Bullion, & Black Gold Bounce

This seemed appropriate…

Quick summary – ISM/PMI beat (good news) and stocks sank but as Europe closed (Italy was ugly again today), so a mysterious bid returned to US stocks – the Dow and S&P scrambled back green briefly, Nasdaq and Small Caps surged again to new records, bond yields fell (bonds were bid), commodities rallied (gold and oil bid), as the dollar tumbled in the late day to unchanged (erasing the overnight gains). Make sense, good.

Tech surged again along with Small Caps as the Dow and S&P trudged sideways around unchanged… Small Caps and Nasdaq ramped into the close to the highs of the day…

Another ramp in small cap and another massive short-squeeze…

US Banks were flat today while EU banks tumbled on Conte’s comments…

Tech extended its run relative to financials to a new post-2000 peak high..

And for fun, here is TECL – the triple-levered tech ETF which is up 4,000% since inception…

Twitter shares extended their overnight spike gains above $40 after inclusion in the S&P 500…

VIX pushed higher to a 13 handle briefly before closing lower on the day…

Notably, the RVX/VIX (Russell 2000 VIX / S&P 500 VIX) ratio has spent 83 consecutive days below 1.2, the longest such period in the history of the two indices. Only in 2008 did the ratio remain below 1.2 for longer than 35 days, in a very volatile period for stocks of all market caps alike.

Short-dated HY Corporate bond ETF fund flows are showing massive exits…

Which may help explain the massive decoupling between stocks and HY bonds recently…

Treasury yields slid lower today, erasing yesterday’s rise…

Bonds traded in a narrow range today

Notably 10Y found resistance – just as we suspected – at the close from the weekend before Italy’s chaos hit…

Another chaotic day in the US Dollar ended with a close of almost unchanged (1168, 1170, 1169, 1168, 1169, 1168,  1171, 1173, 1177, 1170, 1171, 1172, 1171, 1172…)

The Brazilian Real tumbled to its lowest since March 2016 after an early intervention failed (BRL is now down 22% from Jan highs)…

Cryptocurrencies saw gains today, starting with a broad buying program around 11amET

Copper extended its gains and crude bounced back modestly as PMs once again drifted sideways…

WTI tested a $64 handle once again – new two-month lows – before bounmc8ing back above $65…

Gold scrambled back above $1300…

Finally – strangely – the odds of a 4th rate-hike in 2018 (3 more) dropped today…

MARKET DATA

Soft data Markit US Services signals a 3.5% GDP growth rate.

(courtesy zero hedge0

US Services Surge Signals 3.5% GDP Growth, But

Rising Cost Concerns Loom

US Services surged to a three-year high, according to Markit’s PMI survey, but with business optimism near record highs, concerns over rising costs and the impact of tariffs are rising.

Inflationary pressures intensified in May, as input cost inflation accelerated to the fastest since October 2013. Anecdotal evidence suggested the latest rise in cost burdens was due to higher material inputs, often linked to tariffs, higher interest rates and rising energy and fuel prices. Output charges also increased at a quicker rate, with inflation accelerating to a three-month high.

Anecdotal evidence suggested the latest rise in cost burdens was due to higher material inputs, often linked to tariffs, higher interest rates and rising energy and fuel prices… or put another way – corporate margins are about to get crushed.

  • US Services PMI are back above the PMI Manufacturing level at 56.8 (better than expected and up from 54.6 in April)
  • ISM Services rebounded from 4-month lows to 58.6, catching up to Manufacturing (better than expected)

Prices Paid also jumped in the ISM data along with New Orders and Employment.

Commenting on the PMI data, Chris Williamson, Chief Business Economist at IHS Markit said:

The US economy kicked up a gear in May. A markedly improved service sector performance takes the final composite PMI reading above the flash estimate and to its highest for over three years.

“With business optimism about the year ahead running at one of the highest levels seen over the past three years, it looks likely that good growth momentum will be sustained in coming months.

“However, the survey also reveals increased concerns regarding rising costs and the impact of tariffs. Across both manufacturing and services, companies’ costs are now rising at one of the strongest rates seen over the past seven years, which will likely feed through to higher consumer prices in coming months.”

Williamson concluded: “The composite PMI is a reliable leading indicator of GDP, and has risen to a level which is consistent with the economy growing at an annualised rate of approximately 3.5%. “

Which is above consensus for now…

end

SWAMP STORIES

As promised Billl Priestap, is the deep throat and he is the FBI counterintelligence chief.  He has knowledge of the Trump spygate affair as well as the Clinton email scandal.  He will reveal all

get your popcorn ready..if this stuff is leaked out

(courtesy zerohedge)

FBI Agent In Charge Of “Russiagate” Operation

And Clinton Email “Matter” To Testify Tuesday

FBI Counterintelligence chief, Bill Priestap, will sit down for a closed-door session with lawmakers on Tuesday, according to John Solomon of The Hill.

Priestap will be answering questions about the Hillary Clinton email case as well as the counterintelligence operation on the Trump campaign – both of which he oversaw. Priestap was the direct supervisor of Peter Strzok – the FBI agent whose anti-Trump / pro-Clinton bias was revealed after 50,000 text messages to his FBI-attorney mistress, Lisa Page, were discovered by the DOJ’s Inspector General, Michael Horowitz.

All accounts say that Priestap is a cooperating witness. In other words, if there’s one person who can confirm that the FBI counterintelligence operation on the Trump campaign was politically motivated – or that malfeasance occurred during the process, it’s Bill Priestap.

Note how excited Solomon looks breaking the news of Priestap’s testimony…

Solomon: “I think tomorrow is going to be a pivotal day. I think Congress is going to learn a lot of new information tomorrow during these interviews.”

Dobbs: He is going to be speaking candidly about his employer, the FBI, and those who were running the agency during that period.

Solomon: He was very high up. Had a bird’s-eye view of everything that went on in both of these investigations.

Lou Dobbs

@LouDobbs

@Jsolomonreports: FBI Spy Chief Bill Preistap to testify on Capitol Hill tomorrow about Clinton Email Scandal & Russia “Collusion.” PLUS IG report 400+ pages long – That’s a lot of James Comey. @realDonaldTrump

While the session will be closed-door, we imagine leaks will be forthcoming as seems to be standard operating procedure these days.

Just who is Bill Priestap really? The Conservative Treehouse presented an in-depth analysis in February. We recommend reading this before deciding on what size popcorn to buy:

***

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

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

Fughettaboudit.

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

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

…Bill Priestap is cooperating.

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

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

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

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

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

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

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

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

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

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

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

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

REMINDER – FBI Agent Strzok to FBI Attorney Page:

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

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

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

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

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

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

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

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

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

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

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

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

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

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

The reason was obvious.

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

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

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

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

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

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

It’s over.

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

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

Then comes the OIG Horowitz report.

END

I will  see you WEDNESDAY night

HARVEY

 

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